<PAGE>
Rule 485(b)
Registration No. 2-39334
File No. 811-2224
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM N-1A
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REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
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Pre-Effective Amendment No.
----- -----
Post-Effective Amendment No. 34 X
----- -----
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940
Amendment No. 19
----
MML SERIES INVESTMENT FUND
--------------------------
(Exact Name of Registrant Specified in Charter)
1295 State Street, Springfield, Massachusetts 01111
---------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number: (413) 788-8411
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- ---------------------------------------------------------------------
Name and Address of Agent for Service:
Stephen L. Kuhn, Esq.
Vice President and Secretary
MML Series Investment Fund
1295 State Street
Springfield, MA 01111
It is proposed that this filing will become effective (check appropriate line)
immediately upon filing pursuant to paragraph (b)
-----
X on May 1, 1996 pursuant to paragraph (b)
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60 days after filing pursuant to paragraph (a)
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on __________ pursuant to paragraph (a) of rule 485.
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STATEMENT PURSUANT TO RULE 24f-2
- ---------------------------------------------------------------------
Registrant has registered an indefinite number or amount of its shares under the
Securities Act of 1933 pursuant to Rule 24f-2 under the Investment Company Act
of 1940. Registrant's Rule 24f-2 Notice for period ended December 31, 1995 was
filed on or about February 22, 1996. The Index to Exhibits is located at Page
___: Part C, Item 24(b).
Page 1 of ____.
To: The Securities and Exchange Commission
Registrant submits this Post-Effective Amendment No. 34 to its Registration
Statement No. 2-39334 under the Securities Act of 1933 and this Amendment No. 19
to its Registration Statement No. 811-2224 under the Investment Company Act of
1940.
This Amendment consists of:
1. Facing Sheet
2. Cross-Reference Sheet
3. Revised Prospectus (Part A)
4. Statement of Additional Information (Part B)
5. Other Information (Part C)
6. Signature Page
7. Exhibits
Exhibit 11: Consent of Independent Accountants
<PAGE>
(ii)
MML SERIES INVESTMENT FUND: Cross-Reference Sheet
Item No. of Form N-1A Prospectus Caption
- ---------------------- ------------------
1........................ Prospectus Cover Page
2........................ Not Applicable
3(a)..................... Supplementary Information
3(b)..................... Not Applicable
3(c)..................... Investment Performance
4(a), (b) and (c)........ General Information; Investment Practices of
the Funds and Related Risks, Investment
Restrictions
5(a)..................... Management Discussion; Management of MML Trust
5(b), (e), (f) and (g)... Investment Managers; Financial Highlights
5(c)..................... The Funds
5(d)..................... Not Applicable
5A....................... Not Applicable
6(a) and (b)............. Capital Shares; General Information
6(c) and (d)............. Not Applicable
6(e)..................... Capital Shares
6(f)..................... Dividends and Capital Gains Distributions
6(g)..................... Tax Status; Dividends and Capital Gains
Distributions
7........................ Sale and Redemption of Shares
7(a)..................... Not Applicable
7(b)..................... Net Asset Value
7(c)-(e)................. Not Applicable
8(a)..................... Sale and Redemption of Shares
8(b)-(d)................. Not Applicable
9........................ Not Applicable
(iii)
Item No. of Form N-1A Caption in Statement of Additional Information
- ----------------------- -----------------------------------------------
10 (a) and (b)........... Cover Page
11....................... Table of Contents
12....................... General Information
13(a).................... Investment Practices of the Funds and Related
Risks
13(b).................... Investment Restrictions
13(c).................... Investment Practices of the Funds and Related
Risks
13(d).................... Not Applicable
14(a) and (b)............ Management of MML Trust
14(c).................... Management of MML Trust
15(a).................... Not Applicable
15(b).................... Control Persons and Principal Holders of
Securities
15(c).................... Management of MML Trust
16(a) and (b)............ Investment Management and Other Services
16(c)-(g)................ Not Applicable
16(h).................... Investment Management and Other Services;
Financial Information
16(i).................... Not Applicable
17(a)-(c)................ Brokerage Allocation
17(d) and (e)............ Not Applicable
18....................... Capital Shares
19(a) and (b)............ Purchase, Redemption and Pricing of Securities
Being Offered; Financial Statements of MML
Trust
19(c).................... Not Applicable
20....................... Certain Tax and Accounting Information
21....................... Not Applicable
(iv)
Item No. of Form N-1A Caption in Statement of Additional Information
- --------------------- -----------------------------------------------
22....................... Investment Performance
23....................... Report of Independent Accountants; Financial
Statements of MML Trust
<PAGE>
PROSPECTUS
Dated May 1, 1996
MML SERIES INVESTMENT FUND
1295 State Street
Springfield, Massachusetts
(413) 788-8411
MML Series Investment Fund (the "MML Trust") is a no-load, open-end, diversified
management investment company having four separate series of shares (the
"Funds"), each of which has different investment objectives and is designed to
meet different investment needs.
THE FUNDS
MML Equity Fund - The investment objectives are primarily to achieve a superior
total rate of return over an extended period of time from both capital
appreciation and current income and secondarily, depending upon business and
economic conditions, to preserve capital. The Fund invests primarily in
equity-type securities.
MML Money Market Fund - The investment objectives are to achieve high current
income, the preservation of capital, and liquidity. The Fund invests in
short-term debt instruments, including commercial paper, certificates of
deposit, bankers' acceptances, and obligations of the United States, its
agencies and instrumentalities. An investment in the Fund is neither insured nor
guaranteed by the U.S. Government, and there can be no assurance that the Fund
will be able to maintain a stable net asset value of $1.00 per share.
MML Managed Bond Fund - The investment objective is to achieve as high a total
rate of return on an annual basis as is considered consistent with the
preservation of capital. The Fund invests primarily in investment grade,
publicly-traded, fixed income securities.
MML Blend Fund - The investment objective is to achieve as high a level of total
rate of return over an extended period of time as is considered consistent with
prudent investment risk and the preservation of capital. The Fund invests in a
portfolio of common stocks and other equity-type securities, bonds and other
debt securities with maturities generally exceeding one year, and money market
instruments and other debt securities with maturities not exceeding one year.
For further information about each Fund's investment objectives and policies,
see "THE FUNDS" on page 9. There is no assurance that the investment objectives
of the Funds will be realized.
This Prospectus sets forth concisely the information about MML Trust and the
Funds that a prospective investor ought to know before investing. Certain
additional information about MML Trust and the Funds is contained in a Statement
of Additional Information dated May 1, 1996, which has been filed with the
Securities and Exchange Commission and is incorporated herein by reference. This
additional information is available upon request and without charge. To obtain
such information, please contact the Secretary, MML Series Investment Fund, 1295
State Street, Springfield, Massachusetts 01111.
This Prospectus should be retained for future reference for information about
MML Trust and the Funds.
-------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
-------------------------------
<PAGE>
<TABLE>
<CAPTION>
Table Of Contents Page
<S> <C>
Financial Highlights.................................................. 2
Management Discussion................................................. 5
General Information................................................... 9
The Funds............................................................. 9
Investment Practices of the Funds and Related Risks................... 11
Investment Restrictions............................................... 12
Investment Managers................................................... 13
Capital Shares........................................................ 13
Net Asset Value....................................................... 14
Sale and Redemption of Shares......................................... 15
Tax Status............................................................ 15
Dividends and Capital Gains Distributions............................. 15
Investment Performance................................................ 15
Management of MML Trust............................................... 16
</TABLE>
I. Financial Highlights
The information in the following tables has been audited by Coopers & Lybrand
L.L.P., independent accountants, whose report on the financial statements of the
Funds is included in MML Trust's Annual Report and in its Statement of
Additional Information. Further information about the performance of the Funds
is contained in the Annual Report which may be obtained from MML Trust's
Secretary without charge.
MML Equity Fund
Selected per share data for each series share outstanding throughout each year
ended December 31:
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year........... $ 20.520 $ 20.510 $ 19.862 $ 18.735 $15.659 $16.764 $14.929 $13.828 $15.591 $13.832
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Income from investment
operations:
Net investment income....... .634 .594 .524 .543 .563 .636 .694 .646 .525 .495
Net realized and unrealized
gain (loss) on investments.. 5.754 .248 1.365 1.420 3.440 (.722) 2.746 1.660 (.066) 2.174
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Total from investment
operations................. 6.388 .842 1.889 1.963 4.003 (.086) 3.440 2.306 .459 2.669
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net
investment income.......... (.634) (.594) (.524) (.543) (.562) (.665) (.711) (.639) (.988) (.412)
Distribution from net
realized gains............. (.350) (.238) (.717) (.288) (.365) (.354) (.894) (.566) (1.234) (.498)
Distribution in excess of
net realized gains......... -- -- -- (.005) -- -- -- -- -- --
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Total distributions......... (.984) (.832) (1.241) (.836) (.927) (1.019) (1.605) (1.205) (2.222) (.910)
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Net asset value:
End of year................. $ 25.924 $ 20.520 $ 20.510 $ 19.862 $18.735 $15.659 $16.764 $14.929 $13.828 $15.591
========= ========= ========= ========= ======= ======= ======= ======= ======= =======
Total return................ 31.13% 4.10% 9.52% 10.48% 25.56% (.51%) 23.04% 16.68% 2.10% 20.15%
Net assets (in millions):
End of year................ $1,248.90 $ 820.78 $ 663.09 $ 490.62 $355.04 $235.45 $226.41 $172.80 $150.41 $141.46
Ratio of expenses to
average net assets......... .41% .43% .44% .46% .48% .49% .50% .50% .51% .52%
Ratio of net investment
income to
average net assets......... 2.89 % 3.04 % 3.23% 3.09% 3.43% 4.09% 4.30% 4.05% 3.44% 3.54%
Portfolio turnover rate..... 11.72 % 9.99 % 11.28% 9.07% 9.37% 13.50% 15.71% 15.97% 15.73% 14.73%
</TABLE>
2
<PAGE>
MML Money Market Fund
Selected per share data for each series share outstanding throughout each year
ended December 31:
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year......... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Income from investment
operations:
Net investment income....... .054 .038 .027 .034 .059 .078 .088 .072 .063 .064
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Total from investment
operations................ .054 .038 .027 .034 .059 .078 .088 .072 .063 .064
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net
investment income.......... (.054) (.038) (.027) (.034) (.059) (.078) (.088) (.072) (.063) (.064)
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Total distributions......... (.054) (.038) (.027) (.034) (.059) (.078) (.088) (.072) (.063) (.064)
--------- --------- --------- --------- ------- ------- ------- ------- ------- -------
Net asset value:
End of year................ $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
========= ========= ========= ========= ======= ======= ======= ======= ======= =======
Total return................ 5.58% 3.84% 2.75% 3.48% 6.01% 8.12% 9.16% 7.39% 6.49% 6.60%
Net assets (in millions):
End of year............... $ 108.92 $ 91.79 $ 73.66 $ 84.56 $ 94.41 $114.59 $ 70.16 $ 66.35 $ 52.35 $ 33.54
Ratio of expenses to
average net assets........ .54% .55% .54% .53% .52% .54% .54% .55% .57% .57%
Ratio of net investment
income to average
net assets................ 5.43% 3.81% 2.71% 3.42% 5.91% 7.80% 8.79% 7.20% 6.35% 6.44%
</TABLE>
MML Managed Bond Fund
Selected per share data for each series share outstanding throughout each year
ended December 31:
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
---- ----- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year.......... $ 11.141 $ 12.405 $ 12.041 $ 12.219 $ 11.318 $ 11.354 $ 10.919 $ 11.052 $ 12.541 $ 11.978
--------- --------- -------- -------- -------- -------- -------- -------- -------- --------
Income from investment
operations:
Net investment income....... .782 .792 .785 .870 .903 .943 .918 .906 .969 1.061
Net realized and unrealized
gain (loss) on investments
and forward commitments.... 1.307 (1.264) .618 .001 .916 (.036) .454 (.133) (.673) .597
--------- --------- -------- -------- -------- -------- -------- -------- -------- --------
Total from investment
operations................. 2.089 (.472) 1.403 .871 1.819 .907 1.372 .773 .296 1.658
--------- --------- -------- -------- -------- -------- -------- -------- -------- --------
Less distributions:
Dividends from net
investment income.......... (.782) (.792) (.784) (.869) (.902) (.943) (.918) (.906) (1.229) (1.095)
Distribution from net
realized gains............. -- -- (.255) (.158) (.016) -- (.019) -- (.556) --
Distribution in excess of
net realized gains......... -- -- -- (.022) -- -- -- -- -- --
--------- --------- -------- -------- -------- -------- -------- -------- -------- --------
Total distributions......... (.782) (.792) (1.039) (1.049) (.918) (.943) (.937) (.906) (1.785) (1.095)
--------- --------- -------- -------- -------- -------- -------- -------- -------- --------
Net asset value:
End of year................ $ 12.448 $ 11.141 $ 12.405 $ 12.041 $ 12.219 $ 11.318 $ 11.354 $ 10.919 $ 11.052 $ 12.541
========= ========= ======== ======== ======== ======== ======== ======== ======== ========
Total return................ 19.14% (3.76%) 11.81% 7.31% 16.66% 8.38% 12.83% 7.13% 2.60% 14.46%
Net assets (in millions):
End of year................ $ 158.70 $ 121.21 $ 129.11 $ 88.15 $ 66.98 $ 43.07 $ 40.03 $ 31.35 $ 26.16 $ 30.38
Ratio of expenses to
average net assets......... .52% .52% .54% .56% .57% .57% .59% .61% .60% .60%
Ratio of net investment
income to average
net assets................. 6.63% 6.69% 6.37% 7.28% 7.96% 8.40% 8.35% 8.25% 8.24% 8.87%
Portfolio turnover rate..... 70.00% 32.77% 58.81% 39.51% 61.85% 69.93% 64.77% 74.92% 55.60% 203.76%
</TABLE>
3
<PAGE>
MML Blend Fund
Selected per share data for each series share outstanding throughout each year
ended December 31:
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year.......... $ 17.672 $ 18.305 $ 17.846 $ 17.307 $ 14.839 $ 15.428 $ 13.876 $ 13.095 $ 13.774 $ 12.244
--------- --------- --------- --------- -------- -------- -------- -------- -------- --------
Income from investment
operations:
Net investment income....... .811 .707 .655 .707 .736 .792 .823 .734 .624 .540
Net realized and unrealized
gain (loss) on investments
and forward commitments.... 3.246 (.271) 1.057 .880 2.771 (.445) 1.921 1.000 (.148) 1.653
--------- --------- --------- --------- -------- -------- -------- -------- -------- --------
Total from investment
operations................. 4.057 .436 1.712 1.587 3.507 .347 2.744 1.734 .476 2.193
--------- --------- --------- --------- -------- -------- -------- -------- -------- --------
Less distributions:
Dividends from net
investment income.......... (.811) (.707) (.655) (.707) (.736) (.811) (.835) (.728) (.747) (.560)
Distribution from net
realized gains............. (.399) (.359) (.598) (.326) (.303) (.125) (.357) (.225) (.408) (.103)
Distribution in excess of
net realized gains......... -- (.003) -- (.015) -- -- -- -- -- --
--------- --------- --------- --------- -------- -------- -------- -------- -------- --------
Total distributions......... (1.210) (1.069) (1.253) (1.048) (1.039) (.936) (1.192) (.953) (1.155) (.663)
--------- --------- --------- --------- -------- -------- -------- -------- -------- --------
Net asset value:
End of year................ $ 20.519 $ 17.672 $ 18.305 $ 17.846 $ 17.307 $ 14.839 $ 15.428 $ 13.876 $ 13.095 $ 13.774
========= ========= ========= ========= ======== ======== ======== ======== ======== ========
Total return................ 23.28% 2.48% 9.70% 9.36% 24.00% 2.37% 19.96% 13.40% 3.12% 18.30%
Net assets (in millions):
End of year................ $1,823.14 $1,444.26 $1,296.54 $1,013.28 $ 797.04 $ 574.15 $ 524.29 $ 401.22 $ 346.12 $ 236.15
Ratio of expenses to
average net assets......... .38% .39% .40% .41% .42% .44% .45% .46% .48% .51%
Ratio of net investment
income to
average net assets......... 4.19% 3.93% 3.60% 4.07% 4.54% 5.37% 5.57% 5.29% 4.77% 4.81%
Portfolio turnover rate..... 30.78% 26.59% 20.20% 25.43% 26.92% 24.55% 22.39% 25.70% 36.56% 58.75%
</TABLE>
Total return information shown in the Financial Highlights tables does not
reflect expenses that apply at the separate account level or to related
insurance products. Inclusion of these charges would reduce the total return
figures for all periods shown.
