<PAGE>
LIFEPOINTS FUNDS
LIFEPOINTS FUNDS CLASS C SHARES
INSTITUTIONAL FUNDS CLASS Y SHARES
INSTITUTIONAL FUNDS CLASS E & I SHARES
RUSSELL FUNDS CLASS C, E, & S SHARES
FRANK RUSSELL INVESTMENT COMPANY
SUPPLEMENT DATED OCTOBER 6, 1999 TO
PROSPECTUSES DATED MAY 1, 1999 AND JULY 15, 1999
The following information supplements all Prospectuses of the Frank Russell
Investment Company (the "Company") set forth above, which are dated May 1, 1999
and July 15, 1999, although not all information pertains to every Fund.
LIFEPOINTS FUNDS PROSPECTUS
REVISION OF LIFEPOINTS FUND EXPENSE RATIOS: - Under the section "Annual
Operating Expenses," the following total expense ratios and examples are
restated in their entirety to read as follows:
The total direct and indirect operating expense ratios of each
class of shares of each LifePoints Fund (calculated as a percentage of
average net assets) are as follows:
<TABLE>
<CAPTION>
CLASS C CLASS D CLASS E
------- ------- -------
<S> <C> <C> <C>
Equity Aggressive Strategy........ 2.10% 1.60% 1.35%
Aggressive Strategy............... 2.07% 1.57% 1.32%
Balanced Strategy................. 1.96% 1.46% 1.21%
Moderate Strategy................. 1.82% 1.32% 1.07%
Conservative Strategy............. 1.75% 1.25% 1.00%
</TABLE>
Each LifePoints Fund's total expense ratio is based on its total
operating expense ratio plus a weighted average of the expense ratios of
the Underlying Funds in which it was invested as of December 31, 1998.
These total expense ratios may be higher or lower depending on the
allocation of a LifePoints Fund's assets among the Underlying Funds and
the actual expenses of the LifePoints Funds.
<PAGE>
EXAMPLE
THIS EXAMPLE IS INTENDED TO HELP YOU COMPARE THE COST OF INVESTING
IN EACH LIFEPOINTS FUND WITH THE COST OF INVESTING IN OTHER MUTUAL FUNDS.
The example assumes that you invest $10,000 in the LifePoints Fund
for the time periods indicated, your investment has a 5% return each
year, and that operating expenses, which include the indirect expenses of
the Underlying Funds, remain the same. The figures shown would be the
same whether you sold your shares at the end of a period or kept them.
Although your actual costs may be higher or lower, under these
assumptions your costs would be:
<TABLE>
<CAPTION>
CLASS C: 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Equity Aggressive Strategy Fund... $210 $663 $1,161 $2,641
Aggressive Strategy Fund.......... 207 652 1,144 2,603
Balanced Strategy Fund............ 196 618 1,083 2,466
Moderate Strategy Fund............ 182 574 1,006 2,289
Conservative Strategy Fund........ 175 552 968 2,202
<CAPTION>
CLASS D: 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Equity Aggressive Strategy Fund... $160 $504 $883 $2,010
Aggressive Strategy Fund.......... 157 495 868 1,975
Balanced Strategy Fund............ 146 460 806 1,835
Moderate Strategy Fund............ 132 417 730 1,661
Conservative Strategy Fund........ 125 394 691 1,574
<CAPTION>
CLASS E: 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Equity Aggressive Strategy Fund... $135 $426 $746 $1,697
Aggressive Strategy Fund.......... 132 417 730 1,661
<PAGE>
Balanced Strategy Fund............ 121 381 668 1,521
Moderate Strategy Fund............ 107 337 591 1,346
Conservative Strategy Fund........ 100 315 553 1,259
</TABLE>
LIFEPOINTS FUNDS PROSPECTUS
LIFEPOINTS FUNDS CLASS C SHARES PROSPECTUS
INSTITUTIONAL FUNDS CLASS Y SHARES PROSPECTUS
INSTITUTIONAL FUNDS CLASS E & I SHARES PROSPECTUS
RUSSELL FUNDS CLASS C, E & S SHARES PROSPECTUS
CHANGES IN MONEY MANAGERS
- -------------------------
DIVERSIFIED EQUITY, QUANTITATIVE EQUITY, EQUITY I, EQUITY Q, EMERGING
MARKETS, FIXED INCOME III FUNDS AND MULTISTRATEGY BOND FUNDS ARE MANAGED BY THE
FOLLOWING MONEY MANAGERS:
DIVERSIFIED EQUITY AND EQUITY I FUNDS
ALLIANCE CAPITAL MANAGEMENT L.P., US Bank Place, 601 2nd Ave. South, Suite
5000, Minneapolis, MN 55402-4322.
