IAA TRUST GROWTH FUND INC, 485BPOS, 1996-10-28

IAA TRUST GROWTH FUND INC
485BPOS, 1996-10-28

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As filed with the Securities and Exchange Commission File No. 2-24221
on October 28, 1996 File No. 811-1338
===============================================================================

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. [ 53 ]

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ X ]
Amendment No. [ 22 ]

IAA TRUST GROWTH FUND, INC.
(Exact Name of Registrant as Specified on Charter)

808 IAA Drive
Bloomington, Illinois 61702
--------------------------------------
(Address of Principal Executive Offices)

(309) 557-3092
-----------------------------
(Registrant's Telephone Number)

IAA TRUST COMPANY
808 IAA Drive
Bloomington, Illinois 61702
-------------------------------------
(Name and Address of Agent for Service)

Fiscal Year Ended June 30, 1996

It is proposed that this filing will become effective (check appropriate box):

[ X ] immediately upon filing pursuant to paragraph (b);

[ ] on _____________ (date) pursuant to paragraph (b);

[ ] 60 days after filing pursuant to paragraph (a)(i);

[ ] on ______________ (date) pursuant to paragraph (a)(i);

[ ] 75 days after filing pursuant to paragraph (a)(ii); or

[ ] on _____________(date) pursuant to paragraph (a) of
Rule 485.

If appropriate, check the following box:

[ ] this post-effective amendment designates a new effective
date for a previously filed post-effective amendment.

Registrant has registered an indefinite number of securities under the
Securities Act of 1933 pursuant to Rule 24f-2 and the Rule 24f-2 notice for
Registrant's most recent fiscal year was filed on or before August 31, 1996.

TOTAL PAGES: EXHIBITS BEGIN ON PAGE:

<PAGE>

IAA TRUST GROWTH FUND, INC.
CROSS REFERENCE SHEET
INFORMATION REQUIRED IN THE PROSPECTUS

Part A Prospectus Headings
- ------------------------------------- -----------------------------------
<S> <C> <C>

Item 1. Cover Page Not Titled

Item 2. Synopsis Synopsis; Operating Expenses Table

Item 3. Condensed Financial
Information Financial Highlights

Item 4. General Description
of Registrant Investment Objectives and Policies

Item 5. Management of the Funds Management of the Funds; Management's
Discussion of Funds' Performance

Item 6. Capital Stock and Capital Stock; Income Dividends,
Other Securities Capital Gains Distributions, and Taxes

Item 7. Purchase of Securities Purchase of Shares; Special Plans and
Being Offered Other Purchase Information; Valuation of
Shares

Item 8. Redemption or Repurchase Redemption of Shares

Item 9. Pending Legal Proceedings *
</TABLE>

- ----------------------
* The answer to the item is negative or the item is not applicable to this
filing, the registrant, or the securities being registered.

<PAGE>

IAA TRUST GROWTH FUND, INC.

CROSS REFERENCE SHEET
INFORMATION REQUIRED IN STATEMENT
OF ADDITIONAL INFORMATION

Statement of Additional
Part B Information Headings
- ------------------------------------- ---------------------------------------
<S> <C> <C>

Item 10 Cover Page Not Titled

Item 11. Table of Contents Table of Contents

Item 12 General Information Investment Objectives and Policies;
and History Policies and Investment Restrictions
Aimed at Protecting Investors

Item 13. Investment Objectives Investment Objectives and Policies;
and Policies Policies and Investment Restrictions
Aimed at Protecting Investors

Item 14. Management of the
Registrant Directors and Officers of the Funds

Item 15. Control Persons and
Principal Holders Control Persons and Principal Holders
of Securities of Securities

Item 16. Investment Advisory
and Other Services Investment Advisory and Other Services

Item 17. Brokerage Allocation
and Other Practices Brokerage

Item 18. Capital Stock
and Other Securities Brokerage

Item 19. Purchase, Redemption and Purchases, Redemptions, and
Pricing of Securities Pricing of Fund Securities;
Being Offered Underwriter Compensation

Item 20. Tax Status Purchases, Redemptions, and
Pricing of Fund Securities

Item 21. Underwriters Underwriter Compensation

Item 22. Calculations of
Performance Data Investment Performance Information

Item 23. Financial Statements Reports to Shareholders
and Financial Statements

</TABLE>

<PAGE>

IAA TRUST GROWTH FUND, INC.

CROSS REFERENCE SHEET

Part C - Other Information

Information required to be included in Part C is set forth under the appropriate
Item, so numbered, in Part C to this Registration Statement.

<PAGE>

THE IAA TRUST MUTUAL FUNDS

IAA Trust Growth Fund, Inc.
IAA Trust Asset Allocation Fund, Inc.
IAA Trust Tax Exempt Bond Fund, Inc.
IAA Trust Taxable Fixed Income Series Fund, Inc.

PROSPECTUS
OCTOBER 28, 1996

808 IAA Drive Bloomington, Illinois 61702
(309) 557-3222

The IAA Trust Mutual Funds represent four separate funds, with one Fund
containing three separate Series (referred to herein as "Funds" or "Series").
Each of the Funds and Series has distinct investment objectives and policies.
Information concerning the Funds has been combined into this one Prospectus to
aid investors in understanding the similarities and differences among the Funds.
The four Funds are as follows:

IAA Trust Growth Fund, Inc. is a mutual fund with an investment objective of
capital growth. The Fund seeks to achieve its investment objective by investing
principally in common stocks or securities with equity characteristics.

IAA Trust Asset Allocation Fund, Inc. seeks growth of capital and current income
as near-equal objectives. The Fund seeks to achieve this objective by investing
in a mix of assets consisting of common stocks (both dividend and non-dividend
paying), preferred and convertible preferred stocks, fixed income securities
including bonds, bonds convertible into common stocks and short-term interest
bearing obligations.

IAA Trust Tax Exempt Bond Fund, Inc. is a mutual fund with an investment
objective of seeking as high a level of current interest income exempt from
Federal income taxes as is available from municipal bonds, consistent with the
conservation of capital. The Fund seeks to achieve its investment objective by
investing substantially all of its assets in a diversified portfolio of
municipal bonds, the interest from which is exempt from Federal income tax in
the opinion of bond counsel to the issuers.

IAA Trust Taxable Fixed Income Series Fund, Inc. currently consists of
three separate investment Series designed to offer investors a variety of fixed
income investment opportunities.

IAA Trust Money Market Series is a mutual fund whose objective is to
earn as high a level of current income as possible, consistent with maintaining
liquidity and stability of principal. The Fund seeks to achieve its investment
objective by investing in high-quality money market instruments maturing in one
year or less, including securities issued or guaranteed by the U.S. Government,
its agencies or instrumentalities, certificates of deposit issued by domestic
banks, bankers acceptances, commercial paper and other corporate debt, and
repurchase agreements.

IAA Trust Money Market Series is a money market fund which seeks to maintain a
constant net asset value of $1.00 per share. Shares of a money market fund are
neither insured nor guaranteed by the U.S. Government and there is no assurance
that this Series will be successful in meeting its investment objective or in
maintaining a constant net asset value of $1.00 per share.

IAA Trust Short-Term Government Bond Series seeks maximum total return
consistent with the preservation of capital. The Series seeks to achieve its
investment objective by investing primarily in securities of the U.S. government
and its agencies and maintain a dollar-weighted average maturity of less than
three years.

<PAGE>

IAA Trust Long-Term Bond Series seeks to provide as high a level of
current income and capital appreciation as possible, consistent with the
preservation of capital and the maintenance of liquidity. The Series seeks to
achieve its investment objective by investing in bonds and other debt
obligations and maintain a dollar-weighted average maturity of more than ten
years.

The Funds' principal Underwriter is FPS Broker Services, Inc., 3200 Horizon
Drive, P.O. Box 61503, King of Prussia, PA 19406-0903 (formerly at #2 West Elm
Street, P.O. Box 874, Conshohocken, Pennsylvania 19428).

For information about how to invest in the IAA Trust Company Funds, contact FPS
Broker Services, Inc., or a local Country Capital Management Company
salesperson, or call toll-free 1 (800) 245-2100. In Bloomington/Normal, call
557-3222. Country Capital Management Company has a selling agreement with FPS
Broker Services, Inc. Shares of the Funds are sold only in states where the
Funds are registered.

This Prospectus sets forth concisely the information about the Funds that a
prospective investor ought to know before investing. Please read and retain this
Prospectus for future reference.

A Statement of Additional Information combining information about each of the
Funds has been filed with the Securities and Exchange Commission. This Statement
of Additional Information is incorporated by reference in its entirety in this
Prospectus. Copies of the Statement of Additional Information dated October 28,
1996 are available upon request and without charge by contacting FPS Broker
Services, Inc., at the address or telephone numbers listed above.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<PAGE>

TABLE OF CONTENTS

Subject Page
- ------- ----

Synopsis.................................................................

Operating Expenses Tables................................................

Financial Highlights.....................................................

Performance Calculations.................................................

Investment Objectives and Policies.......................................

Investment Strategies and Risk Considerations............................

Management of the Funds..................................................

Management's Discussion of the Funds' Performance........................

Distribution of the Funds' Shares........................................

Distribution Plans.......................................................

Capital Stock............................................................

Income Dividends, Capital Gains Distributions, and Taxes.................

Purchase of Shares.......................................................

Special Plans and Other Purchase Information.............................

Valuation of Shares......................................................

Redemption of Shares.....................................................

<PAGE>

SYNOPSIS

The Funds

The securities offered by this Prospectus consist of shares of four
separate Funds, one of which contains three separate Series, each Fund or Series
has distinct investment objectives and policies. The Funds are open-end,
diversified management investment companies incorporated under the laws of the
State of Maryland. Investors should be aware that by combining the Prospectus of
each Fund into this one document, there is a remote possibility that one Fund
may become liable for any misstatements in the Prospectus about another Fund. To
the extent that a Fund incurs such liability, a shareholder's investment in such
Fund could be adversely affected.

The four Funds are identified herein as follows: IAA Trust Growth Fund, Inc.
("Growth Fund"); IAA Trust Asset Allocation Fund, Inc. ("Asset Allocation
Fund"); IAA Trust Tax Exempt Bond Fund, Inc. ("Tax Exempt Bond Fund"), and IAA
Trust Taxable Fixed Income Series Fund, Inc. ("Taxable Fixed Income Series
Fund"). Taxable Fixed Income Series Fund, Inc. currently consists of three
separate investment Series: IAA Trust Money Market Series ("Money Market
Series"); IAA Trust Short-Term Government Bond Series ("Short-Term Government
Bond Series"); and IAA Trust Long-Term Bond Series ("Long-Term Bond Series").

The value of each Fund's and Series' shares (with the exception of Money Market
Series) fluctuate because the value of the securities in which each Fund/Series
invests fluctuate. The Funds and Series will earn dividend or interest income to
the extent that they receive dividends or interest from their investments. An
investment in any of the Funds/Series is neither insured nor guaranteed by the
U.S. Government. There can be no assurance that any Fund's or Series' investment
objective will be achieved.

Investment Definitions

Open-end - The term "open-end" means that a Fund continually offers new shares
for sale to the public and are legally obligated to buy back such shares held by
an investor and pay the investor the next determined net asset value of the
shares. This open-end type of investment company is commonly called a mutual
fund.

Diversified - The Funds are "diversified" because each invests in securities of
different companies and industries in an attempt to spread and reduce the risks
inherent in all investing. Each Fund and Series has adopted a policy prohibiting
it from investing more than 5% of its total assets in the securities of any one
issuer (other than securities issued by the United States Government or its
agencies or instrumentalities). This restriction applies to 75% of the total
asset of each Fund and Series, except for Growth Fund and Money Market Series
where this restriction applies to 100% of total assets.

Management Investment Company - The Funds are separate "management investment
companies" because upon the advice of professional investment managers, each
Fund continuously reviews, and from time to time changes, its portfolio holdings
in an effort to achieve its investment objective.

Investment Objectives

Growth Fund:

This Fund has an investment objective of capital growth. This Fund seeks to
achieve its investment objective by investing principally in common stocks or
securities with equity characteristics.

Asset Allocation Fund:

<PAGE>

This Fund seeks growth of capital and current income as near-equal objectives,
primarily through equity securities. In general, this Fund may hold a mix of
assets consisting of common stocks (both dividend and non-dividend paying),
preferred and convertible preferred stocks, fixed income securities including
bonds, bonds convertible into common stocks, and short-term interest bearing
obligations.

Tax Exempt Bond Fund:

This Fund has an investment objective of seeking as high a level of current
interest income exempt from Federal income taxes as is available from municipal
bonds. This Fund seeks to achieve its objective by investing in a diversified
portfolio of municipal bonds, the interest from which is exempt from Federal
income tax in the opinion of bond counsel to the issuers.

Taxable Fixed Income Series Fund:

Money Market Series:

This Series has an investment objective of earning a high level of current
income, consistent with maintaining liquidity and stability of principal. This
Series attempts to maintain the value of its shares at a constant $1.00,
although there can be no assurance that the Series will be able to maintain a
stable net asset value of $1.00 per share. This Series seeks to achieve its
investment objective by investing in high-quality money market instruments
maturing in one year or less, including securities issued or guaranteed by the
U.S. Government, its agencies or instrumentalities, certificates of deposit
issued by domestic banks, bankers acceptances, commercial paper and other
corporate debt, and repurchase agreements. An investment in the Series is
neither insured nor guaranteed by the U.S. Government.

Short-Term Government Bond Series:

This Series seeks maximum total return consistent with the preservation of
capital. The Series seeks to achieve its investment objective by investing
primarily in securities of the U.S. Government and its agencies and maintain a
dollar-weighted average maturity of less than 3 years.

Long-Term Bond Series:

This Series seeks to provide as high a level of current income as possible,
consistent with the preservation of capital and the maintenance of liquidity.
The Series seeks to achieve its investment objective by investing in bonds and
other debt obligations and maintain a dollar-weighted average maturity of more
than 10 years.

How to Buy Shares

The minimum initial single purchase for all the Funds is $1,000. The minimum
additional investment for all the Funds is $100. The public offering price of
shares of a Fund is the net asset value per share next determined after receipt
and acceptance of the purchase order at the Transfer Agent in proper form with
accompanying check or other bank wire arrangements satisfactory to the Funds.
See "PURCHASE OF SHARES".

How to Redeem Shares

Shares may be redeemed at the net asset value per share of a Fund next
determined after receipt by the Transfer Agent of a redemption request in proper
form. Signature guarantees may be required in some cases. See "REDEMPTION OF
SHARES".

<PAGE>

Dividends and Reinvestment

The Growth Fund intends to pay semi-annual dividends from its net investment
income and may pay short-term capital gains, if earned and as declared by the
Board of Directors. Distributions of net capital gains, if any, will be paid
annually.

The Asset Allocation Fund, Tax Exempt Bond Fund, Short-Term Government Bond
Series and Long-Term Bond Series pay monthly dividends from their respective net
investment income on the last business day of the month to shareholders of
record on the preceding business day. Distributions of net capital gains, if
any, will be paid annually.

The Money Market Series declares and pays dividends of all its daily net
investment income on each day the Fund's net asset value per share is
determined. Each shareholder receives a monthly summary of such amounts.

Any dividend and distribution payments will be reinvested at net asset value, in
additional full and fractional shares of the particular Fund unless and until
the shareholder notifies the Transfer Agent in writing requesting payments in
cash. Provisions of the Tax Reform Act of 1986 may result in additional net
investment income and/or capital gain distributions at the end of the calendar
year. See "INCOME DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS, AND TAXES".

Investment Management, Underwriter, and Servicing Agents

The IAA Trust Company, 808 IAA Drive, Bloomington, Illinois 61702 is the
Investment Adviser and Custodian for the Funds.

FPS Broker Services, Inc., 3200 Horizon Drive, P.O. Box 61503, King of Prussia,
PA 19406-0903 serves as the Funds' Underwriter. FPS Services, Inc., 3200 Horizon
Drive, P.O. Box 61503, King of Prussia, PA 19406-0903 (formerly at #2 West Elm
Street, P.O. Box 874, Conshohocken, Pennsylvania 19428) serves as the Funds'
Administrator, Accounting/Pricing Agent, and Transfer Agent.

<PAGE>

OPERATING EXPENSES TABLE

Tax
Asset Exempt Taxable
Growth Allocation Bond Fixed Income Series
Fund Fund Fund Series Fund
---- ---- ---- -----------------------------
Short-
Term Long-
Money Gov't Term
Market Bond Bond
Series Series(1) Series(1)
------ --------- ---------
<S> <C> <C> <C> <C> <C> <C>

Shareholder Transaction Expenses:
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price).............. none none none none none none
Maximum Sales Load Imposed
on Reinvested Dividends.......................... none none none none none none
Deferred Sales Load(2)............................... none none none none none none
Redemption Fee....................................... none none none none none none
Exchange Fee......................................... none none none none none none

Annual Fund Operating Expenses:
(as a percentage of average net assets)
Management Fees...................................... 0.75% 0.75% 0.50% 0.50% 0.50% 0.75%
Waiver of Management Fees............................ 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
12(b)1 Fees.......................................... 0.25% 0.25% 0.25% none 0.25% 0.25%
Other Expenses....................................... 0.12% 0.44% 0.33% 0.40% 0.57% 0.57%
----- ----- ----- ----- ----- -----
Total Fund Operating Expenses........................ 1.12% 1.44% 1.08% 0.90% 1.32% 1.57%
</TABLE>
- ----------
(1) With respect to Short-Term Government Bond Series and Long-Term Bond Series,
the ratios shown are those expected to be incurred for the first fiscal
period for these new Series.

(2) The 3% sales load which existed prior to the date hereof, has been
eliminated as of the date hereof.

<TABLE>
Example:
<S> <C> <C> <C> <C> <C> <C> <C>

1 year $11 $15 $11 $9 $13 $16
You would pay the following expenses 3 years $36 $46 $34 $29 $42 $50
on a $1,000 investment, assuming a 5 years $62 $79 $60 $50
5% annual return. ....................... 10 years $136 $172 $132 $111
</TABLE>

The purpose of these tables are to assist the investor in understanding the
various costs and expenses that an investor in the Funds will bear directly and
indirectly. This information has been restated to reflect current fees as if
they had been in effect during the previous fiscal year. The information
contained in the tables should not be considered a representation of future
expenses. Actual expenses may be greater than or less than those stated.

<PAGE>

FINANCIAL HIGHLIGHTS

The following financial highlights are a part of the Funds' financial statements
which have been audited by Coopers & Lybrand L.L.P., independent accountants,
for the most recent five years. The Funds' most recent annual audited financial
statements and the report of Coopers & Lybrand L.L.P. thereon appear in the
Funds' Annual Report dated June 30, 1996. The following tables should be read
in conjunction with these financial statements and related notes which are
incorporated by reference in the Fund's Statement of Additional Information.

The table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.

<TABLE>
<CAPTION>
IAA TRUST GROWTH FUND, INC.

Years ended June 30,
---------------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------- ------ ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year ..... $ 17.23 $ 15.16 $ 17.55 $ 17.23 $ 17.35 $ 17.42 $ 16.83 $ 15.06 $ 19.43 $ 20.64

Income From Investment Operations
Net investment income ................ 0.23 0.22 0.27 0.25 0.35 0.41 0.61 0.52 0.43 0.31
Net gains (losses) on securities
(both realized and unrealized) ..... 3.23 3.45 (0.63) 1.67 0.40 0.44 1.93 2.32 (1.62) 1.96
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations . 3.46 3.67 (0.36) 1.92 0.75 0.85 2.54 2.84 (1.19) 2.27
------- ------- ------- ------- ------- ------- ------- ------- ------- -------

Less Distributions
Dividends (from net investment
income) ............................ (0.25) (0.17) (0.22) (0.29) (0.38) (0.51) (0.65) (0.42) (0.54) (0.38)
Distributions (from capital gains) ... (1.56) (1.43) (1.81) (1.31) (0.49) (0.41) (1.30) (0.65) (2.64) (3.10)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions .............. (1.81) (1.60) (2.03) (1.60) (0.87) (0.92) (1.95) (1.07) (3.18) (3.48)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------

Net Asset Value, End of Year ........... $ 18.88 $ 17.23 $ 15.16 $ 17.55 $ 17.23 $ 17.35 $ 17.42 $ 16.83 $ 15.06 $ 19.43
======= ======= ======= ======= ======= ======= ======= ======= ======= =======

Total Return+ .......................... 21.51% 26.68% (2.42%) 11.71% 4.23% 5.37% 16.09% 20.06% (6.68%) 14.75%

Ratios/Supplemental Data
Net assets, end of period (in 000's) . $84,800 $70,577 $59,448 $70,785 $76,147 $81,974 $81,511 $74,327 $68,436 $79,194

Ratio of expenses to average
net assets* ........................ 1.12% 1.14% 1.24% 1.18% 0.85% 0.82% 0.84% 0.93% 0.96% 0.95%
Ratio of net investment
income to average net assets* ...... 1.30% 1.41% 1.03% 1.36% 1.91% 2.58% 3.58% 3.29% 2.69% 1.70%
Portfolio turnover rate .............. 32.95% 31.84% 49.12% 55.36% 45.50% 26.00% 18.10% 42.60% 51.20% 40.10%
Average Commission Rate Paid** ....... $0.0645 N/A N/A N/A N/A N/A N/A N/A N/A N/A
</TABLE>
- ----------
* Average net assets have been computed based on the aggregate value of the
fund's daily net assets.
+ Total return calculation does not reflect sales load.
** Computed by dividing the total amount of commission paid by the total number
of shares purchased and sold during the period for which there was a
commission. The disclosure is required by the SEC beginning in 1996.

<PAGE>

FINANCIAL HIGHLIGHTS

ASSET ALLOCATION FUND:

The table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.

IAA TRUST ASSET ALLOCATION FUND, INC.

Years ended June 30,
----------------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year ..... $ 12.29 $ 11.08 $ 11.60 $ 11.20 $ 10.74 $ 10.56 $ 10.80 $ 10.51 $ 10.84 $ 11.14
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Income From Investment Operations
Net investment income ................ 0.37 0.36 0.34 0.57 0.68 0.73 0.78 0.75 0.73 0.73
Net gains (losses) on securities
(both realized and unrealized) ..... 1.41 1.38 (0.25) 0.47 0.55 0.24 (0.11) 0.29 (0.08) (0.30)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations . 1.78 1.74 0.09 1.04 1.23 0.97 0.67 1.04 0.65 0.43
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Less Distributions
Dividends (from net investment
income) ............................ (0.37) (0.34) (0.34) (0.57) (0.68) (0.76) (0.77) (0.75) (0.72) (0.73)
Distributions (from capital gains) ... (0.31) (0.18) (0.27) (0.07) (0.09) (0.03) (0.14) 0.00 (0.26) 0.00
Distributions( from return of capital) 0.00 (0.01) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions .............. (0.68) (0.53) (0.61) (0.64) (0.77) (0.79) (0.91) (0.75) (0.98) (0.73)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net Asset Value, End of Year ........... $ 13.39 $ 12.29 $ 11.08 $ 11.60 $ 11.20 $ 10.74 $ 10.56 $ 10.80 $ 10.51 $ 10.84
======= ======= ======= ======= ======= ======= ======= ======= ======= =======

Total Return+ .......................... 14.74% 16.29% 0.71% 9.58% 11.84% 9.47% 6.50% 10.40% 6.47% 3.91%

Ratios/Supplemental Data
Net assets, end of period (in 000's) . $10,083 $ 9,540 $ 8,653 $ 6,663 $ 6,233 $ 5,768 $ 5,714 $ 5,812 $ 5,966 $ 6,003
Ratio of expenses to average
net assets* ........................ 1.44% 1.46% 1.78% 1.71% 1.51% 1.33% 1.39% 1.34% 1.17% 1.42%
Ratio of net investment
income to average net assets* ...... 2.81% 3.18% 2.98% 4.97% 6.20% 6.83% 7.31% 7.12% 6.92% 6.61%
Portfolio turnover rate .............. 33.77% 21.03% 17.39% 36.70% 14.10% 20.60% 6.50% 45.20% 11.70% 51.40%
Average Commission Rate Paid** ....... 0.0861 N/A N/A N/A N/A N/A N/A N/A N/A N/A
</TABLE>
- ----------

* Average net assets have been computed based on the aggregate value of the
fund's daily net assets.
+ Total return calculation does not reflect sales load.
** Computed by dividing the total amount of commission paid by the total number
of shares purchased and sold during the period for which there was a
commission. The disclosure is required by the SEC beginning in 1996.

<PAGE>

FINANCIAL HIGHLIGHTS

TAX EXEMPT BOND FUND:

The table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.

IAA TRUST TAX EXEMPT BOND FUND, INC.

Years ended June 30,
----------------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year ..... $ 8.36 $ 8.19 $ 9.11 $ 8.78 $ 8.44 $ 8.32 $ 8.41 $ 8.15 $ 8.09 $ 8.10
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Income From Investment Operations
Net investment income ................ 0.37 0.39 0.39 0.46 0.49 0.52 0.52 0.54 0.54 0.51
Net gains (losses) on securities
(both realized and unrealized) ..... 0.07 0.20 (0.54) 0.33 0.34 0.13 (0.09) 0.26 0.06 (0.01)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations . 0.44 0.59 (0.15) 0.79 0.83 0.65 0.43 0.80 0.60 0.50
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Less Distributions
Dividends (from net investment
income) ............................ (0.37) (0.39) (0.39) (0.46) (0.49) (0.53) (0.52) (0.54) (0.54) (0.51)
Distributions (from capital gains) ... (0.02) (0.03) (0.38) 0.00 0.00 0.00 0.00 0.00 0.00 0.00
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions .............. (0.39) (0.42) (0.77) (0.46) (0.49) (0.53) (0.52) (0.54) (0.54) (0.51)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net Asset Value, End of Year ........... $ 8.41 $ 8.36 $ 8.19 $ 9.11 $ 8.78 $ 8.44 $ 8.32 $ 8.41 $ 8.15 $ 8.09
======= ======= ====== ======= ======= ======= ======= ======= ======= =======

Total Return+ .......................... 5.30% 7.51% (1.86)% 9.19% 10.05% 8.05% 5.24% 10.15% 7.69% 6.18%

Ratios/Supplemental Data
Net assets, end of period (in 000's) . $17,744 $18,833 $19,095 $20,026 $17,872 $16,035 $14,957 $14,307 $12,906 $13,328
Ratio of expenses to average
net assets* ........................ 1.08% 1.06% 1.15% 1.03% 0.95% 0.83% 0.90% 0.91% 0.89% 1.02%
Ratio of net investment
income to average net assets* ...... 4.30% 4.79% 4.47% 5.11% 5.65% 6.17% 6.22% 6.51% 6.66% 6.27%
Portfolio turnover rate .............. 14.75% 24.89% 41.94% 39.60% 20.30% 6.30% 23.50% 12.70% 16.40% 13.90%
</TABLE>
- ----------
* Average net assets have been computed based on the aggregate value of the
fund's daily net assets.
+ Total return calculation does not reflect sales load.

<PAGE>

FINANCIAL HIGHLIGHTS

TAXABLE FIXED INCOME SERIES FUND
MONEY MARKET SERIES:

The table below sets forth financial data for a share of capital stock of the
Money Market Series outstanding throughout each period presented. This Fund's
two new Series - IAA Trust Short-Term Government Bond Series and IAA Trust
Long-Term Bond Series, have not commenced investment operations.

<TABLE>
<CAPTION>
IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.
MONEY MARKET SERIES

Years ended June 30,
----------------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year ..... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Income From Investment Operations
Net investment income ................ 0.05 0.05 0.03 0.02 0.03 0.06 0.07 0.08 0.06 0.05
Net gains (losses) on securities
(both realized and unrealized) ..... 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations . 0.05 0.05 0.03 0.02 0.03 0.06 0.07 0.08 0.06 0.05
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Less Distributions
Dividends (from net investment
income) ............................ (0.05) (0.05) (0.03) (0.02) (0.03) (0.06) (0.07) (0.08) (0.06) (0.05)
Distributions (from capital gains) ... 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions .............. (0.05) (0.05) (0.03) (0.02) (0.03) (0.06) (0.07) (0.08) (0.06) (0.05)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net Asset Value, End of Year ........... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= ======= ====== ======= ======= ======= ======= =======

Total Return .......................... 4.82% 4.85% 2.86% 2.41% 3.49% 6.40% 7.74% 7.90% 5.90% 5.12%

Ratios/Supplemental Data
Net assets, end of period (in 000's) . $33,664 $36,415 $38,699 $33,302 $10,191 $19,839 $21,920 $17,421 $14,211 $16,875
Ratio of expenses to average
net assets *+ ...................... 0.90% 0.73% 0.56% 0.58% 1.32% 1.03% 1.05% 1.28% 1.28% 1.24%
Ratio of net investment
income to average net assets * ..... 4.74% 4.80% 2.83% 2.67% 3.60% 6.26% 7.49% 7.58% 5.74% 5.01%
</TABLE>
- ----------
* Average net assets have been computed based on the aggregate value of the
fund's daily net assets.
+ After voluntary waiver of advisory fees. Before voluntary waiver of advisory
fees, the ratio of expenses to average net assets was .97%, 1.06% and 1.02%
for the years ended June 30, 1995, June 30, 1994 and June 30, 1993,
respectively.

<PAGE>

PERFORMANCE CALCULATIONS

From time to time, the Funds may advertise performance measures such as total
percentage increase, total return, and yield. Whenever total percentage increase
or yield is advertised, total return will be advertised as well. The following
is a brief explanation of how these figures are obtained.

Yields

With respect to the Asset Allocation Fund, the Tax Exempt Bond Fund, the
Short-Term Government Bond Series and the Long-Term Bond Series, yield is a
measure of the total current income for the 30-day period ended on the given
date, stated as a percentage of the original investment. With respect to the
Money Market Series, yield is a measure of the total current income for the
7-day period ended on the given date. This percent is annualized and compounded,
which means that the income is assumed to be earned and reinvested over a
one-year period. Effective yield is computed in the same manner, except that
income is assumed to have been reinvested over a one-year period. Yield differs
from total percentage increase and total return since it only considers current
income and does not take into account gains or losses on securities held by a
Fund or Series.

With respect to the Tax Exempt Bond Fund, tax-equivalent yield is the yield
which would be required from a fund whose income is subject to Federal income
tax in order to equal the amount of after-tax income received by a shareholder
based on the tax exempt yield of this Fund. The rate simplifies the comparison
of yields of tax exempt funds with yields of taxable funds.

Total Percentage Increase

Total percentage increase is calculated for the specified periods of time by
assuming a hypothetical investment of $1,000 in a Fund's shares. Each dividend
or other distribution is treated as having been reinvested at net asset value on
the reinvestment date. The percentage increases stated are the percent that an
original investment would have increased during the applicable period.

Total Return

Total return is calculated in the same way as the total percentage increase
except that it is stated in terms of a level one-year compound rate of return
(all earnings reinvested on an annual basis) over the investment period.

Advertisements of the Funds' performance may also include the ending value of
the illustrated investment for the period stated. This is the amount that would
be received by a shareholder who sold all shares at the end of the stated
period.

The above performance measures are based on historical earnings and are not
intended to indicate future performance.

INVESTMENT OBJECTIVES AND POLICIES

The investment objective of each Fund is fundamental and may not be changed
without a vote of the holders of the majority of the voting securities of the
Fund. Unless otherwise stated in this Prospectus or the Statement of Additional
Information, each Fund's investment policies are not fundamental and may be
changed without shareowner approval. While a non-fundamental policy or
restriction may be changed by the Directors of the Fund without shareowner
approval, the Funds intend to notify shareowners before making any change in any
such policy or restriction. Fundamental policies may not be changed without
shareowner approval. The Funds strive to attain their investment objectives, but
there can, of course, be no assurance that they will do so.

<PAGE>

GROWTH FUND:

The investment objective of the Growth Fund is capital growth. Current income
through the receipt of interest or dividends from investments will be secondary
to this Fund's goal of capital growth. Thus, the Fund is not intended for
investors whose principal objective is dividend income. Achievement of the
Fund's objective cannot be assured, but through professional management, the
Fund will seek to obtain results which are in keeping with its objective.
Although the portfolio of the Fund may be restructured at times for temporary
defensive purposes, it is the intention of the Board of Directors that no
material change of a permanent nature will be made in the Fund's investment
objective without the approval of the holders of at least a majority of the
Fund's outstanding capital stock.

In seeking capital growth, the Growth Fund will constantly search for the best
values and will make investment decisions based primarily upon fundamental
valuation of securities. The Fund will dispose of securities held whenever, in
the judgment of its management, such securities do not represent the best values
for the purpose of achieving the Fund's objective. This can occur for a variety
of reasons, such as an increase in the market value of a particular security to
what is believed to be an unreasonably high level, a change in trend of growth
which was used as a basis of purchase, what is believed to be a vulnerable
general level of security prices, and other such circumstances bearing on the
desirability of continuing a given investment. Under ordinary circumstances,
securities will be held for periods of time sufficient to qualify for long-term
capital gain treatment for Federal income tax purposes.

The Growth Fund's investment policy is to invest principally in common stocks
and securities with equity characteristics, such as convertible preferred stocks
and convertible bonds; however, it may invest fully in common stocks or
securities with equity characteristics. To a lesser extent, the Fund may also
invest in bonds and preferred stocks when deemed prudent. The Fund may adopt a
temporary defensive position when it deems advisable due to a change in economic
conditions. This may be done by establishing and maintaining a reserve in: cash;
short-term U.S. Government bonds, bills or notes; prime commercial paper of
major companies; and certificates of deposit issued by major banks, for the
purpose of providing working capital, funds for possible redemption of shares,
or to enable the Fund to take advantage of buying opportunities. The adoption of
any such temporary defensive position will be on a temporary basis and will not
be utilized to change the long-term investment objective and policies of the
Fund. The word "temporary" as used in the preceding sentence should not be read
as having a fixed meaning in the sense that it designates any fixed period of
time.

When investing in fixed income securities, the Growth Fund's management intends
to invest in those securities which are rated at the time of purchase within the
four highest grades assigned by Moody's Investors Service, Inc. ("Moody's")
("Aaa", "Aa", "A", or "Baa") or Standard & Poor's Corporation ("S&P") ("AAA",
"AA", "A", or "BBB"); or in those securities, although not rated as a matter of
policy by either of the above two ratings services, which are considered by
management to have investment quality comparable to securities that fall within
the four highest grades assigned by the above two rating services. In the event
a fixed income security held by the Fund is downgraded below a "Baa" or "BBB"
rating, the Investment Adviser (IAA Trust Company) shall promptly reassess the
risks involved and take such actions as it determines are in the best interests
of the Fund and its shareholders. See the Appendix to the Statement of
Additional Information for explanations on applicable ratings.

ASSET ALLOCATION FUND:

The primary investment objective of the Asset Allocation Fund is growth of
capital with current income. The Fund seeks to achieve its objective by
following an asset allocation strategy utilizing a wide range of equity, debt,
and money market securities. Asset classes and securities strategies selected
will be those that the Investment Adviser believes offer the greatest potential
for maximizing total return.

Income and capital appreciation will be derived from the Asset Allocation Fund's
investment in common stocks and

<PAGE>

fixed income securities consisting of bonds, preferred stocks, and short-term
obligations. Short-term obligations are instruments maturing in one year or less
(measured from the time of investment) and include: obligations of or guaranteed
by the U.S. Government, its agencies or instrumentalities; certificates of
deposit of domestic banks; commercial paper rated in the top two grades --
"Prime-1" or "Prime-2" by Moody's or "A-1" or "A-2" by S&P; non-convertible
corporate debt securities such as bonds, notes and debentures which are rated in
the top two grades -- "Aaa" or "Aa" by Moody's or "AAA" or "AA" by S&P;
negotiable certificates of deposit of savings and loan associations; and
repurchase agreements. Fixed income securities may have equity conversion
privileges or other equity features, including attached warrants or rights.

When investing in fixed income securities, the Asset Allocation Fund's
management intends to invest in those securities which are rated at the time of
purchase within the four highest grades assigned by Moody's ("Aaa", "Aa", "A",
or "Baa") or S&P ("AAA", "AA", "A", or "BBB"); or in those securities, although
not rated as a matter of policy by either of the above two rating services,
which are considered by management to have investment quality comparable to
securities that fall within the four highest grades assigned by the above two
rating services. In the event a fixed income security held by the Fund is
downgraded below a "Baa" or "BBB" rating, the Investment Adviser shall promptly
reassess the risks involved and take such actions as it determines to be in the
best interest of the Fund and its shareholders. See the Appendix to the
Statement of Additional Information for explanations on applicable ratings.

Although it is not the intent of the Asset Allocation Fund's management to trade
for short-term profits, purchases and sales of securities will be made whenever
management deems it would contribute to the achievement of the Fund's objective.
The Fund will be invested in securities representing a number of different
industry classifications and does not intend to concentrate its investments in a
particular industry. In addition to domestic securities, the Fund may invest in
Canadian and other foreign securities, both corporate and government, which are
payable in United States dollars. To the extent that the Fund does invest in
foreign securities, such investments may be subject to special risks, such as
changes in the administration or economic and monetary policies of foreign
governments. However, the Fund will not invest as much as 5% of its total assets
in foreign securities.

TAX EXEMPT BOND FUND:

The investment objective of the Tax Exempt Bond Fund is to seek as high a level
of current interest income exempt from Federal income taxes as is available from
municipal bonds, consistent with the conservation of capital. The Fund's
investments (and thus the value of shares held by shareholders) will be subject
to the market fluctuations and risks inherent in all securities, and there can
be no assurance that the Fund's stated objective will be realized.

The Tax Exempt Bond Fund will seek to achieve its objective by investing
substantially all of its assets in a diversified portfolio of debt obligations
issued by or on behalf of states, territories or possessions of the United
States and the District of Columbia or their political subdivisions, agencies
and instrumentalities, or multi-state agencies or authorities, the interest from
which is exempt from Federal income taxes in the opinion of bond counsel to the
issuers. Under normal market conditions, the Fund will maintain at least 80% of
its net assets in tax exempt municipal bonds (not including assets invested in
temporary investments for defensive purposes -- see following paragraph). This
80% limitation is considered a fundamental policy. The Fund's assets will
consist of: (1) municipal bonds which are rated at the time of purchase within
the four highest grades assigned by Moody's ("Aaa", "Aa", "A", or "Baa") or S&P
("AAA", "AA", "A", or "BBB"), or in those municipal bonds, although not rated as
a matter of policy by either of the above two rating services, which are
considered by management to have investment quality comparable to municipal
bonds

<PAGE>

that fall within the four highest grades assigned by the above two rating
services (municipal bonds rated "Baa" or "BBB" have speculative
characteristics); (2) temporary investments as described below; and (3) cash.
While ratings at the time of purchase will determine which securities may be
acquired, a subsequent reduction in rating will not require the Fund to dispose
of the securities. See the Appendix to the Statement of Additional Information
for explanations on applicable ratings. No limitations are imposed as to the
percentage of the Fund's assets which may be invested among Moody's or S&P's
highest four ratings; however, the Fund will not invest more than 20% of its net
assets (measured at the time of investment) in municipal bonds which are not
rated, or in taxable investments, or in investments subject to the alternative
minimum tax.

Pending investment of proceeds from the sale of the Tax Exempt Bond Fund's
shares, the changing of portfolio composition, and from time to time when deemed
appropriate by the Investment Adviser for defensive purposes, the Fund may
invest in temporary investment securities. Temporary investment securities
consist of: (1) notes issued by or on behalf of municipal issuers backed by the
Federal Government; (2) notes of issuers having, at the time of purchase, an
outstanding issue of municipal bonds rated within the four highest grades of
Moody's or S&P; (3) municipal notes rated at the time of purchase within the two
highest grades assigned by Moody's ("MIG-1" and "MIG-2"); (4) obligations of the
United States Government, its agencies or instrumentalities; (5) bonds, notes
and certificates rated within the four highest grades of Moody's or S&P; (6)
commercial paper rated within the two highest grades assigned by Moody's ("P-1"
or "P-2") or by S&P ("A-1 or "A-2"); and (7) debt securities (including
repurchase agreements) issued or guaranteed by domestic banks having investment
quality, in management's opinion, comparable to debt securities of the type
described in category (5) above. The income from the securities described in
categories (4) through (7) above, is subject to Federal income taxes.
Consequently, interest income from temporary investments may be taxable to
shareholders as ordinary income.

TAXABLE FIXED INCOME SERIES FUND:

Each Series of the Taxable Fixed Income Series Fund will invest at least 65% of
its total assets in taxable, fixed income securities, also known as "debt
securities". Examples of debt securities are bills, notes and bonds, each
representing a promise by the issuer to re-pay a debt which is generally secured
by the assets of such issuer. Also in this investment category are debentures,
which are bonds or promissory notes that are backed by the general credit of the
issuer, but not secured by specific assets of such issuer. The types of debt
securities in which each Series may invest have been determined by the
investment objective of the Series.

MONEY MARKET SERIES:

The investment objective of the Money Market Series is to earn as high a level
of current income as possible, consistent with maintaining liquidity and
stability of principal. In pursuing its objective, the Series may not always
purchase securities offering the highest yield. The Series will only invest in
high-quality rated securities or unrated securities determined by the Board of
Directors to be of high-quality and present minimum credit risk. There can be no
assurance that the Series' stated objective will be realized.

The Money Market Series seeks to achieve its objective by investing in the
following types of money market instruments, which are maturing in one year or
less, measured from the time of investment:

o Obligations of, or guaranteed by, the U.S. Government, its agencies or
instrumentalities.

<PAGE>

o Certificates of deposit of domestic banks in amounts (currently $100,000)
that are fully insured by The Federal Deposit Insurance Corporation ("The
FDIC") and, for larger amounts, bank certificates of deposit or bankers
acceptances of domestic banks having total assets in excess of $1 billion
and which are members of The FDIC. The Series may purchase both negotiable
and non-negotiable certificates of deposit. Non-negotiable certificates of
deposit are not purchased or sold in a secondary trading market and must be
held to maturity unless, at the request of the Series, the issuer agrees to
redeem them earlier, possibly at less than par. Accordingly, the Series
will not invest more than 10% of its net assets in non-negotiable
certificates of deposit or in other illiquid, restricted securities so that
this potential liquidity risk will be minimal. Banks are subject to
extensive but different government regulations which may limit the amount
and types of their loans and the interest rates that may be charged. In
addition, the profitability of the banking industry is largely dependent
upon the availability and cost of funds to finance lending operations and
the quality of underlying bank assets.

o Commercial paper rated in the top grade by two nationally recognized
statistical rating organizations (NRSRO's) one of which must be either
Moody's Investors Service, Inc., or Standard & Poor's Corporation.

o Non-convertible corporate debt securities such as bonds, notes and
debentures which are rated in the top grade -- "Aaa" by Moody's or "AAA"
by S&P.

o Negotiable certificates of deposit of savings and loan associations in
amounts (currently $100,000) that are fully insured by The FDIC.

o Repurchase agreements of obligations which are suitable for investment
under the categories set forth above and issued by a member bank or certain
broker/dealers who have been approved by the Board of Directors and are
participating in the Federal Reserve System. The Series will only invest in
repurchase agreements maturing in seven days or less.

SHORT-TERM GOVERNMENT BOND SERIES:

The investment objective of the Short-Term Government Bond Series is to provide
maximum total return, consistent with preservation of capital and prudent
investment management. Total return consists of interest, and dividends from
underlying securities and capital appreciation realized from the purchase and
sale of securities. Under normal conditions, the Series seeks to achieve its
objective by investing at least 65% of the value of its total assets in
short-term government bonds. Short-term government bonds include U.S. Government
securities, such as bonds, notes, and bills which are (a) direct obligations of
the U.S. Treasury, and (b) securities issued or guaranteed by U.S. Government
agencies. The estimated portfolio turnover rate for the Series is less than
100%.

Government securities may be backed by (i) the full faith and credit of the
United States; (ii) the particular Government agency's ability to borrow
directly from the Treasury; (iii) some other type of United States support; or
(iv) the credit of the issuing agency, only. The government guarantee of the
U.S. Government securities in the Series' portfolio, however, does not guarantee
the net asset value of the shares of the Series. There are market risks inherent
in all investments in securities, and the value of an investment in the Series
will fluctuate over time. Normally, the value of the Series' investments varies
inversely with changes in interest rates. For example, as interest rates rise,
the value of the Series' investments will tend to decline, and as rates fall,
investment values tend to increase.

The Series expects to maintain a dollar-weighted average maturity of less than
three years. Because the manager seeks to minimize interest rate risk by
managing effective duration, the Series may invest in securities of any
maturity.

<PAGE>

The Series is designed primarily for investors who seek higher yields than money
market funds generally offer and are willing to accept nominal fluctuation in
the value of the shares but who are not willing to accept the greater
fluctuations that long-term bond funds might entail. This Series is not an
appropriate investment for investors whose primary investment objective is
absolute principal stability. Because the values of the securities in which this
Series invests generally change with interest rates, the value of its shares
will fluctuate, unlike the value of the shares of a money market fund, seeking
to maintain a stable net asset value per share of $1.00. Consequently, this
Series seeks to reduce such fluctuations by managing the effective duration, and
thus the interest rate risk, of its portfolio.

The Series also may invest up to 35% of its total assets in cash, commercial
paper and high grade liquid debt securities, including corporate debt
instruments and privately issued mortgage-related and asset-backed securities
rated within the three highest grades assigned by S&P (AAA, AA, A or A-1) or
Moody's (Aaa, Aa, A or P-1) or in unrated securities such as Certificates of
Deposit issued by Banks, Bankers' Acceptances, and Repurchase Agreements deemed
by the manager to be of comparable quality. Further, the Series may invest in
long-term fixed rate bonds that allow the Series to tender (or "put") bonds to
the issuer at specified intervals and receive face value for them. In addition,
the Series may invest in other investment companies investing primarily in U.S.
Government securities for the appropriate duration.

LONG-TERM BOND SERIES:

The investment objective of the Long-Term Bond Series is to provide the maximum
amount of current income and capital appreciation to the extent consistent with
the preservation of capital and the maintenance of liquidity. The Series invests
principally in debt obligations of corporations, the U.S. Government and its
agencies and instrumentalities, and major U.S. banking institutions and may also
purchase obligations of international agencies and U.S. dollar denominated
foreign debt securities. The estimated portfolio turnover rate for the Series is
less than 100%.

At least 80% of the value of the Series' net assets will consist of obligations
of corporations which, at the time of purchase by the Series are rated at least
A- by S&P or A3 by Moody's, and of securities issued or guaranteed as to
principal and interest by the U.S. Government or its agencies or
instrumentalities. The Series may also invest in securities which, while not
rated, are determined by the investment manager to be of comparable quality to
those rated securities in which the Series may invest; for purposes of the 80%
requirement described in this paragraph, such unrated securities shall be deemed
to have the ratings so determined. See the Appendix to the Statement of
Additional Information for explanations on applicable ratings. At least 65% of
the value of the Series' total assets (except when maintaining a temporary
defensive position) will be invested in bonds. Such instruments include U.S.
Government and corporate bonds, notes, and convertible issues.

On occasion, up to 20% of the Series' net assets may consist of commercial paper
of U.S. issuers rated A-1 or A-2 by S&P or P-1 or P-2 by Moody's, certificates
of deposit, time deposits and bankers' acceptances, and corporate bonds which
are rated in any category lower than A- by S&P and A3 by Moody's. When deemed
necessary for temporary defensive purposes, the Series' investment in commercial
paper, certificates of deposit, time deposits and bankers' acceptances may
exceed 20% of its net assets, although the Series currently does not intend to
invest more than 5% of its assets in any one of these types of instruments.
Commercial paper and certificates of deposit could be over 5%. Under no
circumstances will the Series invest more than 20% of its net assets in
corporate bonds which are rated lower than A- by S&P and A3 by Moody's or are
unrated. Obligations rated BBB by S&P and Baa by Moody's are considered
investment grade obligations which lack outstanding investment characteristics
and may have speculative characteristics as well. See the Appendix to the
Statement of Additional Information for explanations on applicable ratings. The
Series may invest up to 10% of its assets in securities of foreign issuers.

<PAGE>

INVESTMENT STRATEGIES AND RISK CONSIDERATIONS

Shareowners should understand that all investments involve risk and there can be
no guarantee against loss resulting from an investment in the Funds. Unless
otherwise indicated, all percentage limitations governing the investments of the
Funds apply only at the time of transaction.

Securities of Other Investment Companies

All Funds may purchase or acquire securities of other investment companies on
the open market if immediately after such purchase or acquisition, the Fund
would not own in the aggregate: (1) more than 3% of the total outstanding voting
stock of such other investment company; (2) securities issued by such other
investment company having an aggregate value in excess of 5% of the value of the
Fund's total assets; or (3) securities issued by such other investment company
and all other investment companies having an aggregate value in excess of 10% of
the value of the Fund's total assets. By investing in another registered
investment company, there may be a duplication in fees and expenses.