4
<PAGE>
II. Management Discussion
A. Economic and Investment Environment
The past year saw the continuation of a very good economic environment for
investors in both stocks and bonds. The U.S. economic growth rate as measured
by Gross Domestic Product continued to slow throughout the year from its heated
level of 4.1% in 1994 to roughly 2.5% in 1995. The Federal Reserve, which had
been raising rates during 1994 in an attempt to slow growth somewhat, was able
to change course and even move rates lower. Because the economy is cyclical,
the Fed wanted growth to slow to a more moderate, sustainable level - a "soft
landing" from 1994's rapid pace - to prolong the positive part of the current
cycle.
As demand for goods slowed from 1994 levels, businesses began reducing their
inventories, which had started the year at high levels. This in turn slowed
order and production-driven demand from the manufacturing sector, which exerted
further downward pressure on the growth rate, supported the cause for interest
rate cuts, and helped keep inflation at bay.
While the Federal Reserve actually increased rates as late as February 1995, the
bond market had begun to rally as early as November 1994 on the belief that
growth would slow enough to indicate a change in monetary policy. The market
was correct. The Fed's February rate increase of 1/2 point was followed during
the year by two cuts of 1/4 point each in July and December. Rates on
Treasuries fell significantly during this period, which drove dramatic price
appreciation for Treasuries. The prices in most other bond sectors followed
suit, with 1995 playing out to be one of the strongest bull markets for bonds in
history.
Backed by low interest rates and a strong bond market, stocks reached all-time
highs in 1995. The Dow Jones Industrial Average made new highs almost daily,
hitting a peak of 5216 and closing the year at 5117, and the S&P 500 rose
37.58%. In addition to support from the bond market, stocks reacted to
continued positive earnings surprises, merger and consolidation activity, an
improving export picture and growing productivity and efficiency throughout
corporate America.
The forecast for the economy and markets appears favorable, though both should
be somewhat more moderate than they were during the past year. Economic growth
will probably slow further because employment and personal income - which are
important components of demand - are not strong enough to fuel increases in
demand-driven growth.
Even in the face of a slower economy, sales and earnings remained strong through
the end of 1995. The U.S. had its biggest productivity gain on record in 1995
and exports grew, aided in the early part of the year by a weak dollar, which in
turn created improvements in trade. Going into 1996, we expect to see exports
remain strong, as U.S. businesses recognize that future growth will come in part
from operating in a global market. This opinion is supported by the heavy
outlays we've seen for business equipment, which should further enhance
competitiveness, productivity and export activity for the coming year.
Because of uncertainty about the slowing in the economy throughout 1995, growth
investing, or buying stocks of companies whose earnings growth rates can surpass
that of the economy, took the lead last year. By the same token it was growth,
rather than income, that led to the dramatic appreciation of 1995's bond market.
With both markets currently at high levels in terms of price, we believe we will
see a return of superior performance from value investing strategies. Value
investing relies on capturing appreciation by "buying well" and seeking out
fundamental values, rather than buying above-average growth. Value investors
like the MML Series Investment Fund work to buy stocks and bonds that are either
temporarily out-of-favor with the markets, or that offer opportunities that have
not yet been recognized by the investment community at large.
With stocks and bonds at highs and an economy that is likely to continue to
slow, we expect both the stocks and bond markets to return to more "normal"
activity in terms of returns and volatility. In this type of environment, value
investing should continue to offer solid long-term results. Since security
selection should be very important in the coming year, your portfolio managers
will continue to rely upon hands-on research and careful analysis in an effort
to find the best opportunities for investors.
5
<PAGE>
B. MML EQUITY
How has the Fund performed over the period?
The Fund has performed very well, with 1995 returns at nearly three times the
long-term average for stocks. Typically, our value-oriented style has not
outperformed the broad market indices in years where absolute gains have been as
robust as in 1995. Over the long term, however, our value strategy - focusing
on dividend-paying companies with strong balance sheets while their stocks are
selling at what we consider low prices - has been very successful.
How did large company stocks perform in 1995?
Large company stocks were the place to be this year. Benefiting from improved
productivity, falling interest rates and, through August, a weak dollar, large
companies were able to turn in earnings at levels more typical of small company
growth stocks, which drove their prices up. The market's focus on large cap
stocks benefited the Fund.
What strategic moves have you made within the portfolio?
Though we make investments based on researching individual companies rather than
their industry sectors, the biggest move we made over the period was increasing
our exposure to consumer non-durables companies, one of the best performing
sectors for the year. Our purchases in Albertson's, a major grocery concern and
several consumer goods companies such as American Brands and Kimberly-Clark,
benefited the portfolio considerably. These businesses typically are insulated
from slowing economic growth. We also increased our holdings in the very strong
financial services area, buying the stock of MBIA, a municipal bond insurer and
Safeco, a large property and casualty insurance firm. Our higher exposure to
financial services was another plus for the Fund - in fact, looking back, we
would have liked to have owned more. Over the year, the size of the Fund has
grown, and so has the weighted average market capitalization. This was a third
benefit during a period of large cap leadership.
What segments of the market are you currently targeting?
Our buying has shifted from consumer non-durables to more cyclical companies.
Because this area suffered price declines over the year as the market favored
sectors with more stable earnings, we've been able to buy stocks at what we
consider compelling values. We are buying and looking to buy companies that can
benefit from lower basic materials costs and thus improve their profit margins
regardless of the slower economy.
What is your outlook for the Fund?
After the past year, it's become more difficult to find reasonably-priced
stocks, but with inflation and long-term interest rates low, our outlook remains
favorable. We believe the coming year's market will be positive, but that it
will perform more like its historical average than it did in 1995. We expect to
see more typical levels of volatility than last year's market. During the past
year, the broad market advanced significantly. Going forward, we believe stock
selection will again become more important. That could benefit the Fund in that
strong stock selection is one of the major advantages of a research-driven value
strategy like ours.
C. MML MONEY MARKET
How has the Fund performed over the period?
The Fund has performed well, remaining on target with its goal of providing
principal preservation and a competitive level of current income by investing in
highly liquid short-term debt instruments. While longer-term interest rates
continued to decline over the majority of the year, rates for the extremely
short-term securities we focus on remained favorable, and even exceeded rates on
longer-term issues at certain times during the year.
6
<PAGE>
What strategic moves have you made within the portfolio?
Over the course of the year, we made one major change. Both in the early part
of 1995 when it was anticipated and then later when it actually happened, we
lengthened the average maturity of the Fund's portfolio on the likelihood of the
Federal Reserve's interest rate cuts. By lengthening our maturity, we hoped to
make use of available higher current income levels for as long as possible,
expecting that debt issued after a rate cut would offer lower income levels.
This strategy benefited the Fund by allowing us to maintain our income stream
while the market adjusted to the Fed's actions.
What is your outlook for the Fund?
The Fed eased, or lowered rates, twice in 1995 and may do so again in the first
few months of 1996 depending on the forecast for the economy. If it appears
that the economy has slowed too far, or if budget discussions are finalized,
another decline is a distinct possibility. However, we believe that any further
declines will not be significant. In this environment, we are continuing to
extend maturities in an effort to make the most of the current rates while
maintaining an emphasis on principal stability. Our outlook for the Fund
remains optimistic, though our performance as always will be tied to any changes
in the Federal Reserve's monetary policy.
D. MML MANAGED BOND
How has the Fund performed over the period?
The Fund's performance has been excellent. It compares favorably to its market
indices and has been outstanding on an absolute and historical basis. The past
year has been an extremely strong period for the bond market in general, with
bonds from almost every sector the Fund invests in benefiting from decreasing
interest rates and the price appreciation that accompanies rate declines.
What strategic decisions have you made within the portfolio as a result of lower
rates?
In response to declines in interest rates, our duration increased somewhat over
the period. A longer duration will help us take advantage of any potential
benefits from further changes in the rate structure. New supply in the market
tended to be longer, particularly in corporate bonds. This was due in part to
lower rates. So increasing our duration has allowed us to continue to track the
duration of the Lehman Government/Corporate Index, which is our benchmark. The
portfolio's average duration increased over the period from 4.85 years to 5.23
years.
What other strategic moves have you made within the portfolio?
During the year, the Fund grew from $121 million to $159 million in size. While
this was due in part to asset appreciation and in part to new investments, it
required a great deal of trading activity to become fully invested. Over the
period we initially increased our holdings of Treasuries, and then we sold some
of our Treasuries as the market improved. Corporates also performed well over
the period due to strong fundamentals and demand factors. Additionally, we
increased our holdings of mortgage-backed securities. Though mortgages are
typically sensitive to prepayment risk, our well-seasoned, well-structured
holdings remained strong throughout the period's declines in rates.
What areas of the market are you currently targeting?
As we believe the corporate market still offers strong potential, though within
a slowing economy, we're employing extensive credit research before investing in
corporate issues. We also continue to increase our exposure to the mortgage-
backed sector of the market, especially in adjustable rate mortgages, where
we're finding particularly attractive pricing. Pricing remains an important
part of our investment strategy. We continue to buy bonds across sectors
wherever we believe we've found appreciation potential through mispriced issues.
What is your outlook for the Fund?
This has been a dramatic year for the bond market and the Fund. While current
low inflation and slow to moderate economic growth lead us to believe there is
still room for appreciation in the market, it would be very difficult to imagine
repeating 1995's performance. Our outlook is for the extension of a positive
market environment, where income will again be an important component of total
return. Within this outlook, we expect the Fund to continue to provide high
total return potential consistent with reasonable risk by maintaining a
diversified portfolio of high quality bonds.
E. MML BLEND
How has the Fund performed over the period?
The Fund has performed quite well, backed by the dramatic appreciation declining
interest rates sparked in both the stock and bond markets. Because of the Fund's
focus on preservation of capital, however, it did not perform as well as some of
its more aggressive peers over this unusual time period. Though it will tend to
lag in strong bull markets, we believe our strategy is prudent for long-term
investors and that it will outperform over time.
Did your allocation between stocks, bonds and cash change over the period?
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Our stock holdings will normally fall within a range of 50% to 70% of the
portfolio. In the beginning of the year, we were 53% invested in stocks and by
the end of year, they represented approximately 54%. Our core bond holdings at
the end of 1995 represented 15% of the portfolio, down from 19%. In bonds, a
flattening yield curve also indicated a shortening in the average life of our
portfolio. When the yield curve is flatter, investors are typically not well-
compensated for extending into longer-maturity bonds. While this excluded us
from some of the appreciation in the bond market, our bond portfolio performed
well. Our allocation decisions stem from a policy consistent with preservation
of capital. The remainder of the portfolio, approximately 31% up from 28% a year
ago, is invested in short-term securities.
What is your outlook for the Fund?
An environment of low inflation, favorable interest rates and slow to moderate
economic growth suggests the continuation of decent markets for both stocks and
bonds. While results should remain positive, we expect to see a return to more
normal periods for both markets. In stocks, we are positioning the Fund for
greater volatility and selectivity in the coming year and in bonds, we expect
income to again become the most consistent component of total return. We believe
the MML Blend Fund's conservative strategy should position it to perform well
during this more typical market environment.
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III. General Information
MML Trust is a no-load, open-end, diversified management investment company,
having four separate series of shares. Each Fund has its own investment
objectives and policies. MML Trust was organized as a business trust under the
laws of The Commonwealth of Massachusetts pursuant to an Agreement and
Declaration of Trust dated December 19, 1984, as most recently amended on or
about April 16, 1993. MML Trust was established by Massachusetts Mutual Life
Insurance Company ("MassMutual") for the purpose of providing a vehicle for the
investment of assets of various separate investment accounts established by
MassMutual and its life insurance company subsidiaries, including MML Bay State
Life Insurance Company ("MML Bay State").
Shares of the Funds are offered solely to separate investment accounts
established by MassMutual and any life insurance company subsidiary.
MassMutual is responsible for providing all investment advisory, management, and
administrative services needed by the Funds pursuant to investment management
agreements. MassMutual has entered into investment sub-advisory agreements with
Concert Capital Management, Inc. ("Concert"), a wholly-owned subsidiary of DLB
Acquisition Corp., a controlled subsidiary of MassMutual. These agreements
provide that Concert will manage the equity investments of MML Equity Fund ("MML
Equity") and the Equity Sector (the "Equity Sector") of MML Blend Fund ("MML
Blend"). Both MassMutual and Concert are registered with the Securities and
Exchange Commission (the "SEC") as investment advisers (MassMutual and Concert
referred to hereafter as "Advisers"). For further information, see "Investment
Managers" p.13.