BARCLAYS GLOBAL FUND ADVISORS N.A., 45 Fremont Street, San Francisco, CA
94105.
EQUINOX CAPITAL MANAGEMENT, INC., 590 Madison Avenue, 41st Floor, New
York, NY 10022.
JACOBS LEVY EQUITY MANAGEMENT, INC., 280 Corporate Center, 3 ADP
Boulevard, Roseland, NJ 07068.
LINCOLN CAPITAL MANAGEMENT COMPANY, 200 South Wacker Drive, Suite 2100,
Chicago, IL 60606.
MARSICO CAPITAL MANAGEMENT, LLC, 1200 17th Street, Suite 1200, Denver, CO
80202.
<PAGE>
PEACHTREE ASSET MANAGEMENT, One Peachtree Center, Suite 4500, 303
Peachtree Street N.E., Atlanta, GA 30308.
SANFORD C. BERNSTEIN & CO., INC., 767 Fifth Avenue, 21st Floor, New York,
NY 10153.
SUFFOLK CAPITAL MANAGEMENT, INC., 1633 Broadway, 40th Floor, New York, NY
10107.
TRINITY INVESTMENT MANAGEMENT CORPORATION, 75 Park Plaza, Boston, MA
02116.
WESTPEAK INVESTMENT ADVISORS, L.P., 1011 Walnut Street, Suite 400 Boulder,
CO 80302.
QUANTITATIVE EQUITY AND EQUITY Q FUNDS
BARCLAYS GLOBAL FUND ADVISORS. See: Diversified Equity Fund.
FRANKLIN PORTFOLIO ASSOCIATES LLC, Two International Place, 22nd Floor,
Boston, MA 02110-4104.
JACOBS LEVY EQUITY MANAGEMENT, INC. See: Diversified Equity Fund.
J.P. MORGAN INVESTMENT MANAGEMENT, INC., 522 Fifth Ave., 6th Floor,
New York, NY 10036.
EMERGING MARKETS FUND
FOREIGN & COLONIAL EMERGING MARKETS LIMITED, Exchange House, Primrose
Street, London, England EC2A 2NY.
GENESIS ASSET MANAGERS, LTD., 21 Knights Bridge, London, SW1X 7LY
England.
<PAGE>
NICHOLAS-APPLEGATE CAPITAL MANAGEMENT, 600 W. Broadway, 32nd Fl.,
San Diego, CA 92101.
SANFORD C. BERNSTEIN & CO., INC., See: Equity I Fund.
SCHRODERS CAPITAL MANAGEMENT INTERNATIONAL LIMITED, 31 Gresham Street,
London, UK EC2V 7QA.
FIXED INCOME III AND MULTISTRATEGY BOND FUNDS
LAZARD ASSET MANAGEMENT, 30 Rockefeller Plaza, New York, NY 10112-6300
MILLER, ANDERSON & SHERRERD, LLP, One Tower Bridge, W. Conshohocken, PA
19428
PACIFIC INVESTMENT MANAGEMENT COMPANY, 840 Newport Center Drive,
Suite 360, Newport Beach, CA 92660
STANDISH, AYER & WOOD, INC., One Financial Center, Boston, MA 0211.
WESTPEAK INVESTMENT ADVISORS, L.P., 1011 Walnut Street, Suite 400,
Boulder, CO 80302.
<PAGE>
Frank Russell Investment Company
Supplement Dated October 6, 1999
To the Statement of Additional Information Dated May 1, 1999
The following information supplements the Statement of Additional Information of
Frank Russell Investment Company dated May 1, 1999.
The following sub-section to the "INVESTMENT POLICIES" section, immediately
following the "Fund Investment Securities" subsection is restated to read in its
entirety as follows:
CASH RESERVES. Each Fund (except the Money Market, U.S. Government
Money Market and Tax Free Money Market Funds), and its money managers,
may elect to invest the Fund's cash reserves in one or more of FRIC's
money market funds. Those money market funds, and the Funds investing in
them, treat such investments as the purchase and redemption of the money
market funds' shares. Any Fund investing in a money market fund pursuant
to this procedure participates equally on a pro rata basis in all income,
capital gains, and net assets of the money market fund, and will have all
rights and obligations of a shareholder as provided in FRIC's Master
Trust Agreement, including voting rights. However, shares of a money
market fund issued to other Funds will be voted by the Trustees in the
same proportion as the shares of the money market fund that are held by
shareholders that are not Funds. Funds investing in a money market fund
effectively do not pay an advisory or administrative fee to a money
market fund and thus do not pay duplicative advisory or administrative
fees, as FRIMCo waives a portion of its advisory or administrative fees
due from those Funds in an amount that offsets the advisory or
administrative fees it receives from the applicable money market fund in
respect of those investments.