Repurchase Agreements

All Funds may enter into repurchase agreements which are transactions in which
the Funds purchase a security (usually a U.S. Government obligation) and
simultaneously obtain the commitment of the seller to repurchase the security at
an agreed upon price on an agreed upon date, usually not more than seven days
from the date of purchase. The resale price reflects the purchase price plus an
agreed upon market rate of interest which is unrelated to the coupon rate or
maturity of the purchased security. Such transactions afford an opportunity for
a Fund to earn a return on cash which is only temporarily available. The Fund's
risk is limited to the ability of the seller to pay the agreed upon sum upon the
delivery date, but the seller's obligation is in effect secured by the value of
the underlying security. The Funds will only invest in repurchase agreements of
domestic banks maturing in seven days or less and will not invest in repurchase
agreements of broker-dealers.

Still, there are certain risks involved with the use of certain repurchase
agreements. For example, if the seller should default on its obligation to
repurchase the securities, a Fund may experience delay or difficulties in
exercising its rights upon the securities held as collateral and might incur a
loss if the value of the securities should decline. A Fund also might incur
disposition costs in connection with liquidating the securities. While the Funds
acknowledge these risks, it is expected that they can be controlled through
careful monitoring procedures offered by the Funds' Investment Adviser.

Municipal Bonds

The Tax Exempt Bond Fund may purchase municipal bonds which are generally debt
obligations issued by states, territories and possessions of the United States
and the District of Columbia and their political subdivisions, agencies and
instrumentalities. They are issued to obtain funds for various public purposes,
including the construction of a wide range of public facilities such as:
airports; bridges; highways; hospitals; housing; mass transportation; schools;
streets; and water and sewer works. Other public purposes for which municipal
bonds may be issued include obtaining funds for general operating expenses, and
obtaining funds to lend to other public institutions and facilities. In
addition, certain types of industrial development bonds are issued by or on
behalf of public authorities to obtain funds to provide: privately-operated
housing facilities; airports; mass transit; industrial, port or parking
facilities; air or water pollution control facilities; and certain facilities
for water supply, gas, electricity, or sewage or solid waste disposal. Other
types of facilities and certain industrial development bonds, the proceeds of
which are used for the acquisition, construction, reconstruction or improvement
of or to provide equipment for privately-operated industrial or commercial
facilities, may qualify as municipal bonds, although current Federal tax laws
place substantial limitations on the size of such funds. Moreover, when an
industrial development bond is backed only by the assets and revenue of the
non-governmental user, then such non-governmental user is deemed to be the
issuer.

<PAGE>

The two principal classifications of municipal bonds are "general obligation
bonds" and "revenue bonds". General obligation bonds are secured by the issuer's
pledge of its faith, credit and taxing power for the payment of principal and
interest. The taxes or special assessments that can be levied for the payment of
debt service may be limited or unlimited as to rate or amount. Revenue bonds are
payable only from the revenues derived from a particular facility or class of
facilities or, in some cases, from the proceeds of a special excise or other
specific revenue source, but not from the general taxing power. Tax exempt
industrial development bonds are in most cases revenue bonds and do not
generally carry the pledge of the credit of the insurer of such bonds. There
are, of course, variations in the security of municipal bonds, both within a
particular classification and between classifications. The Fund's portfolio may
consist of any combination of general obligation bonds, revenue bonds, and
industrial revenue bonds, and it can be expected that the ratios of such bonds
will vary from time to time.

Yields on municipal bonds are dependent on, among other things, general money
market conditions, conditions of the municipal bond market, size of a particular
offering, maturity of the obligation, the financial condition of the issuer, and
the rating of the issue. Additionally, the imposition of the Fund's management
fee, as well as other operating expenses, will have the effect of reducing the
yield to investors. Proposals have been introduced periodically before Congress
to restrict or eliminate the Federal income tax exemption for interest on
municipal bonds. Similar proposals may be introduced in the future. If such a
proposal was enacted, the availability of municipal bonds for investment by the
Fund and the value of the Fund's portfolio would be affected. In such event, the
Fund would reevaluate its objective and policies and consider recommending to
its shareholders changes in the structure of the Fund.

Government Securities

The Long-Term Bond Series may invest in securities issued or guaranteed by the
U.S. Government or its agencies or instrumentalities which includes U.S.
Treasury securities, which differ in their interest rates, maturities and times
of issuance. Treasury Bills have initial maturities of one year or less;
Treasury Notes have initial maturities of one to ten years; and Treasury Bonds
generally have initial maturities of greater than ten years. Some obligations
issued or guaranteed by U.S. Government agencies and instrumentalities, for
example, Government National Mortgage Association pass-through certificates, are
supported by the full faith and credit of the U.S. Treasury; others, such as
those of the Federal Home Loan Banks, by the right of the issuer to borrow from
the Treasury; others, such as those issued by the Federal National Mortgage
Association, by discretionary authority of the U.S. Government to purchase
certain obligations of the agency or instrumentality; and others, such as those
issued by the Student Loan Marketing Association, only by the credit of the
agency or instrumentality. These securities bear fixed, floating or variable
rates of interest. Principal and interest may fluctuate based on generally
recognized reference rates or the relationship of rates. While the U.S.
Government provides financial support to such U.S. Government sponsored agencies
or instrumentalities, no assurance can be given that it will always do so since
it is not so obligated by law. The Series will invest in such securities only
when it is satisfied that the credit risk with respect to the issuer is minimal.

Zero Coupon Securities

The Long-Term Bond Series may invest in zero coupon U.S. Government securities,
which are U.S. Government obligations that have been stripped of their unmatured
interest coupons, the coupons themselves and receipts or certificates
representing interests in such stripped debt obligations and coupons. The Series
also may invest in zero coupon securities issued by corporations and financial
institutions and by foreign governments where such securities are denominated in
U.S. dollars. A zero coupon security pays no interest to its holder during its
life and is sold at a discount to its face value at maturity. The amount of the
discount fluctuates with the market price of the security. The market prices of
zero coupon securities generally are more volatile than the market price of
securities that pay interest periodically and are likely to respond to a greater
degree to changes in interest rates than non-zero coupon securities having
similar maturities and credit qualities.

<PAGE>

Mortgage-Related Securities

The Long-Term Bond Series may invest in mortgage-related securities which are
collateralized by pools of mortgage loans assembled for sale to investors by
various governmental agencies, such as Government National Mortgage Association
and government-related organizations such as Federal National Mortgage
Association and Federal Home Loan Mortgage Corporation, as well as by private
issuers such as commercial banks, savings and loan institutions, mortgage banks
and private mortgage insurance companies, and similar foreign entities.
Mortgage-related securities are a form of derivative securities. The
mortgage-related securities in which the Series may invest include those with
fixed, floating and variable interest rates and those with interest rates that
change based on multiples of changes in interest rates. Although certain
mortgage-related securities are guaranteed by a third party or otherwise
similarly secured, the market value of the security, which may fluctuate, is not
so secured. If a mortgage-related security is purchased at a premium, all or
part of the premium may be lost if there is a decline in the market value of the
security, whether resulting from changes in interest rates or prepayments in the
underlying mortgage collateral. As with other interest-bearing securities, the
prices of certain mortgage-backed securities are inversely affected by changes
in interest rates. However, although the value of a mortgage-related security
may decline when interest rates rise, the converse is not necessarily true,
since in periods of declining interest rates the mortgage underlying the
security are more likely to be prepaid. For this and other reasons, a
mortgage-related security's stated maturity may be shortened by unscheduled
prepayments on the underlying mortgage and, therefore, it is not possible to
predict accurately the security's return to the Series. The Series also may
invest in collateralized mortgage obligations structures on pools of mortgage
pass-through certificates or mortgage loans. The issuers of collateralized
mortgage obligations typically do not have assets other than those pledged to
secure separately the obligations. Holders of these obligations must rely
principally on distributions on the underlying mortgage related securities and
other collateral securing the obligations for payments of principal and interest
on the obligations. If the collateral securing the obligations is insufficient
to make payments on the obligations, a holder could sustain a loss.
Collateralized mortgage obligations will be purchased only if rated in one of
the two highest rating categories by a nationally recognized rating organization
such as Moody's or S&P.

Fixed-Income Securities

All Funds may invest in fixed-income securities. Even though interest-bearing
securities are investments which promise a stable stream of income, the prices
of such securities are inversely affected by changes in interest rates and,
therefore, are subject to the risk of market price fluctuations. The values of
fixed-income securities also may be affected by changes in the credit rating or
financial condition of the issuing entities. Once the rating of a portfolio
security has been changed, the Fund will consider all circumstances deemed
relevant in determining whether to continue to hold the security. The Growth
Fund, the Asset Allocation Fund, and the Tax Exempt Bond Fund may purchase
fixed-income securities rated Baa by Moody's and BBB by S&P. Such securities may
be subject to the aforementioned risk with respect to the issuing entity and to
greater market fluctuations than certain lower yielding, higher rated
fixed-income securities. Obligations which are rated Baa are considered medium
grade obligations; they are neither highly protected nor poorly secured, and are
considered by Moody's to have speculative characteristics. Bonds rated BBB by
S&P are regarded as having adequate capacity to pay interest and repay
principal, and while such bonds ordinarily exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
bonds in this category than in higher rated categories.

Forward Commitments and When-Issued Securities

The Long-Term Bond Series may purchase securities on a forward commitment or
when-issued basis, which means that the price is fixed at the time of
commitment, but delivery and payment ordinarily take place a number of days
after the commitment to purchase. The Series will make commitments to purchase
such securities only with the intention of actually acquiring the securities,
but the Series may sell these securities before the settlement date if it is
deemed advisable. The Series will not accrue income in respect of a forward
commitment or when-issued security prior to its stated delivery date.

<PAGE>

Securities purchased on a forward commitment or when-issued basis and the
securities held in the Long-Term Bond Series portfolio are subject to changes in
value (both generally changing in the same way, i.e., appreciating when interest
rates decline and depreciating when interest rates rise) based upon the public's
perception of the creditworthiness of the issuer and changes, real or
anticipated, in the level of interest rates. Securities purchased on a forward
commitment or when-issued basis may expose the Series to risk because they may
experience such fluctuations prior to their actual delivery. Purchasing
securities on a forward commitment or when-issued basis can involve the
additional risk that the yield available in the market when the delivery takes
place actually may be higher than that obtained in the transaction itself. A
segregated account of the Series consisting of cash, cash equivalents or U.S.
Government securities or other high quality liquid debt securities at least
equal at all times to the amount of the forward commitment or when-issued
securities will be established and maintained at the Series' custodian bank.
Purchasing securities on a forward commitment or when-issued basis when the
Series is fully or almost fully invested may result in greater potential
fluctuation in the value of the Series' net assets and its net asset value per
share.

Foreign Securities

Since up to 10% of the Long-Term Bond Series' portfolio may consist of
securities of foreign issuers, the Series may be subject to investment risks as
to these securities that are greater in some respects than those incurred by a
Series which invests only in securities of U.S. domestic issuers. Such risks
include future political and economic developments, the possible imposition of
foreign withholding taxes on interest income payable on the securities, the
possible establishment of exchange controls, the possible seizure or
nationalization of foreign deposits, or the adoption of other foreign
governmental restrictions which might adversely affect the payment of principal
and interest on such securities.

MANAGEMENT OF THE FUNDS

The operations of each Fund are under the direction of a Board of Directors who
have been elected by the shareholders of each Fund. The Board meets regularly to
review the activities of the Officers, who are responsible for day to day
operations of the Funds. To assist the Directors and Officers in carrying out
their duties and responsibilities, the Funds have employed IAA Trust Company
("IAATC"), 808 IAA Drive, Bloomington, Illinois, as their Investment Adviser
under written Agreements which are renewable annually by the Funds' Board of
Directors or by votes of a majority of each Fund's outstanding voting
securities. Any such renewals must also be approved by the votes of a majority
of each Fund's Directors, who are not parties to the Agreement or interested
persons of any such party, cast in person at a meeting called for the purpose of
voting on such approvals. The Agreements may be terminated without penalty at
any time by the Board of Directors of a Fund, or by votes of the shareholders,
or by IAATC upon sixty days written notice, and they terminate automatically in
the event of their assignment. IAATC was organized on December 30, 1970 and has
no investment company clients other than the IAA Trust Mutual Funds discussed
herein. Illinois Agricultural Holding Co. owns all of the outstanding voting
securities of IAATC. Approximately 98% of the issued and outstanding voting
stock of the Illinois Agricultural Holding Co. is owned by the Illinois
Agricultural Association ("IAA"). IAA is an Illinois not-for-profit membership
corporation organized to promote the interest of agriculture.

IAATC, subject to the authority of the Board of the Funds, is generally
responsible for the overall management of the Funds' business. For these
services performed and expenses assumed, the Growth Fund, the Asset Allocation
Fund and the Long-Term Bond Series each pay IAATC an annual fee of approximately
.75% of their respective average daily net assets. These fees are considered
higher than the advisory fees paid by most other mutual funds; however, these
fees are comparable with those of other mutual funds with similar investment
objectives. The Tax Exempt Bond Fund, the Money Market Series and the Short-Term
Government Bond Series each pay IAATC an annual fee of approximately .50% of
their respective average daily net assets. All of these fees are computed on a
daily basis and are paid monthly. Neither IAATC nor any company affiliated with
it receives any brokerage commissions from the Funds, as such business is
transacted with non-affiliated broker-dealers.

<PAGE>

The following persons who are Officers and/or Directors of the Funds also hold
positions with IAATC as indicated: Ronald R. Warfield, Director and President;
Bruce Finks, Vice President--Investments; Gary E. Mede, Executive Vice
President; Richard M. Miller, Senior Vice President and Senior Trust Officer;
Rollie D. Moore, Director and Vice President; Paul M. Harmon, Secretary; Robert
W. Weldon, Vice President--Finance and Treasurer; Richard F. Day, Controller.

<PAGE>

MANAGEMENT'S DISCUSSION OF FUNDS' PERFORMANCE

GROWTH FUND:

graph of below plot points, depicting Growth Fund performance vs. Standard &
Poor's Index goes here:

Growth 9,700 11,131 10,387 12,471 14,477 15,255 15,900 17,762 17,332 21,956 26,679

</TABLE>

The above graph reflects the impact of sales charges which were placed
on purchases. The maximum sales charge for the period indicated was
3.0%. Beginning October 28, 1996, no sales charges will be placed on
purchases.

The net asset value of the Growth Fund closed the fiscal year on June 30, 1996
at $18.88 per share. The figures below show historical compound annual returns
of Fund shares with dividends reinvested, as of June 30, 1996.

1 Year 5 Years 10 Years
------ ------- --------

Without Sales Charge 21.51% 11.83% 10.65%
Maximum Sales Charge Deducted 17.88% 11.14% 10.31%

These annual returns are for prior years' performance. Returns in future
periods cannot be guaranteed, and the value of Fund shares can fluctuate either
above or below their original cost. Beginning October 28, 1996, no sales charge
will be deducted. The Maximum Sales Charge Deducted referred to in the above
chart applies to the Fund's performance during the periods indicated.

<PAGE>

picture of Bruce Finks, Investment Officer for the Growth Fund:
Bruce Finks Earned a B.S. in Business Administration from
here Illinois State University in Normal in 1976, and is
also a Chartered Financial Analyst. Mr. Finks is
responsible for the management of common stock
portfolios for individual and institutional clients
and has been with IAA Trust Company since 1992,
following fifteen years of investment management
experience with banking organizations.

<PAGE>

ASSET ALLOCATION FUND:

graph of below plot points, depicting Asset Allocation Fund performance vs.
Merrill Lynch Corporate and Government Master Index and Lipper-Balanced Funds
Index goes here:

Asset Allocation 9,700 10,079 10,731 11,847 12,618 13,812 15,448 16,928 17,048 19,825 22,747

</TABLE>

The net asset value of the Asset Allocation Fund closed the fiscal year on June
30, 1996 at $13.39 per share. The figures below show historical compound annual
returns of Fund shares with dividends reinvested, as of June 30, 1996.

1 Year 5 Years 10 Years
------ ------- --------

Without Sales Charge 14.74% 10.49% 8.90%
Maximum Sales Charge Deducted 11.30% 9.83% 8.57%

<PAGE>

picture of John Jacobs, Investment Officer for the Asset
John Jacobs Allocation Fund: Earned a B.S. in Business and
here Finance at Illinois Wesleyan University in
Bloomington. Mr. Jacobs is also a Chartered Financial
Analyst, and has served as a member of IAA Trust
Company's Investment Committee. Prior to joining the
Company in 1975, he was an account executive for one
of the leading national brokerage firms.

picture of Michael E. Marks: Earned his B.S. in Business
Michael Marks Administration from Washington University in St.
here Louis, his M.B.A. from Indiana University in
Bloomington, and is currently pursuing the Chartered
Financial Analyst certification. Prior to graduate
school, he was a management consultant for Price
Waterhouse's Strategic Consulting Group. Mr. Marks
joined IAA Trust Company in 1993 and manages the
equity portion of the Asset Allocation Fund, and the
international Common Trust Funds and a number of
trust accounts.

<PAGE>

TAX EXEMPT BOND FUND:

graph of below plot points, depicting Tax Exempt Bond Fund performance vs.
Lehman Muni General Bond Index goes here:

Tax Exempt 9,700 10,299 11,091 12,217 12,857 13,892 15,289 16,694 16,383 17,614 18,547

</TABLE>

Note: The IAA Trust Tax Exempt Bond Fund's portfolio does not mirror the
Lehman Index.

The net asset value of the Tax Exempt Bond Fund closed the fiscal year on June
30, 1996 at $8.41 per share. The figures below show historical compound annual
returns of Fund shares with dividends reinvested, as of June 30, 1996.

1 Year 5 Years 10 Years
------ ------- --------

Without Sales Charge 5.30% 5.95% 6.70%
Maximum Sales Charge Deducted 2.12% 5.31% 6.37%

These returns assume all dividends and capital gains distributions were
reinvested and the maximum sales charge applied on initial investments.
Beginning October 28, 1996, no sales charge will be deducted. The Maximum Sales
Charge Deducted referred to in the above chart applies to the fund's performance
during the periods indicated. Although the Fund's income is generally exempt
from Federal income taxes, it may, under certain circumstances, be subject to
state income taxation. See "INCOME DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS, AND
TAXES".

<PAGE>

picture of Mary S. Guinane, Investment Officer for the Tax
Mary S. Guinane Exempt Bond Fund: Earned a M.B.A. at Illinois State
here University and a B.A. in Psychology and Sociology at
St. Ambrose College. Ms. Guinane has been with IAA
Trust Company since 1981.

<PAGE>

TAXABLE FIXED INCOME SERIES FUND:

MONEY MARKET SERIES:

Robert L. Sammer, B.S., manages the IAA Money Market
Fund. Bob received his bachelor of science degree in
finance from Illinois State University in 1988 and is
currently pursuing his MBA from the same institution.
After working as a trust administrator for
Independent Trust Corporation in Lombard, Illinois,
he joined IAA Trust Company in 1991. Here, he has
served as client services coordinator, corporate
retirement and agency accounts coordinator and, now
investment analyst.

SHORT-TERM GOVERNMENT BOND SERIES:

John Jacobs, Investment Officer for the Asset
Allocation Fund: Earned a B.S. in Business and
Finance at Illinois Wesleyan University in
Bloomington. Mr. Jacobs is also a Chartered Financial
Analyst, and has served as a member of IAA Trust
Company's Investment Committee. Prior to joining the
Company in 1975, he was an account executive for one
of the leading national brokerage firms.

LONG-TERM BOND SERIES:

<PAGE>

FPS Services, Inc.

FPS Services, Inc. ("FPS"), 3200 Horizon Drive, P.O. Box 61503, King of Prussia,
Pennsylvania 19406-0903, is the Funds' Transfer and Dividend Disbursing Agent
and as such performs all shareholder services for the Funds. The Funds have also
entered into Agreements with FPS under which FPS provides accounting and
administration services.

Administration services include all administrative services except those
relating to the investment portfolios of the Funds, the distribution of the
Funds, and the maintenance of the Funds' financial records. The fees for
administrative services are based on a declining percentage of each Fund's
average net assets, beginning at .0015% of the first $50,000,000 of average net
assets. However, the Asset Allocation Fund, the Tax Exempt Bond Fund, and the
Taxable Fixed Income Series Fund are each required to pay a minimum annual fee
of $10,000 and the Growth Fund is required to pay a minimum annual fee of
$50,000 for such services.

The Funds each pay a minimum accounting fee of $25,000 and pay additional
accounting fees, based on declining percentages of their respective average net
assets in excess of $10,000,000. There are no direct or indirect relationships
between FPS Services, Inc. and the Funds or IAA Trust Company.

DISTRIBUTION OF THE FUNDS' SHARES

FPS Broker Services, Inc. ("FPBS") serves as the Distributor for the Funds on a
best efforts basis, pursuant to various Underwriting Agreements. The Distributor
is an affiliated company of FPS Services, Inc. ("FPS"), the Funds' servicing
agent, inasmuch as both the Distributor and FPS are under common ownership.

DISTRIBUTION PLANS

The shareholders of the Growth Fund, the Asset Allocation Fund, the Tax Exempt
Bond Fund, the Short-Term Government Bond Series and the Long-Term Bond Series
have each adopted a Plan of Distribution (the "Plan") pursuant to Rule 12b-1
under the Investment Company Act of 1940. The Money Market Series does not
participate in any plan pursuant to this Rule. The Plan permits the
participating Funds to pay certain expenses associated with the distribution of
their shares. The Plan provides that the participating Funds will reimburse the
Distributor for actual distribution and shareholder servicing expenses incurred
by the Distributor not exceeding, on an annual basis, 0.25% of each
participating Fund's average daily net assets. Amounts expended by the
Distributor, but not reimbursed by each participating Fund's Plan, will not be a
continuing liability of such Fund in subsequent years. Because the Funds
reimburse the Distributor only for actual expenditures, the Distributor realizes
no profit from the 12b-1 Plan. The Plan may be terminated at any time and the
Funds shall have no liability for expenses that were not reimbursed as of the
date of termination.

All such payments made pursuant to the Plan shall be made for the purpose of
promoting the sale of shares or other such distribution-related expenses,
including any distribution or service fees paid to securities dealers,
investment advisers, financial planners, and others, who have executed a
distribution agreement with the Distributor. The maximum amount which will be
paid to such parties by the Distributor is 0.25% (on an annual basis) of a
participating Fund's average net assets, owned by client of that party.
Management may choose to pay a lesser amount.

<PAGE>

CAPITAL STOCK

There are no conversion or preemptive rights in connection with any shares of
the Funds, nor are there cumulative voting rights with respect to the shares of
any of the Funds. Each of the Fund's shares has equal voting rights. Each issued
and outstanding share of each Fund is entitled to participate equally in
dividends and distributions declared by such Fund and in net assets of such Fund
upon liquidation or dissolution remaining after satisfaction of outstanding
liabilities.

All issued and outstanding shares of each Fund will be fully paid and
nonassessable and will be redeemable at the net asset value per share. The
interests of shareholders in the Funds will not, unless specifically requested
in writing by a shareholder, be evidenced by a certificate or certificates
representing shares of a Fund.

The authorized capitalizations of the Growth Fund, the Asset Allocation Fund,
and the Tax Exempt Bond Fund consist of 10,000,000 shares for each of these
Funds, each Fund having a par value of $1.00 per share.

The authorized capitalization of the Taxable Fixed Income Series Fund consists
of 250,000,000 shares of the par value of $0.10 per share. 100,000,000 of this
Fund's shares are designated as Money Market Series, 50,000,000 of its shares
are designated as Short-Term Government Bond Series, and 25,000,000 of its
shares are designated as Long-Term Bond Series. The remaining 75,000,000 shares
are undesignated.

Country Life Insurance Company

As of October 1, 1996, 446,787 shares or 9.42% of the issued and outstanding
capital stock of the Growth Fund were owned by Country Life Insurance Company
("Country Life"), Bloomington, Illinois. Country Life's capital stock enables it
to influence the outcome of shareholder votes. Country Life is organized in
Illinois. Substantially all issued and outstanding stock of Country Life is
owned by Illinois Agricultural Holding Co.

As of October 1, 1996, 96,228 shares or 12.20% of the issued and outstanding
capital stock of the Asset Allocation Fund were owned by Country Life Insurance
Company ("Country Life"), Bloomington, Illinois. Country Life's capital stock
enables it to strongly influence the outcome of shareholder votes. Country Life
is organized in Illinois. Substantially all issued and outstanding stock of
Country Life is owned by Illinois Agricultural Holding Co.

Country Mutual Insurance Company

As of October 1, 1996, 248,175 shares or 11.85% of the issued and outstanding
capital stock of the Tax Exempt Bond Fund were owned by Country Mutual Insurance
Company ("Country Mutual"), Bloomington, Illinois. Such shares were purchased at
net asset value for the purpose of providing the initial capital of the Fund.
Country Mutual's capital stock enables it to influence the outcome of
shareholder votes. Country Mutual is organized in Illinois and proxy control of
the company is in Illinois Agricultural Association.

IAA Trust Company

As of October 1, 1996, IAA Trust Company owned of record 1,913,648 shares or
40.37% of the issued and outstanding capital stock of the Growth Fund, 503,853
shares or 63.92% of the issued and outstanding capital stock of the Asset
Allocation Fund, and 26,655,025 shares or 79.25% of the issued and outstanding
capital stock of the Money Market Series.

Illinois Agricultural Holding Co. owns 100% of the outstanding voting securities
of the Trust Company. For additional information on the ownership of Illinois
Agricultural Holding Co. See "MANAGEMENT OF THE FUNDS".

<PAGE>

Shareholder inquiries should be directed to FPS Services, Inc., 3200 Horizon
Drive, P.O. Box 61503, King of Prussia, Pennsylvania 19406-0903, or call
toll-free 1 (800) 245-2100.

INCOME DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS, AND TAXES

Dividends and capital gains distributions may be automatically reinvested in
additional shares of a particular Fund/Series at net asset value, or paid in
cash, at the choice of the investor. The cash option is not available under the
Systematic Withdrawal Plan or Retirement Plans.

Capital gains are taxed at the same rate as ordinary income. The dividends
received deduction for corporations is 70% and is applicable to the Growth Fund
and the Asset Allocation Fund. Each shareholder will receive a summary of the
dividends paid or reinvested as they are declared. If the entire amount in an
account is redeemed at any time during a month, dividends credited to that
account from the beginning of the month through the day of redemption will be
paid together with the proceeds of the redemption.

GROWTH FUND:

It is the policy of the Growth Fund to distribute semi-annually, all of its net
investment income and, if any, all of its net realized capital gains according
to tax regulations. Currently, these distributions are made at the end of the
Fund's fiscal year and at calendar year-end.

ASSET ALLOCATION FUND,
SHORT-TERM GOVERNMENT BOND SERIES and
LONG-TERM BOND SERIES:

It is the policy of each of the Asset Allocation Fund, the Short-Term Government
Bond Series, and the Long-Term Bond Series to pay monthly dividends from its net
investment income and to distribute net capital gains, if any, according to tax
regulations at the end of its fiscal and calendar years.

TAX EXEMPT BOND FUND:

It is the policy of the Tax Exempt Bond Fund to pay monthly dividends from its
net investment income.

The Fund intends to qualify each fiscal year (under the Internal Revenue
Code of 1986 and any amendments thereto) to pay "exempt-interest dividends" to
their shareholders. Exempt-interest dividends which are derived from net income
earned by the Fund on tax-exempt bonds will be excludable from gross income of
the shareholders for Federal income tax purposes. That part of monthly net
investment income which may be earned by the Fund from certain taxable temporary
investments, together with any annual distributions attributable to short-term
capital gains, are taxable as ordinary income to investors whether received in
cash or reinvested in shares. The percentage of each monthly dividend designated
by the Fund as tax exempt will be the same percentage as the actual tax exempt
income earned during the period covered by the distribution bears to total
income earned by the Fund during the period. Shareholders will be notified of
such designations monthly and information regarding the tax status of any other
distributions will be mailed annually. The percentage of the monthly dividend
which is tax exempt may vary from distribution to distribution. Long-term
capital gains distributions are taxable to shareholders as long-term capital
gain, regardless of how long a shareholder has held shares.

<PAGE>

Shareholders of the Fund should recognize that should they redeem shares between
dividend dates, a portion of the per share redemption price may represent
interest accrued on municipal bonds and said portion may be taxed at long- or
short-term capital gains rates and not as a tax-exempt dividend excludable from
gross income.

Interest on indebtedness incurred by shareholders to purchase or carry shares of
the Fund will not be deductible for Federal income tax purposes. The exemption
of interest income for Federal income tax purposes does not necessarily result
in exemption under the income or other tax laws of any state or local authority.
Thus, shareholders may be subject to state and local taxes on distributions of
tax-exempt interest income from the Fund.

MONEY MARKET SERIES:

The Money Market Series declares and pays dividends of all of its daily net
investment income on each day that its net asset value is determined.

Net investment income, for dividend purposes of this Series, consists of: (1)
accrued interest income plus or minus amortized purchase discount or premium;
(2) plus or minus all short-term realized gains and losses and unrealized
appreciation and depreciation on portfolio assets; and (3) minus all accrued
expenses of such Series, which are accrued each day. Net income will be
calculated immediately prior to the determination of the net asset value per
share of the Series Since the net income of the Series (including realized gains
and losses and unrealized appreciation and depreciation on the portfolio
securities) is declared as a dividend each time the net income of the Series is
determined, the net asset value per share of the Series normally remains at
$1.00 per share immediately after each such determination and dividend
declaration. Any increase in the value of a shareholder's investment in the
Series representing the reinvestment of dividend income is reflected by an
increase in the number of shares of the Series in the account. Normally, the
Series will have a positive net income at the time of each determination
thereof. Net income may be negative if an unexpected liability must be accrued,
a loss realized, or unrealized depreciation occurs. If the net income of the
Series determined at any time is a negative amount, the net asset value per
share will be reduced below $1.00. The Series may endeavor to restore the net
asset value per share to $1.00 by not declaring dividends from net income on
subsequent days until restoration, with the result that the net asset value per
share will increase to the extent of positive net income which is not declared.

ALL FUNDS/SERIES:

The Board of Directors may revise the above dividend policies, or postpone the
payment of dividends, if a Fund/Series should have or anticipate any large
presently unexpected expense, loss, or fluctuation in net assets which in the
opinion of the Board might have a significant adverse effect on shareholders.

All of the Funds/Series comply with Subchapter M of the Internal Revenue Code
available to investment companies and therefore, maintain exemption from Federal
income tax.

Long-term capital gains distributions are taxable to shareholders as long-term
capital gain, regardless of how long a person has been a shareholder. Any
dividend or distribution received shortly after the purchase of shares reduces
the net asset value of the shares by the amount of the dividend or distribution
and, although in effect a return of capital, is subject to income taxes. The
Funds/Series are required to withhold and remit to the U.S. Treasury a portion
(31%) of dividend income, capital gains distributions, and redemption proceeds
for any account which provides an incorrect taxpayer identification number, no
number at all, or no certified number for a new account.

In order to avoid an excise tax on undistributed amounts, the Funds/Series must
declare by the end of the calendar year a dividend representing 98% of their
ordinary income for the calendar year and 98% of their net capital gains (both
long-term and short-term) for the period of November 1 of the previous year
through October 31 of the current year. Such dividends will be paid on the last
business day of the calendar year to shareholders of record at the close of
business on the preceding business day.

<PAGE>

Statements as to the tax status of distributions to shareholders will be mailed
annually. If shareholders are not subject to Federal income taxes on their
income, then they are not required to pay Federal tax on amounts distributed to
them. This section is not intended to be a complete discussion of all aspects of
the Federal income tax law and its effect on shareholders. For other tax
information, you may wish to consult your tax adviser.

PURCHASE OF SHARES

You may open an account by contacting FPS Broker Services, Inc., 3200
Horizon Drive, P.O. Box 61503, King of Prussia, Pennsylvania 19406-0903,
1 (800) 245-2100 or your local Country Capital Management Company sales
representative. Purchases of Fund shares may be made in two ways: by mail or by
wire transfer, as discussed further below. The minimum initial investment is
$1,000 for all Funds. The minimum subsequent investment amount is $100 for all
Funds. After an account has been opened, you may purchase additional shares
through a sales representative or you may send your order directly to IAA Trust
Company c/o FPS Broker Services Inc. ("FPBS"), 3200 Horizon Drive, P.O.
Box 61503, King of Prussia, Pennsylvania 19406-0903. Each check should be made
payable to a specific Fund. All orders are subject to acceptance by FPBS and
without in any way limiting the foregoing, the Funds (through FPBS) reserve the
right to refuse any purchase which would result in ownership by any shareholder
of 5% or more of a Fund's outstanding shares at that time. The Funds will
automatically redeem shares if a purchase check is returned for non-sufficient
funds (NSF). This procedure places the risk for loss on the shareholder. The
Funds reserve the right to automatically redeem shares if the share balance of
an account falls below $1,000.

Purchase Price

Shares of all Funds and Series are sold at the net asset value (without a sales
charge) next determined after receipt of the order by FPBS.

Purchases by Mail

To open an account and purchase shares by mail, complete an application and mail
it with your check payable to "IAA Trust ___________________ Fund, Inc." , or
IAA Trust ___________________ Series", whichever is appropriate, c/o FPS
Services, Inc., 3200 Horizon Drive, P.O. Box 61503, King of Prussia,
Pennsylvania 19406-0903. Applications may be obtained by calling toll-free,
1 (800) 245-2100.

The application need not be signed by a sales representative if you prefer to
purchase directly with Country Capital Management Company or FPBS. If you deal
with a sales representative, he or she will assist you in completing the
application, answer any of your questions, and mail the application for you.
Although no commission is paid, the sales representative may, at times, receive
additional compensation.

In order to maximize current income, all investments in the Funds must be made
in Federal Funds so that the Fund can put the money to work immediately. Checks
drawn on a member bank of the Federal Reserve System usually are converted into
Federal Funds within two business days of receipt by FPBS. Shares begin earning
income dividends on the day the purchase order is effective. A Fund will
automatically redeem shares if the purchase check is returned for non-sufficient
funds (NSF). This procedure places the risk for loss on the shareholder.

Purchases by Wire Transfer

To open an account and become a shareholder on the same day, first you (or our
sales representative) must telephone FPBS toll-free at 1 (800) 245-2100, by
12:00 Noon Eastern Time. An account number will be assigned to you for use in
identifying your wire transfer of money.

Second, you must request your bank to transmit immediately available funds
(Federal Funds) by wire to:

<PAGE>

UMB BANK, NA
ABA #10-10-00695
For: FPS Services, Inc.
Account #98-7037-071-9
IAA TRUST ________________ FUND (or SERIES)

Account of (exact name(s) of Account Registration)
Shareholder Account #_______________

In order to obtain same-day investment, your wire must be received by the above
bank by 12:00 Noon Eastern Time. The bank that wires your money may charge a fee
for this service.

Third, you or our sales representative must mail a completed application to
FPBS, as noted above.

Subsequent Investments

Once your account has been established, additional investments in any of the
Funds may be made at any time by mailing a check or by wiring money as described
above. When you wire money for either the initial or additional investments,
always call FPBS on the same day to notify them of the investment. The minimum
subsequent investments are $100 by mail and $1,000 by wire transfer.

SPECIAL PLANS AND OTHER PURCHASE INFORMATION

The Funds have available the following special Plans and purchase options.
Further information with respect to these plans is contained in the Funds'
Statement of Additional Information. Further information on these Plans may also
be obtained by contacting FPBS or Country Capital Management Company.

Automatic Investing

A shareholder may authorize Systematic Investing through automatic withdrawals
from his/her bank account(s).

Exchange Privileges

Shareholders in any of the Funds may exchange shares of their respective Fund
for shares of the other Funds on the basis of the relative net asset values per
share at the time of the exchange. If the exchange is made by telephone, the new
shares will be registered in the same manner as the shares for which they were
exchanged. A capital gain or loss for Federal income tax purposes will be
realized upon the exchange depending upon the cost or other basis of the shares
redeemed. Sixty days written notice will be given to shareholders before any
modifications to this privilege are implemented.

Retirement Plans

IAA Trust Company ("IAATC") sponsors a prototype Defined Contribution Plan which
has been approved by the Internal Revenue Service and which meets the
requirements of the Tax Reform Act of 1986, as amended. This Plan can invest in
shares of the Growth Fund, the Asset Allocation Fund, and the Taxable Fixed
Income Series Fund . The minimum initial investment for each Fund is $100, with
no minimum for subsequent investments.

<PAGE>

For individuals eligible to establish an Individual Retirement Account ("IRA"),
IAATC sponsors a prototype IRA Plan which has been approved by the Internal
Revenue Service.

Systematic Withdrawal Plan

Shareholders who purchase or already own $5,000 or more of a Fund's shares,
valued at the current public offering price, and who wish to receive periodic
payments may establish a Systematic Withdrawal Plan. Such plan holders will
receive monthly, quarterly or annual checks in the amount they designate.

VALUATION OF SHARES

The Funds will be open for business and will price their respective shares on
each day the New York Stock Exchange is open for trading. The Funds' share
prices will be determined at the close of regular trading hours of the New York
Stock Exchange, normally 4:00 p.m. Eastern Time. The Money Market Series
reserves the right to calculate its net asset value more frequently than once a
day if deemed desirable.

The net asset value per share is determined as follows. Securities listed or
admitted to trading privileges on any national securities exchange will be
valued at the last sales price on that day before the time for valuation, or, if
there is no sale before that time that day, the last bid price on such exchange
before that time that day. Equity securities which are traded in the
over-the-counter market only and which are included in the NASDAQ National
Market System will be valued at the last sales price preceding the time for
valuation. Equity securities which are traded in the over-the-counter market
only, but which are not included in the NASDAQ National Market System will be
valued at the mean between the last preceding bid and asked price. Valuations
may also be obtained from a pricing services when such prices are believed to
reflect the fair market value. Securities with a remaining maturity of sixty
days or less are valued at amortized cost, which approximates market value.
Short-term notes are valued at cost. Corporate bonds, municipal bonds,
receivables and portfolio securities not currently quoted as indicated above,
and other assets will be valued at fair value as determined in good faith by the
Board of Directors.

From the gross value of the assets so determined, there will be deducted all
liabilities, including accrued expenses and taxes, and any necessary reserves.
The remainder will be the net asset value of a Fund, which will be divided by
the number of shares of capital stock outstanding in order to determine the
Fund's net asset value per share. (The net asset value per share of the Money
Market Series is ordinarily $1.00.) On any day when depreciation in the value of
a Fund's portfolio securities exceeds income after expenses, such Fund's net
asset value per share may decline.

The market values of debt securities usually reflect yields generally available
on securities of similar quality. When yields decline, the market value of a
portfolio holding higher-yielding securities increases; and when yields
increase, the market value of the portfolio invested at lower yields can be
expected to decline. In addition, if a Fund has net redemptions at a time when
interest rates have increased, such Fund may have to sell portfolio securities
prior to maturity at a price below the Fund's carrying value. Also, because at
least a portion of the portfolio may be valued at amortized cost rather than
market, any yield quoted may be different if the entire portfolio were valued at
market, since amortized cost does not take market fluctuation into
consideration.

With respect to the Money Market Series, the value of all of its securities is
determined by using the amortized cost method of valuation, pursuant to Rule
2a-7 under the Investment Company Act. The amortized cost method of valuation
involves valuing a security at its cost at the time of purchase and thereafter
assuming a constant amortization to maturity of any discount or premium,
regardless of the impact of fluctuating interest rates on the market value of
such security. While this method provides certainty in valuation, it may result
in periods during which value, as determined by amortized cost, is higher or
lower than the price the Series would receive if it sold the instrument. The
purpose of this method of calculation is to attempt to maintain a constant net
asset value per share of $1.00, which may or may not result.

<PAGE>

REDEMPTION OF SHARES

Each Fund will redeem any part or all of your shares whenever you request. The
price you receive will be the net asset value per share as next computed after
your request is received by FPS Services, Inc. ("FPS"), as Transfer Agent, in
proper form. Accounts in the Money Market Series will earn daily dividends up to
the day before the date of redemption. Your redemption proceeds may be delayed
if you purchased the shares to be redeemed by check (including certified or
cashier checks) until such check has cleared and the Trust has collected good
funds for your purchase. Such collection may take 15 days or more.

You can redeem shares from an account -- by mail or by telephone, and with
respect to the Money Market Series only, by writing a check.

Redemptions by Mail

To redeem by mail, simply send a letter to:

IAA Trust Funds
c/o FPS Services, Inc.
P.O. Box 61503
King of Prussia, PA 19406-0903

Your letter must specify the name of the Fund, your account number and either
the number of shares or the dollar amount to be redeemed. Your request must be
signed exactly as your account is registered. If your account is owned jointly,
both owners must sign. If a stock certificate has been issued, it must be
forwarded back (blank and unsigned) with your written request.

The Funds reserve the right to require additional documentation, or signature
guarantees on any redemptions in amounts over $25,000 in value or for the
redemption of corporate, partnership or fiduciary accounts, or for certain types
of transfer requests or account registration adjustments. Signatures must be
guaranteed by an "eligible guarantor institution" as defined in Rule 17Ad-15
under the Securities Exchange Act of 1934. Eligible guarantor institutions
include banks, brokers, dealers, credit unions, national securities exchanges,
registered securities associations, clearing agencies, and savings associations.
A broker-dealer guaranteeing signatures must be a member of a clearing
corporation or maintain net capital of at least $100,000. Credit unions must be
authorized to issue signature guarantees. Signature guarantees will be accepted
from any eligible guarantor institution which participates in a signature
guarantee program.

Redemptions by Telephone

If you completed the portion of the application so as to authorize
redemptions by telephone, you may redeem in this manner by calling toll-free
1 (800) 245-2100 before the close of business on any business day. Telephone
redemptions are not available if a joint owner is under age 14. When one of the
joint tenants is age 14 to 17, the adult tenant must authorize telephone
redemptions. All telephone conversations with FPS will be recorded. The proceeds
will be sent only to the financial institution you designate or to the address
of record of the account. The proceeds will normally be sent the next business
day by mail or, if you prefer and pay the expense, they will be wire transferred
(minimum $1,000). If wire transferred, the Fund(s) cannot be responsible for any
delays which may occur after a Fund has entered the proceeds in the Federal wire
systems. The financial institution you designate must be a bank, savings and
loan or credit union which is insured under The FDIC, as only these institutions
can send or receive Federal wire transfers. These instructions will remain in
effect until you cancel or change them by written request. No stock certificates
will be issued to or may be held by shareholders electing this privilege. The
Funds reserve the right to terminate or modify this privilege at any time upon
thirty days notice to shareholders. Shareholders recently purchasing shares by
check may not use the telephone redemption privilege under certain
circumstances.

<PAGE>

Neither the Funds nor any of their service contractors will be liable for any
loss or expense in acting upon telephone instructions that are reasonably
believed to be genuine. In attempting to confirm that telephone instructions are
genuine, the Funds will use such procedures that are considered reasonable,
including requesting a shareholder to correctly state his or her Fund account
number, the name in which his or her account is registered, his or her social
security number, banking institution, bank account number, and the name in which
his or her bank account is registered. To the extent that a Fund fails to use
reasonable procedures to verify the genuineness of telephone instructions, it
and/or its service contractors may be liable for any such instructions that
prove to be fraudulent or unauthorized.

Redemptions by Writing a Check

If you so request on the application, the Money Market Series only will provide
you with an initial supply of checks, which you should receive within two or
three weeks. These checks may be written in any amount not less than $100 nor
more than $100,000, and can be made payable to you or anyone you desire.
Redemption procedures will enable you to continue to earn daily income dividends
until your redemption check has cleared. Payment of all redemption checks is
subject to approval by the Fund, and if there are not sufficient shares in your
account, the check will be returned marked "Insufficient Funds". The Fund
reserves the right to terminate or modify this privilege at any time upon thirty
days notice to shareholders. Shareholders purchasing shares by check may not use
the check redemption privilege under certain circumstances.

Check-Writing Privilege Terms: Persons electing check-writing automatically
authorize the bank to honor checks drawn by them on the bank and appoint FPS,
the Fund's Transfer Agent, as their agent to redeem a sufficient number of Money
Market Series shares to pay such checks. They also automatically agree: (1) The
owner or owners who signs the check will sign their name exactly as it appears
in Item 1 on the application or the check will not be honored; (2) This
privilege is subject to the Fund's and the bank's rules and regulations and
applicable Government regulations as amended from time to time; (3) The bank may
refuse to honor checks and the Fund may refuse to effect redemptions to pay
checks whenever the right of redemption has been suspended or postponed; (4) To
examine confirmations and to notify the Fund, within thirty days after mailing
to the owner(s), of any error in the confirmations and that failure to do so
shall preclude any claim against the Fund, the Distributor, the bank, FPS, and
each of their representatives and agents by reason of such failure; (5) This
privilege may be modified or terminated by any owner by serving written notice
to the Fund, and the Fund may modify or terminate it by serving written notice
to the owner(s) thirty days in advance thereof. This feature is not available if
a part owner is under age 14. When one of its joint tenants is age 14 to 17,
both tenants must sign drafts.

Redemption Payments to Shareholders

If a partial redemption is being made and the shareholder is using "specific
identification" accounting in determining his/her gain or loss for tax purposes,
it is important that he/she indicate which shares are to be redeemed, giving the
date acquired and number of shares. If several purchases are involved and the
shareholder desires a check for a stated amount, the order in which shares are
to be redeemed should also be specified. If no such instructions are given, the
shareholder will be required to compute his/her tax on a "first in - first out"
basis. No designation of purchase dates is necessary in connection with a
redemption of all shares. The sale date and proceeds of redemptions (unless
exempt) will be reported by the Funds to the Internal Revenue Service at the end
of each year, as required by law.

Redemption of shares may be made from any available assets of each Fund, and if
a Fund does not have sufficient cash on hand, such Fund will normally sell
portfolio securities to effect such redemption.

Payment to shareholders for shares surrendered for redemption is made in cash as
soon as practicable after surrender, within seven days, except: (1) for any
period (a) during which the New York Stock Exchange is closed other than
customary weekend and holiday closing, or (b) during which trading on the New
York Stock Exchange is

<PAGE>

restricted; (2) for any period during which an emergency exists as determined by
the Securities and Exchange Commission as a result of which (a) disposal by a
Fund of securities owned by it is not reasonably practicable, or (b) it is not
reasonably practicable for a Fund to determine the value of its net assets; or
(3) for such other periods as the Securities and Exchange Commission may by
order permit for the protection of security holders of the Funds. In such event,
the day will not be regarded as a business day, the Funds' share prices will not
be calculated, and all orders will be held for execution on the following
business day. The Funds, however, will not mail redemption proceeds until they
have assured themselves that checks received for the purchase of any shares
being redeemed have, or will be, cleared. Accordingly, redemption checks may not
be mailed until the shares being redeemed have been on a Fund's books for at
least fifteen business days measured from the date shown on the purchase
confirmation, although the effective date of the redemption will be the date the
redemption request is received by the particular Fund. Payment for redeemed
shares may be made in whole or in part in portfolio securities of a Fund, at the
portfolio value on the day the proper redemption request is received, if the
Board of Directors determines that the liquidation of securities is
impracticable or that payment in cash would prejudice the best interests of the
remaining shareholders.

The Funds have elected to be governed by Rule 18f-1 under the Investment Company
Act of 1940, pursuant to which the Funds are obligated to redeem shares solely
in cash, up to the lesser of $250,000 or one percent of the net asset value of
the particular Fund during any 90-day period for any one shareholder. The one
percent net asset value of each Fund shall be computed at the beginning of such
90-day period. In the event of a redemption in kind, it should be noted that a
shareholder would incur brokerage costs if he sold the securities received.

The value of the shares on redemption may be more or less than the shareholder's
cost, depending upon the market value of the portfolio securities at the time of
redemption. Shares redeemed will be canceled. Each Fund has the right to
establish a withdrawal charge on redemption of its shares, but the Funds do not
make any such charge and have no present intention of making such a charge, and
in the event such a withdrawal charge is established, at least thirty days prior
notice will be given to shareholders.

<PAGE>

IAA Trust Mutual Funds:
IAA Trust Growth Fund, Inc.
IAA Trust Asset Allocation Fund, Inc.
IAA Trust Tax Exempt Bond Fund, Inc.
IAA Trust Taxable Fixed Income Series Fund, Inc.
IAA Trust Money Market Series
IAA Trust Short-Term Government Bond Series
IAA Trust Long-Term Bond Series

Board of Directors:
Ronald R. Warfield
Herbert G. Allen
Charlot R. Cole
Nancy J. Erickson
William E. Klein, Sr.
Ailene Miller
Rollie D. Moore

Officers:

Ronald R. Warfield, President
Bruce Finks, Vice President
Gary E. Mede, Vice President
Richard M. Miller, Vice President
Rollie D. Moore, Vice President
Paul M. Harmon, Secretary
Robert W. Weldon, Treasurer
Richard F. Day, Controller

Investment Adviser:
IAA Trust Company
Bloomington, Illinois

Distributor:
FPS Broker Services, Inc.
King of Prussia, Pennsylvania

Transfer Agent:
FPS Services, Inc.
King of Prussia, Pennsylvania

Custodian:
IAA Trust Company
Bloomington, Illinois

Independent Accountants:
Coopers & Lybrand L.L.P.
Philadelphia, Pennsylvania

General Counsel
Paul M. Harmon, Esq.
Office of the General Counsel
Bloomington, IL

<PAGE>

Part B

STATEMENT OF ADDITIONAL INFORMATION

October 28, 1996

IAA TRUST GROWTH FUND, INC.
IAA TRUST ASSET ALLOCATION FUND, INC.
IAA TRUST TAX EXEMPT BOND FUND, INC.
IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.