IV. The Funds
The investment objectives of each Fund discussed below are fundamental policies
and may not be changed without the vote of a majority of that Fund's outstanding
voting shares (as used in this Prospectus, a majority of the outstanding voting
shares of any Fund means the lesser of (1) 67% of that Fund's outstanding shares
present at a meeting of the shareholders if more than 50% of the outstanding
shares are present in person or by proxy, or (2) more than 50% of that Fund's
outstanding shares). There is no assurance that the investment objectives of the
Funds will be realized. The success of these objectives depends to a great
extent upon managements' ability to assess changes in business and economic
conditions. For further information about investment policies and techniques,
see "Investment Practices of the Fund and Related Risks," at page 10.
A. MML EQUITY FUND
The primary investment objective of MML Equity Fund ("MML Equity") is to
achieve a superior total rate of return over an extended period of time from
both capital appreciation and current income.
A secondary investment objective is the preservation of capital when business
and economic conditions indicate that investing for defensive purposes is
appropriate. Occasional investments may be made with the objective of short-term
appreciation when in the judgment of Concert general economic conditions dictate
that they may benefit MML Equity and are consistent with sound investment
procedure.
Normally, the assets of MML Equity will be invested primarily in common stocks
and other equity-type securities such as preferred stocks, securities
convertible into common stocks and warrants. Investments are made in securities
of companies which, in the opinion of Concert, are of high quality, offer above-
average dividend growth potential and are attractively valued in the
marketplace. Investment quality and dividend growth potential are evaluated
using fundamental analysis emphasizing each issuer's historical financial
performance, balance sheet strength, management capability and competitive
position. Various valuation parameters are examined to determine the
attractiveness of individual securities. On average, the Fund's portfolio
securities will have price/earnings ratios and price/book value ratios below
those of the Standard & Poor's 500 Composite Stock Price Index (the "S&P 500
Stock Index"). Consideration is also given to securities of companies whose
current prices do not adequately reflect, in the opinion of Concert, the ongoing
business value of the enterprise. These investments may be maintained in both
rising and declining markets. Concert intends to engage in the active management
of MML Equity's portfolio. The portfolio of the Fund is managed by James
MacAllen, Senior Vice President of Concert and David L. Babson and Company
("Babson"). He has been associated with Concert and Babson since January 1,
1996. Prior to January 1, 1996, Mr. MacAllen was with Hagler, Mastrovita &
Hewitt and prior to that was the President and Chief Investment Officer of
Wilmington Capital Management.
B. MML MONEY MARKET FUND
The investment objectives of MML Money Market Fund ("MML Money Market") are to
achieve high current income, the preservation of capital, and liquidity. These
objectives are of equal importance.
MML Money Market will invest only in short-term (i.e., 397 days or less
remaining to maturity) debt instruments, including but not limited to commercial
paper; certificates of deposit; bankers' acceptances; short-term corporate
obligations; obligations issued, sponsored, assumed or guaranteed as to
principal and interest by the government of the United States, its agencies or
instrumentalities ("U.S. Government securities"); and certain repurchase
agreements with respect to any of the securities listed above (which underlying
securities must be of the highest quality at the time the repurchase agreement
is entered into but which securities may have maturities of more than one year).
MML Money Market's dollar-weighted average portfolio maturity will be maintained
at 90 days or less.
MML Money Market's non-fundamental investment policy is that, at the time it
acquires a security, it will invest 100% of its net assets in Tier 1 Securities,
but it retains the right to invest no more than 5% of its net assets in Tier 2
Securities. A Tier 1 Security is one that is rated in the highest rating
category by at least one nationally recognized statistical rating organization
("NRSRO") such as Standard & Poor's Corporation ("S&P") or Moody's Investors
Service, Inc. ("Moody's"). MML Money Market will invest no more than 5% of its
total
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assets in Tier 2 Securities. A Tier 2 Security is one that is rated in the
second highest rating category by at least one NRSRO. Securities which are
unrated may also qualify as Tier 1 and Tier 2 Securities if so determined by the
Board of Trustees of MML Trust (the "Board of Trustees"). For a description of
S&P and Moody's ratings, see the Statement of Additional Information.
Certificates of deposit and bankers' acceptances will be limited to obligations
of banks having deposits of at least $1,000,000,000 as of their most recently
published financial statements. The obligations of U.S. banks in which MML Money
Market may invest include Eurodollar obligations of their foreign branches. In
the case of foreign banks, the $1,000,000,000 deposit requirement will be
computed using exchange rates in effect at the time of their most recently
published financial statements.
Obligations of foreign issuers, including foreign branches of U.S. banks, will
not be acquired if MML Money Market's investment in such obligations would
exceed in the aggregate 25% of its net assets. Foreign obligations may be
affected by foreign governmental action, including imposition of currency
controls, interest limitations, withholding taxes, seizure of assets or the
declaration of a moratorium or restriction on payments of principal or interest.
Foreign branches of U.S. banks and foreign banks may provide less public
information than, and may not be subject to the same accounting, auditing and
financial record-keeping standards, as domestic banks.
MML Money Market will make portfolio investments primarily in anticipation of or
in response to changing economic and money market conditions and trends. Trading
activity is expected to be relatively low. However, it is anticipated that from
time to time, MML Money Market will take advantage of temporary disparities in
the yield relationships among the different segments of the money market or
among particular instruments within the same segment of the market to make
purchases and sales when MassMutual deems that such transactions will improve
the yield or the quality of the portfolio.
The high quality debt instruments in which MML Money Market invests may not
offer as high a yield as may be achieved from lower quality instruments having
less safety. While MML Money Market invests exclusively in First and Second Tier
Securities, investment in MML Money Market is not without risk. If MML Money
Market disposes of an obligation prior to maturity, it may realize a loss or
gain. An increase in interest rates will generally reduce the value of portfolio
investments. In addition, investments are subject to the ability of the issuer
to make payment at maturity. MML Money Market will reassess whether a particular
security presents minimal credit risks in certain circumstances. For example, if
a security ceases to be a Second Tier Security, MML Money Market would dispose
of any such security as soon as practical.
C. MML MANAGED BOND FUND
The investment objective of MML Managed Bond Fund ("MML Managed Bond") is to
achieve as high a total rate of return on an annual basis as is considered
consistent with the preservation of capital.
Normally, the assets of MML Managed Bond will be invested primarily in
investment grade, publicly-traded, fixed income securities of such maturities as
MassMutual deems appropriate from time to time in light of market conditions and
prospects. Except when invested for defensive purposes, at least 80% of total
invested assets at market value at the time of a purchase will consist of U.S.
Government securities and investment grade quality debt securities which have
been rated in the top four rating categories by S&P (AAA, AA, A or BBB) or
Moody's (Aaa, Aa, A or Baa) or, if unrated, which are judged by MassMutual to be
of equivalent quality to securities so rated. While debt securities rated BBB or
Baa are investment grade securities, they have speculative characteristics and
are subject to greater credit risk, and may be subject to greater market risk,
than higher-rated investment grade securities.
In implementing the policies set forth in the preceding paragraph, MML Managed
Bond may invest in (1) obligations (payable in U.S. dollars) issued or
guaranteed as to principal and interest by the Government of Canada, a Province
of Canada, or any instrumentality or political subdivision thereof, provided
that no such investment will be made if it would result in more than 25% of MML
Managed Bond's net assets being invested in such securities, and (2) securities
of foreign issuers, provided however, MML Managed Bond may invest not more than
10% of its net assets in such securities, except as provided in (1) above.
If MML Managed Bond disposes of an obligation prior to maturity, it may realize
a loss or a gain. An increase in interest rates will generally reduce the value
of portfolio investments, and a decline in interest rates will generally
increase the value of portfolio investments. In addition, investments are
subject to the ability of the issuer to make payment at maturity.
Normally, the Fund's duration will range from four to seven years. Portfolio
changes will be accomplished primarily through the reinvestment of cash flows
and selective trading.
The portfolio of the Fund is managed by Mary E. Wilson, Senior Managing Director
of MassMutual, with which she has been associated since 1982. As such, she
oversees all public fixed income trading for MassMutual and its related
subsidiaries and affiliates.
D. MML BLEND FUND
The investment objective of MML Blend Fund ("MML Blend") is to achieve as high
a level of total rate of return over an extended period of time as is considered
consistent with prudent investment risk and the preservation of capital.
The Advisers will adjust the mix of investments among its three market sectors
to capitalize on perceived variations in return potential produced by the
interaction of changing financial market and economic conditions. The Advisers
expects that such adjustments will normally be made in a gradual manner over a
period of time. No investment will be made that would result in more than 90% of
MML Blend's net assets being invested in the Equity Sector or in more than 50%
of MML Blend's net assets being invested in the Bond Sector. Up to 100% of MML
Blend's net assets may be invested in the Money Market Sector. No minimum
percentage has been established for any of the sectors.
In addition to MML Blend's investment objective, each of its market sectors has
a specific investment objective. Within the
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Equity Sector, MML Blend will attempt to achieve a superior total rate of return
over an extended period of time from both capital appreciation and current
income. Within the Bond Sector, MML Blend will attempt to achieve as high a
total rate of return on an annual basis as is considered consistent with the
preservation of capital. Within the Money Market Sector, MML Blend will attempt
to achieve high current income, the preservation of capital, and liquidity. The
portfolio of the Fund is managed by committee.
In seeking a high rate of return from dividends, interest income and capital
appreciation as well as in seeking to preserve capital, Advisers intend to
engage in the active management of MML Blend's portfolio. (See "Portfolio
Management" on page 12).
The portfolio of MML Blend will be invested in the following three market
sectors:
1. Equity Sector
The Equity Sector generally invests in equity-type securities in a substantially
similar manner as described in the discussion of MML Equity Fund on page 9.
2. Bond Sector
The Bond Sector generally invests in the types of bonds and other debt
securities described in the discussion of MML Managed Bond on page 10 with
maturities usually exceeding one year. The Bond Sector may also invest in debt
securities not described above, including lower quality securities and non-rated
securities acquired directly from issuers in direct placement transactions,
provided no such transaction shall cause such debt securities to exceed 10% of
MML Blend's total assets. Lower quality debt instruments generally provide
higher yields but are generally subject to greater market fluctuations and risk
of loss of income and principal than higher quality debt securities. During
1995, no debt securities were acquired by MML Blend which were not rated at
least BBB by S&P or Baa by Moody's.
3. Money Market Sector
The Money Market Sector invests in money market instruments and other debt
securities with maturities generally not exceeding one year. For example, it may
invest in:
(a) U.S. Treasury Bills and other U.S. Government securities,
(b) obligations (payable in U.S. dollars) issued or guaranteed as to
principal and interest by the Government of Canada, (such obligations
may not exceed 25% of MML Blend Fund's total assets),
(c) commercial paper, including variable amount master notes, having a
rating at the time of purchase within the two highest grades as
determined by Moody's (P-1 or P-2) or S&P (A-1 or A-2),
(d) publicly-traded bonds, debentures and notes having a rating within the
four highest grades as determined by Moody's (Aaa, Aa, A or Baa) or S&P
(AAA, AA, A or BBB), or
(e) securities of foreign issuers.
While debt securities rated BBB or Baa are investment grade securities, they
have speculative characteristics and are subject to greater credit risk, and may
be subject to greater market risk, than higher-rated investment grade
securities.
V. Investment Practices Of The Funds and Related Risks
In managing their portfolios of investments, the Funds, pursuant to policies
adopted by the Board of Trustees or where considered appropriate by Advisers,
may engage in various investment-related practices. The Funds' significant
investment practices, which are pursuant to non-fundamental policies and
therefore may be changed by the Board of Trustees without consent of
shareholders, regarding these investment transactions and practices are
discussed below. For further information see the Statement of Additional
Information.
A. DERIVATIVES TRANSACTIONS
Each Fund is authorized to engage in transactions involving derivatives, as more
fully described in the Statement of Additional Information. The Funds' use of
derivatives, other than forward contracts, is minimal. The Funds may use
Derivatives to attempt to: (a) protect against possible declines in the market
value of a Fund's portfolio resulting from downward trends in the debt
securities markets generally due to increasing interest rates, (b) protect a
Fund's unrealized gains or limit unrealized losses in the value of its
securities, (c) to establish a position in the debt securities markets as a
temporary substitute for purchasing or selling particular debt securities, (d)
to manage the effective maturity or duration of fixed-income securities in a
Fund's portfolio, or (e) to manage its exposure to changing security prices
(collectively, "Derivatives Transactions"). Most, if not all, of these
transactions will involve the portfolios of MML Managed Bond and the Bond Sector
of MML Blend as MML Trust has no present intent to enter into derivatives
transactions with regard to MML Money Market, MML Equity, or the Equity or Money
Market Sectors of MML Blend. The Funds will not use Derivatives for speculative
purposes.
Each Fund may purchase or sell securities on a "when issued" or delayed delivery
or on a forward commitment basis ("forward contracts"). When such transactions
are negotiated, the price is fixed at the time of commitment, but delivery and
payment for the securities can take place a month or more after the commitment
date. The securities so purchased or sold are subject to market fluctuations,
and no interest accrues to the purchaser during this period. At the time of
delivery, the securities may be worth more or less than the purchase or sale
price.
There can be no assurance that the use of forward contracts or other derivatives
by any of the Funds will assist it in achieving its investment objectives. Risks
inherent in the use of derivatives include: (1) the risk that interest rates and
securities prices will not move in the direction anticipated; (2) imperfect
correlation between the prices forward contracts and the prices of the
securities being hedged; (3) the fact that skills needed to use these strategies
are different from those needed to select portfolio
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securities; and (4) forward contracts involve a risk of a loss if the value of
the security to be purchased declines prior to the settlement date, which is in
addition to the risk of decline of the Funds' other assets.
A Fund will not enter into a forward contract if as a result more than 25% of
the Fund's total assets would be in one or more segregated accounts covering
forward contracts.
B. PORTFOLIO MANAGEMENT
Advisers intend to use trading as a means of managing the portfolios of the
Funds in seeking to achieve their investment objectives. Advisers, on behalf of
the Funds, will engage in trading when they believe that the trade, net of
transaction costs, will improve interest income or capital appreciation
potential, or will lessen capital loss potential.
Whether the goals discussed above will be achieved through trading depends on
Advisers' ability to evaluate particular securities and anticipate relevant
market factors, including interest rate trends and variations from such trends.