The entitled "MONEY MANAGER INFORMATION" is restated to read in its entirety as
follows:
MONEY MANAGER INFORMATION
DIVERSIFIED EQUITY FUND
ALLIANCE CAPITAL MANAGEMENT, L.P. is a limited partnership whose
(i) general partner is a wholly-owned subsidiary of The Equitable
Companies Incorporated ("The Equitable") and (ii) majority unit holder is
ACM, Inc., a wholly-owned subsidiary of The Equitable. As of March 1,
1995, 60.5% of The Equitable was owned by Axa, a French insurance holding
company.
BARCLAYS GLOBAL FUND ADVISORS N.A. is an indirect, wholly-owned
subsidiary of Barclays Bank PLC.
1
<PAGE>
EQUINOX CAPITAL MANAGEMENT, INC. is a registered investment
adviser with majority ownership held by Ron Ulrich.
JACOBS LEVY EQUITY MANAGEMENT, INC. is 100% owned by Bruce Jacobs
and Kenneth Levy.
LINCOLN CAPITAL MANAGEMENT COMPANY is a division of Lincoln
Capital Management Company, and is a registered investment adviser with
majority ownership held by Dave Flower, Jay Freedman, Parker Hall,
Richard Knee, Ken Meyer and Ray Zemon.
MARSICO CAPITAL MANAGEMENT, LLC is owned 50% by Marsico Management
Holdings, LLC and 50% by TFM Holdings, LLLP. Marsico Management Holdings
is a wholly-owned subsidiary of NationsBank, N.A. which in turn is a
wholly-owned subsidiary of Bank of America. TFM Holdings, LLLP is a
Colorado limited liability limited partnership whose sole general partner
is TFM Managers, Inc. which is wholly-owned by Thomas F. Marsico.
PEACHTREE ASSET MANAGEMENT is division of SSBC Fund Management
LLC. SSBC Fund Management is owned 100% by Salomon Smith Barney Inc.
which is a wholly-owned subsidiary of Citigroup Inc.
SANFORD C. BERNSTEIN & CO., INC. is a registered investment
adviser. Bernstein is controlled by its Board of Directors, which
consists of the following individuals: Andrew S. Adelson, Zalman C.
Bernstein, Kevin R. Rine, Charles C. Cahn, Jr., Marilyn Goldstein Fedak,
Michael L. Goldstein, Roger Hertog, Lewis A. Sanders and Francis H.
Trainer, Jr.
SUFFOLK CAPITAL MANAGEMENT, INC. is a registered investment
adviser and a wholly-owned subsidiary of United Asset Management Company,
a publicly traded corporation.
TRINITY INVESTMENT MANAGEMENT CORPORATION is a corporation with
seven shareholders, with Stanford M. Calderwood holding majority
ownership.
WESTPEAK INVESTMENT ADVISORS, L.P. is a registered investment
adviser that is directly controlled by Metropolitan Life Insurance
Company.
EQUITY INCOME FUND
EQUINOX CAPITAL MANAGEMENT, INC. See: Diversified Equity Fund.
TRINITY INVESTMENT MANAGEMENT CORPORATION. See: Diversified Equity
Fund.
2
<PAGE>
WESTPEAK INVESTMENT ADVISORS, L.P. See: Diversified Equity Fund.
QUANTITATIVE EQUITY FUND
BARCLAYS GLOBAL FUND ADVISORS. See: Diversified Equity Fund.
FRANKLIN PORTFOLIO ASSOCIATES, LLC is a Massachusetts business
trust owned by Mellon Financial Services Corporation, a holding company
of Mellon Bank Corporation.
J.P. MORGAN INVESTMENT MANAGEMENT, INC. is a wholly-owned
subsidiary of J.P. Morgan & Co., Inc., a publicly held bank holding
company.
JACOBS LEVY EQUITY MANAGEMENT, INC. See: Diversified Equity Fund.
INTERNATIONAL SECURITIES FUND
DELAWARE INTERNATIONAL ADVISERS LIMITED is an investment adviser
whose ultimate parent is Lincoln National Corporation, a publicly traded
company.
FIDELITY MANAGEMENT TRUST COMPANY is a bank, as defined in the
Investment Advisors Act of 1940, and is a wholly-owned subsidiary of FMR
Corp. Members of the Edwzard C. Johnson 3rd family are predominant owners
of a class of shares of common stock representing approximately 49% of
the voting power of FMR Corp.
J.P. MORGAN INVESTMENT MANAGEMENT, INC. See: Quantitative Equity
Fund.