808 IAA Drive, Bloomington, Illinois 61702, Phone (309) 557-3222

The IAA Trust Mutual Funds consist of four separate funds (collectively, the
"Funds"): IAA Trust Growth Fund, Inc. (the "Growth Fund"); IAA Trust Asset
Allocation Fund, Inc.* (the "Asset Allocation Fund"); IAA Trust Tax Exempt Bond
Fund, Inc. (the "Tax Exempt Bond Fund"); and IAA Trust Taxable Fixed Income
Series Fund, Inc. (the "Taxable Fixed Income Series Fund") which currently
consists of three Series: IAA Trust Money Market Series (the "Money Market
Series"); IAA Trust Short-Term Government Bond Series (the "Short-Term
Government Bond Series"); and IAA Trust Long-Term Bond Series (the "Long-Term
Bond Series"). This Statement of Additional Information is not a prospectus, but
should be read in conjunction with the Funds' Prospectus dated October 28, 1996.

A copy of the Funds' Prospectus may be obtained from a local Country Capital
Management Company salesperson who is also a Country Companies agent, a licensed
salesperson at IAA Trust Company, 808 IAA Drive, Bloomington, Illinois 61702, by
writing the Funds' principal Underwriter, FPS Broker Services, Inc., 3200
Horizon Drive, P.O. Box 61503, King of Prussia, PA 19406-0903 (formerly at #2
Elm Street, P.O. Box 874, Conshohocken, Pennsylvania 19428), or by calling
toll-free 1 (800) 245-2100.

TABLE OF CONTENTS

SUBJECT PAGE
- ------- ----
Investment Objectives and Policies...................................
Policies and Investment Restrictions Aimed at Protecting Investors...
Directors and Officers of the Funds..................................
Control Persons and Principal Holders of Securities..................
Investment Advisory and Other Services...............................
Brokerage............................................................
Purchases, Redemptions, and Pricing of Fund Securities...............
Exchange Privileges.............................................
Retirement Plans................................................
Automatic Investing.............................................
Systematic Withdrawal Plan......................................
Underwriter Compensation.............................................
Investment Performance Information...................................
Reports to Shareholders and Financial Statements.....................
Appendix.............................................................

<PAGE>

INVESTMENT OBJECTIVES AND POLICIES

For information with respect to the Funds' individual investment objectives and
policies, see " Investment Objectives and Policies" in the Funds' Prospectus,
and "Policies and Investment Restrictions Aimed at Protecting Investors" in this
Statement of Additional Information.

For the fiscal years ended June 30, 1995 and 1996, the Growth Fund's portfolio
turnover rate was 31.84% and 32.95%, respectively. This Fund does not expect
that its turnover rate as of June 30, 1997 will vary significantly from that at
June 30, 1996.

For the fiscal years ended June 30, 1995, and 1996, the Asset Allocation Fund's
portfolio turnover rate was 21.03% and 33.77%, respectively. This Fund does not
expect that its turnover rate as of June 30, 1997 will vary significantly from
that at June 30, 1996.

For the fiscal years ended June 30, 1995 and 1996, the Tax Exempt Bond Fund's
portfolio turnover rate was 24.89% and 14.75%, respectively. This Fund does not
expect that its turnover rate as of June 30, 1997 will vary significantly from
that at June 30, 1996.

POLICIES AND INVESTMENT RESTRICTIONS AIMED AT PROTECTING INVESTORS

Fundamental Investment Restrictions

The following investment restrictions are considered fundamental policies and
may be changed only by the vote of a majority of a Fund's outstanding shares,
which as used herein and in the Prospectus means the lesser of (1) 67% of such
Fund's outstanding shares present at a meeting if the holders of more than 50%
of the outstanding shares are present in person or by proxy, or (2) more than
50% of such Fund's outstanding shares.

Restrictions Applicable to All Funds:

o All Funds will not authorize or issue any class of senior securities.

o The Growth Fund, the Asset Allocation Fund, the Tax Exempt Bond Fund, the
Short-Term Government Bond Series and the Long-Term Bond Series will not
borrow money, except as a temporary measure for extraordinary or emergency
purposes, and then only from a bank in an amount not to exceed 10% of the
value of the Fund's total assets, nor 5% of the value of such Fund's total
assets if such debt matures more than sixty days after issuance.

The Money Market Series will not borrow money, except as a temporary measure
for extraordinary or emergency purposes, and then only from a bank in an
amount not to exceed 10% of the value of the Fund's total assets and will
not purchase securities at any time a loan to such Fund is outstanding
(investments in repurchase agreements are not subject to these
restrictions).

o All Funds will not underwrite or participate in the underwriting of
securities of other issuers.

o All Funds will not purchase or sell real estate, commodities, or commodity
contracts.

o All Funds will not make loans, except through the purchase of publicly
distributed debt securities in accordance with each Fund's investment
policies. Investments in repurchase agreements shall not be considered a
loan for purposes of this restriction. (See the Appendix for risk disclosure
statement on repurchase agreements).

<PAGE>

Restrictions Applicable to Certain Funds and Series:

The Growth Fund will not:

o Invest more than 5% of its assets in the securities of any one issuer.

o Purchase or hold as much as 10% of any class of outstanding equity
securities or as much as 10% of the outstanding voting securities of any one
issuer.

o Concentrate the investments of more than 25% of the total value of its
assets in any single industry.

The Asset Allocation Fund, the Short-Term Government Bond Series and the
Long-Term Bond Series will not:

o With respect to 75% of its assets, invest more than 5% of its assets in
the securities of any one issuer.

o Purchase or hold as much as 10% of any class of outstanding equity
securities or as much as 10% of the outstanding voting securities of any one
issuer.

o Concentrate the investments of more than 25% of the total value of its
assets in any single industry.

The Tax Exempt Bond Fund will not:

o With respect to 75% of its assets, invest more than 5% of its assets in the
securities of any one issuer. The term "issuer" as used by this Fund will
mean any one state municipality, agency, authority, instrumentality or other
entity which is directly responsible for the payment of debt service on its
outstanding obligations.

o With respect to non-municipal bond investments, will not concentrate
investments of more than 25% of the total value of its assets in any single
industry, except that there is no limitation with regard to investments in
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities.

The Money Market Series will not:

o Invest more than 10% of its total assets in repurchase agreements maturing
in more than seven days or in non-negotiable certificates of deposit (See
the Appendix for risk disclosure statement on repurchase agreements).

o Invest more than 5% of its total assets in the securities of any one issuer.

o Concentrate the investments of more than 25% of the total value of its
assets in any single industry, other than banks.

Non-fundamental Investment Restrictions

The following restrictions are imposed by the management of the Funds, and may
be modified by the Board of Directors of the Funds without shareholder approval.

All Funds will not:

o Invest in companies for purposes of exercising control or management.

o Buy from or sell portfolio securities to any of its Officers, Directors,
employees, Investment Advisers or Underwriters as principals except as
otherwise approved by the Board of Directors and in accordance with the
Investment Company Act of 1940.

<PAGE>

o Will not purchase securities on margin, effect a short sale of any security,
purchase or sell puts, calls, straddles or spreads, or participate in any
joint or joint and several trading accounts.

o Will not purchase or retain securities of any company if persons affiliated
with such Fund or its Investment Adviser, as a group, beneficially own more
than 1% of the securities of such a company.

o In any case, borrow money in an amount which exceeds 5% of the value of its
total assets and will not purchase securities at any time a loan to such
Fund is outstanding (investment in repurchase agreements will not be
considered to be loans for purposes of this restriction).

Investment Company Act Restrictions

The following restrictions are imposed by the Investment Company Act of 1940.

All Funds will not:

o Purchase or acquire securities of another investment company except by
purchase on the open market at regular brokerage rates (other than when such
purchase or acquisition is part of a plan of merger or consolidation) if
immediately after such purchase or acquisition, such Fund would own in the
aggregate: (1) more than 3% of the total outstanding voting stock of such
other investment company; (2) securities issued by such other investment
company having an aggregate value in excess of 5% of the value of such
Fund's total assets; or (3) securities issued by such other investment
company and all other investment companies having an aggregate value in
excess of 10% of the value of such Fund's total assets.

Any investment policy or restriction which involves a maximum percentage of
securities or assets shall not be considered to be violated unless an excess
over the percentage occurs immediately after an acquisition of securities and
results therefrom.

DIRECTORS AND OFFICERS OF THE FUNDS

Name and Position(s) Aggregate Total Principal Occupation(s) During Past Five Years
Age Held with Compensation Compensation
Fund(s) From Funds for From Funds
Fiscal Year & Fund
Ended 6/30/96 Complex Paid
to Directors
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>

Ronald R. Director 0 0 Director and President: Illinois Agricultural Association,
Warfield(2) since 1994 Agricultural Holding Co., CC Services, Inc.(4), Country Capital
(52) President Management Company, Country Casualty Insurance Company, Country
Investors Life Assurance Company, Country Life Insurance Company,
Country Mutual Insurance Company, and Country Preferred
Insurance Company, 1993 to date; Director: AgriVisor Services,
Inc., and IAA Trust Company, 1993 to date; Coordinating Committee
Member of GROWMARK, Inc. and Chairman, Board of Trustees, IAA
Foundation(2), 1993 to date; Director and President: IAA Trust
Growth Fund, Inc., IAA Trust Asset Allocation Fund, Inc., IAA Trust
Tax Exempt Bond Fund, Inc., IAA Trust Taxable Fixed Income Series
Fund, Inc.(1), Illinois Agricultural Service Company, 1994 to date;
Country Medical Plans, Inc., 1996 to date; President: AgriVisor
Services, Inc., and IAA Trust Company, 1994 to date; Chairman of
the Board: Country Capital Management Company, 1994 to date;
Director: Bank of Gibson City, 1989 to date. Director: American
Farm Bureau Federation and certain of its affiliated companies,
1995 to date. Farmer.

Herbert G. Director 1,400 1,400 Director: IAA Trust Growth Fund, Inc., IAA Trust Asset Allocation
Allen since 1987 Fund, Inc., IAA Trust Tax Exempt Bond Fund, Inc., and IAA Trust
(66) Taxable Fixed Income Series Fund, Inc.(1), 1987 to date. Farmer.

<PAGE>

Charlot R. Director 0 0 Property Developer, 1979 to date; Member Macoupin-Greene County
Cole since 1996 Cooperation Extension Council (Formerly Macoupin County Cooperative
(55) Extension Council), 1992 to date and President 1995 to date;
Secretary/Treasurer; Cole Farms, Inc., 1993 to date. Farmer

Nancy J. Director 700 700 President of McHatton Farm Management, Inc., 1981 to date; Director:
Erickson since 1995 IAA Growth Fund, Inc., IAA Trust Asset Allocation Fund, Inc., IAA
(39) Trust Taxable Fixed Income Series Fund, Inc.(1), and IAA Trust Tax
Exempt Bond Fund, Inc., 1995 to date. Farmer.

William E. Director 1,050 1,050 Director: Illinois Agricultural Association, Illinois Agricultural
Klein, Sr.(2) since 1993 Holding Co., CC Services, Inc.(4), Country Casualty Insurance
(68) Company, Country Investors Life Assurance Company, Country Life
Insurance Company, Country Mutual Insurance Company, and
Country Preferred Insurance Company, 1988 to date; Director:
Country Capital Management Company, 1992 to date; Director: IAA
Trust Growth Fund, Inc., IAA Trust Asset Allocation Fund, Inc., IAA
Trust Tax Exempt Bond Fund Inc., and IAA Trust Taxable Fixed Income
Series Fund, Inc.(1), 1993 to date. Farmer.

Ailene Director 1,400 1,400 McLean County (Illinois) Board Member: 1986 to date; Member: IAA
Miller since 1991 Foundation(2), Trustee-Emeritus, 1988 to date; Director: IAA Trust
(70) Growth Fund, Inc., IAA Trust Asset Allocation Fund, Inc., IAA Trust
Tax Exempt Bond Fund, Inc., and IAA Trust Taxable Fixed Income
Series Fund, Inc.(1), 1991 to date.

Rollie D. Director 0 0 Director and Vice President: Illinois Agricultural Association,
Moore since 1996 Illinois Agricultural Holding Co., CC Services, Inc.(4), Country
(47) Capital Management Company, Country Casualty Insurance Company,
Country Investors Life Assurance Company, Country Life Insurance
Company, Country Mutual Insurance Company, and Country Preferred
Insurance Company, 1993 to date; Director: IAA Trust Company, 1993 to
date; Vice Chairman, Board of Trustees, IAA Foundation(2), 1993 to
date; Vice President: IAA Trust Growth Fund, Inc., IAA Trust Asset
Allocation Fund, Inc., IAA Trust Tax Exempt Bond Fund, Inc., and IAA
Trust Taxable Fixed Income Series Fund, Inc.(1), 1994 to date; Vice
President and Director: IAA Trust Company, 1994 to date and Country
Medical Plans, Inc., 1996 to date; Director: AgriVisor Services, Inc.
and Illinois Agricultural Service Company, 1994 to date; Coordinating
Committee Member of GROWMARK, Inc., 1994 to date. Farmer. Previously
served as Director: Illinois Agricultural Association, Illinois
Agricultural Holding Co., CC Services, Inc.(4), Country Casualty
Insurance Company, Country Investors Life Assurance Company, Country
Life Insurance Company, Country Mutual Insurance Company, and Country
Preferred Insurance Company, 1984 to 1992; Country Capital Management
Company, 1989 to 1992; IAA Trust Growth Fund, Inc., IAA Trust Asset
Allocation Fund, Inc., IAA Trust Taxable Fixed Income Series Fund,
Inc.(1), and IAA Trust Tax Exempt Bond Fund, Inc., 1989 to 1993;
AgriVisor Services, Inc., 1991 to 1992. Farmer.

Bruce Finks Vice 0 0 Vice President -- Investments: IAA Trust Company, 1996 to date; Vice
(43) President President: IAA Trust Growth Fund, Inc., IAA Trust Asset Allocation
since 1996 Fund, Inc. IAA Trust Tax Exempt Bond Fund, Inc., and IAA Trust
Taxable Fixed Income Series Fund, Inc.(1), 1996 to date.

Gary E. Vice 0 0 Executive Vice President: IAA Trust Company, 1977 to date; Vice
Mede President President--Investments: Country Capital Management Company, 1977 to
(59) since 1978 date; Vice President: IAA Trust Growth Fund, Inc., IAA Trust Asset
Allocation Fund, Inc., and IAA Trust Tax Exempt Bond Fund, Inc.,
1978 to date; IAA Trust Taxable Fixed Income Series Fund, Inc.(1),
1981 to date.

Richard M. Vice 0 0 Senior Vice President and Senior Trust Officer: IAA Trust Company,
Miller President 1991 to date (prior thereto Senior Vice President and Trust Officer);
(58) since 1992 Vice President: IAA Trust Growth Fund, Inc., IAA Trust Asset
Allocation Fund, Inc., IAA Trust Tax Exempt Bond Fund, Inc., and
IAA Trust Taxable Fixed Income Series Fund, Inc.(1), 1992 to date.

<PAGE>

Paul M. Secretary 0 0 General Counsel: Illinois Agricultural Association and Affiliated
Harmon since 1995 Companies, 1996 to date. Deputy General Counsel: Illinois
(54) Agricultural Association and Affiliated Companies, 1991 to date.
Secretary: Country Capital Management Company, IAA Trust Growth Fund,
Inc., IAA Trust Asset Allocation Fund, Inc., IAA Trust Taxable Fixed
Income Series Fund, Inc.(1), IAA Trust Tax Exempt Bond Fund, Inc.,
1995 to date; and IAA Trust Company, 1995 to date. General Counsel:
each of the Companies and IAA Trust Company, 1996 to date; prior
thereto Deputy General Counsel.

Robert W. Treasurer 0 0 Vice President--Finance and Treasurer: IAA Trust Company, Illinois
Weldon since 1975 Agricultural Association, Country Life Insurance Company, Country
(62) Mutual Insurance Company, Country Casualty Insurance Company,
Country Preferred Insurance Company, and Country Capital Management
Company, 1974 to date; Director and Treasurer: Illinois Agricultural
Service Company, 1974 to date; Vice President--Finance and Treasurer:
CC Services, Inc.(4), 1975 to date; Country Investors Life Assurance
Company, 1981 to date; Treasurer: Illinois Agricultural Holding Co.,
1974 to date; Illinois Agricultural Auditing Association, 1975 to
date; IAA Trust Growth Fund, Inc., 1975 to date; IAA Trust Asset
Allocation Fund, Inc. and IAA Trust Tax Exempt Bond Fund, Inc., 1978
to date; IAA Trust Taxable Fixed Income Series Fund, Inc.(1), 1981 to
date; AgriVisor Services, Inc., 1984 to date.

Richard F. Controller 0 0 Controller: IAA Trust Company, 1974 to date; IAA Trust Growth Fund,
Day since 1992 Inc., IAA Trust Asset Allocation Fund, Inc., IAA Trust Tax Exempt
(56) Bond Fund, Inc., and IAA Trust Taxable Fixed Income Series Fund,
Inc.(1), 1992 to date.

</TABLE>

(1) IAA Trust Taxable Fixed Income Series Fund, Inc. was formerly IAA
Trust Money Market Fund, Inc

(2) Interested Directors: all directors classified by the Funds as
interested directors also serve as directors of Illinois
Agricultural Association (IAA), Illinois Agricultural Holding Co.
(IAHC), Country Life Insurance Company, Country Mutual Insurance
Company (CLIC). IAHC owns 99.9% of the outstanding stock of CLIC
and 100% of the outstanding stock of IAA Trust Company (IAATC).
Ronald R. Warfield and Rollie D. Moore also serve as directors of
IAATC and as president and vice president, respectively, of CLIC,
IAACT, IAHC and IAA.

(3) The mailing address for all the Funds' officers and directors is
in care of the IAA Trust Funds, 808 IAA Drive, Bloomington,
Illinois 61702.

(4) CC Services, Inc. was organized to provide insurance brokerage,
administrative, marketing and other services to the insurance
companies affiliated with the Illinois Agricultural Association.

Directors of the Funds are entitled to payment ($200 for the Growth
Fund, $50 for each of the Asset Allocation, Tax Exempt Bond and Taxable Fixed
Income Series Funds) for each day or a portion thereof spent in a meeting or
meetings of the Board of Directors or while engaged in special work
authorized by the President or the Board of Directors and to reimbursement of
expenses for each directors' meeting attended of while engaged in a special
work authorized by the President or by the Board of Directors, but no fees
are paid to any director if such director is also a director, officer or
employee of the Investment Adviser of the Funds. Directors and officers
receive no other compensation from the Funds for their services. During the
fiscal year ended June 30, 1996, the aggregate amount of fees and expenses
paid to directors and officers was $4,550.00.

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

Country Life Insurance Company

As of October 1, 1996, Country Life Insurance Company ("Country Life") owned
446,787 shares or 9.42% of the outstanding shares of the Growth Fund, and
96,228 shares or 12.20% of the outstanding shares of the Asset Allocation
Fund.

<PAGE>

Substantially all of the issued and outstanding voting securities of Country
Life are owned by Illinois Agricultural Holding Co. and approximately 98% of
the outstanding voting securities of this latter company are owned by
Illinois Agricultural Association. Each of these companies is incorporated in
Illinois. Country Life's home office is at 1711 G.E. Road, Bloomington,
Illinois. The home office address for both Illinois Agricultural Holding
Company and Illinois Agricultural Association is 1701 Towanda Avenue,
Bloomington, Illinois. For the effect of Country Life's stock ownership in
the Funds on other Fund shareholders, see the section titled "CAPITAL STOCK"
in the Funds' Prospectus.

Country Mutual Insurance Company

As of October 1, 1996 Country Mutual Insurance Company ("Country Mutual")
owned 248,175 shares or 11.85% of the outstanding shares of the Tax-Exempt
Bond Fund.

Country Mutual has sole voting and investment power with respect to the
common stock which it owns in this Fund. Through proxies, voting control of
Country Mutual is in Illinois Agricultural Association. Each of these
companies is incorporated in Illinois with home office addresses at 1701
Towanda Avenue, Bloomington, Illinois. For the effect of Country Mutual's
stock ownership in the Fund on other Fund shareholders, see the section
titled "CAPITAL STOCK" in the Funds' Prospectus.

IAA Trust Company

As of October 1, 1996, IAA Trust Company owned of record 1,913,648 shares or
40.37% of the issued and outstanding capital stock of the Growth Fund,
503,853 shares or 63.92% of the issued and outstanding capital stock of the
Asset Allocation Fund, and 26,655,025 shares or 79.25% of the issued and
outstanding capital stock of the Money Market Series.

IAA Trust Company's address is 808 IAA Drive, Bloomington, Illinois.
Illinois Agricultural Holding Co. owns 100% of the outstanding voting
securities of the Trust Company.

Officers and Directors

As of October 1, 1996, the Officers and Directors of the Funds as a group
beneficially owned, directly or indirectly, less than 1% of the issued and
outstanding capital stock of any Fund.

INVESTMENT ADVISORY AND OTHER SERVICES

Controlling Shareholders

For the names of all controlling persons of IAA Trust Company, see section
titled " MANAGEMENT OF THE FUNDS" in the Funds' Prospectus.

Fund Officers Affiliated with Adviser

Fund Officers and Directors who are also Officers or Directors of IAA Trust
Company are set forth in the section titled " MANAGEMENT OF THE FUNDS" in the
Funds' Prospectus.

The Investment Adviser

IAA Trust Company, as Investment Adviser to the Funds, advises each Fund as
to: investing its capital; continually reviews its investment portfolio and
recommends changes that appear desirable; furnishes statistical

<PAGE>

and research information, office space, facilities, and equipment required
for each Fund; and pays the compensation of Directors, Officers, and
employees of the Funds who are also Directors, Officers, and employees of IAA
Trust Company. For these services performed and expenses assumed, each Fund
or Series pays IAA Trust Company the annual fees as shown below. Such fees
are computed on a daily basis and are paid monthly.

The Growth Fund pays approximately .75% of 1% in any fiscal year of its
average net assets. For the fiscal years ended June 30, 1994, 1995, and 1996,
IAA Trust Company received $497,296, $476,164, and $580,601, respectively,
for its services as Investment Adviser to the Fund. Neither IAA Trust Company
nor any Company affiliated with it receives any brokerage commissions from
the Fund, as such business is transacted with non-affiliated broker-dealers.

The Asset Allocation Fund pays approximately .75% of 1% in any fiscal year of
its average net assets. For the fiscal years ended June 30, 1994, 1995, and
1996, IAA Trust Company received $58,895, $67,275, and $78,490,
respectively, for its services as Investment Adviser to the Fund. Neither IAA
Trust Company nor any Company affiliated with it receives any brokerage
commissions from the Fund, as such business is transacted with non-affiliated
broker-dealers.

The Tax Exempt Bond Fund pays approximately .50% of 1% in any fiscal year of
its average net assets. For the fiscal years ended June 30, 1994, 1995, and
1996, IAA Trust Company received, $100,624, $93,589, and $93,863,
respectively, for its services as Investment Adviser to the Fund. Neither IAA
Trust Company nor any Company affiliated with it receives any brokerage
commissions from the Fund, as such business is transacted with non-affiliated
broker-dealers.

The Money Market Series pays approximately .50% of 1% in any fiscal year of
its average net assets. For the fiscal year ended June 30, 1994, IAA Trust
Company received $182,832 for investment advisory services, all of which was
voluntarily waived. For the fiscal year ended June 30, 1995, IAA Trust
Company earned $178,518 for investment advisory services and voluntarily
agreed to waive fees totaling $86,900. For the fiscal year ended June 30,
1996, IAA Trust Company received $201,429 for investment advisory services.
The Advisor is currently not waiving any of its investment advisory fees.
Neither IAA Trust Company nor any Company affiliated with it receives any
brokerage commissions from the Fund, as such business is transacted with
non-affiliated broker-dealers.

The Short-Term Government Bond Series pays approximately .50% of 1% in any
fiscal year of its average net assets. Neither IAA Trust Company nor any
Company affiliated with it receives any brokerage commissions from the Fund,
as such business is transacted with non-affiliated broker-dealers.

The Long-Term Bond Series pays approximately .75% of 1% in any fiscal year of
its average net assets. Neither IAA Trust Company nor any Company affiliated
with it receives any brokerage commissions from the Fund, as such business is
transacted with non-affiliated broker-dealers.

The Distributor

FPS Broker Services, Inc. ("FPBS") is the primary and exclusive Distributor
of the Funds' shares, pursuant to Underwriting Agreements with each Fund. As
Distributor, FPBS will use its best efforts to effect such distributions, but
it is required to take and pay for only such securities as it sells to the
public. Commissions for the sale of shares received by FPBS do not represent
compensation paid by the Funds to FPBS and are not expenses of the Funds.

12b-1 Plan

The shareholders of the Growth Fund, the Asset Allocation Fund, the Tax
Exempt Bond Fund the Short-Term

<PAGE>

Government Bond Series, and the Long-Term Bond Series have adopted respective
Plans of Distribution pursuant to Rule 12b-1 under the Investment Company Act
of 1940. During the fiscal year ended June 30, 1996, the Growth Fund
paid $8,912 to FPBS from its Distribution Plan. During the fiscal year ended
June 30, 1996, the Asset Allocation Fund paid $8,538 to FPBS from its
Distribution Plan. During the fiscal year ended June 30,1996, the Tax Exempt
Bond Fund paid $15,380 to FPBS from its Distribution Plan. See "DISTRIBUTION
PLANS" in the Funds' Prospectus.

The Transfer Agent

FPS Services, Inc. ("FPS"), 3200 Horizon Drive, P.O. Box 61503, King of
Prussia, PA 19406-0903 (formerly at #2 Elm Street, P.O. Box 874,
Conshohocken, Pennsylvania 19428) is the Funds' Transfer and Dividend
Disbursing Agent and as such performs all shareholder services for the Funds.
As part of these services, FPS will maintain records pertaining to the sale,
redemption, and transfer of Fund shares and will distribute each Fund's cash
dividends to shareholders. For such services, each Fund will pay FPS fees
which management believes are comparable to fees charged by others who
perform such transfer agency services.

The Growth Fund paid FPS, for the fiscal years ended June 30, 1994, 1995, and
1996, $83,386, $68,022, and $67,980, respectively. These fees were for
transfer and dividend disbursing agent services.

The Asset Allocation Fund paid FPS, for the fiscal years ended June 30, 1994,
1995, and 1996, $15,771, $11,101, and $7,695, respectively. These fees were
for transfer and dividend disbursing agent services.

The Tax Exempt Bond Fund paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $28,536, $21,475, and $14,263, respectively. These fees were
for transfer and dividend disbursing agent services.

The Money Market Series paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $71,526, $41,216, and $39,872, respectively. These fees were
for transfer and dividend disbursing agent services.

Accounting Services

The Funds have entered into Accounting Services Agreements with FPS. These
Agreements require FPS to calculate each Fund's net asset value in accordance
with the provisions of the Funds' current Prospectus and to prepare for Fund
approval and use various government reports, tax returns, and proxy
materials. Each Fund will pay a minimum fee of $25,000 for these services and
additional fees based on declining percentages of their respective average
net assets in excess of $10,000,000. Management believes the fees for these
services are comparable to those charged by others who perform such
accounting services.

The Growth Fund paid FPS for the fiscal years ended June 30, 1994, 1995, and
1996, $45,128, $44,673, and $48,794, respectively.

The Asset Allocation Fund paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $25,089, $25,883, and $28,996, respectively.

The Tax Exempt Bond Fund paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $29,049, $30,271, and $35,352, respectively.

The Money Market Series paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $39,106, $35,458, and $37,196, respectively.

Administrative Services

The Funds have entered into Administration Agreements with FPS. These
Agreements provide that the Administrator shall provide all administrative
services to each Fund other than those relating to the investment portfolio
of the Funds, the distribution of the Funds and the maintenance of each
Fund's financial records. The

<PAGE>

fees for these services are based on declining percentages of each Fund's
average net assets beginning at .0015% of the first $50,000,000 of average
net assets, .0010% on the next $50,000,000 of average net assets, and .0005%
over $100,000,000 of average net assets. The Funds are, however, required to
pay minimum annual administrative fees. The minimum annual fee for the Growth
Fund is $50,000. The minimum annual administrative fee for each of the Asset
Allocation Fund, the Tax Exempt Bond Fund, the Money Market Series, and the
Taxable Fixed Income Series Fund is $10,000.

For the fiscal year ended June 30, 1996, the Growth Fund paid $79,358 to FPS
for administrative services.

For the fiscal year ended June 30, 1996, the Asset Allocation Fund paid
$10,737 to FPS for administrative services.

For the fiscal year ended June 30, 1996, the Tax Exempt Bond Fund paid
$19,820 to FPS for administrative services.

For the fiscal year ended June 30, 1996, the Money Market Series paid $42,050
to FPS for administrative services.

The Custodian

IAA Trust Company, 808 IAA Drive, Bloomington, Illinois 61702, serves as
Custodian for the Funds and all securities and cash of each Fund will be held
by it. None of the Directors, Officers or other employees of the Funds ever
have personal possession of any Fund's investments. The Custodian attends to
the collection of principal and income, pays and collects all monies for
securities bought and sold by each Fund, and performs certain other
ministerial duties. These services do not include any managerial or policy
making functions of the Funds. The Funds have agreed to pay the Custodian
such compensation as may be agreed upon from time to time, but currently the
Custodian is voluntarily waiving the receipt of any fees for custodial
services.

Independent Accountants

The accounting firm of Coopers & Lybrand L.L.P., 2400 Eleven Penn Center,
Philadelphia, Pennsylvania, has been designated as Auditors for each Fund.
Coopers & Lybrand L.L.P. performs annual audits of each Fund and is
periodically called upon to provide accounting and tax advice.

BROKERAGE

GROWTH FUND, and ASSET ALLOCATION FUND:

These Funds always seek to effect their respective transactions in buying and
selling portfolio securities, acting through a broker as agent or with a
dealer as principal so that they can obtain reasonable execution at the most
favorable prices. Accordingly, each Fund, through IAA Trust Company, the
Investment Adviser, negotiates commission rates in accordance with the
reliability and quality of a broker's or dealer's services, the financial
condition of the firm and the value and expected contribution of the
broker-dealer to the performance of the Fund on a continuing basis. Thus,
what a Fund determines to be the most favorable commission price may be
higher than the lowest available price. In evaluating the overall
reasonableness of brokerage commissions paid, the Fund through its Investment
Adviser, maintains an awareness of general practices with regard to
commission levels and rates charged by reputable brokerage firms.

While there is no undertaking or agreement with any broker or dealer to do
so, either Fund may, subject to the primary brokerage allocation criterion
that a Fund obtain reasonable execution at the most favorable prices, place
orders for the purchase or sale of portfolio securities with brokers or
dealers who have provided research,

<PAGE>

statistical, or other financial information to the Fund or its Investment
Adviser. Brokerage house research generally provides economic and financial
market analysis as well as industry studies and investment analysis of
individual companies or entities.

The primary brokerage allocation criterion of the Funds is that each Fund
obtain reasonable execution at the most favorable prices. If two or more
brokers or dealers meet this criterion, a Fund may, although there is no
undertaking or agreement with any broker or dealer to do so or any specific
internal allocation procedure, place orders for the purchase or sale of
portfolio securities with brokers or dealers who have provided research,
statistical or other financial information to the Fund or its Investment
Adviser. Research information obtained from brokers and dealers while
servicing the Fund may be used by IAA Trust Company in servicing all of its
accounts and, conversely, research information obtained from brokers and
dealers while servicing other accounts may be used by IAA Trust Company in
servicing the Fund. Further, all research information obtained from brokers
and dealers while serving the Fund may not be used by the Fund.

Over-the-counter transactions are usually placed with a principal market
maker unless a better net security price is obtainable elsewhere.

During the fiscal years ended June 30, 1994, 1995, and 1996, brokerage
commissions paid by the Growth Fund totaled $135,169, $64,267, and $58,079,
respectively. No brokerage transactions were allocated to brokers or dealers
for the sale of the Fund's shares; such sales are made by FPS Broker
Services, Inc. and Country Capital Management Company through their own
representatives.

During the fiscal years ended June 30, 1994, 1995, and 1996, brokerage
commissions paid by the Asset Allocation Fund totaled $4,558, $6,980, and
$5,540, respectively. No brokerage transactions were allocated to brokers or
dealers for the sale of the Fund's shares; such sales are made by FPS Broker
Services, Inc. and Country Capital Management Company through their own
representatives.

There may be occasions when portfolio transactions for these Funds are
executed as part of concurrent authorizations to purchase or sell the same
security for other Funds served by IAA Trust Company. Although such
concurrent authorizations potentially could be either advantageous or
disadvantageous to a Fund, they are effected only when a Fund, acting on the
advice of IAA Trust Company, believes that to do so is in the interest of
such Fund. When such concurrent authorizations occur, the executions will be
allocated in an equitable manner.

TAX EXEMPT BOND FUND, SHORT-TERM GOVERNMENT BOND SERIES, AND LONG-TERM BOND
SERIES:

This Fund always seeks to effect its transactions in buying and selling
portfolio securities, acting through a broker as agent or with a dealer as
principal so that it can obtain reasonable execution at the most favorable
prices. Accordingly, the Tax Exempt Bond Fund, through IAA Trust Company, its
Investment Adviser, negotiates commission rates in accordance with the
reliability and quality of a broker's or dealer's services, the financial
condition of the firm and the value and expected contribution of the
broker-dealer to the performance of the Fund on a continuing basis. Thus,
what the Tax Exempt Bond Fund determines to be the most favorable commission
price may be higher than the lowest available price. In evaluating the
overall reasonableness of brokerage commissions paid, the Tax Exempt Bond
Fund through its Investment Adviser, maintains an awareness of general
practices with regard to commission levels and rates charged by reputable
brokerage firms.

The primary brokerage allocation criterion of each Fund is that the Fund
obtain reasonable execution at the most favorable prices. If two or more
brokers or dealers meet this criterion, the Fund may, although there is no
undertaking or agreement with any broker or dealer to do so or any specific
internal allocation procedure, place orders for the purchase or sale of
portfolio securities with brokers or dealers who have provided research,
statistical or other financial information to the Fund or its Investment
Adviser. Brokerage house research generally provides economic and financial
market analysis as well as industry studies and investment analysis of

<PAGE>

individual companies or entities.

It is the opinion of the Investment Adviser that the furnishing of research,
statistical, and other financial information to either the Fund or the
Investment Adviser by brokers and dealers will not materially reduce the cost
to the Investment Adviser of fulfilling the terms of its advisory contract
with the Fund because the Investment Adviser must review and analyze such
information along with all other information available to it. Research
information obtained from brokers and dealers while servicing the Fund may be
used by IAA Trust Company in servicing all of its accounts and, conversely,
research information obtained from brokers and dealers while servicing other
accounts may be used by IAA Trust Company in servicing each Fund. Further,
all research information obtained from brokers and dealers while serving the
Fund may not be used by the Fund.

During the fiscal years ended June 30, 1994, 1995, and 1996, all transactions
for the Tax Exempt Bond Fund were placed with a principal market dealer. No
commissions as such are paid on transactions with the principal market dealer
as the asked price on such transactions usually includes an allowance for
such compensation.

No brokerage transactions are allocated to brokers or dealers for the sale of
the Fund's shares; such sales are made by FPS Broker Services, Inc. and
Country Capital Management Company through their own representatives.

There may be occasions when portfolio transactions for this Fund are executed
as part of concurrent authorizations to purchase or sell the same security
for other Funds served by IAA Trust Company. Although such concurrent
authorizations potentially could be either advantageous or disadvantageous to
a Fund, they are effected only when a Fund, acting on the advice of IAA Trust
Company, believes that to do so is in the interest of such Fund. When such
concurrent authorizations occur, the executions will be allocated in an
equitable manner.

MONEY MARKET SERIES:

This Fund, acting on recommendations received from its Investment Adviser,
IAA Trust Company, expects that purchases and sales of portfolio securities
usually will be principal transactions. Portfolio securities will normally be
purchased directly from the issuer or from an underwriter or a market maker
for the securities. Usually, no brokerage commissions will be paid on such
purchases. Purchases from underwriters of portfolio securities will include a
concession paid by the issuer to the underwriter and the purchase price paid
to market makers for money market instruments may include the spread between
the bid and asked price.

The primary consideration in the allocation of portfolio transactions will be
prompt and effective execution of orders at the most favorable price. If two
or more brokers or dealers meet this criterion, the Fund may, although there
is no undertaking or agreement with any broker or dealer to do so or any
specific internal allocation procedure, place orders for the purchase or sale
of portfolio securities with brokers or dealers who have provided research,
statistical, or other financial information to the Fund or its investment
adviser. Brokerage house research generally provides economic and financial
market analysis as well as industry studies and investment analysis of
individual companies or entities. Such information is of the kind generally
supplied by broker-dealers to their customers without obligation. This
information may be used by IAA Trust Company to supplement its own research
and analysis. Although it is not possible to place a dollar value on this
information, it is the opinion of IAA Trust Company that the receipt and
study of such information does not reduce its expenses. Research information
obtained from brokers and dealers while servicing the Fund may be used by IAA
Trust Company in servicing all of its accounts and, conversely, research
information obtained from brokers and dealers while servicing other accounts
may be used by IAA Trust Company in servicing the Fund. Further, not all
research information obtained from brokers and dealers while servicing the
Fund may be used by the Fund.

During the fiscal years ended June 30, 1994, 1995, and 1996, the Money Market
Series incurred no brokerage commissions.

There may be occasions when portfolio transactions for this Series are
executed as part of concurrent authorizations to purchase or sell the same
security for other Funds served by IAA Trust Company. Although such
concurrent authorizations potentially could be either advantageous or
disadvantageous to a Series, they are

<PAGE>

effected only when a Series, acting on the advice of IAA Trust Company,
believes that to do so is in the interest of such Series. When such
concurrent authorizations occur, the executions will be allocated in an
equitable manner.

PURCHASES, REDEMPTIONS, AND PRICING OF FUND SECURITIES

For the method followed by the Funds in determining the total offering price
at which each Fund's securities are offered to the public and the method used
to value each Fund's assets, see sections titled "HOW TO BUY SHARES",
"SPECIAL PLANS AND OTHER PURCHASE INFORMATION", "HOW THE VALUE OF YOUR SHARES
IS DETERMINED", and "HOW TO REDEEM YOUR SHARES" in the Funds' Prospectus. See
the following for additional information on various special Plans the Funds
offer to investors.

Exchange Privileges

A shareholder may exchange his/her shares of one IAA Trust Fund or Series for
shares of another IAA Trust Fund or Series on the basis of the relative net
asset values per share of each Fund at the time of the exchange. When shares
of one Fund or Series are exchanged for shares of another Fund or Series, the
minimum investment requirement of such other Fund or Series must be met. The
two ways to exchange shares, by mail and by telephone, are discussed below.

By Mail: The exchange can be made by forwarding a written request signed by
the registered shareholder(s) and returning any outstanding certificates
needed to effect the exchange to FPS Broker Services, Inc. ("FPSB"), c/o Fund
Plan Services, Inc., 3200 Horizon Drive, P.O. Box 61503, King of Prussia,
PA 19406-0903.

By Telephone: You may make the exchange by telephone provided that: (1) you
have elected the Telephone Exchange option on the initial application or have
authorized this option after your initial purchase; (2) the registration of
the accounts will be identical; and (3) the shares to be exchanged are not in
certificate form. You can call toll-free 1 (800) 245-2100 on any business
day. All telephone conversations with FPSB will be recorded. Neither the
Funds, Country Capital Management Company, or FPSB will be responsible for
the authenticity of the exchange instructions received by telephone.

An exchange is effected by redemption of shares of one Fund or Series and the
issuance of shares of the other Fund or Series selected, and only after
delivery of the current Prospectus. With respect to an exchange among the
Growth Fund, the Asset Allocation Fund, the Tax Exempt Bond Fund, the
Short-Term Government Bond Series, and the Long-Term Bond Series, a capital
gain or loss for Federal income tax purposes will be realized upon the
exchange, depending upon the cost or other basis of the shares redeemed. With
respect to the Money Market Series, assuming such Series maintains its share
value at $1.00 per share, an exchange of this Series' shares for shares of
another IAA Trust Fund or Series should not create a Federal income tax
incident, except for the establishment of a new holding period.

Retirement Plans

IAA Trust Company sponsors a prototype Defined Contribution Plan which has
been approved by the Internal Revenue Service and which meets the requirement
of the Tax Reform Act of 1986, as amended. This Plan can invest in shares of
the Growth Fund, the Asset Allocation Fund, the Money Market Series, the
Short-Term Government Bond Series, or the Long-Term Bond Series.
Contributions to the Plan of up to $30,000 or 25% of earned income, whichever
is the lesser, may be made each year and subtracted from gross income at tax
time. Please note that tax laws with respect to retirement accounts are
being amended with changes that will become effective in 1997.

For individuals eligible to establish an Individual Retirement Account (IRA),
IAA Trust Company sponsors a

<PAGE>

prototype individual retirement Plan which has been approved by the Internal
Revenue Service. An individual may be able to deduct contributions made to
such a Plan up to an annual amount of $2,000 or 100% of compensation,
whichever is less. The deductibility of contributions to an IRA by taxpayers
who are participants in an employer's retirement plan is determined by the
amount of taxpayer's adjusted gross income. If a joint tax return is filed, a
married person whose spouse is not employed may contribute up to $2,250
annually to be divided in any manner between the individual's IRA and the IRA
established for the nonworking spouse so long as no more than $2,000 is
contributed in any one year to either IRA. The deductibility of contributions
to an IRA by taxpayers who are active participants in an employer's
retirement plan is determined by the amount of the taxpayer's adjusted gross
income. "Rollover contributions" from certain other tax-qualified plans may
also be made to this Plan. The custodial fee for this Plan is currently
$15.00 per year on any portion thereof for all IAA Trust Company IRA accounts
held by one participant and his/her spouse (if any). Possible penalties may
be imposed for excess IRA contributions, premature withdrawals or
insufficient distributions after age 70 1/2.

An investor considering either the Defined Contribution Plan or the IRA Plan
should consult with his or her attorney with respect to Plan requirements and
tax implications. Other information relating to eligibility and service fees
may be obtained by reading the prototype Plans and, in the case of the IRA,
by reading the disclosure statement which the IRA requires to be furnished to
individuals who are considering the adoption of an IRA.

For more information about these Plans, contact IAA Trust Company, 808 IAA
Drive, Bloomington, Illinois 61702 or call toll-free 1 (800) 422-8261.

Automatic Investing

A shareholder may authorize Systematic Investing through automatic
withdrawals from his/her bank accounts.

Systematic Withdrawal Plan

Shareholders who purchase or already own $5,000 or more of any Fund's shares,
valued at the current public offering price, and who wish to receive periodic
payments may establish a Systematic Withdrawal Plan by completing an
application provided by FPSB for this purpose. Such planholders will receive
monthly, quarterly or annual checks in the amount they designate. While no
particular withdrawal amount is necessarily recommended, the minimum is $25.
The amount of payment may be changed at any time. Dividends and capital gains
distributions on a Fund's shares in the Plan are automatically reinvested in
additional shares at net asset value, without a sales charge. All
certificates for shares deposited under this Plan must be surrendered and no
certificates will be issued unless the Plan is terminated. Payments are made
from the proceeds derived from the redemption of Fund shares owned by the
planholder. With respect to the Growth Fund, the Asset Allocation Fund,
the Tax Exempt Bond Fund, the Short-Term Government Bond Series, and the
Long-Term Bond Series, each redemption of shares may result in a gain or loss
which is reportable by the investor on his income tax return.

Redemptions required for payments may reduce or use up the planholder's
investment, depending upon the size of payment and market fluctuations, if
applicable. Accordingly, Plan payments cannot be considered as yield or
income on the investment. Additional purchases may be made under the
Systematic Withdrawal Plan in amounts of $5,000 or more.

FPS Services, Inc., ("FPS") as agent for the shareholder, may make a charge
for services rendered beyond those normally assumed by the Funds. No such
charge is currently assessed, but such a charge may be instituted by FPS upon
notice in writing to shareholders. This Plan may be terminated at any time
without penalty upon written notice by the shareholder, by the Funds, or by
FPS.

UNDERWRITER COMPENSATION

<PAGE>

Shares of the Funds are continuously offered to the public through FPS Broker
Services, Inc. ("FPSB").

Currently, out of commissions to be received, FPSB has agreed to pay all
expenses incident to the distribution of shares. If commissions are not
sufficient to pay these expenses, FPSB will look to the Funds' Investment
Adviser for reimbursement. For the fiscal year ended June 30, 1996, FPSB
received no underwriting fees.

For additional information, see "WHO DISTRIBUTES THE FUNDS SHARES" in the
Funds' Prospectus.

INVESTMENT PERFORMANCE INFORMATION

From time to time, the Funds advertise their various respective performance
measures, such as: 7- or 30-day yield; tax-equivalent yield; total percentage
increase; and total return. Performance will vary and the results shown
herein and in the Funds' Prospectus are historical information and will not
be representative of future results. Factors affecting the Funds' performance
include general market conditions, operating expenses, and portfolio
management. No adjustment has been made for taxes payable on dividends and
distributions.

Total Percentage Increase

Total percentage increase is calculated for the specified periods of time by
assuming a hypothetical investment of $1,000 in a Fund's shares. Each
dividend or other distribution is treated as having been reinvested at net
asset value on the reinvestment date. The percentage increases stated are the
percent that an original investment would have increased during the
applicable period.

Total Return Calculations

With respect to the Growth Fund, the Asset Allocation Fund, the Tax Exempt
Bond Fund, the Long-Term Government Bond Series, and the Short-Term Bond
Series the Funds and Series that compute their average annual total returns
do so by determining the average annual compounded rates of return during
specified periods that equate the initial amount invested to the ending
redeemable value of such investment. This is done by dividing the ending
redeemable value of a hypothetical $1,000 initial payment by $1,000 and
raising the quotient to a power equal to one divided by the number of years
(or fractional portion thereof) covered by the computation and subtracting
one from the result. This calculation can be expressed as follows:

Average Annual Total Return = left (ERV over P right) sup {1/n} - 1

Where: ERV = ending redeemable value at the end of the period covered
by the computation of a hypothetical $1,000 payment made
at the beginning of the period.

P = hypothetical initial payment of $1,000.

n = period covered by the computation, expressed in terms of
years.

The Funds and Series that compute their aggregate total returns over a
specified period do so by determining the aggregate compounded rate of return
during such specified period that likewise equates over a specified period
the initial amount invested to the ending redeemable value of such
investment. The formula for calculating aggregate total return is as follows:

<PAGE>

Aggregate Total Return = (ERV) over P - 1

Where: ERV = ending redeemable value at the end of the period
covered by the computation of a hypothetical $1,000
payment made at the beginning of the period.

P = hypothetical initial payment of $1,000.

The calculations of average annual total return and aggregate total return
assume the reinvestment of all dividends and capital gain distributions on
the reinvestment dates during the period. The ending redeemable value
(variable "ERV" in each formula) is determined by assuming complete
redemption of the hypothetical investment and the deduction of all
nonrecurring charges at the end of the period covered by the computations.
Such calculations are not necessarily indicative of future results and do not
take into account Federal, state and local taxes that shareholders must pay
on a current basis.

Since performance will fluctuate, performance data for the Funds and Series
should not be used to compare an investment in a Fund's or Series' shares
with bank deposits, savings accounts and similar investment alternatives
which often provide an agreed or guaranteed fixed yield for a stated period
of time. Shareholders should remember that performance is generally a
function of the kind and quality of the instruments held in a portfolio,
portfolio maturity, operating expenses and market conditions.

30-day Yield Calculations

With respect to the Asset Allocation Fund, the Tax Exempt Bond Fund, the
Long-Term Government Bond Series, and the Short-Term Bond Series the yield of
each of these Funds or Series is calculated by dividing the net investment
income per share (as described below) earned by the Fund or Series during a
30-day (or one month) period by the maximum offering price per share on the
last day of the period and annualizing the result on a semi-annual basis by
adding one to the quotient, raising the sum to the power of six, subtracting
one from the result and then doubling the difference. A Fund's or Series' net
investment income per share earned during the period is based on the average
daily number of shares outstanding during the period entitled to receive
dividends and includes dividends and interest earned during the period minus
expenses accrued for the period, net of reimbursements. This calculation can
be expressed as follows:

YIELD = 2 [ ( a - b + 1) - 1 ]
-------
cd

Where: a = dividends and interest earned during the period.

b = expenses accrued for the period (net of reimbursements).

c = the average daily number of shares outstanding during
the period that were entitled to receive dividends.

d = maximum offering price per share on the last day of the
period.