Such trading places a premium on Advisers' ability to obtain relevant
information, evaluate it properly and take advantage of their evaluations by
completing transactions on a favorable basis. If Advisers' evaluations and
expectations prove to be incorrect, a Fund's income or capital appreciation may
be reduced and its capital losses may be increased. Portfolio trading involves
transaction costs, but, as explained above, will be engaged in when Advisers
believe that the result of the trading, net of transaction costs, will benefit
the Funds.
C. RESTRICTED AND ILLIQUID SECURITIES
The Funds may invest in illiquid securities up to 15% (10% in the case of MML
Money Market) of each Fund's net assets. Each Fund currently expects to invest,
if anything, no more than 10% of its net assets in such securities. This policy
does not limit purchases of securities eligible for resale to qualified
institutional buyers pursuant to Rule 144A under the Securities Act of 1933 that
are determined to be liquid by the Board of Trustees or by Advisers pursuant to
Board approved guidelines. Such guidelines take into account trading activity
for such securities and the availability of reliable pricing information, among
other factors. If there is a lack of trading interest in particular Rule 144A
securities, a Fund's holdings of those securities may be illiquid. There may be
undesirable delays in selling these securities at prices representing fair
value.
D. SECURITIES LENDING
MML Managed Bond and MML Blend may make loans of portfolio securities of not
more than 10% of their respective total assets taken at current value, thereby
realizing additional income. Although lending portfolio securities may involve
the risk of delay in recovery of the securities loaned or possible loss of
rights in the collateral should the borrower fail financially, loans will be
made only to borrowers deemed by MassMutual to be of good standing.
E. FEDERAL TAXES
The extent to which the Funds may enter into Derivatives transactions and engage
in portfolio trading may be limited by the Internal Revenue Code's requirements
for qualification for regulated investment companies. It is each Fund's
intention to qualify as such. See "Certain Tax and Accounting Information" in
the Statement of Additional Information.
F. CASH POSITIONS
Each Fund, other than MML Money Market, may hold cash or cash equivalents to
provide for liquidity (e.g. expenses and anticipated redemption payments) and so
that an orderly investment program may be carried out in accordance with the
Fund's investment policies. To provide liquidity or for temporary defensive
purposes, each Fund may invest any portion of its assets in investment grade
debt securities and MML Equity may also invest in non-convertible preferred
stocks.
VI. Investment Restrictions
The following is a description of certain investment restrictions, and
exceptions to such restrictions, that apply to each Fund which may not be
changed without a vote of a majority of the outstanding shares of such Fund.
(For a description of additional investment restrictions, reference should be
made to the Statement of Additional Information.)
Each Fund will not:
(1) Pledge or mortgage assets taken at market to an extent greater than 15% of
the total assets of the Fund taken at cost;
(2) Borrow money, except from banks as a temporary measure for extraordinary or
emergency purposes (but not for the purpose of making investments), and except
to the extent that each Fund engages in financial futures transactions (as
described on page 11) and in reverse repurchase agreements (as described on page
12), provided (a) that the aggregate amount of all such borrowings at the time
of borrowing does not exceed 10% of the total assets of the Fund taken at cost,
and (b) that immediately after the borrowing, and at all times thereafter, there
will be an asset coverage of at least 300% for all of the Fund's borrowings
(including all obligations under financial futures contracts on debt
obligations); and
(3) Concentrate its investments in any one industry, as determined by the Board
of Trustees, and in this connection it will not acquire securities of companies
in any one industry if, immediately after giving effect to any such acquisition,
more than 25% of the value of the total assets of the Fund would be invested in
such industry, with the following exceptions:
(a) In the case of MML Money Market there is no limitation in respect of
certificates of deposit and bankers' acceptances (see "The Funds - MML Money
Market Fund" on pages 9-10).
(b) MML Money Market, MML Managed Bond and the Bond Sector of MML Blend each
may invest up to 40% of the value of their respective total assets in each
of the electric utility and telephone industries. However, it
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currently is MassMutual's intent not to invest more than 25% of any one of
these funds total assets in either the electric utility or telephone
industries.
VII. Investment Managers
MassMutual serves as investment manager of each Fund pursuant to a separate
investment management agreement executed by MassMutual and each Fund. Under the
agreements, which are substantially identical, MassMutual is authorized to
engage in portfolio transactions on behalf of the Funds, subject to such general
or specific instructions as may be given by the Board of Trustees. MassMutual
also acts as the transfer agent and the dividend paying agent.
The investment management agreements between MassMutual and the Funds provide
that MassMutual will perform all administrative functions relating to the Funds
and will bear all expenses of the Funds except (1) taxes and corporate fees
payable to government agencies, (2) brokerage commissions (which may be higher
than other brokers charge if paid to a broker which provides brokerage and
research services to Advisers or for use in providing investment advice and
management to the Funds and other accounts over which Advisers exercise
investment discretion) and other capital items payable in connection with the
purchase or sale of Fund investments, (3) interest on account of any borrowings
by the Funds, (4) fees and expenses of Trustees of MML Trust who are not
interested persons, as defined in the Investment Company Act of 1940, as amended
(the "1940 Act"), of the Advisers or MML Trust, and (5) fees of the Funds'
independent certified public accountants.
For providing the services described above, MassMutual is paid a quarterly fee
at the annual rate of .50% of the first $100,000,000 of the average daily net
asset value of each Fund, .45% of the next $200,000,000, .40% of the next
$200,000,000 and .35% of any excess over $500,000,000. MassMutual has agreed to
bear expenses of each Fund (other than the management fee, interest, taxes,
brokerage commissions and extraordinary expenses) in excess of .11% of average
daily net asset value through April 30, 1997. In 1995 MML Equity, MML Money
Market, MML Managed Bond, and MML Blend paid fees to MassMutual amounting to
.40%, .50%, .49% and .37%, respectively, of their average daily net assets
during the year.
The investment management agreement between MassMutual and each Fund
automatically terminates: (1) unless its continuance is specifically approved at
least annually by the affirmative vote of a majority of the Board of Trustees,
which affirmative vote shall include a majority of the members of the Board who
are not interested persons (as defined in the 1940 Act) of MassMutual or of MML
Trust, or (2) upon its assignment. Under the terms of each investment management
agreement, each Fund recognizes MassMutual's control of the initials "MML" and
each Fund agrees that its right to use these initials is non-exclusive and can
be terminated by MassMutual at any time. Under each agreement, MassMutual's
liability regarding its investment management obligations and duties is limited
to situations involving its willful misfeasance, bad faith, gross negligence or
reckless disregard of such obligations and duties.
MassMutual is a mutual life insurance company organized in 1851 under the laws
of The Commonwealth of Massachusetts. MassMutual is licensed to transact a life,
accident and health insurance business in all states of the United States, the
District of Columbia and certain Provinces of Canada. At December 31, 1995
MassMutual had total assets of approximately $50 billion and in excess of $100
billion in assets under management.
As of January 1, 1993, MassMutual transferred its equity investment advisory
operations to Concert. All of the senior investment professionals of
MassMutual's Equity Management Department transferred to and became employees of
Concert. MassMutual indirectly owns 100% of DLB Acquisition Company which owns a
controlling interest in both Concert and Babson. As of January 1, 1996, the
employees of Concert became co-employees of Babson. Concert manages
institutional investment advisory accounts and had, as of December 31, 1995,
$5.7 billion of assets under management.
Pursuant to two investment sub-advisory agreements with MassMutual, Concert
manages the investment of the assets of MML Equity and the Equity Sector of MML
Blend and MassMutual pays Concert a quarterly fee equal to an annual rate of
.13% of the average daily net asset value. The agreements provide that they
automatically terminate upon the termination of the respective investment
management agreements between MassMutual and MML Equity and MML Blend. Concert
also serves as the investment sub-adviser to Oppenheimer Value Stock Fund which
had net assets of $163 million as of December 31, 1995.
Securities held by the Funds are also frequently held by Advisers in their
investment accounts and by other investment companies for which Advisers act as
investment advisers. If the same security is purchased or sold for any Fund and
such investment account or companies at the same time, such purchases or sales
normally will be combined, to the extent practicable, and will be allocated as
nearly as practicable on a pro rata basis in proportion to the amounts to be
purchased or sold for each. In determining the amounts to be purchased or sold,
the main factors to be considered will be the investment objectives of the
respective portfolios, the relative size of portfolio holdings of the same or
comparable security, availability of cash for investment by the various
portfolios and the size of their respective investment commitments. It is
believed that the ability of the Funds to participate in larger volume
transactions will, in most cases, produce better execution for the Funds. In
some cases, however, this procedure could have a detrimental effect on the price
and amount of a security available to a Fund or the price at which a security
may be sold. It is the opinion of MML Trust's management that, such execution
advantage and the desirability of retaining Advisers as investment managers of
the Funds outweigh the disadvantages, if any, which might result from this
procedure.
VIII. Capital Shares
MML Trust is a "series" company which is authorized to issue shares in separate
series of the same class. Shares of four series have been authorized,
constituting the interests in the four Funds described in this Prospectus. Under
MML Trust's Declaration of Trust, however, the Board of Trustees is authorized
to create new shares in addition to the Funds without the necessity of a vote of
shareholders of MML Trust. MML
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Trust may issue an unlimited number of shares of the same class, in one or more
series as MML Trustees may authorize, with or without par value as MML Trustees
may prescribe. Each share of a particular series represents an equal
proportionate interest in that series with each other share of the same series,
none having priority or preference over another. Each series shall be preferred
over all other series in respect of the assets allocated to that series. Each
share of a particular series is entitled to a pro rata share of any
distributions declared by that series and, in the event of liquidation, a pro
rata share of the net assets of that series remaining after satisfaction of
outstanding liabilities. When issued, shares are fully paid and nonassessable
and have no preemptive, conversion or subscription rights.
MML Trust is not required to hold annual meetings of shareholders. Special
meetings may be called for purposes such as electing MML Trustees, voting on
management agreements, and with respect to such additional matters relating to
MML Trust as may be required by MML Trust's Declaration of Trust and the 1940
Act. Shareholders holding 10% of the shares of MML Trust may call a meeting to
be held to consider removal of MML Trustees. On any matter submitted to
shareholders, shares of each Fund entitle their holder to one vote per share
(with proportionate voting for fractional shares), irrespective of the relative
net asset values of the Funds' shares. On any matters submitted to a vote of
shareholders, all shares of MML Trust then entitled to vote shall be voted by
individual Fund, except that (i) when required by the 1940 Act, shares shall be
voted in the aggregate and not by individual Fund, and (ii) when MML Trustees
have determined that any matter affects only the interests of one or more Funds,
then only shareholders of such Fund or Funds shall be entitled to vote thereon.
Shareholder inquiries should be made by contacting the Secretary, MML Series
Investment Fund, 1295 State Street, Springfield, Massachusetts 01111.
The assets of certain variable annuity and variable life insurance separate
accounts for which MassMutual or an affiliate is the depositor are invested in
shares of the Funds. Because these separate accounts are invested in the same
underlying Funds it is possible that material conflicts could arise between
owners of the variable life insurance contracts and owners of the variable
annuity contracts. Possible conflicts could arise if (i) state insurance
regulators should disapprove or require changes in investment policies,
investment advisers or principal underwriters or if the depositor should be
permitted to act contrary to actions approved by holders of the variable life or
variable annuity contracts under rules of the Securities and Exchange
Commission, (ii) adverse tax treatment of the variable life or variable annuity
contracts would result from utilizing the same underlying Funds, (iii) different
investment strategies would be more suitable for the variable annuity contracts
than the variable life contracts, or (iv) state insurance laws or regulations or
other applicable laws would prohibit the funding of both variable life and
variable annuity separate accounts by the same Funds.
The Board of Trustees will follow monitoring procedures which have been
developed to determine whether material conflicts have arisen and what action,
if any, should be taken in the event of such conflicts. If a material
irreconcilable conflict should arise between owners of the variable life
insurance contracts and owners of the variable annuity contracts, one or the
other group of owners may have to terminate its participation in the Funds. More
information regarding possible conflicts between variable annuity and variable
life insurance contracts is contained in the prospectuses for those contracts.
Under Massachusetts law, shareholders could, under certain circumstances, be
held personally liable for the obligations of MML Trust. However, MML Trust's
Declaration of Trust disclaims liability of the shareholders, MML Trustees, or
officers of MML Trust for acts or obligations of MML Trust, which are binding
only on the assets and property of MML Trust, and requires that notice of such
disclaimer be given in each agreement, obligation, or instrument entered into or
executed by MML Trust or MML Trustees. MML Trust's Declaration of Trust provides
for indemnification out of MML Trust property for all loss and expense of any
shareholder held personally liable for the obligations of MML Trust. Thus, the
risk of a shareholder incurring financial loss on account of shareholder
liability is considered remote since it is limited to circumstances in which the
disclaimer is inoperative and MML Trust itself would be unable to meet its
obligations.
IX. Net Asset Value
The net asset value of each Fund's shares is determined once daily as of the
normal close of trading on the New York Stock Exchange (presently 4:00 p.m.) on
each day on which the Exchange is open for trading.
A. MML MONEY MARKET FUND
It is the intention of MML Money Market to maintain a per share net asset value
of $1.00, although this cannot be assured. Since the net income of MML Money
Market is declared as a dividend each time it is determined, the net asset value
per share of MML Money Market remains at $1.00 per share immediately after each
determination and dividend declaration. Any increase in the value of a
shareholder's investment in MML Money Market representing the reinvestment of
dividend income is reflected by an increase in the number of shares of MML Money
Market in the shareholder's account, which increase is recorded promptly after
the end of each calendar month. MML Money Market's portfolio instruments are
valued on the basis of amortized cost.
B. OTHER FUNDS
Generally, the other Funds value portfolio securities on the basis of market
value. For example, equity securities, including those traded on national
securities exchanges, the NASDAQ national market system, or over-the-counter
securities not so listed, are valued by one or more pricing services, as
authorized by the Board of Trustees. Normally, the values are based upon the
last reported sale price of the security. Long-term bonds are valued on the
basis of valuations furnished by a pricing service, authorized by the Board of
Trustees, which determines valuations taking into account appropriate factors
such as institutional-size trading in similar groups of securities, yield,
quality, coupon rate, maturity, type of issue, trading characteristics and other
market data. Debt obligations with less than one year but more than sixty days
to maturity are valued on the basis of their market value, and debt obligations
having a maturity of sixty days or less are generally valued at amortized cost
when the Board of Trustees believes that amortized cost approximates market
value. If acquired, preferred stocks will be valued on the basis of their market
value if market quota-
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tions are readily available. Futures contracts are valued based on market prices
unless such prices do not reflect the fair value of the contract, in which case
they will be valued by or under the direction of the Board of Trustees. In all
other cases, assets (including restricted securities) will be valued at fair
value as determined in good faith by the Board of Trustees, although the actual
calculations may be made by persons acting pursuant to the direction of the
Board of Trustees.