MASTHOLM ASSET MANAGEMENT, LLC is a Washington limited liability
company that is controlled by the following founding members: Thomas M.
Garr, Robert L. Gernstetter, Joseph P. Jordan, Arthur M. Tyson and
Theordore J. Tyson.
MONTGOMERY ASSET MANAGEMENT, LLC is a Delaware limited liability
company with majority ownership held by Commerzbank AG, a foreign banking
organization.
OECHSLE INTERNATIONAL ADVISORS, LLC is a Delaware limited
liability company that is controlled by its member manager, Oechsle
Group, LLC a Delaware limited liability company. Oechsle Group, LLC is
controlled by the following members: S. Dewey Keesler, Stephen P. Langer,
L. Sean Roche and Warren R. Walker.
SANFORD C. BERNSTEIN & CO., INC. See: Diversified Equity Fund.
3
<PAGE>
THE BOSTON COMPANY ASSET MANAGEMENT, INC. is 100% owned by Mellon
Bank Corporation, a publicly held corporation.
DIVERSIFIED BOND FUND
LINCOLN CAPITAL MANAGEMENT COMPANY. See: Diversified Equity Fund.
PACIFIC INVESTMENT MANAGEMENT COMPANY is a subsidiary partnership
of PIMCO Advisers L.P. ("Partnership"). PIMCO Partners, G.P. is the sole
general partner of the Partnership. Pacific Financial Asset Management
Corporation indirectly holds a majority interest in PIMCO Partners, G.P.,
with the remainder held indirectly by a group comprised of PIMCO managing
directors.
STANDISH, AYER & WOOD, INC.'S ownership is divided among seventeen
directors, with no director having more than a 25% ownership interest.
MULTISTRATEGY BOND FUND
LAZARD ASSET MANAGEMENT is a division of Lazard Freres & Co. LLC
(LF&Co.) is a broker/dealer. LF&Co. is a New York limited liability
company.
MILLER, ANDERSON & SHERRERD, LLP, is a registered investment
adviser whose ultimate parent is Morgan Stanley Dean Witter & Co, a New
York Stock Exchange quoted company.
PACIFIC INVESTMENT MANAGEMENT COMPANY. See: Diversified Bond Fund.
STANDISH, AYER & WOOD, INC. See: Diversified Bond Fund.
REAL ESTATE SECURITIES FUND
COHEN & STEERS CAPITAL MANAGEMENT is a corporation whose two
principals, Robert H. Steers and Martin Cohen, control the corporation
within the meaning of the 1940 Act.
AEW CAPITAL MANAGEMENT, L.P. is a wholly-owned affiliate of New
England Investment Companies, L.P. ("NEIC"). NEIC is a publicly-held
limited partnership. Metropolitan Life Insurance Company, a publicly held
corporation, owns approximately 53% of NEIC. AEW Capital Management,
Inc., a wholly-owned subsidiary of NEIC, is the general partner, and NEIC
is the sole limited partner, of AEW Capital Management, L.P.
4
<PAGE>
EMERGING MARKETS FUND
FOREIGN & COLONIAL EMERGING MARKETS LIMITED, an investment adviser
registered with the United Kingdom Investment Management Regulatory
Organisation, is a wholly-owned subsidiary of Hypo Foreign & Colonial
Management (Holding) Limited ("HFCM"), the holding company of the Foreign
& Colonial Group of Fund managers which manages $40 billion worldwide.
HFCM is controlled by Bayerische Hypo-und Vereinsbank AG, the second
largest commercial bank in Germany.
GENESIS ASSET MANAGERS, LTD. is a limited liability company
organized under the laws of the state of Guernsey, the Channel Islands,
and has been engaged in the investment advisory business since 1990.
Genesis Asset Managers, Ltd., is registered as an investment adviser
under the Investment Advisers Act of 1940, as amended. Genesis Asset
Managers, Ltd. is affiliated with and has common investment executives
with the Genesis Group of fund management companies. The Genesis Group,
whose holding company is Genesis Holdings International Ltd., is
controlled 55% by management and assorted interests, and the balance held
by outside shareholders, with the largest single holding being 15%.
NICHOLAS-APPLEGATE CAPITAL MANAGEMENT is a California limited
partnership whose general partner is Nicholas-Applegate Capital
Management Holdings, L.P., a California limited partnership controlled by
Nicholas-Applegate Capital Management Holdings, Inc., a California
corporation controlled by Arthur E. Nicholas.
SANFORD C. BERNSTEIN & CO. INC. See: Diversified Equity Fund.
SCHRODERS CAPITAL MANAGEMENT INTERNATIONAL LIMITED is 100% owned
by Schroders plc, which is publicly traded on the London Stock Exchange.