For the purpose of determining net investment income earned during the period
(variable "a" in the formula), dividend income on equity securities held by a
Fund or Series is recognized by accruing 1/360 of the stated

<PAGE>

dividend rate of the security each day that the security is in the Fund or
Series. Except as noted below, interest earned on any debt obligations held
by a Fund or Series is calculated by computing the yield to maturity of each
obligation held by that Fund or Series based on the market value of the
obligation (including actual accrued interest) at the close of business on
the last business day of the month, the purchase price (plus actual accrued
interest) and dividing the result by 360 and multiplying the quotient by the
market value of the obligation (including actual accrued interest) in order
to determine the interest income on the obligation for each day of the
subsequent month that the obligation is held by that Fund or Series. For
purposes of this calculation, it is assumed that each month contains thirty
days. The date on which the obligation reasonably may be expected to be
called or, if none, the maturity date. With respect to debt obligations
purchased at a discount or premium, the formula generally calls for
amortization of the discount premium. The amortization schedule will be
adjusted monthly to reflect changes in the market values of such debt
obligations.

Expenses accrued for the period (variable "b" in the formula) include all
recurring fees charged by a Fund or Series to all shareholder accounts in
proportion to the length of the base period and the Fund's or Series' mean
(or median) account size. Undeclared earned income will be subtracted from
the offering price per capital share (variable "d" in the formula).

With respect to the Tax Exempt Bond Fund, interest earned on tax-exempt
obligations that are issued without original issue discount and have a
current market discount is calculated by using the coupon rate of interest
instead of the yield to maturity. In the case of tax-exempt obligations that
are issued with original issue discount but which have discounts based on
current market value that exceed the then-remaining portion of the original
discount (market discount), the yield to maturity is the imputed rate based
on the original issue discount calculation. On the other hand, in the case of
tax-exempt obligations that are issued with original issue discount but which
have discounts based on current market value that are less than the
then-remaining portion of the original discount (market premium), the yield
to maturity is based on the market value.

With regard to mortgage or other receivables-backed obligations which are
expected to be subject to monthly payments of principal and interest
("pay-downs"): (I) gain or loss attributable to actual monthly pay-downs are
accounted for as an increase or decrease to interest income during the
period; and (ii) a Fund may elect either (a) to amortize the discount and
premium on the remaining security, based on the cost of the security, to the
weighted average maturity date, if such information is available, or to the
remaining term of the security, if any, if the weighted average date is not
available or (b) not to amortize discount or premium on the remaining
security.

Tax-Equivalent Yield Calculations

With respect to the Tax Exempt Bond Fund, the "tax-equivalent yield" of this
Fund is computed by (a) dividing the portion of the yield (calculated as
above) that is exempt from Federal income tax by one minus a stated Federal
income tax rate and (b) adding to that figure to that portion, if any, of the
yield that is not exempt from Federal income tax.

The tax equivalent yield reflects the taxable yield that an investor at the
highest marginal Federal income tax rate would have to receive to equal the
primarily tax-exempt yield from the Fund. Before investing in a tax-exempt
fund, you may want to determine which investment -- tax-free or taxable --
will result in a higher after-tax yield. To do this, divide the yield on the
tax-free investment by the decimal determined by subtracting from 1 the
highest Federal tax rate you pay. For example, if the tax-free yield is 5%
and your maximum tax bracket is 36%, the computation is:

5% Tax-Free Yield - (1/.36 Tax Rate) = 5%/.64% = 7.8125% Tax Equivalent Yield

In this example, your after-tax return would be higher from the 5% tax-free
investment if available taxable yields are below 7.8125%. Conversely, the
taxable investment would provide a higher yield when taxable yields exceed
7.8125%.

<PAGE>

7-day Yield Calculations

The Money Market Series' standard yield quotations as they appear in reports
and other material distributed by the Series or by Country Capital Management
Company are calculated by a standard method prescribed by rules of the
Securities and Exchange Commission. The yield of this Series for a 7-day
period (the "base period") will be computed by determining the net change in
value (calculated as set forth below) of a hypothetical account having a
balance of one share at the beginning of the period, dividing the net change
in account value by the value of the account at the beginning of the base
period to obtain the base period return, and multiplying the base period
return by 365/7 with the resulting yield figure carried to the nearest
hundredth of one percent.

Net changes in value of a hypothetical account will include the value of
additional shares purchased with dividends from the original share and
dividends declared on both the original share and any such additional shares,
but will not include realized gains or losses or unrealized appreciation or
depreciation on portfolio investments.

The effective yield is computed by compounding the unannualized base period
return by adding 1 to the base period return, raising the sum to a power
equal to 365 divided by 7, and subtracting one from the result, according to
the following formula:

365/7
Effective Yield = [(base period return + 1) ]-1

GROWTH FUND:

This Fund's net asset value and return will fluctuate. Please note the
differences and similarities between the investments which the Fund may
purchase for its portfolio and the investments measured by the index which is
described in the Prospectus. Please refer to the Prospectus for specific
information.

ASSET ALLOCATION FUND:

This Fund's net asset value, return, and yield will fluctuate. The Fund's
yield for the thirty days ended June 30, 1996 was 2.62%. Yield differs from
total return in that it only considers current income and does not take into
account gains or losses on securities held by the Fund. Please refer to the
Prospectus for specific information.

TAX EXEMPT BOND FUND:

This Fund's net asset value, return, and yield will fluctuate. The Fund's
yield for the thirty days ended June 30, 1996 was 4.25%. Yield differs from
total return in that it only considers current income and does not take into
account gains or losses on securities held by the Fund. Please refer to the
Prospectus for specific information.

The above yield results in a tax-equivalent yield of 6.64% for the thirty
days ended June 30, 1996.

MONEY MARKET SERIES:

The yield and effective yield of this Series will vary in response to
fluctuations in interest rates and in the expenses of the Fund. For the seven
days ended June 30, 1996 the Fund's annualized standard (cash) yield was
4.49% and its annualized effective (compound) yield was 4.59%. For
comparative purposes, the current and effective yields should be compared to
current and effective yields offered by competing financial institutions for
the same base period and calculated by the methods described above.

<PAGE>

REPORTS TO SHAREHOLDERS AND FINANCIAL STATEMENTS

Reports to Shareholders

Shareholders will receive unaudited semi-annual reports describing the Funds'
investment operations and annual financial statements audited by independent
certified public accountants.

Financial Statements

The Funds' financial statements, including the notes thereto, dated as of
June 30, 1996, which have been audited by Coopers & Lybrand L.L.P., are
incorporated by reference from the Funds' 1996 Annual Report to Shareholders.

<PAGE>

APPENDIX

Commercial Paper Ratings

Moody's Investors Service, Inc.: "Prime-1" and "Prime-2" are Moody's two
highest commercial paper rating categories. Moody's evaluates the salient
features that affect a commercial paper issuer's financial and competitive
position. The appraisal includes, but is not limited to the review of such
factors as:

1. Quality of management.
2. Industry strengths and risks.
3. Vulnerability to business cycles.
4. Competitive position.
5. Liquidity measurements.
6. Debt structures.
7. Operating trends and access to capital markets.

Differing degrees of weight are applied to the above factors as deemed
appropriate for individual situations.

Standard & Poor's Corporation: "A-1" and "A-2" are S&P's two highest
commercial paper rating categories and issuers rated in these categories
have the following characteristics:

1. Liquidity ratios are adequate to meet cash requirements.
2. Long-term senior debt is rated "A" or better.
3. The issuer has access to at least two additional channels of
borrowing.
4. Basic earnings and cash flow have an upward trend with allowance
made for unusual circumstances.
5. Typically, the issuer is in a strong position in a well-
established industry or industries.
6. The reliability and quality of management is unquestioned.

Relative strength or weakness of the above characteristics determine
whether an issuer's paper is rated "A-1" or "A-2". Additionally, within
the "A-1" designation, those issues determined to possess overwhelming
safety characteristics are denoted with a plus (+) rating category.

Bond Ratings

Standard and Poor's Corporation: An S&P bond rating is a current
assessment of the creditworthiness of an obligor with respect to a
specific debt obligation. This assessment may take into consideration
obligors such as guarantors, insurers or lessees.

The bond ratings are not a recommendation to purchase, sell or hold a
security, inasmuch as it does not comment as to market price or
suitability for a particular investor.

The ratings are based on current information furnished by the issuer or
obtained by S&P from other sources it considers reliable. S&P does not
perform any audit in connection with any ratings and may, on occasion,
rely on unaudited financial information. The ratings may be changed,
suspended or withdrawn as a result of changes in, or unavailability of,
such information, or for other circumstances.

The ratings are based, in varying degrees, on the following
considerations:

I. Likelihood of default-capacity and willingness of the obligor as
to the timely payment of interest and repayment of principal in
accordance with the terms of the obligation;
II. Nature of and provisions of the obligation;
III. Protection afforded by, and relative position of, the obligation
in the event of bankruptcy, reorganization or other arrangement
under the laws of bankruptcy and other laws affecting creditor's
rights.

The four highest bond ratings of S&P and their meanings are:

<PAGE>

"AAA" Bonds rated "AAA" have the highest rating assigned by S&P to
a debt obligation. Capacity to pay interest and repay
principal is extremely strong.

"AA" Bonds rated "AA" have a very strong capacity to pay interest
and repay principal and differ from the highest rated issues
only in small degree.

"A" Bonds rated "A" have a strong capacity to pay interest and
repay principal although they are somewhat more susceptible
to the adverse effects of changes in circumstances and
economic conditions than bonds in higher rated categories.

"BBB" Bonds rated "BBB" are regarded as having an adequate capacity
to pay interest and repay principal. Whereas they normally
exhibit adequate protection parameters, adverse economic
conditions or changing circumstances are more likely to lead
to a weakened capacity to pay interest and repay principal
for bonds in this category than for bonds in higher rated
categories.

Plus (+) or Minus (-): The ratings from "AA" to "BB" may be modified by
the addition of a plus or minus sign to show relative standing within the
major rating categories.

Provisional Ratings The letter "p" indicates that the rating is
provisional. A provisional ratings assumes the successful completion of
the project being financed by the bonds being rated and indicate that
payment of debt service requirements is largely or entirely dependent upon
the successful and timely completion of the project. This rating, however,
while addressing credit quality subsequent to completion of the project,
makes no comment on the likelihood of, or the risk of default upon failure
of, such completion. The investor should exercise his own judgement with
respect to such likelihood and risk.

Under present commercial bank regulations issued by the Comptroller of the
Currency, bonds rated in the top four categories ("AAA", "AA", "A", and
"BBB", commonly known as "Investment Grade" ratings) are generally
regarded as eligible for bank investment.

Moody's Investors Service, Inc.: The four highest ratings of Moody's and
their meanings are:

"Aaa" Bonds which are rated "Aaa" are judged to be of the best quality.
They carry the smallest degree of investment risk and are
generally referred to as "gilt edge". Interest payments are
protected by a large or by an exceptionally stable margin and
principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most
unlikely to impair the fundamentally strong position of such
issues.

"Aa" Bonds which are rated "Aa" are judged to be of high quality by all
standards. Together with the "Aaa" group they comprise what are
generally known as high grade bonds. They are rated lower then the
best bonds because margins of protection may not be as large as in
"Aaa" securities or fluctuation of protective elements may be of
greater amplitude or there may be other elements present which
make the long-term risks appear somewhat larger than in "Aaa"
securities.

"A" Bonds which are rated "A" possess many favorable investment
attributes and are to be considered as upper medium grade
obligations. Factors giving security to principal and interest are
considered adequate, but elements may be present which suggest a
susceptibility to impairment sometime in the future.

"Baa" Bonds which are rated "Baa" are considered as medium grade
obligations; i.e., they are neither highly protected nor poorly
secured. Interest payments and principal security appear adequate
for the present but certain protective elements may be lacking or
may be characteristically unreliable over any great length of
time. Such bonds lack outstanding investment characteristics and
in fact have speculative characteristics as well.

Descriptions of Short-Term Instruments

<PAGE>

Obligations of the U.S. Government, its Agencies and Instrumentalities:

Securities issued or guaranteed by the U.S. Government include a
variety of Treasury securities, which differ only in their interest
rate, maturity and date of issuance. Treasury bills have a maturity of
one year or less. Treasury notes have a maturity of one to ten years
and Treasury bonds generally have maturities of greater than ten years
at the date of issuance. Some obligations of U.S. Government agencies
and instrumentalities such as Treasury bills and Government National
Mortgage Association pass-through certificates, are supported by the
full faith and credit of the U.S. Treasury; others, such as securities
of Federal Loan Banks, have the right of the issuer to borrow from the
Treasury; and still others, such as bonds issued by Federal National
Mortgage Association, a private corporation, are supported only by the
credit of the instrumentalities. No assurance can be given that the
U.S. Government would provide financial support to U.S. Government
instrumentalities as it is not obligated to do so by law.

Certificates of Deposit:

In essence, a certificate of deposit is a negotiable receipt issued by
a bank or savings and loan association in exchange for the deposit of
funds. The issuer agrees to pay the amount deposited plus interest to
the bearer of the receipt on the date specified on the certificate.

Bankers' Acceptances:

A bankers' acceptance generally arises from a short-term credit
arrangement designed to enable businesses to obtain funds to finance
commercial transactions. Generally, an acceptance is a time draft
drawn on a bank by an exporter or an importer to obtain a stated
amount of funds to pay for specific merchandise. The draft is then
"accepted" by the bank that, in effect, unconditionally guarantees to
pay the face value of the instrument on its maturity date.

Commercial Paper:

Commercial paper is generally defined as unsecured short-term notes
issued in bearer form by large, well-known corporations and finance
companies. Maturities on commercial paper range from a few days to
nine months.

Repurchase Agreements:

Repurchase agreements are transactions in which a Fund purchases a
security (usually a U.S. Government obligation) and simultaneously
obtains the commitment of the seller (a member bank of the Federal
Reserve System) to repurchase the security at an agreed upon price on
an agreed upon date usually not more than seven days from the date of
purchase. The resale price reflects the purchase price plus an agreed
upon market rate of interest which is unrelated to the coupon rate or
maturity of the purchased security. Such transactions afford an
opportunity for a Fund to earn a return on cash which is only
temporarily available. The Fund's risk is limited to the ability of
the seller to pay the agreed upon sum upon the delivery date, but the
seller's obligation is in effect secured by the value of the
underlying security. With respect to the Money Market Series
repurchase agreements of over seven day's duration will not be more
than 10% of the assets of such Fund.

Foreign Securities Risks

Foreign securities involve investment risk in addition to those of
domestic obligations of domestic issuers, including the possibility that:
liquidity can be impaired because of future political and economic
developments; the obligations may be less marketable than comparable
domestic obligations of domestic issuers; a foreign jurisdiction might
impose withholding taxes or interest income payable on these obligations;
deposits may be seized or nationalized; foreign governmental restrictions
such as exchange controls may be adopted which might adversely affect the
payment of principal and interest on those obligations; the selection of
foreign bank obligations might be more difficult because there may be less
publicly available information concerning foreign banks; there may be
difficulties in obtaining or enforcing a judgement against a foreign bank;
or the accounting, auditing and financial reporting standards, practices
and requirements applicable to foreign banks may differ from those
applicable to U.S. banks. Foreign banks are not subject to examination by
any U.S. Government agency or instrumentality.

<PAGE>

IAA TRUST GROWTH FUND, INC.

Item 24. Financial Statements and Exhibits:

(a) Financial Statements Included in Part A:
Financial Highlights

Financial Statements Incorporated by reference in Part B:
From Annual Report to Shareholders dated June 30, 1996

(1) Portfolio Highlights
(2) Schedule of Investments as of June 30, 1996
(3) Statement of Assets and Liabilities as of June 30, 1996
(4) Statement of Operations for the Year Ended June 30, 1996
(5) Statements of Changes in Net Assets
for the Years ended June 30, 1996 and 1995
(6) Notes to Financial Statements
(7) Financial Highlights
(8) Report of Independent Accountants

(b) Exhibits

(1) Charter. Articles of Incorporation dated August 5, 1965
-- filed herewith.
(2) Bylaws. Bylaws of IAA Trust Growth Fund, Inc.
dated August 26, 1965, as amended November 23, 1992
-- filed herewith.

(3) Voting Trust Agreement. None.
(4) a. Specimen stock certificate. See Exhibit 4 to
Amendment No. 1 to Form N-8B-1 filed March 1966, and
incorporated herein by reference.

b. Share account application form -- filed herewith.
(5) Investment Advisory Agreement, effective September 29,
1992 -- filed herewith.
(6) Underwriting Agreement, effective August 1, 1995 -- filed
herewith.
(7) Bonus, profit sharing, pension or similar agreements.
None.
(8) Custodian Agreement, effective March 31, 1992 -- filed
herewith.
(9) Other material contracts not made in the ordinary course
of business.
a. Transfer Agent Services Agreement, effective
August 1, 1995 -- filed herewith.
b. Administration Agreement, effective August 1, 1995
-- filed herewith.

<PAGE>

c. Accounting Services Agreement, effective
August 1, 1996 -- filed herewith.
(10) Opinion and consent of Counsel. See Exhibit A to 24f-2
Notice filed August 1996, and incorporated herein by
reference.
(11) Consent of Independent Accountants. --
filed herewith.

(12) All financial statements omitted from Item 23. See
Item 24(a) above.
(13) Agreements regarding initial capital. None.

(14) Copies of model plan used in establishment of any
retirement plan in conjunction with which Registrant
offers its securities -- filed herewith.
(15) Plan pursuant to Rule 12b-1 describing financing of
distribution of Registrant's shares. 12b-1 Plan Agreement
with FPS Broker Services, Inc., effective February 8, 1993
-- filed herewith.
(16) Schedule for computation of each performance quotation.
Not applicable.

(27) Electronic Filers - Financial Data Schedules attached.

Item 25. Persons Controlled by or under Common Control with Registrant.

IAA Control Chart. -- filed herewith.

Item 26. Number of Holders of Securities.

(1) (2)
Title of Class Number of Record Holders
Common

As of October 1, 1996 4116

Item 27. Indemnification.
See Item 1.14 to Form N-1R filed for the fiscal year ended June
30, 1977, and incorporated herein by reference. The Registrant
also purchases Errors and Omissions insurance with Directors and
Officers liability coverage.

Item 28. Business and Other Connections of Investment Adviser.
-----------------------------------------------------
As of September 29, 1992, IAA Trust Company became the
Registrant's Investment Adviser. The Trust Company serves as
Investment Adviser to IAA Trust Growth Fund, Inc., IAA Trust
Asset Allocation Fund, Inc., IAA Trust Tax Exempt Bond Fund,
Inc., and IAA Trust Taxable Fixed Income Series Fund, Inc. The
Trust Company also provides investment services to the Country
Companies Insurance Group and exercises fiduciary powers as
permitted by its charter and the State of Illinois.

Other substantial business, professional, vocational or
employment activities of each director and officer of the
Registrant's Investment Adviser during the past two fiscal years
are:

<PAGE>

<TABLE>
<CAPTION>
Substantial Business Activities
Name and Position During Past Two Fiscal Years
----------------- ----------------------------

<S> <C>
Ronald R. Warfield, See information on "Directors and Officers of
Director and President the Funds" - Part B.

Rollie D. Moore, See information on "Directors and Officers of
Director and Vice President the Funds" - Part B.

O. Eugene Barkley, Director: AgriVisor Services, Inc., Illinois
Director Agricultural Association, CC Services, Inc.,
Country Casualty Insurance
Company, Country Investors Life
Assurance Company, Country Life
Insurance Company, Country Medical
Plans, Inc., Country Mutual
Insurance Company, Country
Preferred Insurance Company,
GROWMARK, Inc., Illinois
Agricultural Holding Co., IAA
Trust Company. Farmer.

Robert L. Phelps, Director: AgriVisor Services, Inc., Illinois
Director Agricultural Association, CC Services, Inc.,
Country Casualty Insurance
Company, Country Investors Life
Assurance Company, Country Life
Insurance Company, Country Mutual
Insurance Company, Country
Preferred Insurance Company,
Illinois Agricultural Holding Co.,
IAA Trust Company. Farmer.

Darell D. Sarff, Director: Illinois Agricultural Association,
Director AgriVisor Services, Inc., CC Services, Inc.,
Country Casualty Insurance
Company, Country Investors Life
Assurance Company, Country Life
Insurance Company, Country Mutual
Insurance Company, Country
Preferred Insurance Company, IAA
Communications Company, IAA Trust
Company, Illinois Agricultural
Holding Co. Farmer.

Gary E. Mede, C.F.A., See information on "Directors and Officers of

<PAGE>

Executive Vice President the Funds" - Part B.
and Trust Officer

Bruce Finks, See information on "Directors and Officers
Vice President the Funds" - Part B
Investments

Richard M. Miller, See information on "Directors and Officers of
Senior Vice President--Trusts the Funds" - Part B.
and Senior Trust Officer

Richard F. Day, See information on "Directors and Officers of
Vice President and Controller the Funds" - Part B.

David Tipsword, Vice President--Pension Trusts, Trust Officer:
Vice President--Pension IAA Trust Company.
Trusts and Trust Officer

Connie Denison, Vice President--Management Information Systems
Vice President--Management and Assistant Trust Officer: IAA Trust Company.
Information Systems and
Assistant Trust Officer

Bernard Dornedon, Vice President--Equity Investments: IAA Trust
Vice President-- Company.
Equity Investments

Paul M. Harmon, See information on "Directors and Officers
Secretary and General Counsel the Funds" - Part B

Robert W. Weldon, See information on "Directors and Officers of
Treasurer the Funds" - Part B.

</TABLE>

Item 29. Principal Underwriters

(a) As of October 28, 1996, in addition to acting as the Registrant's
distributor, FPS Broker Services, Inc. also served as distributor
of the shares of IAA Trust Tax Exempt Bond Fund, Inc., IAA Trust
Asset Allocation Fund, Inc., and IAA Trust Taxable Fixed Income
Series Fund, Inc. FPS Broker Services, Inc., the principal
underwriter for the Registrant's securities, currently acts as
principal underwriter for the following entities:

The Brinson Funds
CT&T Funds
Dreman Mutual Fund Group

Fairport Funds
Farrell Alpha Strategies
First Mutual Funds

<PAGE>

Focus Trust, Inc.
The HomeState PA Growth Fund
Matthews International Funds
McM Funds
Smith Breeden Series Fund

Smith Breeden Short Duration U.S. Government Fund
Smith Breeden Trust
The Stratton Funds, Inc.
Stratton Growth Fund, Inc.
Stratton Monthly Dividend Shares, Inc.
The Timothy Plan

(b) The table below sets forth certain information as to the
Underwriter's Directors, Officers and Control Persons:

Name and Principal Position and Offices Position and Offices
Business Address with Underwriter with Registrant
- ---------------- ---------------- ---------------
<S> <C> <C>

Kenneth J. Kempf Director, and None
3200 Horizon Drive President
King of Prussia, PA 19406-0903

Lynne M. Cannon Vice President and None
3200 Horizon Drive Principal
King of Prussia, PA 19406-0903

Rocco J. Cavalieri Director and None
3200 Horizon Drive Vice President
King of Prussia, PA 19406-0903

Gerald J. Holland Director, None
3200 Horizon Drive Senior Vice President and
King of Prussia, PA 19406-0903 Principal

Joseph M. O'Donnell, Esq. Director and None
3200 Horizon Drive Vice President
King of Prussia, PA 19406-0903

Sandra L. Adams Assistant Vice None
3200 Horizon Drive President and
King of Prussia, PA 19406-0903 Principal

Mary P. Efstration Secretary None
3200 Horizon Drive
King of Prussia, PA 19406-0903

John H. Leven Treasurer None
3200 Horizon Drive
</TABLE>

<PAGE>

King of Prussia, PA 19406-0903

James W. Stratton may be considered a control person of the Underwriter due to
his direct or indirect ownership of Fund/Plan Services, Inc., the parent of the
Underwriter.

Item 30. Location of Accounts and Records.

The following accounts, books and other documents of Registrant
required to be maintained by Section 31(a) of the 1940 Act and
the Rule(17 CFR 270.31a-1 to 31a-3) promulgated thereunder are
maintained by Barbara H. Tolle, Senior Vice President, Accounting
Services, 3200 Horizon Drive, P.O. Box 61503, King Of Prussia, PA
19406-0903.

1. Journals, general ledger and supporting ledger.
2. Record of the proof of money balance in all ledger accounts
in form of trial balances.
3. Separate ledger accounts showing each shareholder of record
and the number of shares of capital stock held.

IAA Trust Company maintains record of all portfolio purchases and
sales with supporting authorization and records at 808 IAA Drive,
Bloomington, Illinois 61702.

The Certificate of Incorporation of Registrant is maintained in
safekeeping by Robert W. Weldon, Treasurer, 1701 Towanda Avenue,
Bloomington, Illinois 61702.

The Bylaws of Registrant and minute books of stockholders,
directors and directors' committee meetings are maintained by Paul
M. Harmon, Secretary, 1701 Towanda Avenue, Bloomington, Illinois
61702.

Item 31. Management Services. Not Applicable.

Item 32. Undertakings. None.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant certifies that it meets all of the
requirements for effectiveness of this Registration Statement pursuant to rule
485(b) under the Securities Act of 1933 and has duly caused this Post-Effective
Amendment No. 53 to its Registration Statement under the Securities Act of 1933
and Amendment No. 22 to its Registration Statement under the Investment Company
Act of 1940 to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Bloomington and the State of Illinois on this 30th Day
of September, 1996.

IAA TRUST GROWTH FUND, INC.
(Registrant)

By: /s/ Ronald R. Warfield
-----------------------------------
Ronald R. Warfield, President

Pursuant to the requirements of the Securities Act of 1933, this Post-Effective
Amendment No. 53 to the Registration Statement has been signed below by the
following persons in the capacities and on the dates indicated.

SIGNATURE TITLE DATE
--------- ----- ----

<S> <C> <C>
/s/ Ronald R. Warfield President and Director September 30, 1996
- -------------------------------- (Principal Executive Officer)
Ronald R. Warfield

/s/ Robert W. Weldon Treasurer September 30, 1996
- -------------------------------- (Principal Financial and
Robert W. Weldon Accounting Officer)

/s/ Herbert G. Allen Director September 30, 1996
- -----------------------------------
Herbert G. Allen

/s/ Charlot R. Cole Director September 30, 1996
- -----------------------------------
Charlot R. Cole

/s/ Nancy J. Erickson Director September 30, 1996
- -----------------------------------
Nancy J. Erickson

/s/ William E. Klein. Sr. Director September 30, 1996
- -----------------------------------
William E. Klein, Sr.

/s/ Ailene Miller Director September 30, 1996
- -----------------------------------
Ailene Miller

/s/ Rollie D. Moore Director September 30, 1996
- -----------------------------------
Rollie D. Moore

</TABLE>

<PAGE>

IAA TRUST GROWTH FUND, INC.

Exhibit Index to Part "C"
of
Post-Effective Amendment

Item No. Description
- -------- -----------

99(b)(1) Articles of Incorporation

99(b)(2) By Laws

99(b)(4)(b) Share account application form

99(b)(5) Investment Advisory Contract

99(b)(6) Underwriting Agreement

99(b)(8) Custodian Agreement

99(b)(9)(a) Transfer Agent Services Agreement

99(b)(9)(b) Administration Agreement

99(b)(9)(c) Accounting Services Agreement

99(b)(11) Consent of Independent Accountants

99(b)(14) Model Retirement Plan

99(b)(15) 12b-1 Distribution Plan Agreement

99(b)(27) Financial Data Schedules

(25) IAA Control Chart

<PAGE>

(Incorporated) Filed in Baltimore August 5, l965
Qualified in Illinois - September 8, l965

ARTICLES OF INCORPORATION

IAA TRUST GROWTH FUND, INC.

1: We, the undersigned,

William J. Kuhfuss R. R., Mackinaw, Illinois
Merle Jeffers Catlin, Illinois
Clair J. Hemphill Rt. 1, Box 176, Elwood, Illinois

each being at least twenty-one (21) years of age, do hereby associate
ourselves as Incorporators with the intention of forming a
corporation under and by virtue of the General Laws of the State of
Maryland.

2: The name of the corporation (which is hereinafter called the
"Corporation") is IAA TRUST GROWTH FUND, INC. (9/10/79) (10/1/92)

3: The purpose for which the Corporation is formed and the business and
objects to be carried on and promoted are as follows:

A. To purchase or otherwise acquire, hold for investment or
otherwise, and to sell, exchange or otherwise dispose of
securities of any class, however, evidenced, or rights or
warrants, to acquire such securities of any private or public
company, corporation, association, trust or syndicate however
organized, and to engage in the business of a diversified open-end
management investment company.

B. To purchase or otherwise acquire, hold for investment or
otherwise, and to sell, exchange or otherwise dispose of
securities issued or guaranteed by the United State of America, by
any state of the United States of America, by any political
subdivision of any state, by any public instrumentality of a
state, or by any person controlled or supervised by and acting as
an instrumentality of the United States of America.

C. To deposit funds from time to time in such accounts as
may reasonably be required, and with or without interest, in any
bank, savings bank, or trust company in good standing, organized
under the laws of the United States of America or any state
thereof, or of the District of Columbia.

D. To conduct researches and investigations in respect to
securities, organizations, business and general business
conditions in the United States and elsewhere to secure
information pertaining

-1-

<PAGE>

to the investment and employment of the assets and funds of the
Corporation; and to procure any or all of the foregoing and to
pay compensation therefor.

E. To consent to the reorganization, merger or
consolidation of any of the companies whose securities are held by
the Corporation or to the sale or lease of all or substantially
all of the property and assets of any such companies to any
person, corporation, trust or association and to exchange any of
the shares of stock or other securities issued therefor upon such
reorganization, merger, consolidation, sale or lease; to deposit
any securities of any such company with or pursuant to the request
or direction of any protective, reorganization or readjustment
committee or other agency.

F. To pay all assessments, subscriptions and other sums of
money or other considerations as it may be deemed expedient for
the protection of the Corporation's interest as holder of any
stocks or other securities of any company whose securities are
held by the Corporation, and to exercise any right or option
contained in, pertaining to, or granted or issued to holders of
any stocks or other securities for conversion into or exchange for
or purchase of other stocks or securities.

G. Generally to exercise in respect of all property and
assets owned, all rights, powers and privileges which are or may
be exercised by any natural person owning similar property or
assets in his own right.

H. To acquire all or any part of the good will, right,
property and business of any firm, person, association or
corporation heretofore or hereafter engaged in any business
similar to any business which it has power to conduct, subject to
such limitations as the Board of Directors may impose, and to
hold, utilize, enjoy and in any manner dispose of the whole or any
part of the rights, property and business so acquired and to
assume in connection therewith any liabilities of any such person,
firm, association or corporation.

I. To purchase, acquire, hold, dispose of, transfer and
reissue or cancel its own securities (including shares of its
capital stock) in any manner and to any extent now or hereafter
permitted by the laws of the State of Maryland and by these
Articles without the vote of or consent of the holders of stock of
the Corporation.

J. To carry out all or any part of the aforesaid objects
and purposes and to conduct business in all or any of its branches
in any or all states, territories, districts and possessions of
the United States of America and in foreign countries; and to
maintain offices and agencies in any and all states, territories,
districts and possessions of the United States of America and in
foreign countries.

The foregoing objects and purposes shall, except when otherwise

-2-

<PAGE>

expressed, be in no way limited or restricted by reference to or
inference from the terms of any clause of this or any other Section of
these Articles of Incorporation, or of any amendment thereto, and shall
each be regarded as independent of and construed as powers as well as
objects and purposes.

The Corporation shall be authorized to exercise and enjoy all of the
powers, rights and privileges granted to or conferred upon corporations
of a similar character by the General Laws of the State of Maryland now
or hereafter in force and the enumeration of the foregoing powers shall
not be deemed to exclude any powers, rights or privileges so granted or
conferred.

4: The post office address of the place at which the principal office of
the corporation in this State shall be located is c/o The Corporation
Trust Incorporated; First National Bank Building; Light and Redwood
Street; Baltimore, Maryland. The resident agent of the Corporation is
the Corporation Trust Incorporated, Maryland, a corporation of this
State, the post office address of which is First National Bank Building;
Light and Redwood Street; Baltimore 2, Maryland.

5: The total number of shares of stock which the Corporation has authority
to issue is Ten Million (10,000,000) shares of the par value of One
Dollar ($l.00) per share, all of one class and having an aggregate par
value of Ten Million Dollars ($10,000,000). (9/8/75)

6: The Corporation shall have not less than three (3) nor more than nine
(9) directors, which number may be increased or decreased pursuant to
the Bylaws of the Corporation, but shall never be less than three (3);
and the names of the directors who shall act until the first annual
meeting or until their successors are duly chosen and qualified,
whichever occurs first, are:

William J. Kuhfuss R. R.; Mackinaw, Illinois
Merle Jeffers Catlin, Illinois
Clarence McCauley R. 6; Mt. Vernon, Illinois
Clair J. Hemphill R. 1; Box 176; Elwood, Illinois
Wayne R. Bennett 2639 Marian; Wilmette, Illinois
Homer Curtiss R.F.D.; Stockton, Illinois
Boyce Moore R. 3; Jacksonville, Illinois
Mrs. Dorothy Johnston R. 1; Altona, Illinois
Thomas J. Butler 415 S. Maple Ave.; Oak Park, Illinois

7: The following provisions are hereby adopted for the purpose of defining,
limiting and regulating the powers of the Corporation and of the
directors and stockholders:

A. The Board of Directors of the Corporation is hereby
empowered to authorize the issuance, from time to time, of shares
of its stock of any class or classes whether now or hereafter
authorized for such consideration as said Board of Directors may
deem advisable,

-3-

<PAGE>

subject to the limitations and restrictions set forth in
Article 8 hereof.

B. No holder of any of the stock of the Corporation shall,
as such holder, have any preemptive or other right to purchase or
subscribe for any stock which this Corporation may issue or sell.

C. Each holder of record of stock of this Corporation shall
be entitled to one vote for each share outstanding registered in
his name on the books of the Corporation; each holder of record of
a fractional share of stock shall be entitled to such fraction of
one vote as is the same as the fraction of one share standing
registered in his name.

D. The board of Directors shall have power to determine
from time to time whether and to what extent and at what time and
places and under what conditions and regulations the books,
accounts and documents of the Corporation, or any of them, shall
be open to the inspection of stockholders, except as otherwise
provided by statute or by law; and except as so provided, no
stockholder shall have any right to inspect any book, account or
document of the Corporation unless authorized to do so by
resolution of the Board of Directors.

E. Each holder of the capital stock of the Corporation may
redeem all or a part of the shares of capital stock, or fractions
thereof, standing in the name of such holder on the books of the
Corporation pursuant to such terms and conditions including the
suspension of redemption for good causes as the Board of Directors
may establish from time to time.

F. The Corporation may purchase in the open market or
otherwise acquire from any owner or holder thereof any shares of
its capital stock, in which case the consideration paid therefor
(in cash or in securities in which the funds of the Corporation
shall then be invested) shall not exceed the net asset value
thereof at the time, determined or estimated in accordance with
any method deemed proper by the Board of Directors and producing
an amount approximately equal to the net asset value, as defined,
in accordance with the Resolutions or Bylaws of the Corporation,
of said shares at the time of the purchase or acquisition by the
Corporation thereof less any redemption charge which may have been
established by the Board of Directors. The Corporation to the
extent necessary may sell or cause to be sold any securities held
by it to provide cash for the purchase of its shares.

G. The Board of Directors shall have full power in
accordance with good accounting practice: (1) to determine what
receipts of the Corporation shall constitute income available for
payment of dividends and what shall constitute principal, and to
make such allocation of any particular receipt between principal
and income as may be deemed proper; (2) from time to time, in the
Board's

-4-

<PAGE>

discretion (i) to determine whether any and all expenses and other
outlays paid or incurred (including any and all taxes, assessments
or governmental charges which the Corporation may be required to
pay or hold under any present or future law of the United States
of America or of any other taxing authority therein) shall be
charged to or paid from principal or income or both; and (ii) to
apportion any and all of said expenses and outlays, including
taxes, between principal and income.

H. The Board of Directors shall have full power to amend,
alter or repeal the Bylaws of the Corporation.

8: Except for the initial issue of shares by the Corporation, its capital
stock shall not be issued and sold for a consideration less than the net
asset value (as defined in accordance with Resolutions or Bylaws of the
Corporation) of said shares at the time of such issue and sale.

The Board of Directors shall have power, in the manner and within the
time permitted by the General Laws of the State of Maryland, to
determine what part of the consideration received by the Corporation for
any of the shares of its capital stock which it shall issue from time to
time shall be capital (which par, however, in all cases shall be not
less than the aggregate par value of the shares so issued) and the
excess, if any, at any given time, of the total net assets of the
Corporation over the amount so determined to be capital shall be
surplus.

9: The Corporation is authorized to enter into an investment advisory
agreement providing for the management and supervision of the
investments of the corporation and the furnishing of advice to the
Corporation with respect to investing in, purchasing or selling
securities or other property and is authorized to enter into an
agreement with a bank having an aggregate capital, surplus and undivided
profits of $2,000,000 or more for the custody of its cash and portfolio
securities. Such agreements shall contain such other terms, provisions
and conditions as the Board of Directors of the Corporation may deem
advisable.

10: The Corporation may from time to time make any amendment of its charter,
now or hereafter authorized by law, including any amendment which alters
the contract rights, as expressly set forth in this Charter, of any
outstanding stock. The Corporation may take or authorize such action
upon the concurrence of a majority of the aggregate number of votes
entitled to be cast thereon.

11: The duration of the Corporation shall be perpetual.

-5-

Adopted August 26, l965
As Amended November 23, 1992

BYLAWS

IAA TRUST GROWTH FUND, INC.

ARTICLE I

Stockholders

Section l. Place of Meeting. All meetings of the stockholders shall be
held at the principal office of the Corporation in the State of Illinois, or at
such other place as may be designated in the Notice of Meeting by the Board of
Directors.

Section 2. Annual Meeting. Except as otherwise set forth in this
section, the annual meeting of the stockholders of the Corporation shall be held
on the last Monday in September of each year, (or if said day be a legal
holiday, then on the next succeeding day not a legal holiday), for the purpose
of electing Directors for the ensuing year and for the transaction of such other
business as may be properly brought before the meeting, provided that the Board
of Directors may select any other date in the month of September for the holding
of any annual meeting. The Corporation need not, however, hold an annual meeting
in any year in which the election of directors is not required to be acted upon
under the Investment Company Act of 1940. If a meeting of stockholders is
required to elect directors, the meeting shall be held no later than 120 days
after the occurrence of the event requiring the meeting and the meeting shall be
designated as the annual meeting of stockholders for that year. (9/23/68)
(4/23/90) (4/27/92) (11/23/92)

Section 3. Special or Extraordinary Meetings. Special or extraordinary
meetings of the stockholders for any purpose or purposes may be called by the
President or a majority of the Board of Directors, and shall be called by the
Secretary upon receipt of the request in writing signed by stockholders holding
not less than one quarter in amount of the entire capital stock issued and
outstanding and entitled to vote thereat. Such request shall state the purpose
or purposes of the proposed meeting.

Section 4. Notice of Meetings of Stockholders. Not less than ten days'
and not more than ninety days' written or printed notice of every meeting of
stockholders, stating the time and place thereof (and the general nature of the
business proposed to be transacted at any special or extraordinary meeting),
shall be given to each stockholder entitled to vote thereat by

-1-

<PAGE>

leaving the same with him or at his residence or his usual place of business or
by mailing it, postage prepaid, and addressed to him at his address as it
appears on the books of the Corporation.

No notice of the time, place or purpose of any meeting of
stockholders need be given to any stockholder who attends in person or by proxy
or to any stockholder who, in writing executed and filed with the records of the
meeting, either before or after the holding thereof, waives such notice.

Section 5. Closing of Transfer Books: Record Dates. The Board of
Directors may fix the time, not exceeding twenty days preceding the date of any
meeting of stockholders, any dividend payment date or any date for the allotment
of rights, during which the books of the Corporation shall be closed against
transfers of stock. If such books are closed for the purpose of determining
stockholders entitled to notice of or to vote at a meeting of stockholders, such
books shall be closed for at least ten days immediately preceding such meeting.
In lieu of providing for the closing of the books against transfers of stock as
aforesaid, the Board of Directors may fix, in advance, a date, not exceeding
sixty days and not less than ten days preceding the date of any meeting of
stockholders and not exceeding sixty days preceding any dividend payment date or
any date for the allotment of rights, as a record date for the determination of
the stockholders entitled to notice of and to vote at such meeting, or entitled
to receive such dividends or rights, as the case may be; and only stockholders
of record on such date shall be entitled to notice of and to vote at such
meeting or to receive such dividends or rights, as the case may be. (4/23/90)

Section 6. Quorum, Adjournment of Meetings. The presence in person or
by proxy of the holders of record of a majority of the shares of the capital
stock of the Corporation issued and outstanding and entitled to vote thereat,
shall constitute a quorum at all meetings of the stockholders. If at any meeting
of the stockholders there shall be less than a quorum present, the stockholders
present at such meeting may, without further notice, adjourn the same from time
to time until a quorum shall attend, but no business shall be transacted at the
resumption of any such adjourned meeting except such as might have been lawfully
transacted had the meeting not been adjourned.

Section 7. Voting and Inspectors. At all meetings of stockholders every
stockholder of record entitled to vote thereat shall be entitled to one vote for
each share of stock standing in his name on the books of the Corporation (and
such stockholders of record holding fractional shares shall have proportionate
voting rights as provided in the Articles of Incorporation) on the date for the
determination of stockholders entitled to vote at such meeting, either in person
or by proxy appointed by instrument in writing subscribed by such stockholder or
his duly authorized attorney. No proxy which is dated more than three months
before the meeting at which it is offered shall be accepted, unless such proxy
shall, on its face, name a longer period for which it is to remain in force.

-2-

<PAGE>

All elections shall be had and all questions decided by a
majority of the votes cast at a duly constituted meeting, except as otherwise
provided in the Articles of Incorporation or in these Bylaws or by specific
statutory provision superseding the restrictions and limitations contained in
the Articles of Incorporation or in these Bylaws.

At any election of Directors, the Board of Directors prior
thereto may, or, if they have not so acted, the chairman of the meeting may, and
upon the request of the holders of ten percent (l0%) of the stock entitled to
vote at such election shall, appoint two inspectors of election who shall first
subscribe an oath or affirmation to execute faithfully the duties of inspectors
at such election with strict impartiality and according to the best of their
ability, and shall after the election make a certificate of the result of the
vote taken. No candidate for the office of Director shall be appointed such
Inspector.

The Chairman of the meeting may cause a vote by ballot to be
taken upon any election or matter, and such vote shall be taken upon the request
of the holders of ten percent (l0%) of the stock entitled to vote on such
election or matter.

Section 8. Conduct of Stockholders' Meetings. The meetings of the
stockholders shall be presided over by the President, or if he is not present,
by a Vice President, or if neither of them is present, by a chairman to be
elected at the meeting. The Secretary of the Corporation, if present, shall act
as secretary of such meetings, or if he is not present, an Assistant Secretary
shall so act; if neither the Secretary nor an Assistant Secretary is present,
then the meeting shall elect its secretary.

Section 9. Concerning Validity of Proxies, Ballots, Etc. At every
meeting of the stockholders, all proxies shall be received and taken in charge
of and all ballots shall be received and canvassed by the Secretary of the
meeting, who shall decide all questions touching the qualification of voters,
the validity of the proxies, and the acceptance or rejection of votes, unless
inspectors of election shall have been appointed as provided in Section 7, in
which event such inspectors shall decide all such questions.

ARTICLE II

Board of Directors

Section l. Number and Tenure of Office. The business and property of
the Corporation shall be conducted and managed by a Board of Directors
consisting of seven Directors, which number may be increased or decreased as
provided in Section 3 of this Article. Each Director shall hold office until the
annual

-3-

<PAGE>

meeting of stockholders of the Corporation next succeeding his election or
until his successor is duly elected and qualified, whichever occurs first.
Directors need not be stockholders. (Effective 9/28/92)

Section 2. Vacancies. In case of any vacancy in the Board of Directors
through death, resignation or other cause, a majority of the remaining Directors
may act to fill such vacancy provided that immediately after filling such
vacancy at least two-thirds of the Directors then serving on the Board of
Directors were elected by the holders of the outstanding voting securities of
the Corporation at an annual or special meeting of stockholders called for that
purpose. Such vacancy may be filled by a majority of the remaining Directors,
although such majority is less than a quorum and any such successors so elected
shall hold office until the next annual meeting of the stockholders of the
Corporation or until his successor is duly elected and qualified, whichever
first occurs. Further, if at any time less than a majority in number of the
Board of Directors of the Corporation shall not have been elected by the holders
of the outstanding voting securities of the Corporation at an annual or special
meeting called for that purpose, then the Board of Directors or proper officers
of the Corporation shall forthwith call a special meeting of the stockholders to
be held as soon as possible and in no event later than 60 days for the purpose
of filling any existing vacancies on the Board of Directors.

Section 3. Increase or Decrease in Number of Directors. The number of
Directors may be decreased to a number not less than three or increased to a
number not more than nine by an amendment to the Bylaws. In the event of a
vacancy on the Board of Directors caused by an increase in the number of
Directors, the Board of Directors by the vote of a majority of the entire Board
may elect Directors to fill any such vacancies until the next annual meeting of
the shareholders or until their successors are duly elected and qualified,
whichever occurs first.

Section 4. Election of Entire New Board. If at any time after the first
annual meeting of stockholders of the Corporation a majority of the Directors in
office shall consist of Directors elected by the Board of Directors, a meeting
of the stockholders shall be called forthwith for the purpose of electing the
entire Board of Directors, and the terms of office of the Directors then in
office shall terminate upon the election and qualification of such Board of
Directors.

Section 5. Place of Meeting. The Directors may hold their meetings,
have one or more offices, and keep the books of the Corporation outside the
State of Maryland, at any office or offices of the Corporation or at any other
place as they may from time to time by resolution determine, or in the case of
meetings, as shall be specified or fixed in the respective notices or waivers of
notice thereof.

-4-

<PAGE>

Section 6. Regular Meetings. Regular meetings of the Board of Directors
shall be held at such time and on such notice, if any, as the Directors may from
time to time determine.

The annual meeting of the Board of Directors shall be held
as soon as practicable after the annual meeting of the stockholders for the
election of Directors in those years such a stockholders' meeting is held. In
other years, the annual meeting of the Board of Directors shall be held on the
last Monday in September (or if said day be a legal holiday, then the next
succeeding day not a legal holiday), provided that the Board of Directors may
select any other date in the month of September for the holding of its annual
meeting. (11/23/92)

Section 7. Special Meetings. Special meetings of the Board of Directors
may be held from time to time upon call of the President or of a majority of the
Directors, by oral or telegraphic or written notice duly served on or sent or
mailed to each Director not less than one day before such meeting. No notice
need be given to any Director who attends in person or to any Director who, in
writing executed and filed with the records of the meeting either before or
after the holding thereof, waives such notice. Such notice or waiver of notice
need not state the purpose or purposes of such meeting.

Section 8. Quorum. A majority of the Directors shall constitute a
quorum for the transaction of business. If at any meeting of the Board there
shall be less than a quorum present, a majority of those present may adjourn the
meeting from time to time until a quorum shall have been obtained. The act of
the majority of the Directors present at any meeting at which there is a quorum
shall be the act of the Directors, except as may be otherwise specifically
provided by statute, by the Articles of Incorporation, by these Bylaws or by any
contract or agreement to which the Corporation is a party.

Section 9. Executive Committee. The Board of Directors may, in each
year, by the affirmative vote of a majority of the entire Board, elect from the
Directors an Executive Committee to consist of such number of Directors (not
less than three) as the Board may from time to time determine. The chairman of
the Committee shall be elected by the Board of Directors. The Board of Directors
by such affirmative vote shall have power at any time to change the members of
such Committee and may fill vacancies in the Committee by election from the
Directors. When the Board of Directors is not in session, the Executive
Committee shall have and may exercise any or all of the powers of the Board of
Directors in the management of the business and affairs of the Corporation
(including the power to authorize the seal of the Corporation to be affixed to
all papers which may require it) except as provided by law or by any contract or
agreement to which the Corporation is a party and except the power to increase
or decrease the size of, or fill vacancies on, the Board, to remove or appoint
executive officers or to dissolve or change the permanent membership of the
Executive Committee, or the power to make or amend the Bylaws of the
Corporation. The Executive Committee may fix its own rules of procedure, and may
meet when and as provided by such rules or by resolution of

-5-

<PAGE>

the Board of Directors, but in every case the presence of a majority shall be
necessary to constitute a quorum. In the absence of any member of the Executive
Committee, the members thereof present at any meeting, whether or not they
constitute a quorum, may appoint a member of the Board of Directors to act in
the place of such absent member.