X. Sale And Redemption
Of Shares
The shares of each Fund are sold at their net asset value (which in the case of
MML Money Market is expected to remain at $1.00) as next computed after receipt
of the purchase order, without the deduction of any selling commission or "sales
load."
Each Fund redeems its shares at their net asset value (which in the case of MML
Money Market is expected to remain at $1.00) as next computed after receipt of
the request for redemption. The redemption price for shares of MML Equity, MML
Managed Bond and MML Blend may be more or less than the shareholder's cost. No
fee is charged on redemption.
Redemption payments will be made within seven days after receipt of the written
request therefore by MML Trust, except that the right of redemption may be
suspended or payments postponed when permitted by applicable law and
regulations.
XI. Tax Status
It is the policy of each Fund to comply, and in 1995 each Fund did comply, with
the provisions of the Internal Revenue Code applicable to regulated investment
companies. As a result, none of the Funds will be subject to federal income tax
on any net income or any capital gains to the extent they are distributed or are
deemed to have been distributed to shareholders.
Regulations issued under Internal Revenue Code Section 817(h) require each of
the Funds to be adequately diversified in order for a variable annuity and
variable life contract funded by MML Trust to receive favorable tax treatment as
an annuity or life insurance contract. Among other requirements, the regulations
limit each Fund's investment in a single issuer to 55% of its assets; while this
requirement applies to U.S. Government securities, each government agency or
instrumentality is treated for this purpose as a separate issuer. The Funds
intend to comply with these diversification requirements. For further
information, see the Statement of Additional Information.
Tax consequences to investors in the separate investment accounts which are
invested in the Funds are described in the prospectuses for such accounts.
XII. Dividends And Capital Gains Distributions
The Funds intend to declare capital gain and ordinary income dividends and to
distribute such dividends in a manner designed to avoid a 4% excise tax on
undistributed regulated investment company income, imposed by the Tax Reform Act
of 1986. The declaration and distribution policies specific to each Fund are
outlined below.
A. MML EQUITY FUND
Distributions, if any, are declared and paid annually. Distributions may be
taken either in cash or in additional shares of MML Equity at net asset value on
the day after the record date for the distribution, at the option of the
shareholder.
B. MML MONEY MARKET FUND
The net income of MML Money Market, as defined below, is determined as of the
normal close of trading on the New York Stock Exchange on each day on which the
Exchange is open, and all the net income so determined is declared as a dividend
to shareholders of record as of that time. Dividends are distributed promptly
after the end of each calendar month in additional shares of MML Money Market at
the then current net asset value, or in cash, at the option of the shareholder.
For this purpose the net income of MML Money Market (from the time of the
immediately preceding determination thereof) consists of all interest income
accrued on its portfolio, plus realized gains or minus realized losses, and less
all expenses and liabilities chargeable against income. Interest income includes
discount earned (including both original issue and market discount) on paper
purchased at a discount, less amortization of premium, accrued ratably to the
date of maturity. Expenses, including the compensation payable to MassMutual,
are accrued each day.
Should MML Money Market incur or anticipate any unusual expense, or loss or
depreciation which would adversely affect its net asset value per share or
income for a particular period, the Board of Trustees would at that time
consider whether to adhere to the present dividend policy described above or to
revise it in the light of the then prevailing circumstances. For example, if MML
Money Market's net asset value per share were reduced, or were anticipated to be
reduced, below $1.00, the Board of Trustees might suspend further dividend
payments until the net asset value returned to $1.00. Thus, such expenses or
losses or depreciation might result in an investor receiving no dividends for
the period during which he held his shares and in his receiving upon redemption
a price per share lower than that which he paid.
C. MML MANAGED BOND AND MML BLEND FUNDS
Dividends out of net investment income are declared and paid quarterly. Capital
gains declarations and distributions of net capital gains, if any, for the year
are made annually. Distributions may be taken either in cash or in additional
shares of the applicable Fund at net asset value on the day after the record
date for the distribution, at the option of the shareholder.
XIII. Investment Performance
Each of the Funds may from time to time advertise certain investment performance
figures. These figures are based on historical earnings and are not intended to
indicate future performance.
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MML Money Market may quote its yield and its effective yield. The yield of MML
Money Market refers to the income generated by the Fund over a seven-day period
(which period will be stated in the advertisement). This income is then assumed
to be earned each week over a 52-week period. The effective yield is calculated
similarly, but the income earned by an investment in the Fund is assumed to be
reinvested.
MML Managed Bond, MML Blend and MML Equity may also quote yield. The yield for
each of these Funds refers to the net investment income earned by the Fund over
a 30-day period (which period will be stated in the advertisement). This income
is then assumed to be earned for a full year and to be reinvested each month for
six months. The resulting semi-annual yield is doubled.
Each of the Funds may advertise its total return and its holding period return
for various periods of time. Total return is calculated by determining, over a
period of time, which will be stated in the advertisement, the average annual
compounded rate of return that an investment in the Fund earned over that
period, assuming reinvestment of all distributions. Holding period return refers
to the percentage change in the value of an investment in a Fund over a period
of time (which period will be stated in the advertisement), assuming
reinvestment of all distributions. Total return and holding period return differ
from yield in that the return figures include capital changes in an investment
while yield measures the rate of net income generated by a Fund. Total return
differs from holding period return principally in that total return is an
average annual figure while holding period return is an aggregate figure for the
entire period.
These investment performance figures may be of limited use for comparative
purposes because they do not reflect charges imposed by the separate investment
accounts invested in the Funds which, if included, would decrease the
performance figures. For more information about the investment performance of
the Funds, see the Statement of Additional Information.
XIV. Management Of
MML Trust
The affairs of MML Trust are generally supervised by its Board of Trustees and
officers. As stated previously, MassMutual acts as investment manager of each of
the Funds and Concert is the sub-adviser to MML Equity and the Equity Sector of
MML Blend. In those capacities, MassMutual and Concert are part of the
management of MML Trust. For more information concerning the management of MML
Trust, reference should be made to the Statement of Additional Information.
The name MML Series Investment Fund is the designation of Trustees under a
Declaration of Trust dated December 19, 1984, as amended from time to time. The
obligations of MML Trust are not personally binding upon, nor shall resort be
had to the property of, any of the Trustees, shareholders, officers, employees
or agents of MML Trust, but MML Trust's property only shall be bound.
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<PAGE>
Rule 485(b)
Registration No. 2-39334
File No. 811-2224
MML SERIES INVESTMENT FUND
STATEMENT OF ADDITIONAL INFORMATION
-----------------------------------
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS. IT SHOULD BE READ
IN CONJUNCTION WITH THE PROSPECTUS OF MML SERIES INVESTMENT FUND DATED MAY 1,
1996 (THE "PROSPECTUS"). THE PROSPECTUS MAY BE OBTAINED FROM THE SECRETARY, MML
SERIES INVESTMENT FUND, 1295 STATE STREET, SPRINGFIELD, MASSACHUSETTS 01111.
DATED MAY 1, 1996
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE
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<S> <C>
GENERAL INFORMATION........................................................1
INVESTMENT PRACTICES OF THE FUNDS AND RELATED RISKS........................1
INVESTMENT RESTRICTIONS...................................................11
MANAGEMENT OF THE MML TRUST...............................................13
CONTROL PERSONS
AND PRINCIPAL HOLDERS OF SECURITIES.......................................18
INVESTMENT MANAGEMENT AND OTHER SERVICES..................................19
BROKERAGE ALLOCATION......................................................21
CAPITAL SHARES............................................................23
PURCHASE, REDEMPTION AND PRICING OF SECURITIES BEING OFFERED..............24
TAX STATUS................................................................26
CERTAIN TAX AND ACCOUNTING INFORMATION....................................27
INVESTMENT PERFORMANCE....................................................27
FINANCIAL INFORMATION.....................................................29
REPORT OF INDEPENDENT ACCOUNTANTS.........................................30
FINANCIAL STATEMENTS OF THE TRUST.........................................31
(1) Statement of Assets and Liabilities
As of December 31, 1995............................................32
MML Equity Fund; MML Money Market Fund; MML Managed
Bond Fund; and MML Blend Fund
(2) Statement of Operations
For the year ended December 31, 1995...............................33
MML Equity Fund; MML Money Market Fund; MML Managed
Bond Fund; and MML Blend Fund
(3) Statement of Changes in Net Assets
For the years ended December 31, 1995 and 1994.....................34
MML Equity Fund; MML Money Market Fund; MML Managed
Bond Fund; and MML Blend Fund
(4) Financial Highlights...............................................35
(5) Schedules of Investments as of December 31, 1995...................37
MML Equity Fund; MML Money Market Fund; MML Managed
Bond Fund; and MML Blend Fund
(6) Notes to Financial Statements......................................50
APPENDIX--Securities Ratings...........................................A1-A4
</TABLE>
<PAGE>
I. GENERAL INFORMATION
MML Series Investment Fund (the "MML Trust") is a no-load, open-end, diversified
management investment company having four separate series of shares (the
"Funds") and established by Massachusetts Mutual Life Insurance Company
("MassMutual") for the purpose of providing a vehicle for the investment of
assets of various separate investment accounts established by MassMutual and
life insurance company subsidiaries of MassMutual. Shares of MML Trust are not
offered to the general public but solely to separate investment accounts
established by MassMutual and its life insurance company subsidiaries, including
MML Bay State Life Insurance Company ("MML Bay State"). MML Trust was formed as
a voluntary association of the type known as a "business trust" organized under
the laws of the Commonwealth of Massachusetts pursuant to an Agreement and
Declaration of Trust dated December 19, 1984, as amended on or about April 16,
1993 (the "Declaration of Trust").
MassMutual is responsible for providing all investment advisory, management, and
administrative services needed by the Funds pursuant to investment management
agreements. MassMutual has entered into investment sub-advisory agreements with
Concert Capital Management, Inc. ("Concert"). Concert and David L. Babson, Inc.
("Babson") are both owned by DLB Acquisition Corporation, a controlled
subsidiary of MassMutual. Concert employees and officers are also employees of
Babson. These agreements provide that Concert will manage the investment of the
assets of MML Equity Fund ("MML Equity") and the assets of the Equity Sector
("Equity Sector") of the MML Blend Fund ("MML Blend"). MassMutual, Concert and
Babson are registered with the Securities and Exchange Commission as investment
advisers (MassMutual and Concert are referred to hereinafter collectively as
"Advisers").
II. INVESTMENT PRACTICE OF THE FUNDS AND RELATED RISKS
The following information supplements the discussion of the Funds' investment
objectives, techniques and policies described in the Prospectus. The
fundamental investment objectives and investment restrictions of each Fund (as
described in the Prospectus and below) may not be changed without a vote of a
majority of such Fund's outstanding shares. A "majority of the outstanding
shares" of any Fund means the lesser of (1) 67% of such Fund's outstanding
shares present at a meeting of the shareholders if 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. All other investment policies and techniques of
each Fund may be changed by the Board of Trustees of MML Trust without a vote of
shareholders. For example, such other policies and techniques include
investment in new types of debt instruments which may be devised in the future,
or which are presently in disuse but may become more prominent in the future,
and minor changes in investment policies which may be made in response to
changes in regulatory requirements which are reflected in the present policies
of such Fund. There is no assurance that the investment objectives of the Funds
will be realized. The success of these objectives depends to a great extent
upon the Advisers' ability to assess changes in business and economic
conditions.
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<PAGE>
In managing their portfolios of investments, the Funds may purchase various
securities, investment related instruments and make use of various investment
techniques, including those described below.
A. MML Managed Bond ("MML Bond")
It is a non-fundamental policy of MML Bond to invest all of its assets in
investment grade securities as discussed in the Prospectus. While MML Bond has
no current expectation to invest in non-investment grade securities, it is
authorized to invest up to twenty percent (20%) of its assets in non-investment
grade debt instruments and preferred stocks. Lower quality debt instruments
involve greater volatility of price and yield, and greater risk of loss of
principal and interest, and generally reflect a greater possibility of an
adverse change in financial condition which would affect the ability of the
issuer to make payments of principal and interest. The market price for lower
quality securities generally responds to short-term corporate and market
developments to a greater extent than higher-rated securities because such
developments are perceived to have a more direct relationship to the ability of
an issuer of lower quality securities to meet its ongoing debt obligations.
B. MML Blend -- Money Market Sector
The Money Market Sector of MML Blend may invest in commercial paper or notes
issued by companies with an unsecured debt issue outstanding having a rating at
the time of purchase within the three highest grades as determined by Moody's
(Aaa, Aa or A) or S&P (AAA, AA or A) and U.S. dollar denominated foreign
commercial paper. This sector may also invest in repurchase agreements and
securities of foreign issuers, provided that such securities of foreign issuers
not be more than 10% of the Sector's total assets.
C. Derivatives
Although each Fund is authorized to engage in derivatives transactions as
indicated in the Prospectus, the Funds have no current expectation of entering
into such transactions in a material way other than the use of forward
contracts. Nonetheless, the following is a discussion of the Funds' authority
to enter into derivative transactions and a description of such transactions and
instruments. Examples of Derivative Transactions include entering into financial
futures transactions, writing covered call options on securities and futures or
covered puts on securities and futures and entering into forward contracts, swap
agreements, and other similar instruments (collectively referred to as
"Derivatives").
The Funds may use Derivatives to try to: (a) protect against possible declines
in the market value of a Fund's portfolio resulting from downward trends in the
debt securities markets generally due to increasing interest rates, (b) protect
a Fund's unrealized gains or limit unrealized losses in the value of its
securities, (c) facilitate selling debt securities for investment reasons, (d)
establish a position in the debt securities markets as a temporary substitute
for purchasing particular debt securities, (e) manage its exposure to changing
security prices, or (f) to manage the effective maturity or duration of fixed
income securities in a Fund's portfolio (collectively "Derivatives
Transactions").
1. Forward Contracts--Each Fund may purchase or sell securities on a "when
issued," delayed delivery or on a forward commitment basis ("forward
contracts"). When such transactions are negotiated, the price is fixed at
the time of commitment, but delivery and payment for the securities can
take place a month or more after the commitment date. The securities so
purchased or sold are subject to market fluctuations, and no interest
accrues to the purchaser during this period. At the time of delivery, the
securities may be worth more or less
2
<PAGE>
than the purchase or sale price. The Funds use forward contracts to manage
interest rate exposure, as a temporary substitute for purchasing or selling
particular debt securities, or to take delivery of the underlying security
rather than closing out the forward contract.