EQUITY T FUND
J.P. MORGAN INVESTMENT MANAGEMENT, INC. See: Quantitative Equity
Fund.
5
<PAGE>
SPECIAL GROWTH FUND
DELPHI MANAGEMENT, INC. is 100% owned by Scott Black.
FIDUCIARY INTERNATIONAL, INC., an investment adviser registered
with the SEC, is an indirect wholly-owned subsidiary of Fiduciary Trust
Company International, a New York state chartered bank.
GLOBEFLEX CAPITAL, L.P. is a California limited partnership and an
SEC registered investment adviser. Its general partners are Robert J.
Anslow, Jr. and Marina L. Marrelli.
JACOBS LEVY EQUITY MANAGEMENT, INC. See: Diversified Equity Fund.
SIRACH CAPITAL MANAGEMENT, INC. is a wholly-owned subsidiary of
United Asset Management Company, a publicly traded corporation.
WELLINGTON MANAGEMENT COMPANY, LLP is a private Massachusetts
limited liability partnership of which the following persons are managing
partners: Robert W. Doran, Duncan M. McFarland and John R. Ryan.
WESTPEAK INVESTMENT ADVISORS, L.P. See: Diversified Equity Fund.
TAX EXEMPT BOND FUND
MFS INSTITUTIONAL ADVISORS, INC. is a wholly-owned, indirect
subsidiary of Sun Life Assurance Company of Canada (US), a mutual
insurance company.
STANDISH, AYER & WOOD, INC. See: Diversified Bond Fund.
SHORT TERM BOND FUND
BLACKROCK FINANCIAL MANAGEMENT is a wholly-owned indirect
subsidiary of PNC Bank.
STANDISH, AYER & WOOD, INC. See: Diversified Bond Fund.
STW FIXED INCOME MANAGEMENT LTD. is a Bermuda exempted company.
William H. Williams III is the sole shareholder.
6
<PAGE>
MONEY MARKET FUND
FRANK RUSSELL INVESTMENT MANAGEMENT COMPANY is a registered
investment adviser wholly-owned by Frank Russell Company which is a
subsidiary of The Northwestern Mutual Life Insurance Company.
US GOVERNMENT MONEY MARKET FUND
FRANK RUSSELL INVESTMENT MANAGEMENT COMPANY. See: Money Market
Fund.
TAX FREE MONEY MARKET FUND
WEISS, PECK & GREER, L.L.C. is a registered investment adviser and
a wholly-owned subsidiary of Robeco Groep N.V.
EQUITY I FUND
ALLIANCE CAPITAL MANAGEMENT L.P. See: Diversified Equity Fund.
BARCLAYS GLOBAL FUND ADVISORS. See: Diversified Equity Fund.
EQUINOX CAPITAL MANAGEMENT, INC. See: Diversified Equity Fund.
JACOBS LEVY EQUITY MANAGEMENT, INC. See: Diversified Equity Fund.
LINCOLN CAPITAL MANAGEMENT COMPANY. See: Diversified Equity Fund.
MARSICO CAPITAL MANAGEMENT, LLC. See: Diversified Equity Fund.
PEACHTREE ASSET MANAGEMENT. See: Diversified Equity Fund.
SANFORD C. BERNSTEIN & CO., INC. See: Diversified Equity Fund.
SUFFOLK CAPITAL MANAGEMENT, INC. See: Diversified Equity Fund.
TRINITY INVESTMENT MANAGEMENT CORPORATION. See: Diversified Equity
Fund.
WESTPEAK INVESTMENT ADVISORS, L.P. See: Diversified Equity Fund.
EQUITY II FUND
DELPHI MANAGEMENT, INC. See: Special Growth Fund.
FIDUCIARY INTERNATIONAL, INC. See: Special Growth Fund.
7
<PAGE>
GLOBEFLEX CAPITAL, L.P. See: Special Growth Fund.
JACOBS LEVY EQUITY MANAGEMENT, INC. See: Diversified Equity Fund.
SIRACH CAPITAL MANAGEMENT, INC. See: Special Growth Fund.
WELLINGTON MANAGEMENT COMPANY, LLP. See: Special Growth Fund.
WESTPEAK INVESTMENT ADVISORS, L.P. See: Diversified Equity Fund.
EQUITY III FUND
EQUINOX CAPITAL MANAGEMENT, INC. See: Diversified Equity Fund.
TRINITY INVESTMENT MANAGEMENT CORPORATION. See: Diversified Equity
Fund.
WESTPEAK INVESTMENT ADVISORS, L.P. See: Diversified Equity Fund.