Section l0. Other Committees. The Board of Directors, by the
affirmative vote of a majority of the entire Board, may appoint other committees
which shall in each case consist of such number of members (not less than two)
of the Board of Directors and shall have and may exercise such powers as the
Board may determine in the resolution appointing them. A majority of all members
of any such committee may determine its action and fix the time and place of its
meetings, unless the Board of Directors shall otherwise provide. The Board of
Directors shall have power at any time to change the members and powers of any
such committee, to fill vacancies and to discharge any such committee.

Section ll. Compensation of Directors. No Director shall receive any
stated salary or fees from the Corporation for his services as such Director if
such Director is, otherwise than by reason of being such Director, affiliated
(as such term is defined by the Investment Company Act of l940) with the
Corporation or with its investment adviser. Except as provided in the preceding
sentence, Directors shall be entitled to receive such compensation from the
Corporation for their services as may from time to time be voted by the Board of
Directors.

-6-

<PAGE>

ARTICLE III

Officers

Section l. Executive Officers. The executive officers of the
Corporation shall be chosen by the Board of Directors as soon as may be
practicable after the annual meeting of the stockholders. These shall include a
President (who shall be the principal executive officer of the Corporation and
shall be a Director), one or more Vice Presidents (the number thereof to be
determined by the Board of Directors), a Secretary and a Treasurer. The Board of
Directors, or the Executive Committee may also in its discretion appoint
Assistant Secretaries, Assistant Treasurers, and other officers, agents and
employees, who shall have such authority and perform such duties as the Board or
the Executive Committee may determine. The Board of Directors may fill any
vacancy which may occur in any office. Any two offices, except those of
President and Vice President, may be held by the same person, but no officer
shall execute, acknowledge or verify any instrument in more than one capacity,
if such instrument is required by law or these Bylaws to be executed,
acknowledged or verified by two or more officers.

Section 2. Term of Office. The term of office of all officers shall be
one year or until their respective successors are chosen, whichever occurs
first. Any Officers may be removed from office at any time with or without cause
by the vote of a majority of the entire Board of Directors.

Section 3. Power and Duties. The Officers of the Corporation shall have
such powers and duties as generally pertain to their respective offices, as well
as such powers and duties as may from time to time be conferred on them by the
Board of Directors or the Executive Committee.

ARTICLE IV

Capital Stock

Section l. Certificate of Shares. Certificates for shares of stock of
the Corporation shall not be issued to any stockholder unless requested by the
stockholder. Certificates for shares of stock shall be in such form as the Board
of Directors may from time to time prescribe. No certificate shall be valid
unless it is signed by the President or a Vice President and by the Secretary or
an Assistant Secretary or the Treasurer or an Assistant Treasurer of the
Corporation and sealed with its seal or unless it bears the facsimile signatures
of such officers and a facsimile of such seal.

Section 2. Transfer of Shares. In cases where certificates for shares
have not been issued, the shares of the Corporation shall be transferable on the
books of the Corporation by the person in whose name the shares are held on the
books of the Corporation or by his duly authorized attorney or legal

-7-

<PAGE>

representative upon receipt by the Corporation of written notice from such
person, his duly authorized attorney or legal representative requesting the
transfer of such shares accompanied by proper instruments of assignment and
transfer and with such proof of the authenticity of the signatures as the
Corporation may reasonably require.

In case of shares of the Corporation for which certificates
have been issued, the shares shall be transferable on the books of the
Corporation by the holder thereof in person or by his duly authorized attorney
or legal representative, upon surrender and cancellation of certificates for the
same number of shares of the same class, duly endorsed or accompanied by proper
instruments of assignment and transfer, with such proof of the authenticity of
the signatures as the Corporation may reasonably require.

Section 3. Stock Ledgers. The stock ledgers of the Corporation,
containing the names and addresses of the stockholders and the number of shares
held by them respectively shall be kept at the principal offices of the
Corporation or at the office of the Transfer Agent, and shall during the usual
business hours of every business day be open for the inspection of any person or
persons who hold and have held, for at least six months, in the aggregate, five
percent of the outstanding shares of the Corporation.

Section 4. Lost, Stolen or Destroyed Certificates. The Board of
Directors or the Executive Committee may determine the conditions upon which a
new certificate of stock of the Corporation of any class may be issued in place
of a certificate which is alleged to have been lost, stolen or destroyed; and
may, in their discretion, require the owner of such certificate or his legal
representative to give bond, with sufficient surety to the Corporation to
indemnify it against any and all loss of claims which may arise by reason of the
issue of a new certificate in the place of the one so lost, stolen or destroyed.

ARTICLE V

Corporate Seal

The Board of Directors shall provide a suitable corporate seal, in such
form and bearing such inscriptions as it may determine.

ARTICLE VI

Fiscal Year

The fiscal year of the Corporation shall begin on the first day of July
and shall end on the thirtieth day of June in each year.

-8-

<PAGE>

ARTICLE VII

Indemnification of Directors, Officers, Employees and Agents

(7/21/75)

(a) This Corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending, or completed action,
suit, or proceeding, whether civil, criminal, administrative, or investigative
(other than an action by or in the right of this Corporation) by reason of the
fact that he is or was a director, officer, employee, or agent of this
Corporation. The indemnification may be against expenses (including attorneys'
fees), judgments, fines, and amounts paid in settlement actually and reasonably
incurred by him in connection with the action, suit, or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the Corporation, and with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit, or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the Corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful. No
person shall, however, be indemnified by this Corporation in any situation which
involves such person's willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office.

(b) This Corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending, or completed action or
suit by or in the right of this Corporation to procure a judgment in its favor
by reason of the fact that he is or was a director, officer, employee, or agent
of this Corporation. The indemnification may be against expenses (including
attorneys' fees) actually and reasonably incurred by him in connection with the
defense or settlement of the action or suit if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
this Corporation; except that no indemnification shall be made in respect of any
claim, issue, or matter as to which the person has been adjudged to be liable
for negligence or misconduct in the performance of his duty to this Corporation,
unless and only to the extent that the court in which the action or suit was
brought, or a court of equity in the county in which this Corporation has its
principal office, determines upon application that, despite the adjudication of
liability but in view of all circumstances of the case, the person is fairly and
reasonably entitled to indemnity for the expenses which the court shall deem
proper. No person shall, however, be indemnified by this Corporation in any
situation which involves such person's willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office.

-9-

<PAGE>

(c) To the extent that a director, officer, employee, or agent of this
Corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsection (a) or (b), or in defense
of any claim, issue, or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.

(d) Any indemnification under subsection (a) or (b) (unless ordered by a
court) shall be made by this Corporation only as authorized in the specific case
upon a determination that indemnification of the director, officer, employee, or
agent is proper in the circumstances because he has met the applicable standard
of conduct set forth in subsection (a) or (b). The determination shall be made
(l) by the Board of Directors by a majority vote of a quorum consisting of
Directors who were not parties to the action, suit or proceeding, or (2) if a
quorum is not obtainable, or, even if obtainable a quorum of disinterested
Directors so directs, by independent legal counsel in a written opinion, or (3)
by the stockholders in accordance with the charter and Bylaws of this
Corporation.

If, however, there is neither a court determination on the merits
that the defendant is not liable nor a court determination that the defendant is
not guilty of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his office, no
indemnification will be permitted unless an independent legal counsel (not
including a counsel who does work for either this Corporation, its adviser or
principal underwriter, or persons affiliated with these persons) determines,
based on a review of the facts, that the person in question was not guilty of
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office.

(e) Expenses (including attorneys' fees) incurred in defending a civil or
criminal action, suit or proceeding may be paid by this Corporation in advance
of the final disposition thereof if authorized in the specific case by a
preliminary determination following one of the procedures set forth in the
second sentence of subsection (d) that there is a reasonable basis for a belief
that the director, officer, employee or agent met the applicable standard of
conduct set forth in subsection (a) or (b).

In addition, if any advance of indemnification monies is made
prior to a final determination that the recipient is entitled to
indemnification, such advance shall be limited in the following respects:

(l) Any advance must be limited to amounts used, or to be
used, for the preparation and/or presentation of a defense to the
action (including costs connected with preparation of a settlement);

-10-

<PAGE>

(2) Any advance must be accompanied by a written promise by,
or on behalf of, the recipient to repay that amount of the advance
which exceeds the amount to which it is ultimately determined that he
is entitled to receive from this Corporation by reason of
indemnification;

(3) Such promise must be secured by a surety bond or other
suitable insurance;

(4) Such surety bond or other insurance must be paid for by
the recipient of the advance.

(f) The indemnification provided by this section shall not be deemed
exclusive of any other rights to which a person may otherwise be entitled, both
as to action in his official capacity and as to action in another capacity while
holding the office, and shall continue as to a person who has ceased to be a
director, officer, employee or agent and inure to the benefit of the heirs,
executors, and administrators of the person.

(g) This Corporation may purchase and maintain insurance on behalf of any
person who is or was a director, officer, employee, or agent of this
Corporation, against any liability asserted against him and incurred by him in
any such capacity, or arising out of his status as such, whether or not this
Corporation would have the power to indemnify him against the liability under
the provisions of this section, except that no insurance shall be purchased and
maintained which protects any director, officer, employee or agent of this
Corporation against liabilities arising from action involving willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office unless such insurance merely provides for
payment to this Corporation of any damages caused by such director, officer,
employee or agent and also provides that the insurance company would be
subrogated to the rights of this Corporation to recover from any such director,
officer, employee or agent.

ARTICLE VIII

Amendment of Bylaws

The Bylaws of the Corporation may be altered, amended, added to or
repealed by the vote of three-fourths of the entire Board of Directors.

-11-

<PAGE>

IAA TRUST FUNDS APPLICATION
<S> <C>

1. AMOUNT INVESTED ($1,000 minimum)
FORM OF PAYMENT - INITIAL INVESTMENT
[ ] Check for $ enclosed - payable to FUND(s)/SERIES of your choice
------------------------
[ ] NAV Purchase [ ] Farm Bureau Member - Membership No.
------------------------------------------
[ ] Customer of IAA Trust Company
[ ] Employee of IAA or affiliate
[ ] Broker/Dealer
[ ] My Dealer purchased of the FUND/SERIES on
------------------------------------ ----------------------------------------
Shares Date
[ ] IAA Trust Growth Fund
[ ] IAA Trust Asset Allocation Fund
[ ] IAA Trust Tax Exempt Bond Fund
IAA Trust Taxable Fixed
Income Series Fund
[ ] Money Market Series
[ ] Short-Term Government Bond Series
[ ] Long-Term Bond Series

2. REGISTRATION (Please Print)
INDIVIDUAL *(Joint ownership with rights of survivorship unless otherwise noted)

-------------------------------------------------------------------------------------------------------------------------------
First name Middle Initial Last Name Social Security #

-------------------------------------------------------------------------------------------------------------------------------
Jt. Owner First Name* Middle Initial Last Name Social Security #

GIFT TO MINORS

-------------------------------------------------------------------------------------------------------------------------------
Name of Custodian (name one only) As Custodian For (name one only)

Under the Uniform Gift to Minors Act -------------------
------------------------------------------------------
State Minor's Social Security #

CORPORATIONS, PARTNERSHIPS, TRUSTS and OTHERS (complete Corporate Resolution)

-------------------------------------------------------------------------------------------------------------------------------
Name of Corporation, Partnership, Trust or Other

-------------------------------------------------------------------------------------------------------------------------------
Tax I.D. # Name of Trustee(s) Date of Trust

Citizen of: [ ] United States [ ] Other (Please Indicate)
----------------------------------------------
3. MAILING ADDRESS OF RECORD AND TELEPHONE NUMBER(S)

-------------------------------------------------------------------------------------------------------------------------------
Street Address & Apt. # City State Zip

(____________) (____________)
---------------------------------- ------------------------
Residence Number Business Number

4. DISTRIBUTION OPTIONS (Please indicate one - Distributions will be reinvested if no option is checked)
[ ] Automatic Compounding (dividends & capital gains in additional shares)
[ ] Cash Dividends (dividends in cash, capital gains in additional shares)
[ ] All Cash (dividends & capital gains in cash)

5. SYSTEMATIC WITHDRAWAL PLAN (Minimum investment $5,000)

A check will be sent each [ ] month or [ ] quarter in the amount of $ __________________ to you at your address of record
unless otherwise noted.
Monthly minimum amount is $25.00.

6. TELEPHONE EXCHANGE and REDEMPTION OPTION

[ ] Permits exchanges between accounts with identical registrations.

[ ] I (we)authorize FPS Services to honor telephone instructions for my(our)
account. Neither the Fund nor FPS Services will be liable for properly
acting upon telephone instructions believed to be genuine.

Please attach a voided check on the Transfer account or complete below.

- ----------------------------------------------------------------------------------------------------------------------------------
Name of Bank City State

- ----------------------------------------------------------------------------------------------------------------------------------
Account Number [ ] Checking [ ] Savings Bank Routing Number (nine digits)

7. SIGNATURE AND CERTIFICATION, And Back-up Withholding Certification

Under the penalties of perjury, I (we) certify the following:
1. I (We) certify that the number shown on this form is my (our) correct tax identification number.
2. I (We) am not (are not) subject to backup withholding as a result of
failure to report all interest and dividends, or the Internal Revenue
Service has notified me (us) that I (we) am (are) no longer subject to
backup withholding.

Citizen of: [ ] United States [ ] Other (Please indicate)_____________________________

"The Internal Revenue Service does not require your consent to any
provision of this document other than the certifications required to
avoid backup withholding".

----------------------------------------------------------------------------------- -----------------------
Signature [ ] Owner [ ] Custodian [ ] Trustee Date

----------------------------------------------------------------------------------- -----------------------
Signature of Joint Owner (if applicable) Date

<PAGE>

[ ] Check box if you have been notified by the IRS that you are subject to backup withholding.

8. INVESTMENT DEALER INFORMATION

- ----------------------------------------------------------------------------------------------------------------------------------
Firm Name Rep. Name & Number Authorized Signature

- ----------------------------------------------------------------------------------------------------------------------------------
Street Address City State Zip
</TABLE>

<PAGE>

INVESTMENT ADVISORY AGREEMENT

IAA TRUST GROWTH FUND, INC.

AGREEMENT, effective commencing on September 29, 1992, between IAA Trust
Company, an Illinois corporation, (the "Adviser") and IAA Trust Growth Fund,
Inc., a Maryland corporation, (the "Fund").

WHEREAS, the Fund is registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as an open-end, diversified management investment
company.

WHEREAS, the Fund wishes to retain the Adviser to render investment
advisory services to the Fund, and the Adviser is willing to furnish such
services to the Fund;

NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between the Fund and the Adviser as follows:

1. Appointment. The Fund hereby appoints the Adviser to act as investment
adviser to the Fund for the periods and on the terms set forth in this
Agreement. The Adviser accepts such appointment and agrees to furnish the
services herein set forth, for the compensation herein provided.

2. Investment Advisory Duties. Subject to the supervision of the
Directors of the Fund, the Adviser will (a) provide a program of continuous
investment management for the Fund in accordance with the Fund's investment
objectives, policies and limitations as stated in the Fund's Prospectus and
Statement of Additional Information included as part of the Fund's Registration
Statement filed with the Securities and Exchange Commission, as they may be
amended from time to time, copies of which shall be provided to the Adviser by
the Fund; (b) make investment decisions for the Fund; and (c) place orders to
purchase and sell securities for the Fund.

In performing its investment management services to the Fund
hereunder, the Adviser will provide the Fund with ongoing investment guidance
and policy direction, including oral and written research, analysis, advice,
statistical and economic data and

<PAGE>

judgments regarding individual investments, general economic conditions and
trends and long-range investment policy. The Adviser will determine the
securities, instruments, repurchase agreements, options and other investments
and techniques that the Fund will purchase, sell, enter into or use, and will
provide an ongoing evaluation of the Fund's portfolio. The Adviser will
determine what portion of the Fund's portfolio shall be invested in securities
and other assets, and what portion if any, should be held uninvested.

The Adviser further agrees that, in performing its duties hereunder,
it will:

(a) comply with the 1940 Act and all rules and regulations thereunder,
the Internal Revenue Code (the "Code") and all other applicable federal and
state laws and regulations, and with any applicable procedures adopted by the
Directors;

(b) use reasonable efforts to manage the Fund so that it will qualify,
and continue to qualify, as a regulated investment company under Subchapter M of
the Code and regulations issued thereunder;

(c) place orders pursuant to its investment determinations for the
Fund directly with the issuer, or with any broker or dealer, in accordance with
applicable policies expressed in the Fund's Prospectus and/or Statement of
Additional Information and in accordance with applicable legal requirements;

(d) furnish to the Fund whatever statistical information the Fund may
reasonably request with respect to the Fund's assets or contemplated
investments. In addition, the Adviser will keep the Fund and the Directors
informed of developments materially affecting the Fund's portfolio and shall, on
the Adviser's own initiative, furnish to the Fund from time to time whatever
information the Adviser believes appropriate for this purpose;

(e) make available to the Fund's administrator, Fund/Plan Services,
Inc. (the "Administrator"), and the Fund, promptly upon their request, such
copies of its investment records and ledgers with respect to the Fund as may be
required to assist the Administrator and the Fund in their compliance with
applicable laws and regulations. The Adviser will

-3-

<PAGE>

furnish the Directors with such periodic and special reports regarding the Fund
as they may reasonably request;

(f) immediately notify the Fund in the event that the Adviser or any
of its affiliates (1) becomes aware that it is subject to a statutory
disqualification that prevents the Adviser from serving as investment adviser
pursuant to this Agreement; or (2) becomes aware that it is the subject of an
administrative proceeding or enforcement action by the Securities and Exchange
Commission ("SEC") or other regulatory authority. The Adviser further agrees to
notify the Fund immediately of any material fact known to the Adviser respecting
or relating to the Adviser that is not contained in the Fund's Registration
Statement regarding the Fund, or any amendment or supplement thereto, but that
is required to be disclosed thereon, and of any statement contained therein that
becomes untrue in any material respect.

3. Allocation of Charges and Expenses. Except as otherwise specifically
provided in this Section 3, the Adviser shall pay the compensation and expenses,
including office expenses, of all its directors, officers and employees who
serve as directors, officers and employees of the Fund (including the Fund's
share of payroll taxes), and the Adviser shall make available, without expense
to the Fund, the service of its directors, officers and employees who may be
duly elected directors and officers of the Fund, subject to their individual
consent to serve and to any limitations imposed by law.

The Adviser shall not be required to pay any expenses of the Fund
other than those specifically allocated to the Adviser in this Section 3. In
particular, but without limiting the generality of the foregoing, the Adviser
shall not be responsible, except to the extent of the reasonable compensation of
such of the Fund's employees as are directors, officers or employees of the
Adviser whose services may be involved, for the following expenses of the Fund:
organization and certain offering expenses of the Fund (including out-of-pocket
expenses, but not including the Adviser's overhead and employee costs); fees
payable to the Adviser and to any other Fund advisers or consultants; legal
expenses, auditing and accounting expenses; interest expenses; telephone, telex,
facsimile, postage and other communications expenses; taxes and governmental
fees; fees, dues and expenses incurred by or with respect to the Fund in
connection with membership in investment company trade

-3-

<PAGE>

organizations; cost of insurance relating to fidelity coverage for the Fund's
directors, officers and employees, fees and expenses of the Fund's Administrator
or of any custodian, subcustodian, transfer agent, registrar, or dividend
disbursing agent of the Fund; payments to the Administrator for maintaining the
Fund's financial books and records and calculating its daily net asset value;
other payments for portfolio pricing or valuation services to pricing agents,
accountants, bankers and other specialists, if any; expenses of preparing share
certificates; other expenses in connection with the issuance, offering,
distribution or sale of securities issued by the Fund; expenses relating to
investor and public relations; expenses of registering and qualifying shares of
the Fund for sale; freight, insurance and other charges in connection with the
shipment of the Fund's portfolio securities; brokerage commissions or other
costs of acquiring or disposing of any portfolio securities or other assets of
the Fund, or of entering into other transactions or engaging in any investment
practices with respect to the Fund; expenses of printing and distributing
Prospectuses, Statements of Additional Information, reports, notices and
dividends to stockholders; costs of stationery; any litigation expenses; costs
of stockholders' and other meetings; the compensation and all expenses
(specifically including travel expenses relating to the Fund's business) of
officers, directors and employees of the Fund who are not officers, directors,
employees, or otherwise interested persons of the Adviser.

4. Compensation. As compensation for the services provided and expenses
assumed by the Adviser under this Agreement, the Fund will pay the Adviser on
the tenth day of each calendar month an advisory fee computed daily at an annual
rate equal to 3/4ths of 1% of the Fund's average daily net assets. The value of
net assets of the Fund shall always be determined pursuant to the applicable
provisions of the Articles, the Registration Statement and the 1940 Act. If the
determination of net asset value is suspended for any particular business day,
then for the purposes of this Section 4, the value of the net assets of the Fund
as last determined shall be deemed to be the value of its net assets for that
day. If the determination of the net asset value of the shares of the Fund has
been so suspended for a period including any month end when the Adviser's
compensation is payable at the end of such month shall be computed on the basis
of the value of the net assets of the Fund as last determined (whether during or
prior to such month). If the Fund determines the value of the net assets of its
portfolio more than once on any day, then the last such determination thereof on
that day shall be deemed to be the sole determination thereof on that day for
the purposes of this Section 4.

-4-

<PAGE>

5. Books and Records. The Adviser agrees to maintain such books and
records with respect to its services to the Fund as are required by Section 31
under the 1940 Act, and rules adopted thereunder, and by other applicable legal
provisions, and to preserve such records for the periods and in the manner
required by that Section, and those rules and legal provisions. The Adviser also
agrees that records it maintains and preserves pursuant to Rules 31a-1 and 31a-2
under the 1940 Act and otherwise in connection with its services hereunder are
the property of the Fund and will be surrendered promptly to the Fund upon its
request. The Adviser further agrees that it will furnish to regulatory
authorities having the requisite authority any information or reports in
connection with its services hereunder which may be requested in order to
determine whether the operations of the Fund are being conducted in accordance
with applicable laws and regulations.

6. Standard of Care and Limitation of Liability. The Adviser shall
exercise its best judgment in rendering the services provided by it under this
Agreement. The Adviser shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Fund or the holders of the Fund's shares
in connection with the matters to which this Agreement relates, provided that
nothing in this Agreement shall be deemed to protect or purport to protect the
Adviser against any liability to the Fund or to holders of the Fund's shares to
which the Adviser would otherwise be subject by reason of willful misfeasance,
bad faith or negligence on its part in the performance of its duties or by
reason of the Adviser's reckless disregard of its obligations and duties under
this Agreement. As used in this Section 6, the term "Adviser" shall include any
officers, directors, employees, or other affiliates of the Adviser performing
services with respect to the Fund.

7. Services Not Exclusive. It is understood that the services of the
Adviser are not exclusive, and that nothing in this Agreement shall prevent the
Adviser from providing similar services to other investment companies or to
other series of investment companies, or from engaging in other activities,
provided such other services and activities do not, during the term of this
Agreement, interfere in a material manner with the Adviser's ability to meet its
obligations to the Fund hereunder. When the Adviser recommends the purchase or
sale of a security for other investment companies and other clients, and at the
same time the
-5-

<PAGE>

Adviser recommends the purchase or sale of the same security for the Fund, it is
understood that in light of its fiduciary duty to the Fund, such transactions
will be executed on a basis that is fair and equitable to the Fund. In
connection with purchases or sales of portfolio securities for the account of
the Fund, neither the Adviser nor any of its directors, officers or employees
shall act as a principal or agent or receive any commission. If the Adviser
provides any advice to its clients concerning the shares of the Fund, the
Adviser shall act solely as investment counsel for such clients and not in any
way on behalf of the Fund.

8. Duration and Termination. This Agreement shall continue until
September 29, 1994, and thereafter shall continue automatically for successive
annual periods, provided such continuance is specifically approved at least
annually by (i) the Directors or (ii) a vote of a "majority" (as defined in the
1940 Act) of the Fund's outstanding voting securities (as defined in the 1940
Act), provided that in either event the continuance is also approved by a
majority of the Directors who are not "interested persons" (as defined in the
1940 Act) of any party to this Agreement, by vote cast in person at a meeting
called for the purpose of voting on such approval. Notwithstanding the
foregoing, this Agreement may be terminated: (a) at any time without penalty by
the Fund upon the vote of a majority of the Directors or by vote of the majority
of the Fund's outstanding voting securities, upon sixty (60) days' written
notice to the Adviser or (b) by the Adviser at any time without penalty, upon
sixty (60) days' written notice to the Fund. This Agreement will also terminate
automatically in the event of its assignment (as defined in the 1940 Act).

9. Amendments. No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, waiver, discharge or
termination is sought, and no amendment of this Agreement shall be effective
until approved by an affirmative vote of (i) a majority of the outstanding
voting securities of the Fund, and (ii) a majority of the Directors, including a
majority of Directors who are not interested persons of any party to this
Agreement, cast in person at a meeting called for the purpose of voting on such
approval, if such approval is required by applicable law.

10. Miscellaneous.

-6-

<PAGE>

(a) This Agreement shall be governed by the laws of the State of
Illinois, provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act or rules or orders of the SEC thereunder.

(b) The captions of this Agreement are included for convenience only
and in no way define or limit any of the provisions hereof or otherwise affect
their construction or effect.

-7-

<PAGE>

(c) If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule, or otherwise, the remainder of this
Agreement shall not be affected thereby and, to this extent, the provisions of
this Agreement shall be deemed to be severable.

(d) Nothing herein shall be construed as constituting the Adviser as
an agent of the Fund.

IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of September 29, 1992.

IAA TRUST GROWTH FUND, INC.

By:__________________________________
President

IAA TRUST COMPANY

By:________________________________________
Executive Vice President

-8-

UNDERWRITING AGREEMENT

This Agreement, dated as of the 1st day of August, 1995, made by and
between IAA Trust Growth Fund, Inc. ("the Growth Fund"), a corporation duly
organized under the laws of the state of Maryland and operating as a registered
investment company under the Investment Company Act of 1940, as amended (the
"Act"); IAA Trust Company ("IAA Trust"), a corporation duly organized and
existing under the laws of the State of Illinois; and Fund/Plan Broker Services,
Inc. ("Fund/Plan"), a corporation duly organized and existing under the laws of
the State of Delaware (collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, IAA Trust has been appointed investment advisor (the
"Advisor") to the Growth Fund; and

WHEREAS, Fund/Plan is a broker-dealer registered with the U.S.
Securities and Exchange Commission and a member in good standing of the National
Association of Securities Dealers, Inc. (the "NASD"); and

WHEREAS, the Parties are desirous of entering into an agreement
providing for the distribution by Fund/Plan of the shares of the Growth Fund
(the "Shares");

NOW, THEREFORE, in consideration of the promises and agreements of the
Parties contained herein and in exchange of good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties agree as
follows:

1. Appointment.

The Growth Fund hereby appoints Fund/Plan as its exclusive agent for
the distribution of the Shares in the fifty United States of America,
the District of Columbia and Puerto Rico, and Fund/Plan hereby accepts
such appointment under the terms of this Agreement. The Growth Fund
agrees that it will not sell any shares to any person except to fill
orders for the shares received through Fund/Plan; provided, however,
that the foregoing exclusive right shall not apply: (a) to shares
issued or sold in connection with the merger or consolidation of any
other investment company with the Growth Fund or the acquisition by
purchase or otherwise of all or substantially all of the assets of any
investment company or substantially all of the outstanding shares of
any such company by the Growth Fund; (b) to shares which may be offered
by the Growth Fund to its stockholders for reinvestment of cash
distributed from capital gains or net investment income of the Growth
Fund; or (c) to shares which may be issued to shareholders of other
funds who exercise

Page 1 of 9

<PAGE>

any exchange privilege set forth in the Growth Fund's Prospectus.
Notwithstanding any other provision hereof, the Growth Fund may
terminate, suspend, or withdraw the offering of the Shares whenever in
its sole discretion, it deems such action to be desirable.

2. Sale and Repurchase of Shares.

(a) Fund/Plan is hereby granted the right as agent for the Growth
Fund, to sell Shares to the public against orders therefor at
the public offering price (as defined in sub- paragraph 2. (c)
below).

(b) Fund/Plan will also have the right to take, as agent for the
Growth Fund, all actions which, in Fund/Plan's judgment, are
necessary to carry into effect the distribution of the Shares.

(d) The net asset value of the Shares shall be determined in the
manner provided in the then current prospectus and statement
of additional information relating to the Shares and when
determined shall be applicable to all transactions as provided
in the prospectus. The net asset value of the Shares shall be
calculated by the Growth Fund or by another entity on behalf
of the Growth Fund. Fund/Plan shall have no duty to inquire
into or liability for the accuracy of the net asset value per
Share as calculated.

(e) On every sale, the Growth Fund shall receive the applicable
net asset value of the Shares promptly.

(f) Upon receipt of purchase instructions, Fund/Plan will transmit
such instructions to the Growth Fund or its transfer agent for
registration of the Shares purchased.

(g) Nothing in this Agreement shall prevent Fund/Plan or any
affiliated person (as defined in the Act) of Fund/Plan from
acting as underwriter or distributor for any other person,
firm or corporation (including other investment companies) or
in any way limit or restrict Fund/Plan or such affiliated
person from buying, selling, or trading any securities for its
or their own account or for the accounts of others for whom it
or they may be acting; provided, however, that Fund/Plan
expressly agrees that it will not for its own account purchase
any shares of the Growth Fund except for investment purposes
and that it will not for its own account sell any such shares
except by redemption of such shares by the Growth Fund, and
that it will not undertake any activities which, in its
judgment, will adversely affect the performance of its
obligations to the Growth Fund under this Agreement.

Page 2 of 9

<PAGE>

(h) Fund/Plan may repurchase Shares at such prices and upon such
terms and conditions as shall be specified in the Prospectus.

3. Rules of Sale of Shares.

Fund/Plan does not agree to sell any specific number of Shares.
Fund/Plan, as Underwriter for the Growth Fund, undertakes to sell
Shares on a best efforts basis and only against orders received
therefor. The Growth Fund reserves the right to terminate, suspend or
withdraw the sale of its Shares for any reason deemed adequate by it
and the Growth Fund reserves the right to refuse at any time or times
to sell any of its Shares to any person for any reason deemed adequate
by it.

4. Rules of NASD.

(a) Fund/Plan will conform to the Rules of Fair Practice of the
NASD and the securities laws of any jurisdiction in which it
directly or indirectly sells any Shares.

(b) Fund/Plan will require each dealer with whom Fund/Plan has a
selling agreement to conform to the applicable provisions of
the Prospectus, with respect to the public offering price of
the Shares, and Fund/Plan shall not cause the Growth Fund to
withhold the placing of purchase orders so as to make a profit
thereby.

(c) The Growth Fund and IAA Trust agree to furnish to Fund/Plan
sufficient copies of any and all: agreements, plans,
communications with the public or other materials which the
Growth Fund or IAA Trust intends to use in connection with any
sales of Shares in adequate time for Fund/Plan to file and
clear such materials with the proper authorities before they
are put in use. Fund/Plan and the Growth Fund or IAA Trust may
agree that any such material does not need to be filed prior
to distribution. In addition, the Growth Fund and IAA Trust
agree not to use any such materials until so filed and cleared
for use by appropriate authorities as well as by Fund/Plan.

Page 3 of 9

<PAGE>

(d) Fund/Plan, at its own expense, will qualify as a dealer or
broker, or otherwise, under all applicable state or federal
laws required in order that the Shares may be sold in such
states as may be mutually agreed upon by the Parties.

(e) Fund/Plan shall remain registered with the U.S. Securities
and Exchange Commission and a member of the National
Association of Securities Dealers for the term of this
Agreement.

(f) Fund/Plan shall not, in connection with any sale or
solicitation of a sale of the Shares, make or authorize any
representative, Service Organization, broker or dealer to
make, any representations concerning the Shares except those
contained in the Prospectus covering the Shares and in
communications with the public or sales materials approved by
Fund/Plan as information supplemental to such Prospectus.
Copies of the Prospectus will be supplied by the Growth Fund
or IAA Trust to Fund/Plan in reasonable quantities upon
request.

5. Records to be Supplied by the Growth Fund.

The Growth Fund shall furnish to Fund/Plan copies of all information,
financial statements and other papers which Fund/Plan may reasonably
request for use in connection with the distribution of the Shares
including, but not limited to, one certified copy of all financial
statements prepared for the Growth Fund by its independent public
accountants.

6. Expenses.

(a) The Growth Fund will bear the following expenses:

(i) preparation, setting in type, and printing of
sufficient copies of the prospectuses and statements
of additional information for distribution to
shareholders, and the distribution of same to the
shareholders;

(ii) preparation, printing, and distribution of reports
and other communications to shareholders;

(iii) registration of the Shares under the federal
securities laws;

(iv) qualification of the Shares for sale in the
jurisdictions as directed by the Growth Fund;

(v) maintaining facilities for the issue and transfer
of the Shares;

(vi) supplying information, prices, and other data to be
furnished by the Growth Fund under this Agreement;
and

Page 4 of 9
<PAGE>

(vii) any original issue taxes or transfer taxes
applicable to the sale or delivery of the Shares
or certificates therefor.

(b) Underwriter will pay expenses incident to the sale and
distribution of the Shares sold hereunder to the extent that
payment of such expenses is made by the Fund pursuant to a
Distribution Plan as set forth under Rule 12b-1 of the
Investment Company Act of 1940, as amended. All expenses in
excess of those monies paid pursuant to the Distribution Plan
will be paid by the Advisor.

(c) The Underwriter will provide a report to the Growth Fund
regarding the Distribution Plan under Rule 12b-1 on a
quarterly basis. The report will identify accruals,
expenditures and trail commission payments.
7. Term.

(a) The term of this Agreement shall commence on the date
hereinabove first written ("Effective Date").

(b) This Agreement shall remain in effect for two (2) years from
the Effective Date. This Agreement shall continue thereafter
for periods not exceeding one (1) year if approved at least
annually (i) by a vote of a majority of the outstanding voting
securities of each Series or by a vote of the Board of
Directors of the Growth Fund, and (ii) by a vote of a majority
of the Directors of the Growth Fund who are not interested
persons or parties to this Agreement (other than as Directors
of the Growth Fund), cast in person at a meeting called for
the purpose of voting on such approval.

(c) This Agreement (i) may at any time be terminated without the
payment of any penalty, either by a vote of the Directors of
the Growth Fund or by a vote of a majority of the outstanding
voting securities on sixty (60) days' written notice to
Fund/Plan; and (ii) may be terminated by Fund/Plan on sixty
(60) days' written notice to the Growth Fund.

(d) This Agreement shall automatically terminate in the event of
its assignment or upon the termination of the Administration
Agreement between Fund/Plan Services, Inc., and the Growth
Fund.

8. Indemnification of Fund/Plan by IAA Trust.

IAA Trust will indemnify and hold Fund/Plan harmless for the actions of
IAA Trust's employees registered with the NASD as Fund/Plan
representatives and will undertake to maintain compliance with all
rules and regulations concerning any and all sales presentations made
by such employees.

Page 5 of 9
<PAGE>

9. Liability of Fund/Plan.

(a) Fund/Plan, its directors, officers, employees, shareholders
and agents shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Growth Fund in
connection with the performance of this Agreement, except a
loss resulting from a breach of Fund/Plan's obligation
pursuant to Section 4 of this Agreement, a breach of fiduciary
duty with respect to the receipt of compensation for services
or a loss resulting from willful misfeasance, bad faith or
negligence on the part of Fund/Plan in the performance of its
obligations and duties or by reason of its reckless disregard
of its obligations and duties under this Agreement.

(b) The Growth Fund agrees to indemnify and hold harmless
Fund/Plan against any and all liability, loss, damages, costs
or expenses (including reasonable counsel fees) which
Fund/Plan may incur or be required to pay hereafter, in
connection with any action, suit or other proceeding, whether
civil or criminal, before any court or administrative or
legislative body, in which Fund/Plan may be involved as a
party or otherwise or with which Fund/Plan may be threatened,
by reason of the offer or sale of the Growth Fund shares by
persons other than Fund/Plan or its representatives.

(c) Any person, even though also a director, officer, employee,
shareholder or agent of Fund/Plan, who may be or become an
officer, director, trustee, employee or agent of the Growth
Fund, shall be deemed, when rendering services to the Growth
Fund or acting on any business of the Growth Fund (other than
services or business in connection with Fund/Plan's duties
hereunder), to be rendering such services to or acting solely
for the Growth Fund and not as a director, officer, employee,
shareholder or agent, or one under the control or direction of
Fund/Plan even though receiving a salary from Fund/Plan.

(d) The Growth Fund agrees to indemnify and hold harmless
Fund/Plan, and each person, who controls Fund/Plan within the
meaning of Section 15 of the Securities Act of 1933, as
amended (the "Securities Act"), or Section 20 of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), against any and all losses, claims, damages and
liabilities, joint or several (including any reasonable
investigative, legal and other expenses incurred in connection

Page 6 of 9
<PAGE>

therewith) to which they, or any of them, may become subject
under the Act, the Securities Act, the Exchange Act or other
federal or state law or regulation, at common law or otherwise
insofar as such losses, claims, damages or liabilities (or
actions, suits or proceedings in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue
statement of a material fact contained in a prospectus,
statement of additional information, supplement thereto, sales
literature or other written information prepared by the Growth
Fund and furnished by the Growth Fund to Fund/Plan for
Fund/Plan's use hereunder, disseminated by the Growth Fund or
arise out of or are based upon any omission or alleged
omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading. Such indemnity shall not, however, inure to the
benefit of Fund/Plan (or any person controlling Fund/Plan) on
account of any losses, claims, damages or liabilities (or
actions, suits or proceedings in respect thereof) arising from
the sale of the shares of the Growth Fund to any person by
Fund/Plan (i) if such untrue statement or omission or alleged
untrue statement or omission was made in the prospectus,
statement of additional information, or supplement, sales or
other literature, in reliance upon and in conformity with
information furnished in writing to the Growth Fund by
Fund/Plan specifically for use therein or (ii) if such losses,
claims, damages, or liabilities arise out of or are based upon
an untrue statement or omission or alleged untrue statement or
omission found in any prospectus, statement of additional
information, supplement, sales or other literature,
subsequently corrected, but, negligently distributed by
Fund/Plan and a copy of the corrected prospectus was not
delivered to such person at or before the confirmation of the
sale to such person. Underwriter agrees to indemnify and hold
harmless the Fund, each person, if any, who controls the Fund
within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, insofar as such losses,
claims, damages or liabilities arise out of or are based upon
any untrue statement or omission or alleged untrue statement
of a material fact contained in a Prospectus or Statement of
Additional Information or any supplement thereto, or arise out

Page 7 of 9
<PAGE>

of or are based upon any omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, if
based upon information furnished to the Fund by the
Underwriter in writing specifically for use therein.

(e) Fund/Plan shall not be responsible for any damages,
consequential or otherwise, which IAA Trust or the Growth Fund
may experience, due to the disruption of the distribution of
Shares caused by any action arising out of the actions or
inactions of any registered representative or affiliate of
Fund/Plan.

10. Amendments.

No provision of this Agreement may be amended or modified, in any
manner whatsoever except by a written agreement properly authorized and
executed by the Parties.

11. Section Headings.

Section and Paragraph headings are for convenience only and shall not
be construed as part of this Agreement.

12. Reports.

Fund/Plan shall prepare reports for the Board of Directors of the
Growth Fund on a quarterly basis showing such information as from time
to time shall be reasonably requested by such Board.

13. Severability.

If any part, term or provision of this Agreement is held by any court
to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not
affected, and the rights and obligations of the parties shall be
construed and enforced as if the Agreement did not contain the
particular part, term or provision held to be illegal or invalid
provided that the basic agreement is not thereby substantially
impaired.

14. Governing Law.

This Agreement shall be governed by the laws of the Commonwealth of
Pennsylvania and the venue of any action arising under this Agreement
shall be Montgomery County, Commonwealth of Pennsylvania.

Page 8 of 9
<PAGE>

15. Authority to Execute

The Parties represent and warrant that the execution and delivery of
this Agreement by the undersigned officers of the Parties has been duly
and validly authorized by resolution of the respective Boards of
Directors or each of the Parties.

16. This Agreement may be executed in two or more counterparts, each of
which when so executed shall be deemed to be an original, but such
counterparts shall together constitute but one and the same instrument

IN WITNESS WHEREOF, the parties hereto have caused this
Agreement consisting of nine typewritten pages to be signed by their duly
authorized officers, as of the day and year first above written.

IAA Trust Company

By: Gary E. Mede
-------------------------------------
President

IAA Trust Growth Fund, Inc.

By: Richard M. Miller
---------------------------------------
Vice President

Fund/Plan Broker Services, Inc.

By: Kenneth J. Kempf,
-----------------------------
President

Page 9 of 9

CUSTODIAN AGREEMENT

CUSTODIAN AGREEMENT, made this 31st day of March, 1992, effective May 1,
1992, between Country Capital Growth Fund, Inc., organized and existing under
the laws of the State of Maryland, having its principal office and place of
business at 1711 G.E. Road, Bloomington, Illinois (hereinafter called the
"Fund"), and IAA Trust Company of Bloomington, Illinois, a trust company
organized and existing under the laws of the State of Illinois, having its
principal office and place of business at 1701 Towanda Avenue, Bloomington,
Illinois (hereinafter called the "Custodian").

W I T N E S S E T H:

that for and in consideration of the mutual promises hereinafter set forth, the
Fund and the Custodian agree as follows:

I.
--

APPOINTMENT OF CUSTODIAN
------------------------

1. The Fund hereby constitutes and appoints the Custodian as custodian
of all of the securities and moneys at any time owned by the Fund during the
period of this Agreement.

2. The Custodian hereby accepts appointment as such custodian and
agrees to perform the duties thereof as hereinafter set forth.

II.
---

CUSTODY OF CASH AND SECURITIES
------------------------------

1. The Fund will deliver or cause to be delivered to the Custodian all
securities and all moneys owned by it, including cash received for the issuance
of its shares, at any time during the period of this Agreement. The Custodian
will not be responsible for such securities and such moneys until actually
received by it. The Fund shall instruct the Custodian from time to time in its
sole discretion, by means of a certificate signed in the name of the Fund by two
officers in accordance with the provisions of Article IX, or in connection with
the purchase or sale of money market securities, by means of the oral
instructions of an authorized person, as to the manner in which and in what
amounts such securities and moneys are to be deposited on behalf of the Fund in
the Book-Entry System or the depository, as each term is defined in Article IX;
provided, however, that prior to the deposit of securities of the Fund in either
the Book-Entry System or the depository, including a deposit in connection with
the settlement of a purchase or sale, or a delivery of loan collateral, the
Custodian shall have received a certified resolution of the Fund's Board of
Directors specifically approving such deposits by the Custodian on behalf of the
Fund in the Book-Entry System or the depository as the case may be. Securities
and moneys of the Fund

<PAGE>

deposited in either the Book-Entry System or the depository, as the case may be,
will be represented in accounts which include only assets held by the Custodian
for its customers, in fiduciary or representative capacity.

2. The Custodian shall credit to a separate account in the name of the
Fund all moneys received by it for the account of the Fund, and shall disburse
the same only:

(a) In payment for securities purchased, as provided in Article III
hereof;

(b) In payment of dividends or distributions as provided in Article
IV hereof; or

(d) In payment for capital stock of the Fund redeemed by it, as
provided in Article V hereof; or,

(e) Pursuant to certificates, notices or written instructions of the
Fund, signed in its name by any two officers (as defined in
Article IX) or, with respect to money market securities, as
defined in Article IX, the oral instructions of an authorized
person, as defined in Article IX, setting forth the name and
address of the person to whom payment is to be made, the amount
to be paid, and the corporate purpose for which payment is to be
made; or

(f) In payment of the fees and in reimbursement of the expenses and
liabilities of the Custodian, as provided in Article VII hereof.

3. The Custodian shall notify the Fund promptly after the close of
business on each day with a statement summarizing all transactions and entries
for the account of the Fund during said day; and it shall, at least monthly and
from time to time, render a detailed statement of the securities and moneys held
for the Fund under this Agreement. The Custodian shall send the Fund
confirmation of any purchase or sale of securities and by book entry or
otherwise identify as belonging to the Fund a quantity of securities in a
fungible bulk of securities registered in the name of the Custodian (or its
nominee) or shown on the Custodian's account on the books of the depository or
the Book-Entry System.

4. All securities held for the Fund, which are issued or issuable only
in bearer form, except such securities as are held in the Book-Entry System,
shall be held by the Custodian in that form; all other securities held for the
Fund may be registered in the name of the Fund, in the name of any duly
appointed registered nominee of the Custodian, as the Custodian may from time to
time determine, or in the name of the Book-Entry System or the depository or
their successor or successors, or their nominee or nominees. The Fund agrees to
furnish to the Custodian appropriate instruments to enable the Custodian to hold
or deliver in proper form for transfer, or to register in

-2-

<PAGE>

the name of its registered nominee or in the name of the Book-Entry System or
the depository any securities which it may hold for the account of the Fund and
which may from time to time be registered in the name of the Fund. The Custodian
shall hold all such securities which are not held in the Book-Entry System or in
the depository in a separate account in the name of the Fund physically
segregated at all times from those of any other person or persons. The Fund
hereby acknowledges its right to receive written confirmation of each
transaction, but waives that right upon receiving monthly statements of activity
as agreed upon.

5. Unless otherwise instructed to the contrary by a certificate signed
in the name of the Fund by any two officers, the Custodian by itself, or through
the use of the Book-Entry System or the depository with respect to securities
therein deposited, shall with respect to all securities held for the Fund in
accordance with this Agreement:

(a) Collect all income due or payable per usual and customary
practices;

(b) Present for payment and collect the amount payable upon all
securities which may mature or be called, redeemed, or retired,
or otherwise become payable;

(d) Execute, as Custodian, any necessary declarations or certificates
of ownership under the Federal Income Tax Laws or the laws or
regulations of any other taxing authority now or hereafter in
effect;

(e) Hold directly, or through the Book-Entry System or the depository
with respect to securities therein deposited, for the account of
the Fund all stock dividends, rights and similar securities
issued with respect to any securities held by the Custodian
hereunder.

6. Upon receipt of a certificate signed in the name of the Fund by any
two officers as defined in Article IX, and not otherwise, the Custodian shall:

(a) Execute and deliver to such persons as may be designated in such
certificate, proxies, consents, authorizations, and any other
instruments whereby the authority of the Fund as owner of any
securities may be exercised;

(b) Deliver any securities held for the Fund in exchange for other
securities or cash issued or paid in connection with the
liquidation, reorganization, refinancing, merger, consolidation
or recapitalization of any corporation, or the exercise of any
conversion privilege;

-3-

<PAGE>

connection with the reorganization, refinancing, merger,
consolidation, recapitalization or sale of assets of any
corporation, and receive and hold under the terms of this
Agreement, such certificates of deposit, interim receipts or
other instruments or documents as may be issued to it to evidence
such delivery;

(d) Make such transfers or exchanges of the assets of the Fund, and
take such other steps, as shall be stated in said certificate to
be for the purpose of effectuating any duly authorized plan of
liquidation, reorganization, merger, consolidation or
recapitalization of the Fund.

7. Notwithstanding anything elsewhere contained herein to the contrary,
the Fund hereby authorizes the Custodian for the term of this Agreement, if it
so desires, to maintain in its account(s) with MSTC in a manner consistent and
in accordance with the Investment Company Act of 1940 and any rules and
regulations thereunder, securities, if any, as may from time to time be held for
the Fund and are subject to covered call options issued or written by the Fund.

III.
----

PURCHASE AND SALE OF INVESTMENTS OF THE FUND
--------------------------------------------

1. Promptly after each purchase of securities by the Fund, the Fund
shall deliver to the Custodian (i) with respect to each purchase of securities
which are not money market securities, a certificate signed in the name of the
Fund by any two officers as defined in Article IX and (ii) with respect to each
purchase of money market securities such a certificate or oral instructions from
an authorized person, specifying with respect to each such purchase: (a) the
name of the issuer and the title of the securities, (b) the number of shares or
the principal amount purchased and accrued interest, if any, (c) the dates of
purchase and settlement, (d) the purchase price per unit, (e) the total amount
payable upon such purchase, (f) the name of person from whom or the broker
through whom the purchase was made, (g) whether such purchase is to be settled
through the Book-Entry System or the depository, and (h) whether the securities
purchased are to be deposited in the Book-Entry System or the depository. The
Custodian shall upon receipt of securities purchased by or for the Fund pay out
of the moneys held for the account of the Fund, the total amount payable upon
such purchase, provided that the same conforms to the total amount payable as
set forth in such certificate or such oral instructions.