2. Currency Swaps--The Funds may invest in debt securities of foreign
issuers that are not denominated in U.S. dollars. In such cases, the Funds
will enter into currency transaction either to hedge the foreign currency
risks or to effectively convert the debt security to U.S. dollars.
3. Interest Rate Swap Agreements--Swap Agreements--An interest rate swap
agreement involves the exchange by the Fund with another party of their
respective commitments to pay or receive interest, such as an exchange of
floating rate payments for fixed rate payments with respect to a notional
amount of principal. Interest rate and yield curve swaps may be used by
MassMutual on behalf of a Fund as a hedging technique to preserve a return
or spread on a particular investment or portion of its portfolio or to
protect against any increase in the price of securities a Fund anticipates
purchasing in the future. The Funds intend to use these transactions as
hedges and not as speculative investments. A Fund usually will enter into
such agreements on a net basis whereby the two payments of interest are
netted with only one party paying the net amount, if any, to the other.
4. Futures--The Funds may enter into exchange-traded futures contracts for
the purchase or sale of debt obligations in order to hedge against
anticipated changes in interest rates. The purpose of hedging in debt
obligations is to establish the effective rate of return on portfolio
securities with more certainty than would otherwise be possible. A futures
contract on debt obligations is a binding contractual commitment which, if
held to maturity, will result in an obligation to make or accept delivery,
during a particular month, of obligations having a standardized face value
and rate of return. By entering into a futures contract for the purchase
of a debt obligation, a Fund will legally obligate itself to accept
delivery of the underlying security and pay the agreed price; by entering
into a futures contract for the sale of a debt obligation it will legally
obligate itself to make delivery of the security against payment of the
agreed price. Positions taken in the futures markets are not normally held
to maturity, but are instead liquidated through offsetting transactions
which may result in a profit or a loss.
Unlike the purchase or sale of a security, no price is paid or received by
a Fund upon the purchase or sale of a futures contract. The Fund will
incur brokerage fees in connection with its futures transactions, however,
and will be required to deposit and maintain funds with its custodian in
the brokers name as margin to guarantee performance of its future
obligations. A Fund initially will be required to deposit with its
custodian an amount of "initial margin" consisting of cash or U.S. Treasury
bills currently equal to approximately 1 1/2% of the contract amount. The
nature of initial margin in futures transactions is different from that of
margin in security transactions in that futures contract initial margin
does not involve the borrowing of funds by a Fund to finance the
transactions. Rather, the initial margin is in the nature of a performance
bond or good faith deposit on the contract which is returned to the Fund
upon termination of the futures contract, assuming all contractual
obligations have been satisfied. Subsequent payments to and from the
broker will be made on a daily basis as the price of the underlying debt
security fluctuates, making the long and short positions in the futures
contract more or less valuable, a process known as "mark to the market".
3
<PAGE>
While futures contracts based on debt securities provide for the delivery
and acceptance of securities, such deliveries and acceptances usually are
not made. Generally, the futures contract is terminated by entering into
an offsetting transaction. The closing out of a futures contract sale is
effected by a Fund's entering into a futures contract purchase for the same
aggregate amount of the specific type of financial instrument and the same
delivery date. If the price in the sale exceeds the price in the
offsetting purchase, the Fund immediately is paid the difference and thus
realizes gain. If the offsetting purchase price exceeds the sale price, a
Fund pays the difference and realizes the loss. Similarly, the closing out
of a futures contract purchase is effected by a Fund's entering into a
futures contract sale for the same aggregate amount of the specific type of
financial instrument and the same delivery date. If the offsetting sale
price exceeds the purchase price, the Fund realizes a gain, and if the
purchase price exceeds the offsetting sale price, the Fund realizes a loss.
Instead of entering into an offsetting position, a Fund might make or take
delivery of the underlying securities whenever it appears economically
advantageous for it to do so.
To compensate for the imperfect correlation of movements in the price of
debt securities being hedged and movements in the price of futures
contracts, a Fund may buy or sell futures contracts in a greater dollar
amount than the dollar amount of the securities being hedged if the
historical volatility of the prices of such securities has been greater
than the historical volatility of the futures contracts. Conversely, a
Fund may buy or sell fewer futures contracts if the historical volatility
of the price of the securities being hedged is less than the historical
volatility of the futures contracts.
5. Call and Put Options
Call Options--give the right to a person to buy a security at a stated
price, or strike price, within a stated period. A call option can be
exercised during the exercise period if the spot price rises above the
strike price; if not, the option expires. A call option backed by the
securities underlying the option is a covered call option. The owner of
the security will normally sell covered call options to collect premium
income or to reduce price fluctuations of the security. A covered call
option limits the capital appreciation of the underlying security. As a
writer of a call option, a Fund receives a premium, that may be an
additional source of income for the Fund, for undertaking the obligation to
sell the underlying security at a fixed price during the option period if
the option is exercised. So long as the Fund remains obligated as a writer
of a call, it forgoes the opportunity to profit from increases in the
market price of the underlying security above the exercise price of the
option, except insofar as the premium represents such profit.
Each Fund may write covered call options which are traded on a national
securities exchange with respect to securities in its portfolio, provided
that at all times it will have in its portfolio the securities which it may
be obligated to deliver if the option is exercised. Each Fund may write
call options on securities in its portfolio in an attempt to realize a
greater current return than would be realized on the securities alone or to
provide greater flexibility in disposing of such securities. The Fund may
also enter into "closing purchase transactions" in order to terminate its
obligation as a writer of a call option prior to the expiration of the
option. The writing of call options could result in increases in the Funds'
portfolio turnover rate, especially during periods when market prices of
the underlying securities appreciate.
4
<PAGE>
Put Options--give the holder the right to sell the underlying securities to
the Fund during the term of the option at a fixed exercise price up to a
stated expiration date or, in the case of certain options, on such date.
Put options are "covered" by a Fund, for example, when it has established a
segregated account with its Custodian consisting of cash, U.S. Government
issued securities and other liquid high quality debt securities. Each Fund
may also write straddles (combinations of calls and puts on the same
underlying security). The writing of straddles generates additional
premium income but may present greater risk.
6. Other Derivatives--The Funds may use other derivatives that are or
become appropriate in the context of each Fund's investment objectives and
in a manner and to an extent permitted by law and authorized by the Board
of Trustees pursuant to guidelines proposed by MassMutual.
7. Derivatives Limitations--The policies limiting the use of Derivatives
are non-fundamental policies established by the Board of Trustees. The
policies may be changed by the Board without obtaining shareholder
approval. MML Trust's current non-fundamental policies are: (1) A Fund
would not enter into a futures contract if, immediately after entering into
the futures contract, more than 5% of the Fund's total assets would be
committed to initial margin deposits on such contracts; (2) A Fund will
not purchase a put or call option on securities or investment related
instruments if, as a result, more than 5% of its total assets would be
attributable to premiums paid for such options; (3) A Fund would not write
a covered call or put option if as a result more than 20% of the Fund's
total assets would be in one or more segregated accounts covering call and
put options; and (4) A Fund would not enter into a forward contract if as
a result more than 25% of the Fund's total assets would be in one or more
segregated accounts covering forward contracts. Additionally, a Fund is
required at all times to maintain its assets at a level at least three
times the amount of all of its borrowings (the "300% asset coverage test").
Borrowings for this purpose include obligations under any futures contract
on a debt obligation.
8. Segregated Accounts--If a Fund enters into forward contracts, it must
cover such contracts by, for example, establishing a segregated account
with its Custodian, Citibank, N.A., consisting of cash, U.S. Government
issued securities and other liquid high quality debt securities. The
assets of the account must have a value equal to or greater than the
aggregate amount of that Fund's commitment under forward contracts (that
is, greater than the aggregate of the purchase price of the underlying
security on the delivery date). If the value of the securities in the
segregated account declines, additional cash or high grade liquid assets
will be placed in the account so that the value of the account will equal
the amount of the Fund's commitments. At the time of entering into a
forward contract, the segregated account covering such forwards shall not
exceed 25% of the Fund's assets. As an alternative to maintaining all or
part of the segregated account, a Fund could buy call or put options to
"cover" the forward contracts. Forward contracts involve a risk of a loss
if the value of the security to be purchased declines prior to the
settlement date, which risk is in addition to the risk of decline of the
Funds' other assets. A Fund may realize short-term gains or losses upon
the sale of forward contracts.
In instances determined by the Board of Trustees, a Fund selling caps and
floors would maintain in a segregated account cash or high-grade debt
obligations having an aggregate net asset value at least equal to the full
amount, accrued on a daily basis, of the Fund's obligations
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with respect to any caps or floors. The purchase of an interest rate cap
entitles the purchaser, to the extent a specific index exceeds a
predetermined interest rate, to receive payments on a contractually-based
notional amount from the party selling the interest rate cap. The purchase
of an interest rate floor entitles the purchaser, to the extent that a
specific index falls below a predetermined interest rate, to receive
payments of interest on a contractually-based notional principal amount
from the party selling the interest rate floor. In instances determined by
the Board of Trustees, a Fund selling caps and floors would maintain in a
segregated account cash or high-grade liquid assets having an aggregate net
asset value at least equal to the full amount, accrued on a daily basis, of
the Fund's obligations with respect to any caps or floors.
9. Risks in Using Derivatives--There can be no assurance that the use of
Derivatives by any of the Funds will assist it in achieving its investment
objectives. Risks inherent in the use of futures, options, forward
contracts, and swaps include:
a. the risk that interest rates and securities prices will not move in the
direction anticipated;
b. imperfect correlation between the price of futures, options, forward
contracts and the prices of the securities being hedged;
c. the fact that skills needed to use these strategies are different from
those needed to select portfolio securities;
d. the possible absence of a liquid secondary market for any particular
instrument at any time;
e. futures contracts and options can be highly volatile;
f. the writing of call options could result in increases in the Funds'
portfolio turnover rate, especially during periods when market prices of
the underlying securities appreciate;
g. the possible need to defer closing out certain hedged positions to avoid
adverse tax consequences;
h. the risk that a Fund will not be able to effect closing purchase
transactions as to call options it has written at any particular time or at
any acceptable price; and
i. forward contracts involve a risk of a loss if the value of the security
to be purchased declines prior to the settlement date, which is in addition
to the risk of decline of the Funds' other assets.
D. Other Investments Practices
1. Repurchase Agreements--MML Money Market, MML Managed Bond, and MML Blend
may enter into repurchase agreements. While it is the current expectation
that not more than 5% of each such Fund's total assets would be invested in
repurchase agreements at any one time, each such Fund may invest not more
than 10% of their respective total assets in such agreements. Under a
repurchase agreement, a Fund acquires an obligation for a relatively short
period (usually not more than one week) subject to the agreement of the
seller (a member bank of the Federal Reserve System or a securities dealer)
to repurchase the obligation at an agreed upon price and date. The
repurchase price reflects an agreed-upon
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interest rate unrelated to the coupon rate on the purchased obligation. A
repurchase agreement is considered to be loans by a Fund for purposes of
its investment restrictions. Investments in repurchase agreements will be
limited to transactions with financial institutions which are believed by
MassMutual to present minimal credit risks. While the repurchase
agreements will provide that the underlying security at all times shall
have a value at least equal to the resale price stated in the agreement, if
the seller defaults, the Fund could realize a loss on the sale of the
underlying security. In addition, if the seller should be involved in
bankruptcy or insolvency proceedings, the Fund may incur delay and costs in
selling the underlying security or may suffer a loss of principal and
interest if the Fund is treated as an unsecured creditor and required to
return the underlying securities to the seller's estate.
2. Reverse Repurchase Agreement--MML Blend may engage in reverse repurchase
agreements, which are agreements in which MML Blend, as the seller of the
securities, agrees to repurchase them at an agreed upon time and price.
MML Blend will maintain a segregated account which will contain cash or
high-grade debt obligations having a current market value at all times in
an amount sufficient to repurchase securities pursuant to outstanding
reverse repurchase agreements. Reverse repurchase agreements are
borrowings subject to the 300% asset coverage test described on page 14 of
the Prospectus.
3. Restricted and Illiquid Securities--Rule 144A provides a non-exclusive
safe harbor exemption from the registration requirements of the Securities
Act of 1933 for the resale of restricted securities to qualified
institutional buyers ("QIBs"). If one or more of the Funds invests in Rule
144A securities or other types of illiquid securities, investors should
recognize that the investment could have the effect of increasing the level
of fund illiquidity to the extent that QIBs become uninterested in
purchasing the securities. Although MML Equity, MML Managed Bond, and MML
Blend may invest up to 15% of their net assets in such securities, they
each have non-fundamental policies to invest not more than 10% of their
respective net assets in such securities. Although MML Money Market may
invest no more than 10% of its assets in such securities, its current
policy is that it will invest no more than 5% of its net assets in such
securities. These limitations do not apply if MassMutual, Concert, or the
Board of Trustees determines that they are liquid as discussed in the next
paragraph. The policy regarding the extent to which a Fund may invest in
such securities or instruments is a non-fundamental policy of MML Trust
which can be changed without obtaining shareholder approval. Although the
Board of Trustees is responsible for determining the liquidity of
restricted securities, it is not required to specifically approve and
review each restricted security recommended by Advisers for the Funds'
portfolios. With respect to Rule 144A securities, for example, the Board
of Trustees is responsible for establishing guidelines for determining the
liquidity and value of securities and monitoring Adviser's implementation
of the guidelines. Such guidelines have been adopted and take into account
trading activity and the availability of reliable pricing information and
any other factor of importance. If there is a lack of trading interest in
particular Rule 144A securities, the Fund's holdings of those securities
may become less liquid and there may be undesirable delays in selling these
securities at prices representing their fair value. Securities not
registered for sale to the general public but that can be resold to
institutional investors may not be considered illiquid, provided that a
dealer or institutional trading market exists. The institutional trading
market is relatively new and liquidity of the Funds' investments could be
impaired if trading does not develop or declines.