EQUITY Q FUND
BARCLAYS GLOBAL FUND ADVISORS. See: Diversified Equity Fund.
FRANKLIN PORTFOLIO ASSOCIATES, LLC. See: Quantitative Equity Fund.
J.P. MORGAN INVESTMENT MANAGEMENT, INC. See: Quantitative Equity
Fund.
JACOBS LEVY EQUITY MANAGEMENT INC. See: Diversified Equity Fund.
INTERNATIONAL FUND
DELAWARE INTERNATIONAL ADVISERS LIMITED. See: International
Securities Fund.
FIDELITY MANAGEMENT TRUST COMPANY. See: International Securities
Fund.
J.P. MORGAN INVESTMENT MANAGEMENT, INC. See: Quantitative Equity
Fund.
MASTHOLM ASSET MANAGEMENT, LLC. See: International Securities
Fund.
MONTGOMERY ASSET MANAGEMENT, LLC. See: International Securities
Fund.
OECHSLE INTERNATIONAL ADVISORS, LLC. See: International Securities
Fund.
SANFORD C. BERNSTEIN & CO., INC. See: Diversified Equity Fund.
8
<PAGE>
THE BOSTON COMPANY ASSET MANAGEMENT, INC. See: International
Securities Fund.
FIXED INCOME I FUND
LINCOLN CAPITAL MANAGEMENT COMPANY. See: Diversified Equity Fund.
PACIFIC INVESTMENT MANAGEMENT COMPANY. See: Diversified Bond Fund.
STANDISH, AYER & WOOD, INC. See: Diversified Bond Fund.
FIXED INCOME III FUND
LAZARD ASSET MANAGEMENT. See: Multistrategy Bond Fund.
MILLER, ANDERSON & SHERRERD, LLP. See: Multistrategy Bond Fund.
PACIFIC INVESTMENT MANAGEMENT COMPANY. See: Diversified Bond Fund.
STANDISH, AYER & WOOD, INC. See: Diversified Bond Fund.
9
<PAGE>
Frank Russell Investment Company
Supplement Dated October 6, 1999
To the LifePoints Funds
Statement of Additional Information Dated May 1, 1999
The following information supplements the Statement of Additional Information of
The LifePoints Funds.
The following new sub-section to the "INVESTMENT POLICIES OF THE UNDERLYING
FUNDS" section, immediately following the "Other Investment Practices of the
Underlying Funds" subsection is restated in its entirety as follows:
CASH RESERVES. Each LifePoints Fund and each Underlying
Fund (the "Funds") and its money mangers may elect to invest the Fund's
cash reserves in one or more of FRIC's money markets funds. Those money
market funds seeks to maximize current income to the extent consistent
with the preservation of capital and liquidity, and the maintenance of a
stable $1.00 per share net asset value by investing solely in short-term
money market instruments. The Underlying Funds will use this procedure
only so long as doing so does not adversely affect the portfolio
management and operations of the money market funds and FRIC's other
Funds. Those money market funds and the Underlying Funds investing in
them treat such investments as the purchase and redemption of money
market fund shares. Any Underlying Fund investing in the money market
funds pursuant to this procedure participates equally on a pro rata basis
in all income, capital gains and net assets of the money market fund, and
will have all rights and obligations of a shareholder as provided in
FRIC's Master Trust Agreement, including voting rights. However, shares
of the money market funds issued to the Underlying Funds will be voted by
the Trustees of FRIC in the same proportion as the shares of the money
market funds that are held by shareholders who are not Underlying Funds.
Underlying Funds investing in the money market funds effectively do not
pay an advisory or administrative management fees to the money market
funds.
The section entitled "MONEY MANAGER INFORMATION FOR THE UNDERLYING FUNDS" is
restated in its entirety as follows:
MONEY MANAGER INFORMATION
FOR THE UNDERLYING FUNDS
DIVERSIFIED EQUITY FUND
ALLIANCE CAPITAL MANAGEMENT, L.P. is a limited partnership whose
(i) general partner is a wholly-owned subsidiary of The Equitable
Companies Incorporated ("The Equitable") and (ii) majority unit holder is
ACM, Inc., a
10
<PAGE>
wholly-owned subsidiary of The Equitable. As of March 1, 1995, 60.5% of
The Equitable was owned by Axa, a French insurance holding company.
BARCLAYS GLOBAL FUND ADVISORS N.A. is an indirect, wholly-owned
subsidiary of Barclays Bank PLC.
EQUINOX CAPITAL MANAGEMENT, INC. is a registered investment
adviser with majority ownership held by Ron Ulrich.
JACOBS LEVY EQUITY MANAGEMENT, INC. is 100% owned by Bruce Jacobs
and Kenneth Levy.