2. Promptly after each sale of securities by the Fund, the Fund shall
deliver to the Custodian (i) with respect to each sale of securities which are
not money market securities a certificate signed in the name of the Fund by any
two officers as defined in Article IX and (ii) with respect to each sale of
money market securities such a certificate or oral instructions from an
authorized person specifying with respect to each such sale: (a) the name of the
issuer and the title of the security, (b) the number of shares or principal
amount sold, and the accrued interest, if any, (c) the date of sale,

-4-

<PAGE>

(d) the sale price per unit, (e) the total amount payable to the Fund upon such
sale, (f) the name of the broker through whom or the person to whom the sale was
made, and (g) whether such sale is to be settled through the Book-Entry System
or the depository. The Custodian shall deliver the securities upon receipt of
the total amount payable to the Fund upon such sale, provided that the same
conforms to the total amount payable as set forth in such certificate or such
oral instructions. Subject to the foregoing, the Custodian may accept payment in
such form as shall be satisfactory to it, and may deliver securities and arrange
for payment in accordance with the customs prevailing among dealers in
securities.

3. Promptly after the Fund writes a covered call option contract it
shall deliver to the Custodian a certificate signed in the name of the Fund by
any two officers as defined in Article IX that specifies: (a) the name of the
issuer and title and number of the security subject to call, (b) the exercise
price, (c) the premium to be received by the Fund, (d) the expiration date, and
(e) the name of the person from whom the premium is to be received.

4. If the Custodian acts as escrow agent with respect to a covered call
option, or if securities underlying such covered call option are maintained by
the Custodian with MSTC, the Custodian shall deliver or cause to be delivered
such receipts as are required in accordance with the customs prevailing among
dealers in such securities.

5. When a covered call option written by the Fund is exercised, the
Fund shall furnish the Custodian with a certificate signed in the name of the
Fund by any two officers instructing the Custodian to cause delivery of the
securities covered by the call option in exchange for the exercise price and
specifying: (a) the name of the issuer and title and number of the security
subject to the covered call, (b) the person to whom the securities are to be
delivered, and (c) the amount to be received by the Custodian upon such
delivery.

6. When a covered call option written by the Fund expires, the Fund
will deliver to the Custodian a certificate signed in the name of the Fund by
any two officers that contains the information specified in paragraph 3 herein
and instructs the Custodian to free the securities covered by the call option
from the restrictions previously imposed by reason of the writing of such
covered call option. Upon the return and/or the cancellation of the receipts
issued pursuant to paragraph 4 herein, the Custodian shall remove such
restrictions on the securities covered by the call option, delete such covered
call option from the list of holdings maintained by the Custodian, and continue
to hold such securities in accordance with this Agreement.

7. In the event the Fund purchases a covered call option identical to a
previously written covered call option in a transaction expressly designed as a
"Closing Purchase Transaction" in order to liquidate its position as a writer of
such covered call option, it will deliver to the Custodian a certificate signed
in the name of the Fund by any two officers that specifies: (a) the name of the
issuer and title and number of the security subject to the covered call option,
(b) the exercise price, (c) the premium to be paid by the Fund, (d) the
expiration date, and (e) the name of the person to whom the premium is to be
paid. Upon the Custodian's payment of the premium and the return and/or

-5-

<PAGE>

cancellation of the receipts issued pursuant to paragraph 4 herein, the
Custodian shall remove the previously imposed restrictions on the securities
covered by the call option that is liquidated by reason of the Closing Purchase
Transaction, delete such covered call option from the list of holdings
maintained by the Fund, and continue to hold such securities in accordance with
this Agreement.

8. The Custodian shall not make payment for the purchase of securities
for the account of the Fund in advance of the receipt of such securities
purchased without specific written instructions from the Fund to so pay in
advance, provided, however, that in the case of repurchase agreements entered
into by the Fund with a bank which is a member of the Federal Reserve System,
the Custodian may transfer funds to the account of such bank prior to the
receipt of written evidence that the securities subject to such repurchase
agreement have been transferred by book entry into a segregated nonproprietary
account of the Custodian maintained with the Federal Reserve Bank 04 Chicago or
of the safekeeping receipt, provided that such securities have in fact been so
transferred by book entry.

IV.
---

PAYMENT OF DIVIDENDS OR DISTRIBUTIONS
-------------------------------------

1. The Fund shall furnish to the Custodian a copy of a resolution of
its Board of Directors, certified by the Secretary or any Assistant Secretary,
authorizing the declaration of dividends, and authorizing the Custodian to rely
on the oral instructions from an authorized officer of the Fund, or setting
forth the date of the declaration of such dividend or distribution, the date of
payment thereof, the record date as of which stockholders entitled to payment
shall be determined, and the amount payable per share to the stockholders of
record as of that date and the total amount payable to the Dividend Agent on the
payment date.

2. Upon the payment date specified in such officer's certificate or
oral instructions, the Custodian shall pay out of the moneys held for the
account of the Fund the total amount payable to the Dividend Agent for the Fund.

V.
--

SALE AND REDEMPTION OF CAPITAL STOCK OF THE FUND
------------------------------------------------

1. Whenever the Fund shall sell any shares of its capital stock, it
shall cause to be delivered to the Custodian all moneys received for such sales.
The Custodian shall make such arrangements with the Transfer Agent of the Fund
as will enable the Custodian to receive the cash consideration due the Fund for
such shares of the Fund as may be issued or sold from time to time by the Fund.
In connection with such issuance of shares of the Fund, the Custodian shall make
such arrangements with the Transfer Agent to provide for the timely notification
to the Transfer Agent and to the Fund of the receipt of proper consideration by
the Custodian for the issuance of such shares, including the receipt of funds
transferred directly to the Custodian by wire.

-6-

<PAGE>

2. Upon receipt of such money, the Custodian shall credit such money to
the account of the Fund and shall notify the Fund and its Transfer Agent of the
receipt of such money.

3. Upon the issuance of any of the capital stock of the Fund in
accordance with the foregoing provisions of this Article, the Custodian shall
pay, out of the money held for the account of the Fund, all original issue or
other taxes required to be paid by the Fund in connection with such issuance
upon the receipt of a notice signed by any two officers, as defined in Article
IX, specifying the amount to be paid.

4. Whenever the Fund shall hereafter redeem any shares of its capital
stock, it shall furnish to the Custodian a certificate signed in the name of the
Fund by any two officers, specifying:

(a) The name of the investor redeeming;

(b) The amount to be paid for the shares redeemed;

5. Upon receipt from the Transfer Agent of an advice setting forth the
number of shares received by the Transfer Agent for redemption and that such
shares are valid and in good form for redemption, the Custodian shall make
payment out of the moneys held for the account of the Fund, either to the
Transfer Agent or to such other person as may be specified by the Transfer Agent
of the total amount specified in the certificate issued pursuant to the
foregoing paragraph 4 of this Article.

VI.
---

INDEBTEDNESS
------------

If the Custodian should in its sole discretion advance funds on behalf
of the Fund because the moneys held by the Custodian for the account of the Fund
shall be insufficient to pay the total amount payable upon purchase of
securities as set forth in a certificate or oral instructions issued pursuant to
Article III, such indebtedness shall be deemed to be a loan made by the
Custodian to the Fund payable on demand and shall bear interest from the date
incurred at a rate per annum (based on a 360-day year for the actual number of
days involved) equal to 1/2% over Harris Trust and Savings Bank's prime
commercial lending rate in effect from time to time, such rate to be adjusted on
the effective date of any change in such prime commercial lending rate, but in
no event to be less than 6% per annum. The parties agree that such indebtedness
shall be considered a temporary measure for extraordinary or emergency purposes.
Any such indebtedness shall be reduced by an amount equal to the total of all
amounts due the Fund which have not been collected by the Custodian on behalf of
the Fund when due because of the failure of the Custodian to timely make demand
or presentment for payment. In addition thereto, the Fund hereby agrees that the
Custodian shall have a continuing lien and security interest in and to any
property at any time held by it for the benefit of the Fund or in which the Fund
may have an interest which is then in the Custodian's possession or control or
in possession or control of any third party acting in the Custodian's behalf
only to the extent and

-7-

<PAGE>

duration of the foregoing advance of funds to the Fund by the Custodian. The
Fund authorizes the Custodian, in its sole discretion, at any time to charge any
such indebtedness against any balance of account standing to the Fund's credit
on the Custodian's books. Furthermore, the Fund authorizes the Custodian, in its
sole discretion, upon 48 hours' prior written notice to the Fund, at any time to
charge interest due upon such indebtedness against any balance of account
standing to the Fund's credit on the Custodian's books. If the Custodian
receives a written notice from the Fund within the 48-hour notice period that it
disputes the mathematical calculation of the interest charge or if the Custodian
has erroneously advanced funds because the moneys held by the Custodian for the
account of the Fund were sufficient to pay for the purchase of securities,
Custodian shall not charge the Fund's account until the parties agree to the
correct calculation of the charge. Furthermore, if the parties are unable to
reach such an agreement within five working days from the time Custodian first
receives the Fund's notice of dispute as herein provided, either party may
terminate this Agreement upon 30 days' prior written notice to the other party.

VII.
----

CONCERNING THE CUSTODIAN
------------------------

1. Except as hereinafter provided, neither the Custodian nor its
nominee shall be liable for any loss or damage including counsel fees, resulting
from its action or omission to act or otherwise, except for any such loss or
damage arising out of its own negligence or misconduct. The Custodian may, with
respect to questions of law, apply for and obtain the advice and opinion of
counsel to the Fund or of its own counsel, the expenses for which may be charged
to the Fund upon the mutual agreement of the Fund and the Custodian, and shall
be fully protected with respect to anything done or omitted by it in good faith
in conformity with such advice or opinion. The Custodian shall be liable to the
Fund for any loss or damage resulting from the use of the Book-Entry System or
the depositories arising by reason of any negligence, misfeasance or misconduct
on the part of the Custodian or any of its employees or agents. If the Fund
incurs any loss or damages resulting from the use of the Book-Entry System
arising by reason of the negligence, misfeasance or misconduct on the part of
any depository, the Custodian agrees to initiate a claim through normal banking
channels with the depository for the amount of such loss or damage, subject to
the provisions of paragraph 5 of this Article VII.

2. Without limiting the generality of the foregoing, the Custodian
shall be under no obligation to inquire into, and shall not be liable for:

(a) The validity of the issue of any securities, including covered
calls, purchased by or for the Fund, the legality of the purchase
thereof, or the propriety of the amount paid therefore;

(b) The legality of the sale of any securities, including covered
calls, by or for the Fund, or the propriety of the amount for
which the same are sold;

-8-

<PAGE>

(c) The legality of the issue or sale of any shares of the capital
stock of the Fund, or the sufficiency of the amount to be
received therefore;

(d) The legality of the declaration of any dividend by the Fund, or
the legality of the issue of any shares of the Fund's capital
stock in payment of any stock dividend.

3. The Custodian shall not be liable for, or considered to be the
Custodian of, any money, whether or not represented by any check, draft, or
other instrument for the payment of money, received by it on behalf of the Fund
until the Custodian actually receives and collects such money directly or by the
final crediting of the account representing the Fund's interest at the
Book-Entry System or the depository.

4. The Custodian shall not be under any duty or obligation to take
action to effect collection of any amount due to the Fund from the Transfer
Agent of the Fund nor to take any action to effect payment or distribution by
the Transfer Agent of the Fund of any amount paid by the Custodian to the
Transfer Agent of the Fund in accordance with this Agreement.

5. The Custodian shall not be under any duty or obligation to take
action to effect collection of any amount, if the securities upon which such
amount is payable are in default, or if payment is refused after due demand or
presentation, unless and until (i) it shall be directed to take such action by a
certificate signed in the name of the Fund by any two officers, and (ii) it
shall be assured to its satisfaction of reimbursement of its costs and expenses
in connection with any such action.

6. The Custodian may, with the prior approval of the Fund, appoint one
or more banking institutions as Depository or Depositories or as Sub-Custodian
or Sub-Custodians, including, but not limited to banking institutions located in
foreign countries, of securities and moneys at any time owned by the Fund, upon
terms and conditions approved in written instructions from two officers of the
Fund. Such appointment may include, but is not limited to, the deposit of all or
any portion of the securities of the Fund with MSTC.

7. The Custodian shall not be under any duty or obligation to ascertain
whether any securities at any time delivered to or held by it for the account of
the Fund are such as may properly be held by the Fund under the provisions of
its Articles of Incorporation.

8. The Custodian shall be entitled to receive and the Fund agrees to
pay the Custodian, such compensation as may be agreed upon from time to time
between the Custodian and the Fund. The Custodian may charge such compensation
and any costs or expenses incurred by the Custodian in the performance of its
duties pursuant to such agreement against any money held by it for the account
of the Fund, provided, however, that Custodian shall provide the Fund with 48
hours' prior written notice that such charge will be made. If the Custodian
receives a written notice from the Fund that it disputes the costs or expenses
proposed to be charged or the mathematical calculation of the Custodian's
compensation within the 48-hour notice period, Custodian shall not charge the
Fund's account until the parties agree as to

-9-

<PAGE>

the correct calculation of the compensation or the correct charge for costs
and/or expenses, as the case may be. Furthermore, if the parties are unable to
reach such an agreement within five business days from the time Custodian first
receives the Fund's notice of dispute as herein provided, either party may
terminate this Agreement upon 30 days' prior written notice to the other party.
The expenses which the Custodian may charge against the account of the Fund
include, but are not limited to, the expenses of Sub-Custodians and foreign
branches of the Custodian incurred in settling outside of New York City
transactions involving the purchase and sale of securities of the Fund.

9. The Custodian shall be entitled to rely upon any certificate, notice
or other instrument in writing received by the Custodian and believed by the
Custodian to be genuine and to be sent by two officers of the Fund as defined in
Article IX. The Custodian shall be entitled to rely upon any instructions
received by the Custodian pursuant to Article III hereof with regard to the
purchase and sale of money market securities and believed by the Custodian to be
genuine and to be given by an authorized person. The Fund agrees to forward to
the Custodian written instructions from an authorized person confirming such
oral instructions in such manner so that such written instructions are received
by the Custodian, whether by hand delivery, telex or otherwise, by the close of
business of the same day that such oral instructions are given to the Custodian.
The Fund agrees that the fact that such confirming instructions are not received
by the Custodian shall in no way affect the validity of the transactions or
enforceability of the transactions hereby authorized by the Fund. The Fund
agrees that the Custodian shall incur no liability to the Fund in acting upon
oral instructions given to the Custodian hereunder concerning such transactions
provided such instructions appear to have been received from a duly authorized
person.

VIII.
-----

TERMINATION
-----------

1. Either of the parties hereto may terminate this Agreement by giving
to the other party a notice in writing specifying the date of such termination,
which shall be not less than 90 days after the date of giving of such notice. In
the event such notice is given by the Fund, it shall be accompanied by a copy of
a resolution of the Board of Directors of the Fund, certified by the Secretary
or any Assistant Secretary, electing to terminate this Agreement and designating
a successor Custodian or custodians, each of which shall be a bank or trust
company having not less than $2,000,000 aggregate capital, surplus, and
undivided profits. In the event such notice is given by the Custodian, the Fund
shall, on or before the termination date, deliver to the Custodian a copy of a
resolution of its Board of Directors, certified by the Secretary or any
Assistant Secretary, designating a successor Custodian or custodians. In the
absence of such designation by the Fund, the Custodian may designate a successor
Custodian which shall be a bank or trust company having not less than $2,000,000
aggregate capital, surplus, and undivided profits and upon delivery by the
Custodian to such successor Custodian of all securities and moneys then owned by
the Fund and held by the Custodian upon the date specified in the notice of
termination of this Agreement, shall be relieved of any further duties and
responsibilities under this Agreement.

-10-

<PAGE>

2. Upon the date set forth in such notice, this Agreement shall
terminate, and the Custodian shall upon receipt of a notice of acceptance by the
successor Custodian on that date deliver directly or through MSTC to the
successor Custodian all securities and moneys then owned by the Fund and held by
it as Custodian, after deducting all fees, expenses and other amounts for the
payment or reimbursement of which it shall then be entitled.

IX.
---

MISCELLANEOUS
-------------

1. The term "certificate" shall mean any notice, instruction or other
instrument in writing, authorized or required by this Agreement to be given to
the Custodian signed by two officers on behalf of the Fund.

2. The term "officers" shall be deemed to include the President, any
Vice President, the Secretary, the Treasurer, and Assistant Secretary or
Assistant Treasurer, or any other person or persons duly authorized by the Board
of Directors to execute any certificate, instruction, notice or other instrument
on behalf of the Fund.

3. The Fund agrees to furnish the Custodian with a certificate signed
by two of the present officers of the Fund under its corporate seal, setting
forth the names and the signatures of the present officers of the Fund. The Fund
agrees to furnish to the Custodian a new certificate in the event any such
present officer ceases to be an officer of the Fund, or in the event that other
or additional officers as defined in Article IX are elected or appointed. Until
such new certificate shall be received, the Custodian shall be fully protected
in acting under the provisions of this Agreement upon the signatures of the
officers as set forth in the latest issued certificate.

4. The term "authorized person" shall be deemed to include the
President, the Treasurer, and any other persons, whether or not any such person
is an officer or employee of the Fund, duly authorized by the Board of Directors
to deliver oral instructions on behalf of the Fund.

5. The Fund agrees to furnish the Custodian with a certificate signed
by two of the present officers of the Fund under its corporate seal, setting
forth the names and the signatures of the present authorized persons. The Fund
agrees to furnish to the Custodian a new certificate in the event that any such
present authorized person ceases to be an authorized person or in the event that
other or additional authorized persons are elected or appointed. Until such new
certificate shall be received, the Custodian shall be fully protected in acting
under the provisions of this Agreement upon oral instructions or signatures of
the present authorized persons as set forth in the latest issued certificate.

6. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Custodian, shall be sufficiently given if
addressed to the Custodian and mailed or delivered to it at its offices at 1701
Towanda Avenue, Bloomington, Illinois, or at such other place as the Custodian
may from time to time designate in writing.

-11-

<PAGE>

7. Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Fund shall be sufficiently given if addressed
to the Fund and mailed or delivered to it at its office at 1711 G.E. Road,
Bloomington, Illinois, or at such other place as the Fund may from time to time
designate in writing.

8. The Agreement may not be amended or modified in any manner except by
a written agreement executed by both parties with the same formality as this
Agreement, and authorized and approved by a resolution of the Board of Directors
of the Fund.

9. The term "money market security" shall be deemed to include, but not
be limited to debt obligations issued or guaranteed as to interest and principal
by the Government of the United States or agencies or instrumentalities thereof,
bank time deposits, certificates of deposit and banker's acceptances, where the
purchase or sale of such securities normally requires settlement in federal
funds on the same day as such purchase or sale.

10. This Agreement shall extend to and shall be binding upon the parties
hereto, and their respective successors and assigns; provided, however, that
this Agreement shall not be assignable by the Fund without the written consent
of the Custodian, or by the Custodian without the written consent of the Fund,
authorized or approved by a resolution of its Board of Directors.

11. This Agreement shall be construed in accordance with the laws of the
State of Illinois.

12. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.

13. The term "written instructions" shall mean written communications by
telex or any other such system whereby the receiver of such communications is
able to verify by codes or otherwise with a reasonable degree of certainty the
authenticity of the sender of such communication.

14. The term "Book-Entry System" shall mean the Federal Reserve/Treasury
Book-Entry System for United States and federal agency securities, its successor
or successors and its nominee or nominees, and the term "depository" shall mean
the Midwest Securities Trust Company ("MSTC"), a clearing agency registered with
the Securities and Exchange Commission, its successor or successors and its
nominee or nominees, provided the Custodian has received a certified copy of a
resolution of the Fund's Board of Directors specifically approving deposits in
the Book-Entry System or MSTC, as the case may be. The term "depository" shall
further mean and include any other registered clearing agent, its successors and
its nominee or nominees, specifically identified in a certified copy of a
resolution of the Fund's Board of Directors approving deposits therein by the
Custodian.

15. The Custodian shall provide the Fund with any report obtained by the
Custodian on the system of internal accounting control of the Book-Entry System
or the depository and with such reports on its own systems of internal
accounting control as the Fund may reasonably request from time to time.

-12-

<PAGE>

16. From time to time the Fund contracts with various providers for
services to be furnished to the Fund or its shareholders. It is understood that
from time to time information to be provided to the Custodian by the Fund may
actually be provided by one of these service providers on behalf of the Fund.
Conversely, it is understood that from time to time information to be provided
to the Fund by the Custodian may actually be provided to one of these service
providers on the Fund's behalf.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective corporate officers, thereunto duly
authorized and their respective corporate seals to be hereunto affixed as of the
day and year first above written.

COUNTRY CAPITAL GROWTH FUND, INC.

By: /s/ Donald J. Engelker
--------------------------------
Its Vice President

ATTEST:

/s/ Sue Satterfeal
- -----------------------------
IAA TRUST COMPANY

By: /s/ Gary S. Mede
---------------------------------
Its Executive Vice President
ATTEST:

/s/ Delez Johnson, Assistant Secretary
- ----------------------------------------

-13-

<PAGE>

IAA TRUST COMPANY
CUSTODIAN FEE SCHEDULE
COUNTRY CAPITAL GROWTH FUND, INC.

It is the desire of the Custodian to assist in the reduction of the Fund
expenses. Therefore, pursuant to Paragraph 8 of Article VII of the Custodian
Agreement dated March 31, 1992, the Custodian waives any right to compensation
or the recovery of any expenses charged by sub-custodians involving the purchase
and sale of securities of the Fund for one year from the effective date of the
Custodian Agreement. Each year thereafter, the Custodian will confirm in writing
if it wishes to continue this arrangement. If the Custodian does not wish to
continue this arrangement, the parties will agree to a fee schedule pursuant to
Paragraph 8 of Article VII of the Custodian Agreement.

IAA TRUST COMPANY, CUSTODIAN

By: /s/ Gary S. Mede
--------------------------------
Its Executive Vice President

Date: March 31, 1992

TRANSFER AGENT SERVICES AGREEMENT

This Agreement, dated as of the 1st day of August, 1995, made by and
between IAA Trust Growth Fund, Inc. (the "Growth Fund"), a corporation duly
organized and existing under the laws of the state of Maryland and operating as
a registered investment company under the Investment Company Act of 1940, as
amended (the "Act"), and Fund/Plan Services, Inc. ("Fund/Plan"), a corporation
duly organized and existing under the laws of the State of Delaware
(collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Growth Fund desires to retain Fund/Plan to perform share
transfer agency, redemption and dividend disbursing services as set forth in
this Agreement and in Schedule "A" attached hereto, and to perform certain other
functions in connection with these duties; and

WHEREAS, Fund/Plan is registered with the Securities and Exchange
Commission as a Transfer Agent as required under Section 17(A)(c) of the
Securities Exchange Act of 1934, as amended; and

WHEREAS, Fund/Plan is willing to serve in such capacity and perform
such functions upon the terms and conditions set forth below.

NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for good and valuable consideration, the receipt and
sufficiency is hereby acknowledged, the Parties hereto, intending to be legally
bound, do hereby agree as follows:

Section 1. The terms as defined in this Section wherever used in this
Agreement, or in any amendment or supplement hereto, shall have the meanings
herein specified unless the context otherwise requires.

Share Certificates shall mean the certificates representing shares of
stock of the Growth Fund.

Shareholders shall mean the registered owners of the Shares of the
Growth Fund in accordance with the share registry records maintained by
Fund/Plan for the Growth Fund.

Shares shall mean the issued and outstanding shares of the Growth Fund.

Signature Guarantee shall mean the guarantee of signatures by an
"eligible guarantor institution" as defined in rule 17Ad-15 under the Securities
Exchange Act of 1934, as amended. Eligible guarantor institutions include banks,
brokers, dealers, credit unions, national securities exchanges, registered
securities associations, clearing agencies and savings

<PAGE>

associations. Broker-dealers guaranteeing signatures must be members of a
clearing corporation or maintain net capital of at least $100,000. Signature
guarantees will be accepted from any eligible guarantor institution which
participates in a signature guarantee program.

Oral Instruction shall mean an authorization, instruction, approval,
item or set of data, or information of any kind transmitted to Fund/Plan in
person or by telephone, telegram, telecopy or other mechanical or documentary
means lacking an original signature, by a person or persons reasonably
identified to Fund/Plan to be a person or persons so authorized by a resolution
of the Board of Directors of the Growth Fund.

Written Instruction shall mean an authorization, instruction, approval,
item or set of data or information of any kind transmitted to Fund/Plan in an
original writing containing an original signature or a copy of such document
transmitted by telecopy including transmission of such signature reasonably
identified to Fund/Plan to be the signature of a person or persons so authorized
by a resolution of the Board of Directors of the Growth Fund to give Written
Instructions to Fund/Plan.

TRANSFER AGENCY SERVICES

Section 2. The Fund shall furnish to Fund/Plan as Transfer Agent a
sufficient supply of blank Share Certificates and from time to time will renew
such supply upon the request of Fund/Plan. Such blank Share Certificates shall
be signed manually or by facsimile signatures of officers of the Fund authorized
by law or the by-laws of the Fund to sign Share Certificates and, if required,
shall bear the corporate seal or a facsimile thereof.

Section 3. Fund/Plan as Transfer Agent shall make original issues of
Shares in accordance with the terms of this agreement below and with the Growth
Fund's Prospectus and Statement of Additional Information then in effect, upon
the written request of the Growth Fund, and upon being furnished with (i) a
certified copy of a resolution or resolutions of the Board of Directors of the
Growth Fund authorizing such issue; (ii) an opinion of counsel as to the
validity of such Shares; and (iii) necessary funds for the payment of any
original issue tax applicable to such additional Shares.

Section 4. Transfers of Shares shall be registered and new Share
Certificates issued by Fund/Plan upon redemption of outstanding Share
Certificates, (i) in the form deemed by Fund/Plan to be properly endorsed for
transfer, (ii) with all necessary endorser's signatures guaranteed pursuant to
Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended, accompanied
by, (iii) such assurances as Fund/Plan shall deem necessary or appropriate to

<PAGE>

evidence the genuineness and effectiveness of each necessary endorsement, and
(iv) satisfactory evidence of compliance with all applicable laws relating to
the payment or collection of taxes.

Section 5. When mail is used for delivery of Share Certificates,
Fund/Plan shall forward Share Certificates in "non-negotiable" form by
first-class mail, and Share Certificates in "negotiable" form by registered
mail, all mail deliveries to be covered while in transit to the addressee by
insurance arranged for by Fund/Plan.

Section 6. In registering transfers, Fund/Plan as Transfer Agent may
rely upon the applicable commercial code or any other applicable law which, in
the written opinion (a copy of which shall previously have been furnished to the
Growth Fund) of counsel, protect Fund/Plan and the Growth Fund in not requiring
complete documentation, in registering transfer without inquiry into adverse
claims, in delaying registration for purposes of such inquiry, or in refusing
registration where in its judgment an adverse claim requires such refusal.

Section 7. Fund/Plan as Transfer Agent may issue new Share Certificates
in place of Share Certificates represented to have been lost, destroyed or
stolen, upon receiving indemnity satisfactory to Fund/Plan and may issue new
Share Certificates in exchange for and upon surrender of mutilated Share
Certificates.

Section 8. In case any officer of the Fund who shall have signed
manually or whose facsimile signature shall have been affixed to blank Share
Certificates shall die, resign or be removed prior to the issuance of such Share
Certificates, Fund/Plan as Transfer Agent may issue or register such Share
Certificates as the Share Certificates of the Fund notwithstanding such death,
resignation or removal; and the Fund shall file promptly with Fund/Plan such
approval, adoption or ratification as may be required by law.

Section 9. With respect to confirmed trades received by Fund/Plan as
Transfer Agent for the Fund, Fund/Plan shall periodically notify the Fund of the
current status of outstanding confirmed trades. Fund/Plan is authorized to
cancel confirmed trades which have been outstanding for thirty (30) days. Upon
such cancellation, the Transfer Agent shall instruct the Fund Accounting Agent
to adjust the books of the Fund accordingly.

Section 10. Fund/Plan will maintain stock registry records in the usual
form in which it will note the issuance, transfer and redemption of Shares and
the issuance and transfer of Share Certificates, and is also authorized to
maintain an account entitled Unissued Certificate

<PAGE>

Account in which it will record the Shares and fractions issued and outstanding
from time to time for which issuance of Share Certificates is deferred.
Fund/Plan will provide reports of Fund Share purchases, redemptions, and total
Shares outstanding on the next business day after each net asset valuation.
Fund/Plan is authorized to keep records, which will be part of the stock
transfer records, in which it will note the names and registered address of
Shareholders and the number of Shares and fractions from time to time owned by
them for which no Share Certificates are outstanding. Each Shareholder will be
assigned a single account number even though Shares for which Certificates have
been issued will be accounted for separately.

Section 11. Fund/Plan will issue Share Certificates for Shares of the
Fund, only upon receipt of a written request from a Shareholder. In all other
cases, the Fund authorizes Fund/Plan to dispense with the issuance and
countersignature of Share Certificates whenever Shares are purchased. In such
case Fund/Plan as Transfer Agent, shall merely note on its stock registry
records the issuance of the Shares and fractions (if any), shall credit the
Unissued Certificate Account with the Shares and fractions issued and shall
credit the proper number of Shares and fractions to the respective Shareholders.
Likewise, whenever Fund/Plan has occasion to surrender for redemption Shares and
fractions owned by Shareholders, it shall be unnecessary to issue Share
Certificates for redemption purposes. The Fund authorizes Fund/Plan in such
cases to process the transactions by appropriate entries in its Share transfer
records, and debiting of the Unissued Certificate Account and the record of
issued Shares outstanding.

Section 12. Under this Agreement, Fund/Plan shall, in addition to the
duties and functions above-mentioned, perform the usual duties and functions of
a stock transfer agent for an investment company as listed in Schedule "A"
attached hereto. Fund/Plan may rely conclusively and act without further
investigation upon any list, instruction, certification, authorization or other
instrument or paper believed by it in good faith to be genuine and unaltered,
and to have been signed, countersigned, or executed by duly authorized person or
persons, or upon the instructions of any officer of the Growth Fund, or upon the
advice of counsel for the Growth Fund or for Fund/Plan. Fund/Plan may record any
transfer of Shares which is reasonably believed by it to have been duly
authorized or may refuse to record any transfer of Shares if in good faith
Fund/Plan in its capacity as Transfer Agent deems such refusal necessary in
order to avoid any liability either of the Growth Fund or Fund/Plan. The

<PAGE>

Growth Fund agrees to indemnify and hold harmless Fund/Plan from and against any
and all losses, costs, claims, and liability which it may suffer or incur by
reason of so relying or acting or refusing to act. Fund/Plan shall maintain and
reconcile all operating bank accounts necessary to facilitate all transfer
agency processes; including, but not limited to, distribution disbursements,
redemptions and payment clearance accounts.

Section 13. In case of any request or demand for the inspection of the
Share records of the Growth Fund, Fund/Plan as Transfer Agent shall endeavor to
notify the Growth Fund and to secure instructions as to permitting or refusing
such inspection. Fund/Plan may, however, exhibit such records to any person in
any case where it is advised by its counsel that it may be held liable for
failure to do so.

Section 14. Fund/Plan acknowledges that all records that it maintains
on behalf of the Growth Fund are the property of the Growth Fund and will be
surrendered promptly to the Growth Fund upon written request. Fund/Plan will
preserve, for the periods prescribed under Rule 31a-2 under the Act, all such
records required to be maintained under Rule 31a-1 of the Act.

ISSUANCE OF SHARES

Section 15. Prior to the daily determination of net asset value in
accordance with the Fund's Prospectus and Statement of Additional Information,
Fund/Plan shall process all purchase orders received since the last
determination of the Fund's net asset value.

Fund/Plan shall calculate on a daily basis the amount available for
investment in Shares at the net asset value determined by the Growth Fund's
pricing agent as of the close of regular trading on the New York Stock Exchange,
the number of Shares and fractional Shares to be purchased and the net asset
value to be deposited with the custodian of the assets of the Growth Fund (the
"Custodian"). Fund/Plan shall place a purchase order daily with the Growth Fund
for the proper number of Shares and fractional Shares to be purchased and
confirm such number to IAA Trust Company, in writing.

Section 16. Fund/Plan having made the calculations provided for in
Section 9, shall thereupon pay over the net asset value of Shares purchased to
the Custodian. The proper number of Shares and fractional Shares shall then be
issued daily and credited by Fund/Plan to the Shareholder Registration Records.
The Shares and fractional Shares purchased for each Shareholder will be credited
by Fund/Plan to that Shareholder's separate account. Fund/Plan shall mail to
each Shareholder a confirmation of each purchase with, if requested, copies to
the

<PAGE>

Growth Fund. Such confirmations will show the prior Share balance, the new Share
balance, the Shares for which Stock Certificates are outstanding (if any), the
amount invested and the price paid for the newly purchased Shares.

REDEMPTIONS

Section 17. Prior to the daily determination of net asset value in
accordance with the Fund's Prospectus and Statement of Additional Information
then in effect, Fund/Plan shall process all requests from Shareholders to redeem
Shares and determine the number of Shares required to be redeemed to make
monthly payments, automatic payments or the like. Thereupon, Fund/Plan shall
advise the Growth Fund of the total number of Shares available for redemption
and the number of Shares and fractional Shares requested to be redeemed. The
Growth Fund's pricing agent shall then determine the applicable net asset value.
Thereafter Fund/Plan shall furnish the Growth Fund with an appropriate
confirmation of the redemption and process the redemption by filing with the
Custodian an appropriate statement and make the proper distribution and
application of the redemption proceeds in accordance with the Fund's Prospectus
and Statement of Additional Information then in effect. The stock registry books
recording outstanding Shares, the Shareholder Registration Records and the
individual account of the Shareholder shall be properly debited.

Section 18. The proceeds of redemption shall be remitted by Fund/Plan
in accordance with the Fund's Prospectus and Statement of Additional Information
then in effect, by check mailed to the Shareholder at the Shareholder's
registered address or wired to an authorized bank account. If Share Certificates
have been issued for Shares being redeemed, then such Share Certificates and a
stock power with a signature guarantee of a commercial bank, or a member firm of
a national securities exchange shall accompany the redemption request. If Share
Certificates have not been issued to the redeeming Shareholder, the signature of
the Shareholder on the redemption request must be similarly guaranteed. The Fund
may authorize Fund/Plan to waive signature guarantees.

For the purposes of redemption of Shares which have been purchased
within 15 days of a redemption request, the Growth Fund shall provide Fund/Plan,
from time to time, with Written Instructions concerning the time within which
such requests may be honored.

DIVIDENDS

<PAGE>

Section 19. The Growth Fund shall notify Fund/Plan of the date of each
dividend declaration or capital gains distribution and the record date for
determining the Shareholders entitled to payment. The per share payment amount
of any dividend or capital gain shall be determined by the Growth Fund after
receipt of necessary information from and consultation with Fund/Plan.

Section 20. On or before each payment date, the Growth Fund will notify
Fund/Plan of the total amount of the dividend or distribution currently payable.
Fund/Plan will, on the designated payment date, automatically reinvest all
dividends in additional Shares except in cases where Shareholders have elected
to receive distribution in cash, in which case Fund/Plan will mail distribution
checks to the Shareholders for the proper amounts payable to them from monies
transferred by The Custodian to Fund/Plan for that purpose.

FEES

Section 21. The Growth Fund agrees to pay Fund/Plan compensation for
its services and to reimburse it for expenses, at the rates and amounts as set
forth in Schedule "B" attached hereto, and as shall be set forth in any
amendments to such Schedule "B" approved by the Growth Fund and Fund/Plan. The
Growth Fund agrees and understands that Fund/Plan's compensation will be
comprised of two components, payable on a monthly basis, as follows:

(i) Subject to a minimum fee, the Growth Fund agrees to pay
Fund/Plan an annual Shareholder account maintenance fee calculated by
multiplying the monthly average number of accounts in each Fund by one twelfth
(1/12th) the per account fee as stated in Schedule "B". A combined account fee,
subject to a minimum amount, will be billed monthly to the Growth Fund. These
fees are to be paid by the Growth Fund within ten calendar days after receipt of
an invoice from Fund/Plan.

(ii) reimbursement of any reasonable out-of-pocket expenses
paid by Fund/Plan on behalf of the Growth Fund, which out-of-pocket expenses
will be billed to the Growth Fund within the first ten calendar days of the
month following the month in which such out-of-pocket expenses were incurred.
The Growth Fund agrees to reimburse Fund/Plan for such expenses within ten
calendar days of receipt of such bill.

For the purpose of determining fees payable to Fund/Plan, the value of
the Growth Fund's net assets shall be computed at the times and in the manner
specified in its Prospectus and Statement of Additional Information then in
effect. During the term of this Agreement, should the Growth Fund seek services
or functions in addition to those outlined above or in Schedule

<PAGE>

"A" attached, a written amendment to this Agreement specifying the additional
services and corresponding compensation shall be executed by both Fund/Plan and
the Growth Fund.

GENERAL PROVISIONS

Section 22. Fund/Plan shall maintain records (which may be part of the
stock transfer records) in connection with the issuance and redemption of
Shares, and the disbursement of dividends and dividend reinvestments, in which
will be noted the transactions effected for each Shareholder and the number of
Shares and fractional Shares owned by each Shareholder. Fund/Plan agrees to make
available upon request and to preserve for the periods prescribed in Rule 31a-2
under the Investment Company Act of 1940, as amended, any records relating to
services provided under this Agreement which are required to be maintained by
Rule 31a-1 under the Act.

Section 23. In addition to the services as Transfer Agent and dividend
disbursing agent set forth above, Fund/Plan will perform other services for the
Growth Fund as agreed upon from time to time, including but not limited to,
preparation of and mailing Federal Tax Information Forms, mailing semi-annual
reports of the Growth Fund, preparation of one annual list of Shareholders, and
mailing notices of shareholders' meetings, proxies and proxy statements.

Section 24. Nothing contained in this Agreement is intended to or shall
require Fund/Plan in any capacity hereunder, to perform any functions or duties
on any holiday, day of special observance or any other day on which the
Custodian or the New York Stock Exchange are closed. Functions or duties
normally scheduled to be performed on such days shall be performed on, and as
of, the next business day on which both the New York Stock Exchange and the
Custodian are open.

Section 25.

(a) Fund/Plan, its directors, officers, employees,
shareholders and agents shall only be liable for any error of judgment or
mistake of law or for any loss suffered by the Growth Fund, in connection with
the performance of this Agreement that result from willful misfeasance, bad
faith or negligence on the part of Fund/Plan in the performance of its
obligations and duties under this Agreement.

(b) Any person, even though also a director, officer,
employee, shareholder or agent of Fund/Plan, who may be or become an officer,
trustee, employee, or agent of the Growth Fund, shall be deemed, when rendering
services to such entity or acting on any

<PAGE>

business of the Growth Fund, (other than services or business in connection with
Fund/Plan's duties hereunder), to be rendering such services to or acting solely
for the Growth Fund and not as a director, officer, employee, shareholder or
agent of, or one under the control or direction of Fund/Plan even though that
person is being paid salary by Fund/Plan.

(c) Notwithstanding any other provision of this Agreement, the
Growth Fund shall indemnify and hold harmless Fund/Plan, its directors,
officers, employees, shareholders and agents from and against any and all
claims, demands, expenses and liabilities (whether with or without basis in fact
or law) of any and every nature which Fund/Plan may sustain or incur or which
may be asserted against Fund/Plan by any person by reason of, or as a result of
(i) any action taken or omitted to be taken by Fund/Plan in good faith
hereunder; (ii) any action taken or omitted to be taken by Fund/Plan in good
faith in reliance upon any certificate, instrument, order, or stock certificate
or other document reasonably believed by it to be genuine and to be signed,
countersigned or executed by any duly authorized person, upon the Oral
Instructions or Written Instructions of an authorized person of the Growth Fund
or upon the opinion of legal counsel to the Growth Fund, or its own counsel; or
(iii) any action taken or omitted to be taken by Fund/Plan in connection with
its appointment under this agreement, which action or omission was taken in good
faith in reliance upon any law, act, regulation or interpretation of the same
even though the same may thereafter have been altered, changed, amended, or
repealed. Indemnification under this subparagraph, however, shall not apply to
actions or omissions of Fund/Plan or its directors, officers, employees,
shareholders, or agents in cases of its or their willful misfeasance, bad faith,
negligence or reckless disregard of its or their duties hereunder.

(d) Fund/Plan shall give written notice to the Growth Fund
within ten (10) business days of receipt by Fund/Plan of a written assertion or
claim of any threatened or pending legal proceeding which may be subject to this
indemnification. The failure to notify the Growth Fund of such written assertion
or claim shall not, however, operate in any manner whatsoever to relieve the
Growth Fund of any liability arising under this Section or otherwise, except to
the extent that failure to give notice prejudices the Growth Fund.

<PAGE>

Fund/Plan may participate in the litigation at its own expense through counsel
of its own choosing. In the event the Growth Fund chooses to defend or prosecute
such claim, the parties shall cooperate in the defense or prosecution thereof
and shall furnish such records and other information as are reasonably
necessary.

(f) The Growth Fund shall not settle any claim under Sub
Section (d) and (e) without Fund/Plan's express written consent, which consent
shall not be unreasonably withheld. Fund/Plan shall not settle any such claim
without the Growth Fund's express written consent, which likewise shall not be
unreasonably withheld.

Section 26. Fund/Plan is authorized, upon receipt of Written
Instructions from the Growth Fund, to make payment upon redemption of Shares
without a signature guarantee. The Growth Fund hereby agrees to indemnify and
hold Fund/Plan, its successors and assigns, harmless of and from any and all
expenses, damages, claims, suits, liabilities, actions, demands, losses
whatsoever arising out of or in connection with a payment by Fund/Plan upon
redemption of Shares pursuant to Written Instructions and without a signature
guarantee; upon the request of Fund/Plan, the Growth Fund shall assume the
entire defense of any action, suit or claim subject to the foregoing indemnity.
Fund/Plan shall notify the Growth Fund of any such action, suit or claim within
thirty (30) days after receipt by Fund/Plan of notice thereof.

Section 27.

(a) The term of this Agreement shall be for a period of three (3)
years, commencing on the date hereinabove first written (the "Effective Date"),
and shall continue thereafter on a year to year term subject to termination by
either Party set forth in (c) below.

(b) The fee schedule set forth in Schedule "B" attached shall be fixed
for three (3) years commencing on the Effective Date of this Agreement. Such
fees are to be paid by the Fund within ten calendar days of receipt of an
invoice from Fund/Plan after the end of each month.

(c) After the initial term of this Agreement, the Growth Fund or
Fund/Plan may give written notice to the other of the termination of this
Agreement, such termination to take effect at the time specified in the notice,
which date shall not be less than one hundred twenty (120) days after the date
of receipt of such notice. Upon the effective termination date, the Growth Fund
shall pay to Fund/Plan such compensation as may be due as of the date of
termination and shall likewise reimburse Fund/Plan for any out-of-pocket
expenses and disbursements reasonably incurred by Fund/Plan to such date.

<PAGE>

(d) If a successor to any of Fund/Plan's duties or responsibilities
under this Agreement is designated by the Growth Fund by written notice to
Fund/Plan in connection with the termination of this Agreement, Fund/Plan shall
promptly upon such termination and at the expense of the Growth Fund, transfer
all required records and shall cooperate in the transfer of such duties and
responsibilities.

Section 28. The Growth Fund shall file with Fund/Plan a certified copy
of each resolution of its Board of Directors authorizing the execution of
Written Instructions or the transmittal of Oral Instructions, as provided in
Section 1 of this Agreement.

Section 29. Except as otherwise provided in this Agreement, any notice
or other communication required by or permitted to be given in connection with
this Agreement shall be in writing, and shall be delivered in person or sent by
first class mail, postage prepaid, to the respective parties as follows:

If to the Growth Fund: If to Fund/Plan:

IAA Trust Growth Fund, Inc. Fund/Plan Services, Inc.
808 IAA Drive 2 West Elm Street
Bloomington, IL 61702 Conshohocken, PA 19428
Attention: Richard M. Miller Attention: Kenneth J. Kempf,
Vice President President

Section 30. The Growth Fund represents and warrants to Fund/Plan that
the execution and delivery of this Agreement by the undersigned officers of the
Growth Fund has been duly and validly authorized by resolution of the Board of
Directors of the Growth Fund.

Section 31. This Agreement may be executed in two or more counterparts,
each of which when so executed shall be deemed to be an original, but such
counterparts shall together constitute but one and the same instrument.

Section 32. This Agreement shall extend to and shall be binding upon
the Parties and their respective successors and assigns; provided, however, that
this Agreement shall not be assignable by the Growth Fund without the written
consent of Fund/Plan or by Fund/Plan without the written consent of the Growth
Fund, authorized or approved by a resolution of their respective Boards of
Directors.

Section 33. This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania and the venue of any action arising under this
Agreement shall be Montgomery

<PAGE>

County, Commonwealth of Pennsylvania.

Section 34. No provision of this Agreement may be amended or modified,
in any manner except in writing, properly authorized and executed by Fund/Plan
and the Growth Fund.

Section 35. If any part, term or provision of this Agreement is held by
any court to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not be affected,
and the rights and obligations of the parties shall be construed and enforced as
if the Agreement did not contain the particular part, term or provision held to
be illegal or invalid, provided that the basic agreement is not thereby
substantially impaired.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
consisting in its entirety, of twelve typewritten pages, together with Schedules
"A" and "B", to be signed by their duly authorized officers as of the day and
year first above written.

IAA Trust Growth Fund, Inc. Fund/Plan Services, Inc.

- ------------------------------------ --------------------------------------
By: Gary E. Mede By: Kenneth J. Kempf, President
Vice President

<PAGE>

SCHEDULE "A"

TRANSFER AGENT/SHAREHOLDER SERVICES
FOR
IAA TRUST GROWTH FUND, INC.

The following Transfer Agency Services shall be provided under this agreement:

o Opening new accounts and entering demographic data into shareholder base.

o Real-time Customer Information File (CIF) to link accounts within a Fund
and across all Funds.

o 100% Quality Control of new accounts opened on a same-day/next day basis.

o Account Maintenance

o Processing all investments including:
- initial investments
- subsequent investments through lock box computer interface
- pre-authorized investments through ACH
- government allotments through ACH

o Processing tax ID certifications and Non-Resident Alien (NRA) and
reporting back-up withholding.

o Processing legal transfers of accounts.

o Automated exchange processing.

o Recording and retaining on tape all shareholder calls.

o Research and respond to shareholder calls and written inquiries.

o Generating account statements with copies to appropriate interested
parties. (Up to four statements.)

o Redemption processing includes:
- complete and partial redemptions
- check redemption processing (if applicable)

o Distribution options:
- federal wires*
- mailing checks
- ACH*

o Certificate issuance and cancellation.

<PAGE>

o Replacement of certificates through surety bonds.*

o Process dividends and capital gains distributions.

o Producing daily and monthly reports of shareholder activity.

Daily Reports
-------------

Report Number Report Description
(no report number) Daily Activity Register
024 Tax Reporting Proof
051 Cash Receipts and Disbursement Proof
053 Daily Share Proof
091 Daily Gain/Loss Report
104 Maintenance Register
044 Transfer/Certificate Register
056 Blue Sky Warning Report
501 New Account Report
038 Money Market Payment & Adjustment Detail
039 Money Market Distribution Proof Report

Monthly Reports
---------------

Report Description
Blue Sky
Certificate Listing
State Sales and Redemption
Monthly Statistical
Account Demographic Analysis
MTD Sales - Demographics by Account Group
Account Analysis by Type

o Preparation of federal tax information forms to include 1099-DIV's,
1099-B's, 1042's, etc. to shareholders with tape to IRS.

o Microfilming and indexing in PC system of all application,
correspondence and other pertinent shareholder documents to provide
automated location of these records.

o Microfilming all checks presented for investment and check redemptions.

o Processing reinvestment of dividends of one fund into another fund.

o Addressing, mailing and tabulation of annual proxy cards (one per year).

o Ad Hoc reports as requested by fund management.*

<PAGE>

o System access by PC dial-up or by dedicated line for IAA initiated calls
only (if applicable).*

o Retirement Plan processing (IRA, SEP, Omnibus Qualified Plans)
- Systematic tracking of current, prior year and rollover contributions
- 5498 tax reporting
- 1099R reporting on distributions
- Processing transfer of assets between custodians
- PC based recalculation of required minimum distributions for IRA SWP's
for shareholders over 59 1/2 years of age.

o Preparation of one annual list of shareholders.

o Prepare shareholder lists, labels, etc.*

o Processing sweep purchases and redemptions for brokerage, bank or other
accounts via tape or transmission.*

* Separate fees will apply for these services

<PAGE>

SCHEDULE "B"

SHAREHOLDER SERVICES AND TRANSFER AGENT FEE SCHEDULE
FOR
IAA TRUST GROWTH FUND, INC.

This Fee Schedule is fixed for a period of three (3) years from the Effective
Date as that term is defined in the Agreement.

I. A) Base Fee

$15.00 per account per year (1/12 payable monthly)
Minimum monthly fee - $2,000

B) IRA's, 403(b) Plans, Defined Contribution/Benefit Plans:

$ 12.00 per Account Annual Maintenance Fee

II. Out-of-Pocket Expenses:

The Growth Fund will reimburse Fund/Plan Services monthly for all
reasonable out-of-pocket expenses, including postage, stationery
(statements), telecommunications (telephone, fax, dedicated 800 line,
on-line access), special reports, transmissions, records retention,
tapes, couriers and any pre-approved travel expenses.