Restricted securities frequently can be purchased at a discount from the
price of unrestricted
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<PAGE>
securities of the same class, and the valuation of such securities in the
Funds' portfolios (which will be their fair value as determined in good
faith by the Board of Trustees of MML Trust or pursuant to the direction of
the Board of Trustees subject to its review) will generally reflect such
discount in whole or in part until the restriction is eliminated. With the
exceptions of Rule 144A securities and commercial paper, the Funds
generally do not expect to purchase restricted securities unless the issuer
has agreed to pay the expenses of registering such securities under the
Securities Act of 1933. However, under some circumstances the Funds may
dispose of such securities privately at a discount or pay the cost of
registration. A considerable period may elapse between the time a Fund
decides to sell restricted securities and the time a suitable purchaser is
found or registration is effected. Any such lapse of time would reduce the
Fund's flexibility and also delay its ability to dispose of such
securities, thereby subjecting the Fund to the risk of a market decline in
the interim or, in a thin market, a decline caused by the proposed sale
itself. In disposing of restricted securities, the Funds may be
underwriters as that term is defined in the Securities Act of 1933.
4. Warrants--MML Equity may invest in warrants. A warrant typically gives
the holder the right to purchase an underlying stock at a specified price
for a designated period of time. Warrants may be a relatively volatile
investment for the holder. The holder of a warrant takes the risk that the
market price of the underlying stock may never equal or exceed the exercise
price of the warrant. A warrant will expire without value if it is not
exercised or sold during its exercise period.
5. Foreign Securities--Generally, the Funds may invest not more than 10% of
their net assets in the securities of foreign issuers, whether or not the
securities are listed on a domestic or foreign exchange. It is the current
expectation, however, that MML Equity will make no such investments. If
such investments are made by MML Managed Bond or MML Blend, it is presently
expected that no more than 5% of the Fund's net assets will be invested in
such securities. Investments in Canadian securities have their own
limitations as set forth in the Prospectus.
In making foreign investments, each Fund will be subject to a number of
factors and risks not generally associated with investments in domestic
securities. For example, foreign securities usually are denominated in
foreign currencies which means that their value will be affected favorably
or unfavorably by changes in the strength of the U.S. dollar relative to
other currencies as well as to other factors that affect security prices.
Moreover, foreign issuers are not subject to uniform legal, accounting,
auditing, and financial standards and requirements comparable to those
applicable to U.S. issuers. Other risks include: unfavorable political or
economic developments, applicability of less stringent regulation of
foreign securities markets, the availability of less information about the
issuer of the security in question, possible seizure, expropriation or
nationalization of foreign assets, the imposition of foreign withholding
tax on dividend or interest payments, greater expenses because of the
increased transaction costs on non-U.S. securities markets and the
increased costs of maintaining the custody of foreign securities. Foreign
securities markets also have different clearance and settlement procedures.
6. U.S. Government Obligations--Obligations issued by the U.S. Government
which MML Money Market, MML Managed Bond and MML Blend may purchase include
U.S. Treasury bills, notes and bonds having no more than one year remaining
to maturity. At present, obligations of United States agencies or
instrumentalities which MassMutual intends to
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<PAGE>
purchase for the portfolio of MML Money Market include principally
obligations of Government National Mortgage Association (which are backed
by the full faith and credit of the United States) and obligations of the
Federal National Mortgage Association and the Federal Home Loan Banks
(which may be backed only by the credit of the issuer itself).
7. Money Market Instruments: Large Denominations--Certain money market
instruments are available only in relatively large denominations, and
others may carry higher yields if purchased in relatively large
denominations. For example, yields on certificates of deposit for
$1,000,000 or over could be higher than yields on certificates of deposit
for less than $1,000,000. Also, it is believed by MassMutual that an
institutional purchaser of money market instruments who has the ability to
invest relatively large sums on a regular basis may have investment
opportunities that are not available to those who invest smaller sums less
frequently. Certain of the investment restrictions of the Funds, and in
particular MML Money Market, limit the percentage of its assets which may
be invested in certain industries or in securities of any issuer.
Accordingly, while MML Money Market has relatively small net assets and net
cash flow from sales and redemptions of shares, it may be unable to invest
in money market instruments paying the highest yield available at a
particular time.
8. MML Money Market Investments--All of MML Money Market's assets will
qualify as Eligible Securities, which include both "First Tier" and "Second
Tier" Securities, at the time of their purchase. Eligible Securities may
also include certain long term securities with, at the time of purchase, a
remaining maturity of 397 days or less, provided the issuer has received
from a nationally recognized statistical rating organization, such as
Standard and Poor's Corporation ("S&P") or Moody's Investors Service, Inc.
("Moody's"), a rating with respect to short term obligations in one of the
top two rating categories, or provided the issuer is similarly rated with
respect to a class of short-term securities that is comparable in priority
and security. A security qualifies as a First Tier Security if two
nationally recognized statistical rating organizations ("NRSROs") have both
given it their highest ratings, even if other NRSROs have rated it lower,
or if one NRSRO has given it the highest rating, but only if the security
has been rated by only the one NRSRO. In addition to S & P and Moody's,
other NRSROs include: Duff & Phelps, Inc, Fitch Investors, Inc., IBCA
Limited and IBCA, Inc. A Second Tier Security is one that is rated in the
second highest rating category by one or more NRSROs. In certain
circumstances, unrated securities may qualify as First or Second Tier
Securities if MML Trust's Board of Trustees determines that such securities
are of comparable quality to First or Second Tier Securities and the
purchase of such unrated securities is approved or ratified by the Board of
Trustees. Purchases of securities that have only been rated by one NRSRO
also must be approved or ratified by MML Trust's Board of Trustees.
MML Money Market generally is prohibited from investing more than 5% of its
assets in the securities of one issuer. The 5% limit also applies to
investments in bank instruments that are securities, such as certificates
of deposits, bankers acceptances and letters of credit. After giving
effect to the securities collateralizing a repurchase agreement, a fund may
not invest more than 5% of its assets in any one issuer, including the
issuer of securities collateralizing the repurchase agreement. Where the
underlying securities are not U.S. Government securities, they must be
First Tier securities at the time the agreement is entered into. If the
repurchase agreement is fully collateralized, the fund need look solely to
the underlying securities to determine whether it meets the diversification
test. A safe harbor to the 5% diversification limitation permits a fund to
invest more than 5% of its assets in First Tier Securities of a single
issuer for up to 3 business days after the purchase to allow a fund more
flexibility, such
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<PAGE>
as, to invest large cash inflows. This "safe harbor" can only be used by a
fund for one investment at a time and is only available with respect to 25%
of the fund's net assets.
If MassMutual becomes aware that any unrated security or Second Tier
Security has received a rating by any NRSRO below its second highest rating
category, MassMutual will either (1) dispose of the security within 5
business days and so notify the Board of Trustees, or (2) immediately call
a meeting of the Board to reassess whether such security presents a minimal
credit risk. If a First Tier Security ceases to be a First Tier Security,
MassMutual will reassess promptly whether such security continues to
present minimal credit risk. No reassessment is necessary if MassMutual
promptly determines that it would be in the best interest of the Fund to
sell such security and promptly does so. MML Money Market must dispose of
defaulted securities and securities that are no longer Eligible Securities
unless the Board determines it would not be in the best interest of the
fund. The Board may take into account market conditions that "could affect
the orderly disposition of the security" (i.e. a fund would not necessarily
have to dispose of the security in a "fire sale"). If MML Money Market
holds one or more defaulted securities that, immediately before the
default, accounted for one half of one percent or more of fund assets, it
must promptly notify the SEC of this fact and indicate what action it
intends to take.
9. Lower Quality Debt Instruments and Preferred Stock--MML Managed Bond and
MML Blend may invest in debt instruments and preferred stock not rated in
the top four rating categories by S&P or Moody's. MML Managed Bond may
invest not more than 20% of its total invested assets in such investments
and MML Blend may invest not more than 10% of its total assets in such
investments. Lower quality debt instruments involve greater volatility of
price and yield, and greater risk of loss of principal and interest, and
generally reflect a greater possibility of an adverse change in financial
condition which would affect the ability of the issuer to make payments of
principal and interest. The market price for lower quality securities
generally responds to short-term corporate and market developments to a
greater extent than higher-rated securities because such developments are
perceived to have a more direct relationship to the ability of an issuer of
lower quality securities to meet its ongoing debt obligations. Because of
the relatively high risks associated with investments in lower quality
securities, an investor should carefully consider the manner in which MML
Managed Bond and MML Blend seeks to achieve their investment objectives and
such investor's ability to assume these risks before investing in MML
Managed Bond or MML Blend.
10. Investment Basket--The Board of Trustees, notwithstanding any of the
investment restrictions set forth in this Statement of Additional
Information or those set forth in the Prospectus, except those imposed as a
matter of law, may authorize one or more Funds to invest in any security or
investment related instrument, or to engage in investment related
transactions or practices, such as newly developed debt instruments or
hedging programs, provided that the Board has determined that to do so is
consistent with the Fund's investment objectives and policies, has adopted
reasonable guidelines for use by the Fund's Advisers, and provided further
that at the time of making such an investment or entering into such
transaction, such investments or instruments account for no more than 10%
of the Fund's total assets. MML Trust has no current plans to use this
authority.
11. Variable Rate Master Demand Notes--While the Money Market Sector of MML
Blend may purchase variable rate master demand notes, it has never done so
and has no current intention of doing so in the foreseeable future.
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<PAGE>
12. Trading Activity--It is the policy of MML Equity not to invest for the
purpose of exercising management or control. It is also the policy of MML
Equity not to engage in arbitrage activities. In seeking a high rate of
return from interest income and capital appreciation as well as in seeking
to preserve capital values, MassMutual intends to engage in the active
management of MML Managed Bond's portfolio. MML Money Market will make
portfolio investments primarily in anticipation of or in response to
changing economic and money market conditions and trends. Trading activity
is expected to be relatively low. However, it is anticipated that from
time to time MML Money Market will take advantage of temporary disparities
in the yield relationships among the different segments of the money
markets or among particular instruments within the same segment of the
market to make purchases and sales when management deems that such
transactions will improve the yield or the quality of the portfolio.
Advisers intend to use trading as a means of managing the portfolio of MML
Blend in seeking to achieve its investment objective. Portfolio trading
involves transaction costs, but will be engaged in when Advisers believe
that the result of the trading, net of transaction costs, will benefit the
Fund.
IV. INVESTMENT RESTRICTIONS
A. The following is a description of certain restrictions on investments of the
Funds (in addition to those described in the Prospectus) which may not be
changed without a vote of a majority of the outstanding shares of the applicable
Fund.
Each Fund will not:
1. Make an investment in the securities of any issuer if such investment
when made would cause more than 5% of the value of the total assets of the
Fund to be invested in such securities (other than U.S. Government
securities), or, in the case of MML Equity Fund, would cause more than 10%
of the outstanding securities of any class of such issuer to be held by MML
Equity;
2. Purchase securities on margin, except for such short-term credits as are
necessary for the clearance of transactions, and except that each Fund may
deposit and maintain funds with its custodian or brokers as margin in
connection with its use of financial futures contracts (see the
Prospectus);
3. Purchase commodities or commodity contracts, except to the extent that
each Fund may enter into financial futures contracts (see the Prospectus);
4. Purchase the securities of companies which (including predecessors) are
less than three years old, if such purchase would cause more than 5% of the
value of the total assets of the Fund to be invested in such companies;
5. Hold more than 10% of the voting securities of any one company;
6. Purchase or hold the securities of any company, if to the knowledge of
the Board of
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<PAGE>
Trustees of MML Trust, persons who are officers or directors of MassMutual
or officers or Trustees of MML Trust, and who individually own more than
1/2 of 1% of the securities of that company, together own more than 5% of
such securities;
7. Make short sales of securities;
8. Write, purchase or sell puts, calls or combinations thereof, except:
each Fund may write call options on the securities in its portfolio and
enter into closing purchase transactions with respect thereto (see the
Prospectus);
9. Make loans to any officer, Trustee or employee of the Trust or to any
officer, director or employee of MassMutual, or to MassMutual;
10. Purchase or sell real estate or interests in real estate, although it
may purchase and sell marketable securities secured by, or of companies
investing or dealing in, real estate;
11. Invest in securities of other investment companies, except (A) as part
of a merger, consolidation or other corporate acquisition, or (B) by
purchases in the open market at no more than customary brokers'
commissions, as a result of which not more than 5% of the value of the
total assets of the Fund would be so invested and no more than 3% of the
total outstanding voting stock of any one investment company would be held;
12. Participate in the underwriting of securities, except to the extent
that each Fund may be deemed an underwriter under federal securities laws
by reason of acquisitions or distributions of portfolio securities (e.g.
investments in restricted securities and instruments subject to such limits
as imposed by the Board and/or law);
13. Make loans, except (i) through the acquisition of bonds, debentures,
notes or other evidences of indebtedness in which the Fund is authorized to
invest, (ii) in the case of MML Money Market, MML Managed Bond and MML
Blend, through repurchase agreements (repurchase agreements of each such
Fund maturing in more than seven days not to exceed 10% of the value of the
total assets of such Fund), and (iii) in the case of MML Managed Bond and
MML Blend, through the lending of portfolio securities with respect to not
more than 10% of the total assets of each such Fund taken at current value.
(The present intention is that securities loans would be made to broker-
dealers only pursuant to agreements requiring that the loans be
continuously secured by collateral in cash or U.S. Government securities at
least equal at all times to the market value of the securities lent. The
borrower pays the Fund an amount equal to any interest or dividends on the
securities lent. The Fund also receives the interest on the securities
purchased with the cash collateral (high-grade interest-bearing short-term
obligations), or a fee from the borrower. Although voting rights, or
rights to consent, with respect to the securities lent pass to the
borrower, the Fund retains the right to call the loans at any time on
reasonable notice, and it will do so in order to vote the securities on a
material event affecting the investment. Such loans may also be called in
order to sell the securities involved;
14. Issue senior securities, except to evidence borrowings permitted by
investment restriction (2) described in the Prospectus, or
15. Pledge or mortgage assets at market to an extent greater than 15% of
the total assets of the
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Fund taken at cost.
IV. MANAGEMENT OF MML TRUST
MML Trust has a Board of Trustees, but a majority of them must not be
"Interested Persons" as defined in the Investment Company Act of 1940 as
amended. MML Trustees and principal officers of MML Trust are listed below
together with information on their positions with MML Trust, principal
occupations during the past five years and other principal business
affiliations.