LINCOLN CAPITAL MANAGEMENT COMPANY is a division of Lincoln
Capital Management Company, and is a registered investment adviser with
majority ownership held by Dave Flower, Jay Freedman, Parker Hall,
Richard Knee, Ken Meyer, and Ray Zemon.
MARSICO CAPITAL MANAGEMENT, LLC is owned 50% by Marsico Management
Holdings, LLC and 50% by TFM Holdings, LLLP. Marsico Management Holdings
is a wholly-owned subsidiary of NationsBank, N.A. which in turn is a
wholly-owned subsidiary of Bank of America. TFM Holdings, LLLP is a
Colorado limited liability limited partnership whose sole general partner
is TFM Managers, Inc. which is wholly-owned by Thomas F. Marsico.
PEACHTREE ASSET MANAGEMENT is division of SSBC Fund Management
LLC. SSBC Fund Management is owned 100% by Salomon Smith Barney Inc.
which is a wholly-owned subsidiary of Citigroup Inc.
SANFORD C. BERNSTEIN & CO., INC. is a registered investment
adviser. Bernstein is controlled by its Board of Directors, which
consists of the following individuals: Andrew S. Adelson, Zalman C.
Bernstein, Kevin R. Rine, Charles C. Cahn, Jr., Marilyn Goldstein Fedak,
Michael L. Goldstein, Roger Hertog, Lewis A. Sanders and Francis H.
Trainer, Jr.
SUFFOLK CAPITAL MANAGEMENT, INC. is a registered investment
adviser and a wholly-owned subsidiary of United Asset Management Company,
a publicly traded corporation.
TRINITY INVESTMENT MANAGEMENT CORPORATION is a corporation with
seven shareholders, with Stanford M. Calderwood holding majority
ownership.
WESTPEAK INVESTMENT ADVISORS, L.P. is a registered investment
adviser that is directly controlled by Metropolitan Life Insurance
Company.
11
<PAGE>
SPECIAL GROWTH FUND
DELPHI MANAGEMENT, INC. is 100% owned by Scott Black.
FIDUCIARY INTERNATIONAL, INC., an investment adviser registered
with the SEC, is an indirect wholly-owned subsidiary of Fiduciary Trust
Company International, a New York state chartered bank.
GLOBEFLEX CAPITAL, L.P. is a California limited partnership and an
SEC registered investment adviser. Its general partners are Robert J.
Anslow, Jr. and Marina L. Marrelli.
JACOBS LEVY EQUITY MANAGEMENT, INC. See: Diversified Equity Fund.
SIRACH CAPITAL MANAGEMENT, INC. is a wholly-owned subsidiary of
United Asset Management Company, a publicly traded corporation.
WELLINGTON MANAGEMENT COMPANY, LLP is a private Massachusetts
limited liability partnership of which the following persons are managing
partners: Robert W. Doran, Duncan M. McFarland and John R. Ryan.
WESTPEAK INVESTMENT ADVISORS, L.P. See: Diversified Equity Fund.
QUANTITATIVE EQUITY FUND
BARCLAYS GLOBAL FUND ADVISORS. See: Diversified Equity Fund.
FRANKLIN PORTFOLIO ASSOCIATES, LLC is a Massachusetts business
trust owned by Mellon Financial Services Corporation, a holding company
of Mellon Bank Corporation.
J.P. MORGAN INVESTMENT MANAGEMENT, INC. is a wholly-owned
subsidiary of J.P. Morgan & Co., Inc., a publicly held bank holding
company.
JACOBS LEVY EQUITY MANAGEMENT, INC. See: Diversified Equity Fund.
INTERNATIONAL SECURITIES FUND
DELAWARE INTERNATIONAL ADVISERS LIMITED is an investment adviser
whose ultimate parent is Lincoln National Corporation, a publicly traded
company.
FIDELITY MANAGEMENT TRUST COMPANY is a bank, as defined in the
Investment Advisors Act of 1940, and is a wholly-owned subsidiary of FMR
Corp. Members of the Edward C. Johnson 3rd family are predominant owners
of a class of shares of common stock representing approximately 49% of
the voting power of FMR Corp.
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J.P. MORGAN INVESTMENT MANAGEMENT, INC. See: Quantitative Equity
Fund.
MASTHOLM ASSET MANAGEMENT, LLC is a Washington limited liability
company that is controlled by the following founding members: Thomas M.
Garr, Robert L. Gernstetter, Joseph P. Jordan, Arthur M. Tyson and
Theordore J. Tyson.
MONTGOMERY ASSET MANAGEMENT, LLC is a Delaware limited liability
company with majority ownership held by Commerzbank AG, a foreign banking
organization.