III. Additional Services

Activities of a non-recurring nature including but not limited to fund
consolidations, mergers, acquisitions, reorganizations, the addition or
deletion of a series, and shareholder meetings/proxies are not included
herein, and will be quoted separately. To the extent the Growth Fund
should decide to issue multiple/separate classes of shares, additional
fees will apply. Any enhanced services, programming requests or reports
will be quoted upon request.

ADMINISTRATION AGREEMENT

This Agreement, dated as of the 1st day of August, 1995, made by and
between IAA Trust Growth Fund, Inc. ("The Growth Fund"), a corporation duly
organized and existing under the laws of the state of Maryland, operating as a
registered investment company under the Investment Company Act of 1940, as
amended (the "Act"), and Fund/Plan Services, Inc. ("Fund/Plan"), a corporation
duly organized and existing under the laws of the State of Delaware
(collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Parties desire to enter into an agreement whereby
Fund/Plan will provide certain administration services to the Growth Fund on the
terms and conditions set forth in this Agreement; and

WHEREAS, Fund/Plan is willing to serve in such capacity and perform
such administrative services under the terms and conditions set forth below; and

WHEREAS, the Growth Fund will provide all necessary information to
Fund/Plan concerning the Fund so that Fund/Plan may appropriately execute its
responsibilities hereunder;

NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and in exchange of good and valuable consideration, the
sufficiency and receipt of which is hereby acknowledged, the Parties hereto,
intending to be legally bound, do hereby agree as follows:

Section 1. Appointment The Growth Fund hereby appoints Fund/Plan as
administrator and Fund/Plan hereby accepts such appointment.

Section 2. Duties and Obligations of Fund/Plan

(a) Subject to the succeeding provisions of this section and
subject to the direction and control of the Board of Directors of the Growth
Fund, Fund/Plan shall provide to the Fund all administrative services as set
forth in Schedule "A" attached hereto and incorporated by reference in its
entirety into this Agreement. In addition to the obligations set forth in
Schedule "A", Fund/Plan shall (i) provide its own office space, facilities,
equipment and personnel for the performance of its duties under this Agreement;
and (ii) take all actions it deems necessary to properly execute the
administrative responsibilities of the Growth Fund.

(b) So that Fund/Plan may perform its duties under the terms
of this Agreement,

<PAGE>

the Board of Directors of the Growth Fund shall direct the officers, investment
advisor, distributor, legal counsel, independent accountants and custodian of
the Growth Fund to cooperate fully with Fund/Plan and to provide such
information, documents and advice relating to the Growth Fund as is within the
possession or knowledge of such persons provided that no such person need
provide any information to Fund/Plan if to do so would result in the loss of any
privilege or confidential treatment with respect to such information. In
connection with its duties, Fund/Plan shall be entitled to rely, and shall be
held harmless by the Growth Fund when acting in reasonable reliance upon the
instruction, advice or any documents as provided by the Growth Fund to Fund/Plan
by any of the aforementioned persons. All fees charged by any such persons shall
be deemed an expense of the Growth Fund.

(1) the provisions of the Investment Company Act of 1940, as
amended (the "Act") and the Securities Act of 1933, as amended, and of any rules
or regulations in force thereunder;

(2) any other applicable provision of state and federal law;

(3) the provisions of the Articles of Incorporation and
By-Laws of the Growth Fund as amended from time to time;

(4) any policies and determinations of the Board of Directors
of the Growth Fund; and

(5) the fundamental policies of the Growth Fund as reflected
in the registration statement under the Act.

Fund/Plan acknowledges that all records that it maintains for the
Growth Fund are the property of the Growth Fund and will be surrendered promptly
to the Growth Fund upon written request. Fund/Plan will preserve, for the
periods prescribed under Rule 31a-2 under the Act, all such records required to
be maintained under Rule 31a-1 of the Act.

(d) Nothing in this Agreement shall prevent Fund/Plan or any officer
thereof from acting as administrator for or with any other person, firm or
corporation. While the administrative services supplied to the Growth Fund may
be different than those supplied to other persons, firms or corporations,
Fund/Plan shall provide the Growth Fund equitable treatment in supplying
services. The Growth Fund recognizes that it will not receive

<PAGE>

preferential treatment from Fund/Plan as compared with the treatment
provided to other Fund/Plan clients. Fund/Plan agrees to maintain the records
and all other information of the Growth Fund in a confidential manner and shall
not use such information for any purpose other than the performance of
Fund/Plan's duties under this Agreement.

Section 3. Allocation of Expenses All costs and expenses of the Growth
Fund shall be paid by the Growth Fund including, but not limited to:
(a) fees paid to an investment adviser (the "Adviser");
(b) interest and taxes;
(c) brokerage fees and commissions;
(d) insurance premiums;
(e) compensation and expenses of its Directors who are not
affiliated persons of the Adviser;
(f) legal, accounting and audit expenses;
(g) custodian and transfer agent, or shareholder servicing
agent, fees and expenses;
(h) fees and expenses incident to the registration of the
shares of the Growth Fund under Federal or state
securities laws;
(i) expenses related to preparing, setting in type,
printing and mailing prospectuses, statements of
additional information, reports and notices and proxy
material to shareholders of the Growth Fund;
(j) all expenses incidental to holding meetings of
shareholders and Directors of the Growth Fund;
(k) such extraordinary expenses as may arise, including
litigation, affecting the Growth Fund and the legal
obligations which the Growth Fund may have regarding
indemnification of its officers and directors; and
(l) fees and out-of-pocket expenses paid on behalf of the
Growth Fund by Fund/Plan.

Section 4. Compensation of Fund/Plan The Growth Fund agrees to pay
Fund/Plan compensation for its services and to reimburse it for expenses
incurred and paid by Fund/Plan on behalf of the Growth Fund, at the rates and
amounts as set forth in Schedule "B" attached hereto, and as shall be set forth
in any amendments to such Schedule "B" approved by the Growth Fund and
Fund/Plan. The Growth Fund agrees and understands that Fund/Plan's compensation
be comprised of two components, payable on a monthly basis, as follows:

(i) A combined asset-based fee subject to a minimum amount will be
billed monthly to the Growth Fund. These fees are to be paid by the Growth Fund
within ten calendar days after receipt of an invoice from Fund/Plan.

(ii) reimbursement of any out-of-pocket expenses paid by Fund/Plan on
behalf of the Growth Fund, which out-of-pocket expenses will be billed to the
Growth Fund within the

<PAGE>

first ten calendar days of the month following the month in which such
out-of-pocket expenses were incurred. The Growth Fund agrees to reimburse
Fund/Plan for such expenses within ten calendar days of receipt of such bill.

For the purpose of determining fees payable to Fund/Plan, the value of
the Growth Fund's net assets shall be computed at the times and in the manner
specified in the Growth Fund's Prospectus and Statement of Additional
Information then in effect.

During the term of this Agreement, should the Growth Fund seek services
or functions in addition to those outlined above or in Schedule "A" attached, a
written amendment to this Agreement specifying the additional services and
corresponding compensation shall be executed by both Fund/Plan and the Growth
Fund.
Section 5. Duration

(a) The term of this Agreement shall be for a period of three (3)
years, commencing on the date hereinabove first written ("Effective Date") and
shall continue thereafter on a year to year term subject to termination by
either Party set forth in (c) below.

(b) The fee schedule set forth in Schedule "B" attached shall be fixed
for three (3) years commencing on the Effective Date of this Agreement.

Section 6. Amendment No provision of this Agreement may be amended or
modified, in any manner except by a written agreement properly authorized and
executed by Fund/Plan and the Growth Fund.

<PAGE>

Section 7. Applicable Law This Agreement shall be governed by the
laws of the Commonwealth of Pennsylvania and the venue of any action arising
under this Agreement shall be Montgomery County, Commonwealth of Pennsylvania.

Section 8. Limitation of Liability

(a) The execution and delivery of this Agreement has been duly
authorized by the Board of Directors of the Growth Fund and executed on behalf
of the Growth Fund by the undersigned officer, in that officer's capacity as an
officer of the Growth Fund. The obligations under this Agreement shall be
binding upon the assets and property of the Growth Fund and shall not be binding
upon any director, officer or shareholder of the Fund individually.

(b) Fund/Plan, its directors, officers, employees, shareholders and
agents shall only be liable for any error of judgment or mistake of law or for
any loss suffered by the Growth Fund in connection with the performance of this
Agreement that result from willful misfeasance, bad faith or negligence on the
part of Fund/Plan in the performance of its obligations and duties under this
Agreement.

(c) Any person, even though a director, officer, employee, shareholder
or agent of Fund/Plan, who may be or become an officer, director, employee or
agent of the Growth Fund, shall be deemed when rendering services to such entity
or acting on any business of such entity (other than services or business in
connection with Fund/Plan's duties under the Agreement), to be rendering such
services to or acting solely for the Growth Fund and not as a director, officer,
employee, shareholder or agent of, or under the control or direction of
Fund/Plan even though such person may receive compensation from Fund/Plan.

(d) Notwithstanding any other provision of this Agreement, the Growth
Fund shall indemnify and hold harmless Fund/Plan, its directors, officers,
employees, shareholders and agents from and against any and all claims, demands,
expenses and liabilities (whether with or without basis in fact or law) of any
and every nature which Fund/Plan may sustain or incur or which may be asserted
against Fund/Plan by any person by reason of, or as a result of (i) any action
taken or omitted to be taken by Fund/Plan in good faith, (ii) any action taken
or omitted to be taken by Fund/Plan in good faith in reliance upon any
certificate, instrument, order or stock certificate or other document reasonably
believed by Fund/Plan to be genuine and to be signed, countersigned or executed
by any duly authorized person, upon the oral instructions or

<PAGE>

written instruction of an authorized person of the Growth Fund or upon the
opinion of legal counsel for the Growth Fund; or (iii) any action taken in good
faith or omitted to be taken by Fund/Plan in connection with its appointment in
reliance upon any law, act, regulation or interpretation of the same even though
the same may thereafter have been altered, changed, amended or repealed.
Indemnification under this subparagraph shall not apply, however, to actions or
omissions of Fund/Plan or its directors, officers, employees, shareholders or
agents in cases of its or their willful misfeasance, bad faith, negligence or
reckless disregard of its or their duties hereunder.

(e) Fund/Plan shall give written notice to the Growth Fund within ten
(10) business days of receipt by Fund/Plan of a written assertion or claim of
any threatened or pending legal proceeding which may be subject to this
indemnification. The failure to notify the Growth Fund of such written assertion
or claim shall not, however, operate in any manner whatsoever to relieve the
Growth Fund of any liability arising under this Section or otherwise, unless
such failure prejudices the Growth Fund.

(f) For any legal proceeding giving rise to this indemnification, the
Growth Fund shall be entitled to defend or prosecute any claim in the name of
Fund/Plan at its own expense and through counsel of its own choosing if it gives
written notice to Fund/Plan within ten (10) business days of receiving notice of
such claim. Notwithstanding the foregoing, Fund/Plan may participate in the
litigation at its own expense through counsel of its own choosing. If the Growth
Fund does choose to defend or prosecute such claim, then the parties shall
cooperate in the defense or prosecution thereof and shall furnish such records
and other information as are reasonably necessary.

(g) The terms of this Section 8 shall survive the termination of this
Agreement.

Section 9. Notices Except as otherwise provided in this Agreement, any
notice or other communication required by or permitted to be given in connection
with this Agreement shall be in writing, and shall be delivered in person or
sent by first class mail, postage prepaid to the respective parties as follows:

If to IAA Trust Growth Fund, Inc.: If to Fund/Plan:
IAA Trust Growth Fund, Inc. Fund/Plan Services, Inc.
808 IAA Drive 2 West Elm Street
Bloomington, IL 61702 Conshohocken, PA 19428
Attention: Richard M. Miller Attention: Kenneth J. Kempf,
Vice President President

<PAGE>

Section 10. Severability If any part, term or provision of this
Agreement is held by any court to be illegal, in conflict with any law or
otherwise invalid, the remaining portion or portions shall be considered
severable and not affected, and the rights and obligations of the parties shall
be construed and enforced as if the Agreement did not contain the particular
part, term or provision held to be illegal or invalid.

Section 11. Section Headings Section and Paragraph headings are for
convenience only and shall not be construed as part of this Agreement.

Section 12. This Agreement may be executed in two or more counterparts,
each of which when so executed shall be deemed to be an original, but such
counterparts shall together constitute but one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
consisting of seven typewritten pages, together with Schedules "A" and "B" to be
signed by their duly authorized officers as of the day and year first above
written.

IAA Trust Growth Fund, Inc. Fund/Plan Services, Inc.

- -------------------------------------- ------------------------------------
By: Gary E. Mede, Vice President By: Kenneth J. Kempf, President

<PAGE>

SCHEDULE "A"

FUND ADMINISTRATION SERVICES
FOR
IAA TRUST GROWTH FUND, INC.

I. Regulatory Compliance

A. Compliance - Federal Investment Company Act of 1940
1. Review, report and renew
a. Investment advisory contracts
b. Fidelity bond (if requested)
c. Underwriting contracts
d. Distribution (12b-1) plans
e. Administration contracts
f. Accounting contracts
g. Custody contracts
h. Transfer agent and shareholder services contract

2. Filings
a. N-SAR (semi-annual report)
b. N-1A (prospectus), post effective amendments and
supplements ("stickers")
c. 24f-2 indefinite registration of shares
d. Filing shareholder reports under 30b2-1
e. Notify frequency capital gains under 19b-1
f. Coordination of EDGAR filings

3. Annual up-dates of biographical information and
questionnaires for Directors and Officers (if requested)

4. Monitor money market funds under Rule 2A-7

B. Compliance - State "Blue Sky"
Blue Sky (state registration)
a. Registration shares (initial/renewal)
b. Monitor sale shares over/under
c. Report shares sold
d. Filing of federal prospectus and contracts
e. Filing annual and semi-annual reports with states

C. Compliance - Prospectus
1. Analyze and review portfolio reports from advisor
regarding:
a. compliance with investment objectives
b. maximum investment by company/industry size

D. Compliance - Other

<PAGE>

1. Applicable state tax laws

II. Corporate Business and Shareholder/Public Information

A. Directors/Management
1. Preparation of meetings
a. Agendas - all necessary items of compliance
b. Preparation of Board packages
c. Assist with arranging and conducting meetings
d. Prepare minutes (if requested)
e. Keep attendance records (if requested)
f. Maintain certain board records as requested

2. Preparation and distribution of periodic operation reports to
management

B. Coordinate Proposals for Service Agents
1. Suppliers
2. Printers
3. Fulfillment of literature requests
4. Underwriters

C. Maintain Corporate Calendars
1. General
2. Blue sky

D. Shareholder Meeting - maximum one per year
1. Preparation of Proxy
2. Conduct Meeting
3. Record Ballot Results

E. Maintain certain Corporate Files as requested

F. Release Corporate Information
1. To shareholders
2. To financial and general press
3. To industry publications
a. distributions (dividends and capital gains)
b. tax information
c. changes to prospectus
d. letters from management
e. funds' performance

4. Respond to:
a. financial press
b. miscellaneous shareholder inquiries
c. industry questionnaires

<PAGE>

5. Prepare, maintain and update monthly information manual

F. Communications to Shareholders
1. Coordinate printing and distribution of annual and semi-
annual reports and prospectus

III. Financial and Management Reporting

A. Income and Expenses
1. Expense figures calculated and accrual levels set
2. Monitoring of expenses, accruals monthly
3. Approve and coordinate payment of expenses
4. Projection of income and expenses (with regards to B(2)) -
ex-date will determine if projection will apply
5. Calculation of advisory fee, 12b-1 fee
6. Calculation of average net assets

B. Distributions to Shareholders
1. Calculations of dividends and capital gain distributions (in
conjunction with the Fund and their auditors)
a. compliance with income tax provisions
b. compliance with excise tax provisions
c. compliance with Investment Company Act of 1940

C. Financial Reporting
1. Liaison between Fund management, independent auditors and
printers for shareholder reports
2. Preparation of semi-annual and annual reports to shareholders
3. 60-day delivery to SEC and shareholders
4. Preparation of semi-annual and annual NSAR's (financial data)

D. Subchapter M Compliance (monthly)
1. Asset diversification test
2. Short/short test
3. Income Qualification Test

E. Other Financial Analyses
1. Upon request from fund management, other budgeting and
analyses can be constructed to meet a fund's specific needs
(additional fees may apply)
2. Sales information, portfolio turnover (monthly)
3. Work closely with independent auditors on return of capital
presentation, excise tax calculation
4. Performance (total return) calculation (monthly)
5. Analysis of interest derived from various Government
obligations (annual)(if interest income was distributed in a
calendar year) for reporting to Shareholders

<PAGE>

F. Review and Monitoring Functions (monthly)
1. Review expense and reclassification entries to ensure proper
update
2. Perform various reviews to ensure accuracy of subscription/
liquidation schedules, accounting (the monthly expense
analysis)
3. Review all accruals and expenditures where applicable

G. Preparation and distribution of monthly operational reports to
management by 10th Business Day
1. Management Statistics (Recap)
- portfolio
- book gains/losses/per share
- net income, book income per share
- capital stock activity
- distributions
2. Performance Analysis
- total return
- monthly, year to date, average annual (1, 5, 10
yrs), 5 yr cumulative, since inception cumulative
3. Expense Analysis
- schedule
- expenses paid
- accrual monitoring
- advisory fee
4. Short-Short Analysis
- short-short income
- gross income (components)
5. Portfolio Turnover
- cost of purchases
- net proceeds of sales
- average market value
6. Asset Diversification Test
- gross assets
- non-qualifying assets
7. Activity Summary
- shares sold, redeemed and reinvested
- change in investment
8. Summary of Dividends paid for each Fund.

H. Provide rating agencies statistical data as requested
(monthly/quarterly)

I. Standard schedules for Board Package (quarterly)

<PAGE>

1. Activity Summary (III-G-7 from above)
2. Other schedules can be provided (additional fees may
apply)
3. Statistical Report

<PAGE>

SCHEDULE "B"

ADMINISTRATION SERVICES FEE SCHEDULE
FOR
IAA TRUST GROWTH FUND, INC.

This Fee Schedule is fixed for a period of three (3) years from the Effective
Date as that term is defined in the Agreement.

I. Administration Expense

.0015 On the First $ 50 Million of Average Net Assets
.0010 On the Next $ 50 Million of Average Net Assets
.0005 Over $100 Million of Average Net Assets

The above fee schedule is applicable to total net assets of all four
portfolios within the IAA Trust family of Funds. A minimum annual fee
of $50,000 will be charged to the Growth Fund and a minimum annual fee
of $80,000 applies in total to the group of four IAA Trust Funds. New
portfolios added shall bear an annual minimum fee of $10,000.

II. Out-of-Pocket Expenses

The Fund(s) will reimburse Fund/Plan Services monthly for all
reasonable out-of-pocket expenses, including telephone, postage,
telecommunications, special reports, all currently required tax return
preparation ($3500 per year, total all Funds), record retention, script
fees, stamp duty, special transportation costs as incurred, and copying
and sending materials to auditors.

III. Additional Services

Activities of a non-recurring nature including but not limited to fund
consolidations, mergers, acquisitions, reorganizations, the addition or
deletion of a fund, and shareholder meetings/proxies, are not included
herein, and will be quoted separately. To the extent the Growth Fund
should decide to issue multiple/separate classes of shares, additional
fees will apply. Any additional/enhanced services or reports will be
quoted upon request.

ACCOUNTING SERVICES AGREEMENT

This Agreement, dated as of the 1st day of August, 1995 made by and
between IAA Trust Growth Fund, Inc. (the "Growth Fund"), a corporation duly
organized and existing under the laws of the State of Maryland and operating as
an open-end management investment company registered under the Investment
Company Act of 1940, as amended, and Fund/Plan Services, Inc. ("Fund/Plan"), a
corporation duly organized and existing under the laws of the State of Delaware
(collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Growth Fund desires to appoint Fund/Plan as Accounting
Services Agent to maintain and keep current the books, accounts, records,
journals or other records of original entry relating to the business of the
Growth Fund (the "Accounts and Records") and to perform certain other functions
in connection with such Accounts and Records; and

WHEREAS, Fund/Plan is willing to serve in such capacity and perform
such functions upon the terms and conditions set forth below; and

WHEREAS, the Growth Fund will provide all necessary information
concerning the Fund to Fund/Plan so that Fund/Plan may appropriately execute its
responsibilities hereunder;

NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and in exchange of good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties hereto,
intending to be legally bound, do hereby agree as follows:

Section 1. For purposes of this Agreement:

Oral Instructions shall mean an authorization, instruction, approval,
item or set of data, or information of any kind transmitted to Fund/Plan in
person or by telephone, telegram, telecopy, or other mechanical or documentary
means lacking an original signature, by a person or persons reasonably
identified to Fund/Plan to be a person or persons authorized by a resolution of
the Board of Directors of the Growth Fund, to give such Oral Instructions on
behalf of the Growth Fund.

Written Instructions shall mean an authorization, instruction,
approval, item or set of data or information of any kind transmitted to
Fund/Plan in original writing containing an original signature or a copy of such
document transmitted by telecopy including transmission of such signature
reasonably identified to Fund/Plan to be the signature of a person authorized

<PAGE>

by a resolution of the Board of Directors of the Growth Fund to give written
instructions on behalf of the Growth Fund.

The Growth Fund shall file with Fund/Plan a certified copy of each
resolution of its Board of Directors authorizing execution of Written
Instructions or the transmittal of Oral Instructions as provided above.

Section 2. To the extent Fund/Plan receives the necessary information
from the Growth Fund or its agents by Written or Oral Instructions, Fund/Plan
shall maintain and keep current the following Accounts and Records relating to
the business of the Growth Fund in such form as may be mutually agreed upon
between the Growth Fund and Fund/Plan:

(a) Cash Receipts Journal
(b) Cash Disbursements Journal
(c) Dividends Paid and Payable Schedule
(d) Purchase and Sales Journals - Portfolio Securities
(e) Subscription and Redemption Journals
(f) Security Ledgers - Transaction Report and Tax Lot Holdings Report
(g) Broker Ledger - Commission Report
(h) Daily Expense Accruals
(i) Daily Interest Accruals
(j) Daily Trial Balance
(k) Portfolio Interest Receivable and Income Journal
(l) Portfolio Dividend Receivable and Income Register
(m) Listing of Portfolio Holdings - showing cost, market value and
percentage of portfolio comprised of each security.
(n) Average Daily Net assets provided on monthly basis.

The necessary information to perform the above functions and the
calculation of the net asset value of the Growth Fund as provided below, is to
be furnished by Written or Oral Instructions to Fund/Plan daily (in accordance
with the time frame identified below) prior to the close of regular trading on
the New York Stock Exchange.

Section 3. Fund/Plan shall perform the ministerial calculations
necessary to calculate the Growth Fund's net asset value each day that the New
York Stock Exchange is open for business, in accordance with (i) the Fund's
current prospectus and statement of additional information then in effect and
(ii) procedures with respect thereto approved by the Board of Directors of the
Growth Fund and supplied in writing to Fund/Plan. Portfolio items for which
market quotations are available by Fund/Plan's use of an automated financial
information service (the "Service") shall be based on the closing prices of such
Service except where the Growth Fund has given or caused to be given specific
Written or Oral Instructions to utilize a

<PAGE>

different value subject to the appropriate provisions in the Growth Fund's
prospectus and statement of additional information then in effect. All of the
portfolio securities shall be given such values as the Growth Fund provides by
Written or Oral Instructions including all restricted securities and other
securities requiring valuation not readily ascertainable solely by such Service
subject to the appropriate provisions in the Growth Fund's prospectus and
statement of additional information then in effect. Fund/Plan shall have no
responsibility or liability for the accuracy of prices quoted by such Service;
for the accuracy of the information supplied by the Growth Fund; or for any
loss, liability, damage, or cost arising out of any inaccuracy of such data.
Fund/Plan shall have no responsibility or duty to include information or
valuations to be provided by the Growth Fund in any computation unless and until
it is timely supplied to Fund/Plan in usable form. Fund/Plan shall record
corporate action information as received from the custodian of the Growth Fund's
assets (the "Custodian"), the Service, or the Growth Fund. Fund/Plan shall have
no duty to gather or record corporate action information not supplied by these
sources.

Fund/Plan will assume no liability for price changes caused by: the
investment advisor(s), custodian of the assets of the Growth Fund (the
"Custodian") and suppliers of security prices, corporate action and dividend
information, or any party other than Fund/Plan itself.

In the event an error is made by Fund/Plan which creates a price change
of an amount greater than or equal to one half of one percent of the correct net
asset value ("NAV"), consideration must be given to the effect of the price
change as described below.

Notwithstanding the provisions of Section 11, the following provisions
govern Fund/Plan's liability for errors in calculating the NAV of the Growth
Fund:

If the NAV should have been higher for a date or dates in the
past, the error would have the effect of having given more shares to
subscribers and less money to redeemers to which they were entitled.
Conversely, if the NAV should have been lower, the error would have the
effect of having given less shares to subscribers and overpaying
redeemers.

If the error affects the prior business day's NAV only, and if
Fund/Plan can rerun the prior day's work before shareholder statements
and checks are mailed, the Growth Fund hereby accepts this manner of
correcting the error.

<PAGE>

If the error spans five (5) business days or less, Fund/Plan
shall reprocess shareholder purchases and redemptions where redeeming
shareholders have been underpaid. Fund/Plan shall assume liability to
the Growth Fund for overpayments to shareholders who have fully
redeemed.

If the error spans more than five (5) business days, Fund/Plan
would bear the liability to the Growth Fund for, 1) buying in for
excess shares given to shareholders if the NAV should have been higher,
or, 2) funding overpayments to shareholders who have redeemed if the
NAV should have been lower. The cost of any reprocessing required for
shareholders who have been credited with fewer shares than appropriate,
or for redeeming shareholders who are due additional amounts of money
will also be borne by Fund/Plan.

Section 4. For all purposes under this Agreement, Fund/Plan is
authorized to act upon receipt of the first of any Written or Oral Instruction
it receives from the Growth Fund or its agents on behalf of the Growth Fund. In
cases where the first instruction is an Oral Instruction that is not in the form
of a document or written record, a confirmatory Written Instruction or Oral
Instruction in the form of a document or written record shall be delivered, and
in cases where Fund/Plan receives an Instruction, whether Written or Oral, to
enter a portfolio transaction on the records, the Growth Fund shall cause the
broker/dealer to send a written confirmation to the Custodian. Fund/Plan shall
be entitled to rely on the first Instruction received, and for any act or
omission undertaken in compliance therewith shall be free of liability and fully
indemnified and held harmless by the Growth Fund, provided however, that in the
event a Written or Oral Instruction received by Fund/Plan is countermanded by a
timely received subsequent Written or Oral Instruction prior to acting upon such
countermanded Instruction, Fund/Plan shall act upon such subsequent Written or
Oral Instruction. The sole obligation of Fund/Plan with respect to any follow-up
or confirmatory Written Instruction, Oral Instruction in documentary or written
form, shall be to make reasonable efforts to detect any such discrepancy between
the original Instruction and such confirmation and to report such discrepancy to
the Growth Fund. The Growth Fund shall be responsible, at the Growth Fund's
expense, for taking any action, including any reprocessing, necessary to correct
any discrepancy or error. To the extent such action requires Fund/Plan to act,
the Growth Fund shall give Fund/Plan specific Written Instruction as to the
action required.

<PAGE>

Section 5. The Growth Fund shall cause its Custodian to forward to
Fund/Plan a daily statement of cash and portfolio transactions. At the end of
each month, the Growth Fund shall cause the Custodian to forward to Fund/Plan a
monthly statement of portfolio positions, which will be reconciled with the
Growth Fund's Accounts and Records maintained by Fund/Plan on its behalf.
Fund/Plan will report any discrepancies to the Custodian, and report any
unreconciled items to the Growth Fund.

Section 6. Fund/Plan shall promptly supply daily and periodic reports
to the Growth Fund as requested by the Growth Fund and agreed upon by Fund/Plan.

Section 7. The Growth Fund shall provide and shall require each of its
agents (including the Custodian) to provide Fund/Plan as of the close of each
business day, or on such other schedule as the Growth Fund determines is
necessary, with Written or Oral Instructions (to be delivered to Fund/Plan by
11:00 a.m., Eastern time, the next following business day) containing all data
and information necessary for Fund/Plan to maintain the Growth Fund's Accounts
and Records and Fund/Plan may conclusively assume that the information it
receives by Written or Oral Instructions is complete and accurate. Fund/Plan, as
Transfer Agent, accepts responsibility for providing reports to the Fund/Plan
Accounting Unit of share purchases, redemptions, and total shares outstanding,
on the next business day after each net asset valuation.

Section 8. The Accounts and Records, in the agreed-upon format,
maintained by Fund/Plan shall be the property of the Growth Fund and shall be
made available to the Growth Fund promptly upon request and shall be maintained
for the periods prescribed in Rules 31a-1 and 31a-2 under the Investment Company
Act of 1940, as amended. Fund/Plan shall assist the Fund's independent auditors,
or upon approval of the Fund, or upon demand, any regulatory body, in any
requested review of the Fund's Accounts and Records but shall be reimbursed for
all reasonable expenses (expenses generally such as shipping, photocopying,
faxing, special reports, etc.) and reasonable employee time for complying with
extra services, (currently a rate of $50.00 per hour) invested in any such
review of the Fund's Accounts and Records outside of routine and normal periodic
review and audits. Upon receipt from the Growth Fund of the necessary
information, Fund/Plan shall supply the necessary data for the Growth Fund or an
independent auditor's completion of any necessary tax returns, questionnaires,
periodic

<PAGE>

reports to Shareholders and such other reports and information requests as the
Growth Fund and Fund/Plan shall agree upon from time to time.

Section 9. In case of any request or demand for the inspection of the
records of the Growth Fund, Fund/Plan shall endeavor to notify the Growth Fund
and to secure instructions as to permitting or refusing such inspection.
Fund/Plan may however, exhibit such records to any person in any case where it
is advised by its counsel that it may be held liable for failure to do so after
notice to the Growth Fund.

Section 10. Fund/Plan and the Growth Fund may from time to time adopt
such procedures as agreed upon in writing, and Fund/Plan may conclusively assume
that any procedure approved by the Growth Fund or directed by the Growth Fund,
does not conflict with or violate any requirements of the Growth Fund's
Prospectus, Articles of Incorporation, By-Laws, or any rule or regulation of any
regulatory body or governmental agency. The Growth Fund shall be responsible for
notifying Fund/Plan of any changes in regulations or rules which might
necessitate changes in Fund/Plan's procedures, and for working out with
Fund/Plan such changes.

Section 11.

(a) Fund/Plan, its directors, officers, employees,
shareholders, and agents shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Growth Fund in connection with
the performance of this Agreement, except losses resulting from willful
misfeasance, bad faith or negligence on the part of Fund/Plan in the performance
of its obligations and duties under this Agreement.

(b) Any person, even though also a director, officer,
employee, shareholder or agent of Fund/Plan, who may be or become an officer,
trustee, employee or agent of the Growth Fund shall be deemed, when rendering
services to the Growth Fund or acting on any business of the Growth Fund (other
than services or business in connection with Fund/Plan's duties hereunder), to
be rendering such services to or acting solely for the Growth Fund, and not as a
director, officer, employee, shareholder or agent of, or one under the control
or direction of Fund/Plan even though receiving a salary from Fund/Plan.

<PAGE>

with or without basis in fact or law) of any and every nature which Fund/Plan
may sustain or incur or which may be asserted against Fund/Plan by any person
by reason of, or as a result of:

(i) any action taken or omitted to be taken by
Fund/Plan except matters resulting from willful misfeasance, bad faith,
negligence or reckless disregard on the part of Fund/Plan in the performance of
its obligations and duties under this Agreement; or

(ii) in reliance upon any certificate, instrument,
order or stock certificate or other document reasonably believed by it to be
genuine and to be signed, countersigned or executed by any duly authorized
person, upon the Oral Instructions or Written Instructions of an authorized
person of the Growth Fund or upon the written opinion of legal counsel for the
Growth Fund or Fund/Plan; or

(iii) any action taken or omitted to be taken in good
faith by Fund/Plan in connection with its appointment, in reliance upon any law,
act, regulation or interpretation of the same even though the same may
thereafter have been altered, changed, amended, or repealed. Indemnification
under this subparagraph shall not apply, however, to actions or omissions of
Fund/Plan or its directors, officers, employees, shareholders, or agents in
cases of its or their own negligence, willful misconduct, bad faith, or reckless
disregard of its or their own duties hereunder.

(d) Fund/Plan shall give written notice to the Growth Fund
within ten (10) business days of receipt by Fund/Plan of a written assertion or
claim of any threatened or pending legal proceeding which may be subject to this
indemnification. The failure to so notify the Growth Fund of such written
assertion or claim shall not, however, operate in any manner whatsoever to
relieve the Growth Fund of any liability arising from this Section or otherwise,
except to the extent failure to give notice prejudices the Growth Fund.

(e) For any legal proceeding giving rise to this
indemnification, the Growth Fund shall be entitled to defend or prosecute any
claim in the name of Fund/Plan at its own expense and through counsel of its own
choosing if it gives written notice to Fund/Plan within ten (10) business days
of receiving notice of such claim. Notwithstanding the foregoing, Fund/Plan may
participate in the litigation at its own expense through counsel of its own
choosing. If the Growth Fund chooses to defend or prosecute such claim, then the
Parties shall cooperate in the defense or prosecution thereof and shall furnish
such records and other information as are reasonably necessary.

<PAGE>

(f) The Fund shall not settle any claim without the Company's
express written consent which shall not be unreasonably withheld. The Company
shall not settle any claim without the Fund's express written consent which
shall not be unreasonably withheld.

Section 12. All financial data provided to, processed by, and reported
by Fund/Plan under this Agreement shall be stated in United States dollars.
Fund/Plan shall have no obligation to convert to, equate, or deal in foreign
currencies or values, and expressly assumes no liability for any currency
conversion or non-U.S. dollar denominated computations relating to the affairs
of the Growth Fund.

Section 13. The Growth Fund agrees to pay Fund/Plan compensation for
its services and to reimburse it for expenses, at the rates and amounts as set
forth in Schedule "B" attached hereto, and as shall be set forth in any
amendments to such Schedule "B" approved by the Growth Fund and Fund/Plan. The
Growth Fund agrees and understands that Fund/Plan's compensation be comprised of
two components and payable on a monthly basis as follows:

(i) An asset based fee subject to a stated minimum
fee, will be billed to the Growth Fund within the first ten (10) calendar days
of the month following the month in which the fee was incurred. The Growth Fund
agrees to pay this fee to Fund/Plan within ten (10) calendar days of receipt of
such bill.

(ii) Reimbursement of any reasonable out-of-pocket
expenses paid by Fund/Plan on behalf of the Growth Fund, which out-of-pocket
expenses will be billed to the Growth Fund within the first ten calendar days of
the month following the month in which such out-of-pocket expenses were
incurred. The Growth Fund agrees to reimburse Fund/Plan for such expenses within
ten calendar days of receipt of such bill.

Section 14. Nothing contained in this Agreement is intended to or shall
require

<PAGE>

Fund/Plan, in any capacity hereunder, to perform any functions or duties
on any holiday, day of special observance or any other day on which the New York
Stock Exchange is closed. Functions or duties normally scheduled to be performed
on such days shall be performed on, and as of, the next succeeding business day
on which the New York Stock Exchange is open. Notwithstanding the foregoing,
Fund/Plan shall compute the net asset value for the Fund on each day required
pursuant to (i) Rule 22c-1 promulgated under the Investment Company Act of 1940,
as amended, and (ii) the Growth Fund's Prospectus and Statement of Additional
Information then in effect.

Section 15.

(a) The term of this Agreement shall be for a period of three
(3) years, commencing on the date hereinabove first written ("Effective Date")
and shall continue thereafter on a year to year term subject to termination by
either Party as set forth in (c) below.

(b) The fee schedule set forth in Schedule "B" attached shall
be fixed for three (3) years commencing on the Effective Date of this Agreement
and shall continue thereafter subject to review and adjustment of the fee
schedule and termination notice as set forth in section (c) below.

(c) After the initial term of this Agreement, the Growth Fund
or Fund/Plan may give written notice to the other of the termination of this
Agreement, such termination to take effect at the time specified in the notice,
which date shall not be less than one hundred twenty (120) days after the date
of receipt of such notice. Upon the effective termination date, the Growth Fund
shall pay to Fund/Plan such compensation as may be due as of the date of
termination and shall likewise reimburse Fund/Plan for any out-of-pocket
expenses and disbursements reasonably incurred by Fund/Plan to such date.

(d) If a successor to any of Fund/Plan's duties or
responsibilities under this Agreement is designated by the Growth Fund by
written notice to Fund/Plan in connection with the termination of this
Agreement, Fund/Plan shall promptly upon such termination and at the expense of
the Growth Fund, transfer all Required Records and shall cooperate in the
transfer of such duties and responsibilities.

Section 16. Except as otherwise provided in this Agreement, any notice
or other communication required by or permitted to be given in connection with
this Agreement shall

<PAGE>

be in writing, and shall be delivered in person or sent by first class mail,
postage prepaid to the respective parties as follows: If to IAA Trust Growth
Fund, Inc. If to Fund/Plan:

Section 17. This Agreement may be amended from time to time by
supplemental agreement executed by the Growth Fund and Fund/Plan and the
compensation stated in Schedule "B" attached hereto may be adjusted accordingly
as mutually agreed upon.

Section 18. The Growth Fund represents and warrants to Fund/Plan that
the execution and delivery of this Agreement by the undersigned officers of the
Growth Fund has been duly and validly authorized by resolution of the Board of
Directors of the Growth Fund.

Section 19. This Agreement may be executed in two or more counterparts,
each of which when so executed shall be deemed to be an original, but such
counterparts shall together constitute but one and the same instrument.

Section 20. This Agreement shall extend to and shall be binding upon
the parties hereto and their respective successors and assigns; provided,
however, that this Agreement shall not be assignable by the Growth Fund without
the written consent of Fund/Plan or by Fund/Plan without the written consent of
the Growth Fund, authorized or approved by a resolution of its respective Boards
of Directors.

Section 21. This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania and the venue of any action arising under this
Agreement shall be Montgomery County, Commonwealth of Pennsylvania.

Section 22. No provision of this Agreement may be amended or modified,
in any manner except by a written agreement properly authorized and executed by
Fund/Plan and the Growth Fund.

Section 23. If any part, term or provision of this Agreement is held by
any court to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not be affected,
and the rights and obligations of the parties shall be construed and enforced as
if the Agreement did not contain the particular part, term or provision held to
be illegal or invalid.

<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
consisting of eleven typewritten pages, together with Schedules "A" and "B", to
be signed by their duly authorized officers as of the day and year first above
written.

IAA Trust Growth Fund, Inc. Fund/Plan Services, Inc.

- ------------------------------------ ----------------------------------------
By: Gary E. Mede, Vice President By: Kenneth J. Kempf, President

<PAGE>

SCHEDULE "A"

FUND ACCOUNTING AND PORTFOLIO VALUATION SERVICES
FOR
THE GROWTH FUND, INC.

Daily Accounting Services

1) Calculate Net Asset Value ("NAV") and Offering Price Per Share:
o Update the daily market value of securities held by the Growth
Fund using Fund/Plan's standard agents for pricing domestic equity
and bond securities. The standard domestic equity pricing services
are Quotron/Reuters, Inc., Muller Data Corporation, or Interactive
Data Corporation (IDC). Muller Data Corporation, Telerate Systems,
Inc and IDC are used for bond and money market issues.
o Enter limited number (not to exceed ten per day) of manual prices
supplied by the Growth Fund.
o Prepare NAV proof sheet. Review components of change in NAV for
reasonableness.
o Review variance reporting on-line and in hard copy for price
changes in individual securities using variance levels
established by the Growth Fund. Verify US dollar security
prices exceeding variance levels by notifying the Growth Fund
and pricing sources of noted variances.
o Review for ex-dividend items indicated by pricing sources; trace
to general ledger for agreement.
o Communicate required pricing information, NAV, to the Growth
Fund's transfer agent (the "Transfer Agent") and,
electronically, to NASDAQ.

2) Complete Money Market (Daily Dividend) Fund Requirements:
(If applicable)

o Calculate net investment income available for distribution daily.
o Calculate daily rate, and 1, 7, 30-day yields.
o Provide system calculated average weighted maturity.
o Supply Transfer Agent and client with distribution rates.
o Provide money market original and amortized cost schedules in
accordance with valuing the Fund based on amortized cost,
inclusive of all debt issues income accruals.
o Communicate required information electronically to NASDAQ, if
applicable.

3) Determine and Report Cash Availability to Fund by approximately
9:30 AM Eastern Time:
o Receive daily cash and transaction statements from the Growth
Fund's custodian by 8:30 AM Eastern time.
o Receive previous day shareholder activity reports from the
transfer agent by 8:30 AM Eastern time.
o Fax hard copy cash availability calculations with all details to
the Growth Fund.

<PAGE>

o Supply the Growth Fund with 5-day cash projection report.
o Prepare and complete daily bank cash reconciliations including
documentation of any reconciling items and notify the Custodian
and the Growth Fund.
o For Money Market Funds, the Fund's transfer agent will also
support the client in receipt of timely cash information.

4) Reconcile and Record All Daily Expense Accruals:
o Accrue expenses based on budget supplied by the Growth Fund
either as percentage of net assets or specific dollar amounts.
o If applicable, monitor expense limitations established by the
Growth Fund.
o If applicable, accrue daily amortization of Organizational
expense.
o If applicable, complete daily accrual of 12b-1 expenses.

5) Verify and Record All Daily Income Accruals for Debt Issues:
o Review and verify all system generated Interest and Amortization
reports.
o Establish unique security codes for bond issues to permit
segregated Trial Balance income reporting.

6) Monitor Domestic Securities Held for cash dividends, corporate actions
and capital changes such as splits, mergers, spinoffs, etc. and process
appropriately.
o Monitor electronically received information from Muller Data
Corporation for all domestic securities.
o Review current daily security trades for dividend activity.
o Interface with custodian to monitor timely collection and postings
of corporate actions, dividends and interest.

7) Enter All Security Trades on Investment Accounting System (IAS) based
on written instructions from the Growth Fund.
o Review system verification of trade and interest calculations.
o Verify settlement through the statements supplied by the
custodian.
o Maintain security ledger transaction reporting.
o Maintain tax lot holdings.
o Provide complete broker commission reporting.
o Determine realized gains or losses on security trades.

8) Enter All Fund Share Transactions on IAS:
o Process activity identified on reports supplied by the Fund/Plan
transfer agent.
o Verify settlement through the statements supplied by the
Custodian.
o Reconcile to Fund/Plan's transfer agent report balances.

9) Prepare and Reconcile/Prove Accuracy of the Daily Trial Balance
(listing all asset, liability, equity, income and expense accounts)
o Post manual entries to the general ledger.
o Post custodian bank activity.
o Post shareholder and security transactions.
o Post and verify system generated activity, i.e., income and
expense accruals.

<PAGE>

o Prepare general ledger net cash proof used in NAV calculation.

10) Review and Reconcile With Custodian Statements:
o Verify all posted interest, dividends, expenses, and shareholder
and security payments/receipts, etc. (Discrepancies will be
reported to and resolved by the custodian.)
o Post all cash settlement activity to the Trial Balance.
o Reconcile to ending cash balance accounts.
o Clear IAS subsidiary reports with settled amounts.
o Track status of past due items and failed trades handled by the
custodian.

11) Submission of Daily Accounting Reports to the Growth Fund: (Additional
reports readily available.)
o Non-Money Market Fund
- Trial Balance.
- Portfolio Valuation (listing inclusive of holdings,
costs, market values, unrealized
appreciation/depreciation and percentage of portfolio
comprised of each security).
- Cash Availability and 5-day Cash Projection Report
- NAV calculation report.

Monthly Accounting Services

1) Full Financial Statement Preparation (automated Statements of Assets
and Liabilities, of Operations and of Changes in Net Assets) and
submission to the Growth Fund by 10th business day.

2) Submission of Monthly Automated IAS Reports to the Growth Fund:
o Security Purchase/Sales Journal
o Interest and Maturity Report
o Brokers Ledger (Commission Report)
o Security Ledger Transaction Report with Realized Gains/Losses
o Security Ledger Tax Lot Holdings Report
o Additional reports available upon request

3) Reconcile Accounting Asset Listing to Custodian Asset Listing:
o Report any security balance discrepancies to the custodian/the
Growth Fund.

4) Provide Monthly Analysis and Reconciliation of Additional Trial Balance
Accounts, such as:
o Security cost and realized gains/losses
o Interest/dividend receivable and income
o Payable/receivable for securities purchased and sold
o Payable/receivable for fund shares; issued and redeemed

<PAGE>

o Expense payments and accruals analysis

5) If Appropriate, Prepare and Submit to the Growth Fund:
o SEC yield reporting (non-money market funds with domestic and ADR
securities only).
o Income by state reporting.
o Standard Industry Code Valuation Report.
o Alternative Minimum Tax Income segregation schedule.

Annual (and Semi-Annual) Accounting Services

1) Assist and supply auditors with schedules supporting securities and
shareholder transactions, income and expense accruals, etc. during the
year in accordance with standard audit assistance requirements.

2) Provide NSAR Reporting (Accounting Questions):

If applicable, answer the following items:
2, 12B, 20, 21, 22, 23, 28, 30A, 31, 32, 35, 36, 37, 43, 53, 55, 62,
63, 64B, 71, 72, 73, 74, 75, and 76.

<PAGE>

ACCOUNTING SERVICES UNIT (ASU) BASIC
ASSUMPTIONS FOR THE IAA TRUST GROWTH FUND, INC.

The Accounting Fees as set forth in Schedule "B" are based on the
following assumptions. To the extent these assumptions are
inaccurate or requirements change, fee revisions may be
necessary.

Basic Assumptions:

1) The Growth Fund's asset composition and trading activity levels will
remain comparable to the current portfolio.

2) The Growth Fund has a tax year-end which coincides with its fiscal
year-end. No additional accounting requirements are necessary to
identify or maintain book-tax differences. ASU will supply segregated
Trial Balance account details to assist the Growth Fund in proper
identification by category of all appropriate realized and unrealized
gains/losses.

Security tax accounting which differs from book accounting will be
provided by the Growth Fund or the Fund's independent auditor.

3) The Growth Fund foresees no difficulty in using Fund/Plan's standard
current pricing agents for domestic equity, bond, and ADR securities.
Fund/Plan currently uses Quotron/Reuters, Inc., Muller Data Corporation
or Interactive Data Corporation (IDC) for domestic equities and listed
ADR's. Muller Data Corporation, Telerate Systems, Inc. or IDC are used
for bonds and money market instruments.

4) To the extent the Growth Fund requires daily security prices (limited
to ten per day) from specific brokers for domestic securities, these
manual prices will be obtained by the Growth Fund's investment advisor
and faxed to ASU by approximately 4:00 PM Eastern time for inclusion in
the NAV calculations. The Growth Fund will also supply ASU with the
appropriate pricing contacts for the manual quotes.

5) To the extent the Growth Fund should ever purchase/hold open-end
registered investment companies (RIC's), procedural discussions shall
take place between ASU and the Advisor to establish the appropriate
pricing and dividend rate sources. Depending on the methodologies
selected by the Growth Fund, additional fees may apply.

6) ASU will supply daily Portfolio Valuation Reports to the Growth Fund's
investment adviser or manager identifying current security positions,
original/amortized cost, security market values and changes in
unrealized appreciation/depreciation.

It will be the responsibility of the Fund's investment adviser to
review these reports and to promptly notify ASU of any possible
problems, trade discrepancies, incorrect

<PAGE>

security prices, corporate action/capital change information that
could result in a misstated Fund NAV.

7) The Growth Fund does not currently expect to invest in Futures, Swaps,
Derivatives or Foreign (non-US dollar denominated) currency or
securities. To the extent these investment strategies should change,
additional fees will apply after the appropriate procedural discussions
have taken place between ASU and the Growth Fund. (At least two weeks
advance notice is required should the Growth Fund commence trading in
these investments).

8) The Growth Fund shall direct the investment advisor to supply the ASU
with critical income information such as accrual methods, interest
payment frequency details, coupon payment dates, floating rate reset
dates and complete security descriptions with issue types and CUSIP
numbers. If applicable, for proper income accrual accounting, ASU will
look to the investment advisor to supply the yield to maturity and
related cash flow models for any mortgage/asset-backed securities held
by the Growth Fund.

9) The Growth Fund shall direct the Custodian to provide ASU with daily
custodian statements reflecting all prior day cash activity by 8:30 AM
Eastern time. Complete descriptions of any postings, inclusive of CUSIP
numbers, interest/dividend payment dates, capital stock details,
expense authorizations, beginning/ending cash balances, etc. will be
provided by the Custodian's reports or system.