OECHSLE INTERNATIONAL ADVISORS, LLC is a Delaware limited
liability company that is controlled by its member manager, Oechsle
Group, LLC, a Delaware limited liability company. Oechsle Group, LLC is
controlled by the following members: S. Dewey Keesler, Stephen P. Langer,
L. Sean Roche and Warren R. Walker.
SANFORD C. BERNSTEIN & CO., INC. See: Diversified Equity Fund.
THE BOSTON COMPANY ASSET MANAGEMENT, INC. is 100% owned by Mellon
Bank Corporation, a publicly held corporation.
DIVERSIFIED BOND FUND
LINCOLN CAPITAL MANAGEMENT COMPANY. See: Diversified Equity Fund.
PACIFIC INVESTMENT MANAGEMENT COMPANY is a subsidiary partnership
of PIMCO Advisers L.P. ("Partnership"). PIMCO Partners, G.P. is the sole
general partner of the Partnership. Pacific Financial Asset Management
Corporation indirectly holds a majority interest in PIMCO Partners, G.P.,
with the remainder held indirectly by a group comprised of PIMCO managing
directors.
STANDISH, AYER & WOOD, INC.'S ownership is divided among seventeen
directors, with no director having more than a 25% ownership interest.
SHORT TERM BOND FUND
BLACKROCK FINANCIAL MANAGEMENT is a wholly-owned indirect
subsidiary of PNC Bank.
STANDISH, AYER & WOOD, INC. See: Diversified Bond Fund.
STW FIXED INCOME MANAGEMENT LTD. is a Bermuda exempted company.
William H. Williams III is the sole shareholder.
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MULTISTRATEGY BOND FUND
LAZARD ASSET MANAGEMENT is a division of Lazard Freres & Co. LLC
(LF&Co.) is a broker/dealer. LF&Co. is a New York limited liability
company.
MILLER, ANDERSON & SHERRERD, LLP, is a registered investment
adviser whose ultimate parent is Morgan Stanley Dean Witter & Co, a New
York Stock Exchange quoted company.
PACIFIC INVESTMENT MANAGEMENT COMPANY. See: Diversified Bond Fund.
STANDISH, AYER & WOOD, INC. See: Diversified Bond Fund.
REAL ESTATE SECURITIES FUND
COHEN & STEERS CAPITAL MANAGEMENT is a corporation whose two
principals, Robert H. Steers and Martin Cohen, control the corporation
within the meaning of the 1940 Act.
AEW CAPITAL MANAGEMENT, L.P. is a wholly-owned affiliate of New
England Investment Companies, L.P. ("NEIC"). NEIC is a publicly-held
limited partnership. Metropolitan Life Insurance Company, a publicly held
corporation, owns approximately 53% of NEIC. AEW Capital Management,
Inc., a wholly-owned subsidiary of NEIC, is the general partner, and NEIC
is the sole limited partner, of AEW Capital Management, L.P.
EMERGING MARKETS FUND
FOREIGN & COLONIAL EMERGING MARKETS LIMITED, an investment adviser
registered with the United Kingdom Investment Management Regulatory
Organisation, is a wholly-owned subsidiary of Hypo Foreign & Colonial
Management (Holding) Limited ("HFCM"), the holding company of the Foreign
& Colonial Group of Fund managers which manages $40 billion worldwide.
HFCM is controlled by Bayerische Hypo-und Vereinsbank AG, the second
largest commercial bank in Germany.
GENESIS ASSET MANAGERS, LTD. is a limited liability company
organized under the laws of the state of Guernsey, the Channel Islands,
and has been engaged in the investment advisory business since 1990.
Genesis Asset Managers, Ltd., is registered as an investment adviser
under the Investment Advisers Act of 1940, as amended. Genesis Asset
Managers, Ltd. is affiliated with and has common investment executives
with the Genesis Group of fund management companies. The Genesis Group,
whose holding company is Genesis Holdings International Ltd., is
controlled 55% by management and assorted interests, and the balance held
by outside shareholders, with the largest single holding being 15%.
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NICHOLAS-APPLEGATE CAPITAL MANAGEMENT is a California limited
partnership whose general partner is Nicholas-Applegate Capital
Management Holdings, L.P., a California limited partnership controlled by
Nicholas-Applegate Capital Management Holdings, Inc., a California
corporation controlled by Arthur E. Nicholas.
SANFORD C. BERNSTEIN & CO. INC. See: Diversified Equity Fund.
SCHRODERS CAPITAL MANAGEMENT INTERNATIONAL LIMITED is 100% owned
by Schroders plc, which is publicly traded on the London Stock Exchange.
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