10) The Growth Fund shall direct the custodian to supply capital change
information and interest rate changes to ASU in a timely manner. The
investment advisor will supplement and supply as appropriate.

11) The Growth Fund shall direct the Custodian to handle and report upon
all settlement problems, failed trades and resolve unsettled
dividends/interest/paydowns and capital changes. The Custodian will
process all applicable capital change paperwork based upon advice from
the investment advisor. ASU agrees to supply segregated Trial Balance
reporting and supplemental reports to assist in this process.

12) With respect to mortgage/asset-backed securities including GNMA's,
FHLMC's, FNMA's, CMO's, ARM's, the Growth Fund shall direct the
Custodian (or a Growth Fund supplied source) to provide ASU with
current principal repayment factors on a timely basis in accordance
with the appropriate securities' schedule. Income accrual adjustments
(to the extent necessary) based upon initial estimates will be
completed by ASU when actual principal/income payments are collected by
the Custodian and reported to ASU.

13) To the extent applicable, ASU will maintain on a daily basis US dollar
denominated qualified covered call options and index options reporting
on the daily Trial Balance and value the respective options and
underlying positions. This Agreement does not provide for tax
classifications if they are required.

<PAGE>

If the Growth Fund commences investment in domestic options or
designated hedges, at least two week's advance notice is required to
clarify operational procedures between ASU and the investment advisor.

14) To the extent the Growth Fund, Inc. should establish a Line of Credit
in segregated accounts with the Custodian for temporary administrative
purposes, and/or leveraging/hedging the portfolio, it is not the
responsibility under this Agreement for ASU to complete the appropriate
paperwork/monitoring for segregation of assets and adequacy of
collateral. The Growth Fund shall direct the investment advisor to
execute such responsibilities. ASU will, however, reflect appropriate
Trial Balance account entries and interest expense accrual charges on
the daily Trial Balance adjusting as necessary at month-end.

15) If the Growth Fund commences participation in Security Lending,
Leveraging, Precious Metals or Short Sales, at least two week's advance
notice is required. To the extent the Growth Fund does so in the
future, additional fees will apply.

16) The Growth Fund shall direct the investment advisor to supply ASU with
portfolio specific expense accrual procedures and monitor the expense
accrual balances for adequacy based on outstanding liabilities monthly.
The investment advisor will promptly communicate to the ASU any
adjustments needed.

17) Specific deadlines shall be met and complete information shall be
supplied by the Growth Fund in order to minimize any settlement
problems, NAV miscalculations or income accrual adjustments.

The Growth Fund shall direct the investment advisor to provide to ASU
Trade Authorization Forms, with the appropriate officer's signature, on
all security trades placed by the Growth Fund no later than 12:30 PM
Eastern time on settlement/value date for money market issues, assuming
that trade date equals settlement date; and by 11:00 AM Eastern time on
trade date plus one for non-money market securities. Receipt by ASU of
trade information within these identified deadlines may be via telex,
fax, or on-line system access. The investment advisor will also
communicate all trade information directly to the Custodian.

There is no assurance that security trade information received by ASU
after the above stated deadlines will be included in that day's work.

The Growth Fund agrees to direct the investment advisor to include all
information required by ASU, including CUSIP numbers and/or ticker
symbols for all US dollar denominated trades on the Trade Authorization
Form, telex or on-line support. ASU will not be responsible for NAV
changes or distribution rate adjustments that result from incomplete
trade information.

18) To the extent the Growth Fund utilizes Purchases In-Kind (U.S. dollar
denominated

<PAGE>

securities only) as a method for shareholder subscriptions, ASU will
provide the Growth Fund with procedures to properly handle and process
securities in-kind. Should the Growth Fund prefer procedures other than
those provided by ASU, additional fees may apply. (The Parties agree
that discussions will take place in advance between ASU and the Growth
Fund to clarify the appropriate In-Kind operational procedures to be
followed).

19) It is assumed that the investment advisor or Fund/Plan as administrator
will complete the applicable performance and rate of return
calculations as required by the SEC for the Growth Fund.

20) Compliance reporting (Sub-Chapter "M") will be completed by the
Fund/Plan administrator or investment advisor.

21) Fund/Plan will provide Administration and Transfer Agency Services.

22) The Growth Fund is not currently expected to issue separate classes of
shares. To the extent they do so, additional fees will be negotiated.

<PAGE>

SCHEDULE "B"

FUND ACCOUNTING AND PORTFOLIO VALUATION SERVICES FEE SCHEDULE
FOR
IAA TRUST GROWTH FUND, INC.

This Fee Schedule is fixed for a period of
three (3) years from the Effective
Date as that term is defined in the
Agreement.

The Accounting Fees as set forth below are based on the "Basic
Assumptions" as set forth in Schedule "A." To the extent that those
assumptions are inaccurate or requirements change,
fee revisions may be necessary.

FUND ACCOUNTING AND PORTFOLIO VALUATION FEES (US dollar denominated
securities only) All Accounting Services fees are quoted with the assumption
that Transfer Agent Services will be provided by Fund/Plan Services, Inc.

<TABLE>
I. Annual Fee Schedule Per Portfolio: (1/12th payable monthly)

$25,000 Minimum to $ 10 Million of Average Net Assets
.0004 On the Next $ 40 Million of Average Net Assets
.0003 On the Next $ 50 Million of Average Net Assets
.0001 Over $100 Million of Average Net Assets
</TABLE>

II. Pricing Services Quotation Fee (Based on individual CUSIP or
security identification number.) Specific costs will be
identified based upon options selected by the client and will
be billed monthly.

A) Muller Data Corporation* (if applicable)
*(Based on current vendor costs, subject to change)

<TABLE>
<S> <C> <C>
Government/Mortgage Backed/Corporate
Short & Long Term Quotes $ .50 per Quote per Issue
Tax-Exempt Short & Long Term Quotes $ .55 per Quote per Issue
CMOs/ARMs/ABS $1.00 per Quote per Issue
Foreign Security Quotes $ .50 per Quote per Issue
Foreign Security Supplemental
Corporation Actions, Dividends
& Capital Changes $2.00 per Issue per Month
Mortgage Backed Factors $1.00 per Issue per Month

Minimum Weekly File Transmission is Assumed

There are currently no charges for the domestic dividend and
capital change information transmitted daily to Fund/Plan
services from Muller Data Corporation.

<PAGE>

B) Futures and Currency Forward Contracts $2.00 per
Issue per Day

C) Telerate Systems, Inc.* (if applicable)
*(Based on current vendor costs, subject to change.)

Specific costs will be identified based upon options
selected by the client and will be billed monthly.

D) Quotron/Reuters, Inc.*
*(Based on current vendor costs, subject to change.)

Fund/Plan does not currently pass along the charges
for the domestic security prices supplied by
Quotron/Reuters, Inc.

E) Interactive Data Corp.* (if applicable)
*(Based on current vendor costs, subject to change.)

<S> <C>
Domestic Equities and Options $ .15 per Quote per Issue
Corporate/Government/Agency Bonds including
Mortgage-Backed Securities (evaluated,
seasoned, and/or closing) $ .50 per Quote per Issue
US Municipal Bonds and Collateralized
Mortgage Obligations $ .80 per Quote per Issue
International Equities and Bonds $ .50 per Quote per Issue
Domestic Dividends and Capitalization
Changes $3.50 per Month per Holding
International Dividends and Capital
Changes $4.00 per Month per Holding
</TABLE>

Interactive Data also charges monthly transmission
costs and disk storage charges.

Specific costs will be identified based upon options selected
by the Growth Fund and will be billed monthly.

III. SEC Yield Calculation: (if applicable)

Provide up to 12 reports per year to reflect the yield calculations for
non-money market funds required by the SEC, at no additional charge.
(US dollar denominated securities only).

<PAGE>

IV. Out-Of-Pocket Expenses

The Growth Fund will reimburse Fund/Plan Services, Inc. monthly for all
out-of-pocket expenses, including telephone, postage,
telecommunications, special reports, record retention, special
transportation costs as approved, and the cost of copying and sending
materials to auditors.

V. Additional Services

To the extent the Growth Fund commences using investment techniques
such as Futures, Security Lending, Swaps, Short Sales, Derivatives,
Leveraging, Precious Metals or non-US dollar denominated currency and
securities, additional fees will apply, as mutually agreed upon.

Activities of a non-recurring nature such as shareholder in-kinds, fund
consolidations, mergers, or reorganizations will be subject to
negotiation. To the extent that the Growth Fund should decide to issue
separate/multiple classes of shares, additional fees shall apply. Any
additional enhanced services, programming requests or reports will be
quoted upon request.

This Schedule may be amended to reflect the addition of other
services/reports.

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the incorporation by reference in this Post-Effective Amendment
No. 53 to the Registration Statement under the Securities Act of 1933 on Form
N-1A (File No. 2-24221) of our report dated August 14, 1996 on our audit of the
financial statements and financial highlights of IAA Trust Growth Fund, Inc. We
also consent to the reference to our Firm under the caption "Financial
Highlights" in the Prospectus and under the captions "Independent Accountants"
and "Financial Statements" in the Statement of Additional Information.

COOPERS & LYBRAND L.L.P.

2400 Eleven Penn Center
Philadelphia, Pennsylvania
October 28, 1996

IAA Trust Company

IAA Financial Center
808 IAA Drive, P.O. Box 2901
Bloomington, Illinois 61702-2901

Tax MiniMiser

Individual Retirement Custodial Account Agreement

ARTICLE 1
PURPOSE

This Custodial Account Agreement serves as the legal governing
instrument for the Tax MiniMiser Individual Retirement Custodial Account
sponsored by the IAA Trust Company and transmitted to the Applicant named in the
Application marked as Exhibit A attached hereto, and incorporated herein by
reference. The Application serves as the instrument of adoption of this Tax
MiniMiser Individual Retirement Custodial Account by the Participant, and the
date of adoption is that as stated on the Signatory Section of the Application.
This Custodial Account is established for the exclusive benefit of the
Participant and Participant's beneficiaries. The Agreement shall set forth the
provisions and requirements which qualify this Custodial Account for treatment
as an Individual Retirement Account in accordance with Internal Revenue Code
Section 408 and the Employee Retirement Income Security Act of 1974 as amended
from time to time. Additionally, administrative provisions applicable to the
Custodian and Participant as parties to this Agreement are set forth in this
Agreement. The copy of the Application should be retained as a part of this
Agreement along with all other documents referred to herein for the purpose of
verification of this Account as a qualified Individual Retirement Account.

ARTICLE 2
DEFINITIONS

As used in this Custodial Account Agreement and in the related
Application, the following terms shall have the specified meaning as set forth
in this Article 2 and shall be used in strict accordance with those meanings.
Terms not explicitly so defined in this Article or elsewhere in this Agreement
shall be used in accordance with their generally understood English meanings
with masculine gender references to include the feminine, and singular
references to include the plural. All references to "Articles" refer only to
Articles of this Agreement.

1) Anniversary Date - The date occurring yearly having the same day and
month as the effective date of the Custodial Account as set forth in Article 1.

2) Application - The document attached hereto as Exhibit A, pursuant to
which the Participant has adopted this Individual Retirement Custodial Account
Agreement.

3) Beneficiary - Any person, as designated in the Application (Exhibit
A) or as later designated in writing from time to time by the Participant to the
Custodian, who is or shall become entitled to benefits from this Custodial
Account under its provisions.

4) Code - The Internal Revenue Code of 1986 as amended from time.

5) Compensation - Wages, salaries, professional fees, or other amounts
derived from or received for personal service actually rendered (including, but
not limited to commissions paid salesmen, compensation for services on the basis
of a percentage of profits, commissions on insurance premiums, tips, and
bonuses) and including earned income, as defined in Section 401(c)(2) of the
Code (reduced by the deduction the self-employed individual takes for
contributions made to a Keogh plan). For purposes of this definition, Section
401(c)(2) shall be applied as if the term trade or business for purposes of
Section 1402 included service described in Subsection (c)(6). Compensation does
not include amounts derived from or received as earnings or profits from
property (including, but not limited to, interest and dividends) or amounts not
includable in gross income. Compensation also does not include any amount
received as a pension or annuity or as deferred compensation. The term
"compensation" shall include any amount includable in the individual's gross
income under Section 71 of the Code with respect to a divorce or separation
instrument described in Subparagraph (A) of Section 71(b)(2) of the Code.

6) Custodial Account - This Tax MiniMiser Individual Retirement
Custodial Account established by the Application (Exhibit A), as governed by the
directions of that Application and this Agreement, and funded by the Funding
Election specified in the Application by the Participant.

7) Custodial Account Agreement - This Custodial Account Agreement,
Articles 1 through 14, including the Application (Exhibit A) along with any
amendments or modifications made thereto as provided for by this Agreement.

8) Custodial Account Assets - The total of all assets held by Custodian
on behalf of Participant.

9) Custodian - The IAA Trust Company acting through its delegate as
Custodian and Sponsor of this Custodial Account.

10) Designated Investment Company - The following regulated investment
companies registered under the Investment Company Act of 1940: IAA Trust Growth
Fund, Inc., IAA Trust Asset Allocation Fund, Inc., IAA Trust Money Market Fund,
Inc., any other investment company so registered which is advised by IAA Trust
Company, and any money market fund made available to replace IAA Trust Money
Market Fund, Inc.

11) Disability - A Participant's inability to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or to be of long-continued
and indefinite duration; or such other meaning as may be determined under
Section 72(m)(7) of the Code.

12) ERISA - The Employee Retirement Income Security Act of 1974 and its
subsequent amendments and modifications.

13) Participant - The Applicant referred to in Article 1 who is the
person making contributions to this Custodial Account.

14) Rollover Contribution - A contribution described in Sections
402(a)(5), 402(a)(6), 402(a)(7), 403(a)(4), 403(b)(8), or 408(d)(3) of the Code.

15) Simplified Employee Pension (SEP) - A Plan as described in Section
408(k) of the Code.

ARTICLE 3
FUNDING ELECTION

The Custodian shall invest the assets initially contributed to it by or
on behalf of the Participant in such of the Designated Investment Company shares
as are specified by the Participant in the Application. Subsequent contributions
shall be invested into such Designated Investment Company shares as are
specified by the Participant in writing, or by telephone and thereafter
confirmed in writing. If a Participant does not specify how a contribution is to
be invested, the contribution shall be invested in the IAA Trust Money Market
Fund, Inc. (or a replacement money market fund). All dividends and capital gain
distributions received on any Designated Investment Company shares shall be
reinvested in full and fractional shares of the same Designated Investment
Company paying such distribution. Investment in shares of the Designated
Investment Company shall be made at the price and in the manner as set forth in
the current prospectus.

At any time, the Participant may direct the Custodian to exchange all or
any part of the Designated Investment Company shares then being held in a
Participant's custodial account for the shares of any other Designated
Investment Company.

The Custodian shall not be responsible for any loss incurred with
respect to any investment made or retained in accordance with the instructions
of the Participant.

No part of the Custodial Account assets will be invested in life
insurance contracts or in collectibles, as defined in Section 408(m) of the
Code. The assets of the Custodial Account will not be commingled with other
property except in a common trust fund or common investment fund to the extent
allowed by law.

ARTICLE 4
APPLICATION CHANGES

The Application (Exhibit A) may, from time to time at the discretion of
the Participant, be modified by means of written instrument to the Custodian,
signed

<PAGE>

by the Participant. Specifically, modifications which are permitted are:

a) Change of Beneficiary as provided for in the Application. If there is
no Beneficiary designation at the death of the Participant, the Beneficiary
shall be the spouse of the Participant; or if there is no spouse living at the
time of the Participant's death, the Beneficiary shall be the estate of the
Participant.

b) Changes of Funding Election as set forth in the Application are
permissible with respect to the application of future plan contributions, as
long as they conform to the requirements of the Application and the provisions
of the Custodial Account Agreement.

ARTICLE 5
CONTRIBUTIONS

Except as limited by the following provisions of this Article, additional
contributions may, from time to time, be made to the Custodial Account and upon
receipt thereof by the Custodian, such contributions shall be retained as part
of the Custodial Account Assets. The Custodian will accept only contributions
which:

a) are in cash and do not exceed the lesser of $2,000 or 100% of
Compensation for any taxable year of Participant prior to attainment of age 70
1/2; or

b) in the case of a spousal account, constitute a cash amount not
exceeding the lesser of $2,250 or 100% of Compensation, but no more than $2,000
can be contributed to either spouse's account; or

c) in the case of a contribution by your employer under a Simplified
Employee Pension (SEP), constitute a cash amount not exceeding the lesser of
$30,000 or 15% of the first $200,000 Compensation (as adjusted) from that
employer, or

d) constitute a rollover contribution as defined in Sections 402(a)(5),
402(a)(6), 402(a)(7), 403(a)(4), 403(b)(8) or 408(d)(3) of the Code; or

e) constitute a transfer directly from another Trustee or Custodian of
contributions previously made by Participant.

The Custodian shall have no responsibility to Participant for
determining whether any contribution made hereunder conforms to the requirements
of the Code.

ARTICLE 6
VESTING, ASSIGNMENT,
NONFORFEITABILITY AND LOANS

At all times, the interest of the Participant in contributions and the
Custodial Account Assets shall be 100% vested and nonforfeitable. Furthermore,
the Custodian shall not make a loan of the Participant's Custodial Account on
behalf of the Participant nor shall he accept any pledging or assignment against
the Participant's Custodial Account as collateral. Similarly, the Participant
shall not transfer, sell, assign, discount, or pledge his Custodial Account as
collateral for a loan or as security for the performance of an obligation or any
other purpose. Should the Participant take such action, the plan is disqualified
as an Individual Retirement Account and is treated as having been distributed to
the Participant as of the first day of the calendar year during which such
transaction transpired.

ARTICLE 7
DISTRIBUTION OF BENEFITS

A Participant who incurs a Disability or has reached age 59 1/2, may
receive distributions from the Custodial Account. Distributions prior to such
time will be subject to a penalty tax of 10% of the amount distributed which is
includable in the Participant's gross income, over and above the regular income
tax. In connection with making any distributions, the Custodian may rely solely
on the accuracy of all facts the Participant supplies at any time, including a
Beneficiary designation described in the Participant's Application or in changes
made to the Application according to Article 4.

Distributions will begin when the Participant provides the Custodian
with written instructions, in a form acceptable to it, as to the method and
reason (if it is to be made before reaching age 59 1/2) for the distribution;
but in all events, the entire value of the Custodial Account will be distributed
or commence to be distributed, no later than the first day of April following
the calendar year in which the Participant reaches age 70 1/2 (the required
beginning date). The Participant may elect, in a form and at such time as may be
acceptable to the Custodian, to have the balance in the Custodial account
distributed under one of the options specified below:

a) a single sum payment; or

b) equal or substantially equal monthly, quarterly or annual payments
over the life of the Participant; or

<PAGE>

c) equal or substantially equal monthly, quarterly or annual payments
over the joint lives of the Participant and the designated Beneficiary; or

d) equal or substantially equal monthly, quarterly or annual payments
over a period certain not extending beyond the life expectancy of the
Participant; or

e) equal or substantially equal monthly, quarterly, or annual payments
over a period certain not extending beyond the joint life and last survivor
expectancy of the Participant and the designated Beneficiary.

If a distribution option is not elected by the time distribution must
begin, distribution will be made under option (a). Even though distributions may
have commenced pursuant to one of the above options, the Participant may receive
a distribution of the balance in the Custodial Account (or any portion) at any
time upon written notice to the Custodian.

For distributions in other than a lump sum payment, the minimum
distribution for each year (beginning with the required beginning date and each
year thereafter) is determined by dividing the Participant's entire interest by
the life expectancy of the Participant (or the joint and last survivor
expectancy of the Participant and his or her designated Beneficiary) determined
in accordance with Federal Income Tax Regulations.

For calendar years beginning before January 1, 1989, if the individual's
spouse is not the designated beneficiary the method of distribution selected
must assure that at least 50% of the present value of the amount available for
distribution is paid within the life expectancy of the owner.

For calendar years beginning after December 31, 1988, the amount to be
distributed each year, beginning with the first calendar year for which
distributions are required and then for each succeeding calendar year, shall not
be less than the quotient obtained by dividing the owner's benefit by the lesser
of (1) the applicable life expectancy or (2) if the owner's spouse is not the
designated beneficiary, the applicable divisor determined from the table set
forth in Q&A-4 of section 1.401(a)(9)-2 of the Proposed Income Tax Regulations.
Distributions after the death of the owner shall be calculated using the
applicable life expectancy as the relevant divisor without regard to proposed
regulations section 1.401(a)(9)-2.

Life expectancy is computed by use of the expected return multiples in
Tables V and VI of section 1.72-9 of the Income Tax Regulations. Life expectancy
will be calculated using the attained age of the participant (or the designated
beneficiary) during the calendar year in which distributions are required to
begin pursuant to this section, and payments for subsequent years shall be
calculated based on such life expectancy reduced by one for each calendar year
which has elapsed since the calendar year life expectancy was first calculated.
The life expectancy of a participant and a participant's spouse may, at the
election of the participant or participant's spouse, be recalculated annually.
The election, once made, shall be irrevocable. If no election is made by the
time distributions are required to begin, life expectancies shall not be
recalculated annually. The life expectancy of a non-spouse beneficiary may not
be recalculated.

If the Participant dies before the entire Custodial Account balance is
distributed, the following distribution provisions shall apply:

a) Distributions beginning before death. If the Participant dies after
distribution of his or her interest has begun, the remaining portion of the
Custodial Account balance will continue to be distributed at least as rapidly as
under the method of distribution being used prior to the Participant's death.

b) Distributions beginning after death. If the Participant dies before
distribution of his or her Custodial Account balance begins, the Participant's
entire Custodial Account balance will be distributed in accordance with one of
the following four provisions:

(1) The Participant's entire Custodial Account balance will be paid by
December 31 of the calendar year containing the fifth anniversary of
the Participant's death.

(2) If the Participant's Custodial Account balance is payable to a
Beneficiary designated by the Participant and the Participant has not
elected (1) above, then the entire Custodial Account balance will be
distributed in substantially equal installments over the life or over
a period certain not greater than the life expectancy of the designated
Beneficiary commencing on or before December 31 of the calendar year
immediately following the calendar year in which the Participant died.
The designated Beneficiary may elect at any time to receive greater
payments.

<PAGE>

(3) If the designated Beneficiary of the Participant is the
Participant's surviving spouse, the spouse may elect to receive equal
or substantially equal payments over the life or life expectancy of the
surviving spouse commencing at any date prior to the later of (1)
December 31 of the calendar year immediately following the calendar
year in which the Participant died and (2) December 31 of the calendar
year in which the Participant would have attained age 70 1/2. Such
election must be made no later than the earlier of December 31 of the
calendar year containing the fifth anniversary of the Participant's
death or the date distributions are required to begin pursuant to the
preceding sentence. The surviving spouse may accelerate these payments
at any time, i.e., increase the frequency or amount of such payments.

(4) If the designated Beneficiary is the Participant's surviving
spouse, the spouse may treat the Custodial Account as his or her own
individual retirement arrangement (IRA). This election will be deemed
to have been made if such surviving spouse makes a regular IRA
contribution to this Custodial Account, makes a rollover to or from
this Custodial Account, or fails to elect any of the above three (3)
provisions.

c) Life expectancy is computed by use of the expected return multiples
in Tables V and VI of section 1.72-9 of the Income Tax Regulations. For purposes
of distributions beginning after the owner's death, unless otherwise elected by
the surviving spouse by the time distributions are required to begin, life
expectancies shall not be recalculated annually. Such election shall be
irrevocable as to the surviving spouse and shall apply to all subsequent years.
In the case of any other designated beneficiary, or of a spouse who does not
elect recalculation, life expectancies shall be calculated using the attained
age of such beneficiary during the calendar year in which distributions are
required to begin pursuant to this section, and payments for any subsequent
calendar year shall be calculated based on such life expectancy reduced by one
for each calendar year which has elapsed since the calendar year life expectancy
was first calculated.

d) Distributions under this section are considered to have begun if the
distributions are made on account of the individual reaching his or her required
beginning date. If the individual receives distributions prior to the required
beginning date and the individual dies, distributions will not be considered to
have begun.

e) For purposes of this requirement, any amount paid to a child of the
Participant will be treated as if it had been paid to the surviving spouse if
the remainder of the account balance becomes payable to the surviving spouse
when the child reaches the age of majority.

In any event causing distribution of assets as installments over a
specified period of time into the future, the Participant, or if the Participant
is deceased the Participant's designated Beneficiary, may direct the Custodian
to purchase a Single Premium Immediate Annuity Contract from an insurance
company with which the Participant or the designated Beneficiary deems it
prudent to do business. Such Annuity Contract must meet the requirements
contained in Section 408(b) of the Code and the regulations thereunder. After an
Annuity Contract is purchased for the Participant or the designated Beneficiary,
the Custodian will not be responsible for any payment(s) to be made to
Participant or the designated Beneficiary.

Unless otherwise properly elected by Participant or Participant's
designated Beneficiary, income tax will be withheld from distributions made
hereunder in accordance with the Code. Custodian will provide appropriate forms
to Participant or the designated Beneficiary in order to facilitate an election
not to have such tax withheld as permitted by the Code.

ARTICLE 8
AMENDMENTS AND TERMINATION

This Custodial Account Agreement and all of its counterparts may be
amended by the Sponsor from time to time as required by the Code and regulations
thereunder for continued qualification of this Tax MiniMiser Individual
Retirement Custodial Account as an Individual Retirement Account. Furthermore,
the Sponsor may amend the provisions of this Agreement and its counterparts
without obtaining the approval and consent of the Participant provided that no
part of any such amendment shall authorize or permit diversion of any part of
this Custodial Account for purposes other than for the exclusive benefit of the
Participant and his Beneficiary. The Custodian shall have the right to resign as
Custodian of the Custodial Account, or the Participant shall have the right to
terminate this Custodial Account, each upon written notice, 30 days prior to the
effective date of such action. If the Custodian resigns his position as
Custodian of the Custodial Account, the Custodian shall deliver the assets of
the Participant's Custodial Account to the successor Custodian or

<PAGE>

other party, as designated in writing by the Participant and such delivery shall
be made as of the effective date of the Custodian's resignation or as soon
thereafter as is practical, but no later than 60 days after the date of the
Custodian's resignation.

ARTICLE 9
REVOCATION

As set forth in the Notification to Planholder letter, the Participant
may revoke this Custodial Account Agreement by written notice to the Custodian,
postmarked no later than the 7th day from the date of delivery of the
Notification to Planholder letter, such date of delivery as attested to the
receipt detached from said letter and made a matter of record with the
Custodian. As specified in Article 9, the Notification to Planholder letter is
delivered with all contracts binding issuer to the terms of the Funding
Election; additionally, all required disclosure information for purposes of
maintaining this as a qualified Individual Retirement Account shall be included.
All such information taken together with this Agreement serves as adequate
information upon which the Participant may rely for purposes of determining if
revocation is in order. Upon revocation, the full consideration advanced to the
Custodian by the Participant as Applicant shall be returned to the Participant.

ARTICLE 10
PROHIBITED TRANSACTIONS

Neither the Custodian nor the Participant or his Beneficiary shall
engage in any transaction which would constitute a prohibited transaction as
defined by Section 4975 of the Code or which would not be considered prudent in
accordance with the prudent man doctrine of ERISA.

ARTICLE 11
LEGAL SITUS

The legal situs of the Custodial Account in its administration,
construction, validity and interpretation shall be governed by the laws of the
State of Illinois where not pre-empted by the laws of the United States of
America.

ARTICLE 12
CUSTODIAN POWERS

The Custodian may adopt such rules and regulations as it may deem
necessary or desirable for the efficient performance of its duties hereunder,
consistent with the purposes of the Individual Retirement Custodial Account
Agreement and the Application.

Each Participant shall direct the manner in which any Designated
Investment Company shares held in his Custodial Account shall be voted with
respect to any matters coming before any meeting of shareholders of the
investment company which issued such shares. The Custodian shall not vote shares
held in the Custodial Account except as directed by the Participant. The
Custodian shall deliver, or cause to be delivered, to the Participant all
notices, prospectuses, financial statements, proxies, and proxy soliciting
material relating to shares of Designated Investment Company stock held pursuant
to this Individual Retirement Custodial Account.

Subject to the limitations or requirements contained in this Custodial
Account Agreement, the Custodian shall have the following powers:

(a) To sell, exchange or otherwise deal with the assets of the Custodial
Account as directed by the Participant;

(b) To hold securities as Custodian in its own name or in the name of
any nominee in such form that ownership of the securities will pass by delivery
with or without disclosure of any fiduciary relationship provided the records of
the Custodian shall indicate the true ownership of such securities;

(c) To make distribution from the account of any Participant in cash or
in property pursuant to the provisions of this Agreement;

(d) To use the redemption price of the Designated Investment Company
shares for purposes of determining the Fair Market Value of the assets held in
the Custodial Account in the case of distribution;

(e) To employ agents, attorneys or other persons, and to the extent
permitted by law to allocate and delegate certain responsibilities and duties,
including clerical and administrative duties;

(f) To perform any and all other acts in its judgment necessary or
appropriate for the proper and advantageous management, investment and
distribution of the assets of this Custodial Account.

In the event the Custodian shall be required to pay any tax with respect
to this Custodial Account, the amount of such tax (including interest) shall be
paid from and charged against the assets of the Custodial

<PAGE>

Account. If the assets of such account are insufficient to satisfy such charges,
the Participant hereby agrees to pay any deficit to the Custodian.

The Custodian shall receive fees for its services with respect to a
Participant's account as set forth in the Custodian's fee schedule as amended
from time to time. The annual custodian fee will be deducted automatically at
year end, or upon termination of the Custodial Account, if earlier, by
liquidating shares from the Participant's Custodial Account, first from the IAA
Trust Money Market Fund (or a replacement money market fund), then, if
necessary, from the IAA Trust Asset Allocation Fund, then, if necessary, from
the IAA Trust Growth Fund. The Custodian reserves the right to change the fees
upon thirty (30) days' advance notice to the Participant.

To the extent permitted by law, the Custodian shall not be responsible
in any way for the collection of contributions provided for hereunder, the
purpose or propriety of any distribution made pursuant to Article 7, or any
other action taken at a Participant's direction, nor shall the Custodian have
any duty or responsibility to determine whether information furnished to it by a
Participant is correct. The Custodian does not guarantee the investment
performance of any Fund selected by Participant pursuant to the Application. The
Custodian shall be indemnified and saved harmless by the Participant (and his
legal representatives, heirs and assigns) from and against any and all personal
liability arising from distributions made or actions taken at such Participant's
direction, and from any and all other liability whatsoever which may arise in
connection with this Custodial Account, except the obligation of the Custodian
to perform in accordance with this document and with applicable law. The
Custodian shall be under no duty to take any action other than as herein
specified with respect to the Custodial Account unless the Participant furnishes
the Custodian with proper instructions and such instructions shall have been
specifically agreed to by the Custodian. The Custodian shall be protected in
acting upon any written or verbal direction or request from a Participant, which
is reasonably and in good faith believed by it to be genuine.

ARTICLE 13
EXCESS CONTRIBUTIONS

Any amount in excess of the maximum contribution permitted pursuant to
Article 5 may be subject to an additional excess contribution tax penalty of 6%
calculated pursuant to Code Section 4973. This additional tax may be avoided if
the Participant withdraws the excess contribution, plus any earnings on it on or
before the due date of his tax return for that year.

Excess contributions not so withdrawn by the Participant will be
retained and treated as a contribution for the following year. In no event shall
the Custodian or any officers, employees, attorneys or agents of the Custodian
be liable for any costs, expenses, income or excise taxes which might accrue by
virtue of a failure to distribute such excess contributions prior to the date on
which such Participant must file his individual federal income tax return for
the taxable year, unless such Participant shall have given, and the Custodian or
its agent shall have received, a written direction to distribute such excess
contributions (including net income earned thereon) not less than thirty (30)
days prior to that date.

ARTICLE 14
WRITTEN REPORTS

The Custodian shall furnish Participant with annual calendar year
reports concerning the status of the Participant's Custodial Account. Except as
may be otherwise provided herein, the Custodian shall be responsible for
preparing and filing or mailing all reports, accounts and statements required by
any federal or state statute or regulation, all within the time and in the
manner provided therein.

Any notice, report or material required to be delivered by the Custodian
to the Participant (or any other party to be notified) shall be deemed delivered
and effective on the date deposited by the Custodian in the United States mail,
postage prepaid, addresssed to the Participant (or other party to be notified)
at his or its last address known to the Custodian.

The Participant agrees to provide information to the Custodian at such
time and in such manner and containing such information as may be necessary for
the Custodian to prepare any reports required by any federal or state statute or
regulation.

<PAGE>

CONFIDENTIAL CUSTOMER RECORD

Please complete this section.

These questions are for the purpose of determining the suitability of an
investment for you in the IAA Trust Mutual Funds and are asked pursuant to rules
established by the Securities and Exchange Commission. The information will be
treated confidentially and is intended to assist in determining an appropriate
recommendation.

1. Year of Birth: ____________________________________

2. Marital Status: [ ] Single [ ] Married [ ] Widow [ ] Widower [ ] Divorced

3. Dependent Children: Number _____ Age of Youngest _____ Age of Oldest _______

4. Principal Occupation: _______________________________

Name of Employer: ____________________________________

Employer's Address: _________________________________

5. Insurance on Life of Customer:

[ ]Less than $10,000 [ ] $10,000 to $24,999 [ ]$25,000 to $49,000

[ ]$50,000 or over

6. Investment Objective: [ ] Income [ ] Growth [ ] Tax Exempt Income

[ ] Income and Growth [ ] Other

7. Savings: [ ] Less than $2,500 [ ] $2,500 to $9,999 [ ] $10,000 to $24,999

[ ]$25,000 or over

8. Annual Income: [ ]Less than $15,000 [ ]$15,000 to $25,000

[ ]$25,000 to $50,000 [ ]$50,000 or over

DISTRIBUTION PLAN
UNDER RULE 12b-1

THIS DISTRIBUTION PLAN (the "Plan") under Rule 12b-1 of the Investment
Company Act of 1940 (the "1940 Act") is made as of the 8th day of February, 1993
by and between IAA TRUST GROWTH FUND, INCORPORATED (the "Fund"), a Maryland
corporation, and FUND/PLAN BROKER SERVICES, INC., (the "Distributor") a
Pennsylvania corporation.

WITNESSETH:

WHEREAS, the Fund is engaged in the business as an open end management
investment company and is registered as such under the 1940 Act; and

WHEREAS, it has been proposed the Fund make payments to the Distributor
out of the Fund's net assets for distribution services rendered to the Fund; and

WHEREAS, the Fund intends to distribute its common shares ("shares") in
accordance with Rule 12b-1 under the 1940 Act, and desires to adopt this Plan
pursuant to such Rule; and

WHEREAS, the Fund's Board of Directors, in considering whether the Fund
should adopt and implement a written plan, has evaluated such information as it
deemed necessary to an informed determination as to whether a written plan
should be adopted and implemented and has considered such pertinent factors as
it deemed necessary to form the basis for a decision to use assets of the Fund
for such purposes and has determined that there is a reasonable likelihood that
adoption and implementation of a plan will benefit the Fund and its
shareholders;

NOW, THEREFORE, the Fund hereby adopts this Plan in accordance with
Rule 12b-1- under the 1940 Act, and the parties hereto agree to the following
terms and conditions of the Plan:

1. Distribution Activities. The Fund will reimburse the Distributor for
costs and expenses incurred in connection with the distribution and marketing of
shares of the Fund and servicing of Fund shareholders. Such Distribution and
servicing costs and expenses may include (1) printing and advertising expenses;
(2) payments to employees or agents of the Distributor who engage in or support
distribution of the Fund's shares, including salary, commissions, travel and
related expenses; (3) the costs of preparing, printing and distributing
prospectuses and reports to prospective investors; (4) expenses of organizing
and conducting sales seminars; (5) expenses related to selling and servicing
efforts, including processing new account applications, transmitting customer
transaction information to the Fund's transfer agent and answering questions of
shareholders; (6) payments of fees to one or more broker-dealers (which may
include the Distributor itself), financial institutions or other industry
professionals, such as investment advisers, accountants and estate planning
firms (severally, a "Service Organization"), in respect of the average daily
value of the Fund's shares owned by shareholders for whom the Service
Organization is the dealer of

<PAGE>

record or holder of record, or owned by shareholders with whom the Service
Organization has a servicing relationship; (7) costs and expenses incurred in
implementing and operating the Plan; and (8) such other similar services as the
Fund's Board of Directors determines to be reasonably calculated to result in
the sale of Fund shares.

2. Compensation. The Distributor will receive a fee monthly for such
costs, expenses or payments at an annual rate of up to but not more than 0.25%
of the average daily net assets of the Fund. In the event the Plan is terminated
as herein provided, the Fund shall have no liability for expenses that were not
reimbursed as of the date of termination.

3. Term and Termination.

(a) This Plan shall become effective upon approval by a vote
of at least a "majority of the outstanding voting securities
of the Fund," and upon approval by a vote of the Directors of
the Fund and of those Directors who have no direct or indirect
financial interest in the Plan or in any agreements related to
the Plan (the "disinterested directors") cast in person at a
meeting called for the purpose of voting on the Plan.

(b) This Plan shall remain in effect until February 8, 1993,
and from year to year thereafter; provided, however, that such
continuance is subject to approval annually by a vote of the
Directors of the Fund and of the disinterested directors cast
in person at a meeting called for the purpose of voting on
this Plan. If such annual approval is not obtained, the Plan
shall expire twelve (12) months after the date of the last
approval. This Plan may be amended at any time by the Board of
Directors; provided that (a) any amendment to increase
materially the amount to be spent for the services described
herein shall be effective only upon approval by a vote of a
majority of the outstanding shares of the Fund and (b) any
material amendments of this Plan shall be effective only upon
approval in the manner provided in the first sentence in this
paragraph.

(c) This Plan may be terminated at any time, without the
payment of any penalty, by vote of a majority of the
disinterested directors or by a vote of a majority of the
outstanding voting securities of the Fund, and shall
automatically terminate in the event of its assignment.

4. Reporting Requirements.

(a) the Distributor shall provide the Fund, for review by the
Fund's Board of Directors, and the Directors shall review, at
least quarterly, a written report of the amounts expended
pursuant to the Plan and the purposes for which such
expenditures were made. Such written report shall be in a form
satisfactory to the Fund and shall supply all information
necessary for the Board to discharge its responsibilities,
including its responsibilities pursuant to Rule 12b-1.

(b) The Fund or the Investment Adviser to the Fund shall, from
time to time, furnish or otherwise make available to the
Distributor such financial reports, proxy statements and other
information relating to the business and affairs of the Fund
as

<PAGE>

the Distributor may reasonably require in order to discharge
its duties and obligations hereunder.

5. Selection and Nomination of Directors. While this Plan is in effect,
the selection and nomination of disinterested directors shall be committed to
the discretion of the Directors who are not interested persons.

6. Recordkeeping. The Fund shall preserve copies of this Plan, any
related agreements, and all reports made pursuant to Section 11 hereof for a
period of not less than six years from the date of this Plan or any such
agreement or report, as the case may be, the first two years in an easily
accessible place.

7. Non-Exclusivity Clause. Nothing herein contained shall limit the
freedom of the Distributor or an "affiliated person" of the Distributor, to act
as distributor for other persons, firms or corporations or to engage in other
business activities.

8. Limit of Liability.

(a) Neither the Distributor nor any of its employees or agents is
authorized to make any representations concerning the shares except
those contained in the then current Prospectus or Statement of
Additional Information of the Fund.

(b) The Distributor shall use its best efforts in rendering services
hereunder, but in the absence of willful misfeasance, bad faith,
negligence or reckless disregard of its obligations hereunder, the
Distributor shall not be liable to the Fund or any of its
shareholders for any error of judgment or mistake of law of for any
act or omission or for any losses sustained by the Fund or its
shareholders resulting therefrom.

(c) Nothing herein contained shall be deemed to require the Fund to
take any action contrary to its Articles of Incorporation or
By-Laws, or any applicable statutory or regulatory requirement to
which it is subject or by which is bound, or relieve or deprive the
Board of Directors of the Fund of the responsibility for and control
of the affairs of the Fund.

9. Applicable Law. The provisions hereof shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and shall be construed in accordance with the laws of the State of Maryland and
the applicable provisions of the 1940 Act. To the extent the applicable law of
the State of Maryland or any of the provisions herein conflicts with the
applicable provisions of the 1940 Act, the latter shall control.

10. Invalidity. If any provision of this Plan shall be held or made
invalid by a court decision, statute, rule or otherwise the remainder of the
Plan shall be affected thereby.

11. Definitions. For the purposes of this Plan, the terms "interested
person," "assignment," "affiliated person" and "majority of the outstanding
voting securities" are used as defined in the 1940 Act.

<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Plan to be
signed by the respective officers thereunto duly authorized and their respected
corporate seals to be hereunto affixed, as of the day and year first above
written.

IAA TRUST GROWTH FUND, INC.

By _________________________________________
Title

FUND/PLAN BROKER SERVICES, INC.

By _________________________________________
Title

Illinois Agricultural Association and Affiliated Companies as of June 30, 1996

<TABLE>
<S> <C>
*ILLINOIS AGRICULTURAL ASSOCIATION
l. Country Mutual Insurance Company
2. Country Casualty Insurance Company
3. Country Preferred Insurance Company
4. IAA Trust Tax Exempt Bond Fund, Inc.
5. CC Services, Inc.
6. Mid-America Services of Alaska, Inc. Mid-America Services of Missouri, Inc.
Mid-America Services of Arizona, Inc. Mid-America Services of Nevada, Inc.
Mid-America Services of Arkansas, Inc. Mid-America Services of New Mexico, Inc.
Mid-America Financial Corp. of CO, Inc. Mid-America Brokerage, Inc. (Oklahoma)
Mid-America Services of Kansas, Inc. Mid-America Services of Oregon, Inc.
M-A Services Corp. of Minnesota, Inc. Mid-America Services of Utah, Inc.
Mid-America Services of Washington, Inc.
</TABLE>
7. Illinois Agricultural Holding Co.
8. Illinois Agricultural Service Co.
9. Country Life Insurance Co.
10. Country Medical Plans Inc.
11. Country Capital Management Co.
12. Country Investors Life Assurance Co.
13. AgriVisor Services, Inc.
14. IAA Trust Company
15. IAA Trust Asset Allocation Fund, Inc.
16. IAA Trust Growth Fund, Inc.
17. IAA Trust Taxable Fixed Income Series Fund, Inc.
18. Prairie Farms Dairy, Inc.
19. Muller-Pinehurst Dairy, Inc.
20. East Side Jersey Dairy, Inc.
21. Ice Cream Specialities, Inc.
22. ABC Dairy, Inc.
23. P.F.D. Supply Corporation
24. Mo-Kan Express, Inc.
25. GMS Transportation Co.
26. Illinois Milk Producers Association
27. Interstate Producers Livestock Association
28. Illinois Livestock Marketing Company
29. IAA Federal Credit Union
30. Illinois Agricultural Auditing Association
31. IAA Recreation Association
32. **GROWMARK, Inc.
33. FS Credit Corporation
34. MID-CO Commodities, Inc.
35. TRI-FS Feeds, Inc.
36. FS Farmco, Inc.
37. Lakeland FS, Inc.
38. Illinois Feed Manufacturing Company
39. Four Seasons FS, Inc.
40. Southwest FS, Inc.
41. FS Services Ontario, Inc.
42. Cedar Johnson Exchange Co.
43. 1105433 Ontario Inc.
44. UPI, Inc.

<PAGE>

1. Organized in Illinois as a mutual insurance company. Proxy control in
Illinois Agricultural Association.

2. Organized in Illinois as a stock insurance company. 100% of voting securities
owned by Country Mutual Insurance Company.

3. Organized in Missouri as a stock insurance company. 100% of voting securities
owned by Country Mutual Insurance Company.

4. Organized in Maryland as a mutual fund under the General Corporation Law.
11.76% of voting securities owned by Country Mutual Insurance Company.

5. Organized in Illinois as a business corporation. 71.4% of voting securities
owned by Illinois Agricultural Association; 17.14% of voting securities owned by
Country Mutual Insurance Company; 11.43% of voting securities owned by Country
Life Insurance Company.

6. Organized as a business corporation in the state indicated. 100% of voting
securities of each company owned by CC Services, Inc.

7. Organized in Illinois under the General Corporation Act. 98.3% of voting
securities owned by Illinois Agricultural Association.

8. Organized in Illinois as a business corporation. 100% of voting securities
owned by Illinois Agricultural Holding Co.

9. Organized in Illinois as a stock insurance company. 99.99% of voting
securities owned by Illinois Agricultural Holding Co.

10. Organized in Illinois as a stock insurance company. 100% of voting
securities owned by Country Life Insurance Company.

11. Organized in Illinois as a business corporation. 100% of voting securities
owned by Country Life Insurance Company.

12. Organized in Illinois as a stock insurance company. 100% of voting
securities owned by Country Life Insurance Company.

13. Organized in Illinois under the General Corporation Act. 100% of voting
securities owned by Illinois Agricultural Holding Co.

14. Organized in Illinois as a business corporation. 100% of voting securities
owned by Illinois Agricultural Holding Co.

15. Organized in Maryland as a mutual fund under the General Corporation Law.
12.77% of voting securities owned by Country Life Insurance Company. 51.06% of
the securities owned of record by IAA Trust Company.

16. Organized in Maryland as a mutual fund under the General Corporation Law.
9.66% of voting securities owned by Country Life Insurance Company. 36.46% of
the voting securities owned of record by IAA Trust Company.

17. Organized in Maryland as a mutual fund under the General Corporation Law.
81.45% of the voting securities owned of record by IAA Trust Company.

18. Organized in Illinois as an agricultural cooperative. 39.5% of voting
securities owned by Illinois Agricultural Association.

19. Organized in Illinois as a business corporation. 50% of voting securities
owned by Prairie Farms Dairy, Inc.

20. Organized in Indiana as a business corporation. 100% of voting securities
owned by Prairie Farms Dairy, Inc.

21. Organized in Missouri as a business corporation. 100% of voting securities
owned by Prairie Farms Dairy, Inc.

22. Organized in Missouri as a business corporation. 100% of voting securities
owned by Prairie Farms Dairy, Inc.

23. Organized in Illinois as a business corporation. 100% of voting securities
owned by Prairie Farms Dairy, Inc.

<PAGE>

24. Organized in Kansas as a business corporation. 50% of voting securities
owned by P.F.D. Supply Corporation.

25. Organized in Illinois as a business corporation. 100% of voting securities
owned by Prairie Farms Dairy, Inc.

26. Organized in Illinois as an agricultural cooperative. 44.4% of voting
securities owned by Illinois Agricultural Association.

27. Organized in Illinois as an agricultural cooperative. 36.5% of voting
securities owned by Illinois Agricultural Association.

28. Organized in Illinois as a business corporation. 100% of voting securities
owned by Interstate Producers Livestock Association.

29. Organized as a Federal Credit Union. No corporate control. Membership
control in Illinois Agricultural Association and certain affiliated companies.

30. Organized in Illinois as an agricultural cooperative. 48.9% of voting
securities owned by Illinois Agricultural Association.

31. Organized in Illinois as a not-for-profit association. Membership control
in Illinois Agricultural Association and certain affiliated companies.

32. Organized in Delaware under the General Corporation Act. 25.9% of voting
securities owned by Illinois Agricultural Association.

33. Organized in Illinois as an agricultural cooperative. 99.8% of voting
securities owned by GROWMARK, Inc.

34. Organized in Delaware under the General Corporation Act. 99.0% of voting
securities owned by GROWMARK, Inc.

35. Organized in Iowa under the Business Corporation Act. 100% of voting
securities owned by GROWMARK, Inc.

36. Organized in Delaware under the General Corporation Act. 100% of voting
securities owned by GROWMARK, Inc.

37. Organized in Illinois as an agricultural cooperative. 47.57% of voting
securities owned by FS Farmco, Inc.

38. Organized in Delaware under the General Corporation Act. 50% of voting
securities owned by GROWMARK, Inc.

39. Organized in Delaware under the General Corporation Act. 100% of voting
securities owned by GROWMARK, Inc.

40. Organized in Delaware under the General Corporation Act. 100% of voting
securities owned by GROWMARK, Inc.

41. Organized in Ontario under the Business Corporation Act. 100% of voting
securities owned by GROWMARK, Inc.

42. Organized in Iowa under the Business Corporation Act. 100% of voting
securities owned by GROWMARK, Inc.

43. Organized in Ontario under the Business Corporation Act. 100% of voting
securities owned by GROWMARK, Inc.

44. Organized in Ontario under the Business Corporation Act. 50% of voting
securities owned by 1105433 Ontario Inc.

*Organized in Illinois as a not-for-profit corporation. No voting securities.
No person controls it.
**GROWMARK, Inc. owns more than 25% of the outstanding voting securities in
approximately 70 of its Illinois and Iowa member companies.

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