Gary E. Wendlandt/1/ Chairman and Trustee of MML Trust
1295 State Street
Springfield, MA 01111
Age: 45
Chief Investment Officer (since 1993), Executive Vice President (since
1992), Senior Vice President (1983-1992), MassMutual; Chairman and Chief
Executive Officer, MassMutual Institutional Funds; Chairman (since 1995),
President (1983-1995) and Trustee: MassMutual Corporate Investors; Chairman
(since 1995), President (1988-1995) and Trustee, MassMutual Participation
Investors; President and Director (since 1995), DLB Acquisition Corporation
(holding company for investment advisers); President and Chief Executive
Officer (since 1994), Director (since 1992), and Vice Chairman (1983-1992),
Concert Capital Management, Inc. (wholly-owned investment advisory
subsidiary of MassMutual Holding Company); Director (since 1990),
Oppenheimer Acquisition Corporation (investment advisory holding company);
Supervisory Director (since 1991) MassMutual/Carlson CBO N.V.
(collateralized bond fund); Director (since 1994), MassMutual Corporate
Value Partners Limited (investor in debt and equity securities) and
MassMutual Corporate Value Limited (parent of MassMutual Corporate Value
Partners Limited); Chairman, President and Chief Executive Officer (since
1994) and Director (since 1991), MassMutual Holding Company and Director
and President (since 1994), MassMutual Holding Company Two, Inc. and
MassMutual Holding Company Two MSC, Inc. (direct and indirect holding
company subsidiaries of MassMutual); Chairman (since 1994) and Director
(since 1993), MML Realty Management Corporation; Chairman and Chief
Executive Officer (since 1994), Cornerstone Real Estate Advisers, Inc.
(wholly-owned real estate investment adviser subsidiary of MassMutual
Holding Company); Director (since 1992), Merrill Lynch Derivative Products,
Inc.; Chairman (1994-1995) and Director (1993-1995), MML Real Estate
Corporation.
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/1/ Trustee who is an "interested person" of MML Trust within the definition set
forth in Section 2(a)(19) of the Investment Company Act of 1940, as amended.
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<PAGE>
Ronald J. Abdow Trustee of MML Trust
1400 Elm Street
West Springfield, MA 01089
Age: 64
President, Abdow Corporation (operator of restaurants); General Partner,
Grove Investment Group (apartment building syndicator); Trustee, Abdow G&R
Trust and Abdow G&R Co. (owners and operators of restaurant properties);
Partner, Abdow Partnership, Abdow Auburn Associates, and Abdow Hazard
Associates (owners and operators of restaurant properties); Trustee (since
1994), MassMutual Institutional Funds (open-end investment company).
Mary E. Boland Trustee of MML Trust
67 Market Street
Springfield, MA 01118
Age: 56
Partner, Egan, Flanagan and Cohen, P.C., Attorneys at Law, Springfield, MA;
Director (since 1995), Trustee (until 1995), SIS Bank (formerly,
Springfield Institution for Savings); Trustee, MassMutual Institutional
Funds (open-end investment company).
Richard G. Dooley/2/ Vice Chairman and Trustee of MML Trust
1295 State Street
Springfield, Massachusetts
Age: 66
Consultant (since 1993), Executive Vice President and Chief Investment
Officer (1978-1993), MassMutual; Director, The Advest Group, Inc.
(financial services holding company), Hartford Steam Boiler Inspection and
Insurance Co., New England Education Loan Marketing Corporation; Trustee
(since 1992), Kimco Realty Corp. (shopping center ownership and
management); Director (since 1993), Jefferies Group, Inc. (financial
services holding company); Director and Vice President, Oppenheimer
Acquisition Corporation (investment advisory holding company); Trustee
(since 1996), MassMutual Institutional Funds (open-end investment company);
Vice Chairman (since 1995), Chairman (1982-1995), MassMutual Corporate
Investors, and Vice Chairman (since 1995), Chairman (1988-1995), MassMutual
Participation Investors (closed-end investment companies); Director (1992-
1995), Chairman (1982-1992) Concert Capital Management, Inc. (an indirect
investment advisory subsidiary of MassMutual); Director (1993-1995),
Luxonen S.A. (Swedish investment fund); Supervisory Director (1991-1995),
MassMutual/Carlson CBO N.V. (collateralized bond fund); Director (1984-
1993), MML Real Estate Corporation (real estate management subsidiary of
MassMutual Holding Company) and MML Realty Management Corporation
(subsidiary of MassMutual Holding Company to manage real estate projects).
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/2/ Trustee who is an "interested person" of MML Trust within the definition set
forth in Section 2(a)(19) of the Investment Company Act of 1940, as amended.
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<PAGE>
F. William Marshall, Jr. Trustee of MML Trust
1441 Main Street
Springfield, MA 01102-3034
Age: 54
President, Chief Executive Officer and Director (since 1993), SIS Bank
(formerly, Springfield Institution for Savings); Chairman and Chief
Executive Officer (1990-1993), Bank of Ireland First Holdings, Inc. and
First New Hampshire Banks; Trustee (since 1996), MassMutual Institutional
Funds (open-end investment company).
Charles J. McCarthy Trustee of MML Trust
181 Eton Road
Longmeadow, MA 01106
Age: 72
Proprietor, Synectics Financial Company (venture capital activities,
business consulting and investments); Trustee (since 1994), MassMutual
Institutional Funds (open-end investment company).
John H. Southworth Trustee of MML Trust
195 Eton Road
Longmeadow, MA 01106
Age: 68
Chairman (since 1993) and President (1984-1992), Southworth Company
(manufacturer of paper and calendars); Director (since 1995), Trustee
(until 1995), SIS Bank (formerly, Springfield Institution for Savings);
Trustee (since 1994), MassMutual Institutional Funds (open-end investment
company).
Stuart H. Reese President of MML Trust
1295 State Street
Springfield, MA 01111
Age: 40
Senior Vice President (since 1993), MassMutual; President (since 1995),
Executive Vice President (1993-1995), MassMutual Corporate Investors and
MassMutual Participation Investors; President (since 1995), MassMutual
Institutional Funds (open-end investment company); Director (since 1994),
MassMutual Corporate Value Partners Limited (investor in debt and equity
securities) and MassMutual Corporate Value Limited (parent of MassMutual
Corporate Value Partners Limited); Supervisory Director (since 1994),
MassMutual/Carlson CBO (collateralized bond fund); Director and Member of
Investment Committee (since 1994), MML Bay State Life Insurance Company
(wholly-owned insurance subsidiary of MassMutual); Director and Member of
Investment and Auditing Committees, MML Pension Insurance Company (wholly-
owned insurance subsidiary of MassMutual Holding Company Two MSC, Inc.);
Director (since 1994), Pace Industries (aluminum die caster); Vice
President and Managing Director (1990-1992), Capital Markets Group of Aetna
Life & Casualty Company; Chairman and President (1990-1993), Aetna
Financial Services, Inc.
15
<PAGE>
Hamline C. Wilson Vice President and Chief Financial
1295 State Street Officer of MML Trust
Springfield, MA 01111
Age: 58
Senior Managing Director (since 1996), Vice President and Managing Director
(1989-1996), MassMutual; Vice President and Chief Financial Officer,
MassMutual Institutional Funds, MassMutual Corporate Investors and
MassMutual Participation Investors; Investment Officer (since 1992), Vice
President (1983-1992), Concert Capital Management, Inc.
Stephen L. Kuhn Vice President and Secretary
1295 State Street of MML Trust
Springfield, MA 01111
Age: 49
Vice President and Associate General Counsel (since 1992), Second Vice
President and Associate General Counsel (1988-1992), MassMutual; Vice
President and Secretary, MassMutual Institutional Funds, MassMutual
Participation Investors and MassMutual Corporate Investors; President,
MassMutual/Carlson CBO Incorporated; Chief Legal Officer and Assistant
Secretary (since 1995), DLB Acquisition Corporation (holding company for
investment advisers); Assistant Clerk (since 1994), Chief Legal Officer
(since 1993), and Clerk (1990-1994), Concert Capital Management, Inc.
Mary E. Wilson Senior Vice President of MML Trust
1295 State Street
Springfield, MA 01111
Age: 42
Senior Managing Director (since 1996), Vice President and Managing Director
(1991-1996), Vice President (1991), MassMutual; Vice President (since
1991), MassMutual Participation Investors; Vice President (since 1992),
MassMutual Corporate Investors; Vice President (1991-1995) Oppenheimer
Investment Grade Bond Fund.
Nancy S. Muise Vice President of MML Trust
1295 State Street
Springfield, MA 01111
Age: 46
Second Vice President, MassMutual.
16
<PAGE>
Raymond B. Woolson Treasurer of MML Trust
1295 State Street
Springfield, MA 01111
Age: 37
Managing Director (since 1996), Second Vice President (1992-1996),
Director/Fund Account Administration (1989-1992), MassMutual; Treasurer,
MassMutual Corporate Investors, MassMutual
Participation Investors and MassMutual Institutional Funds; Second Vice
President (since 1994), MassMutual Holding Company.
John J. McMahon Comptroller of MML Trust
1295 State Street
Springfield, Ma 01111
Age: 40
Director of Accounting Services, MassMutual; Comptroller (since 1994),
MassMutual Institutional Funds, MassMutual Corporate Investors and
MassMutual Participation Investors.
MML Trust's Agreement and Declaration of Trust provides that MML Trust will
indemnify its Trustees and officers against liabilities and expenses incurred in
connection with litigation in which they may be involved because of their
offices with MML Trust, except if it is determined in the manner specified in
the Agreement and Declaration of Trust that they have not acted in good faith in
the reasonable belief that their actions were in the best interests of MML Trust
or that such indemnification would relieve any Trustee or officer of any
liability to MML Trust or its shareholders by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of his or her duties.
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<PAGE>
The following table discloses actual compensation paid to non-interested
Trustees during the 1995 fiscal year. Registrant paid no compensation to any of
its officers. The Registrant has no pension or retirement plan, but does have a
deferred compensation plan. One Trustee elected in 1994 to receive these
benefits over a three year period, beginning in 1994 when he became 67 years
old. All of the non-interested Trustees also serve as Trustees of one other
investment company.
<TABLE>
<CAPTION>
======================================================================================
Aggregate Deferred Deferred Total
Name/Position Compensation Compensation Compensation Compensation
from MML Plan Benefits Benefits Paid From MML
Trust Accrued as Part in 1994 Trust and Fund
of MML Trust Complex
Expenses
======================================================================================
<S> <C> <C> <C> <C>
Abdow,
Ronald J. $16,000 N/A N/A $32,000
Trustee
- --------------------------------------------------------------------------------------
Boland, $16,000
Mary E. (Paid by N/A N/A $32,000
Trustee MassMutual)
- --------------------------------------------------------------------------------------
McCarthy,
Charles J. $17,000 N/A N/A $34,000
Trustee
- -------------------------------------------------------------------------------------
Southworth,
John H. $17,000 $5,103.57 $36,073.71 $70,073.71
Trustee
- -------------------------------------------------------------------------------------
</TABLE>
V. CONTROL PERSON AND PRINCIPAL HOLDERS OF SECURITIES
MassMutual and MML Bay State are the record owners of all of the outstanding
shares of MML Trust. However, certain owners of variable life insurance policies
and variable annuity contracts that depend upon the investment performance of
the Funds have the right to instruct MassMutual and MML Bay State as to how
shares of MML Trust deemed attributable to their contracts shall be voted.
MassMutual and MML Bay State generally are required to vote shares attributable
to such contracts but for which no instructions were received, in proportion to
those votes for which instructions were received. MassMutual's address is 1295
State Street, Springfield, Massachusetts 01111.
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<PAGE>
VI. INVESTMENT MANAGEMENT AND OTHER SERVICES
MassMutual serves as investment manager of each Fund pursuant to a separate
investment management agreement between MassMutual and MML Trust on behalf of
each Fund. Under the agreements, which are substantially identical, MassMutual
is authorized to engage in portfolio transactions on behalf of the Funds,
subject to such general or specific instructions as may be given by the Board of
trustees of MML Trust.
The net asset values of the Funds at December 31, 1995 and the investment
management fees each paid during the past three years were:
MML Equity Fund
Net Assets (December 31, 1995: $1,248,899,006
Investment Management Fees:
1993 $2,588,249
1994 $3,191,449
1995 $4,178,204
MML Money Market Fund
Net Assets (December 31, 1995): $108,920,201
Investment Management Fees:
1993 $379,621
1994 $412,832
1995 $501,924
MML Managed Bond Fund
Net Assets (December 31, 1995): $158,698,138
Investment Management Fees:
1993 $546,819
1994 $620,816
1995 $681,807
19
<PAGE>
MML Blend Fund
Net Assets (December 31, 1995): $1,823,140,930
Investment Management Fees:
1993 $4,678,865
1994 $5,476,633
1995 $6,344,373
The Investment Management Agreement with each Fund may be terminated by the
Board of Trustees of MML Trust, or by vote of a majority of the outstanding
shares of such Fund, or by MassMutual. Such termination requires 60 days'
written notice to be given and may be effected without the payment of any
penalty. In addition, each such agreement automatically terminates: (1)
unless its continuance is specifically approved at least annually by the
affirmative vote of a majority of the Board of Trustees of MML Trust, which
affirmative vote shall include a majority of the members of the Board who are
not interested persons (as defined in the Investment Company Act of 1940 as
amended) of MassMutual or of MML Trust, or (2) upon its assignment. Each
agreement also provides that its continuance will be submitted to the
shareholders of the Fund in the event the use of the initial "MML" is withdrawn
from the Fund by MassMutual.
Advisers entered into two investment sub-advisory agreements effective January
1, 1993 (the "Concert Sub-Advisory Agreements") whereby Concert agreed to assume
MassMutual's duties to manage the investment of the assets of MML Equity and the
Equity Sector of the MML Blend. MassMutual is ultimately responsible for
providing investment advice to these Funds and will continue to provide
administrative and non-investment advisory services to the Funds. MML Trust will
continue to pay MassMutual its investment management fee at the same rate as in
1993.
MassMutual pays Concert a quarterly fee equal to an annual rate of .13% of the
average daily net asset value of MML Equity as of the close of each business
day for the investment advisory services Concert provides with respect to MML
Equity. MassMutual pays Concert a quarterly fee equal to an annual rate of .13%
of the average daily net asset value of the Equity Sector of MML Blend as of
the close of each business day for the investment advisory services Concert
provides with respect to the Equity Sector of MML Blend. Additionally, Concert
agreed to assume the expenses associated with fund accounting for MML Equity and
the Equity Sector of MML Blend, however, Concert has no responsibility for
providing such fund accounting services.
20
<PAGE>
The Sub-Advisory Agreements will terminate automatically upon their assignment
or upon the termination of the respective Management Agreement or by MassMutual
upon sixty days written notice or by liquidation of either MML Equity or the
Equity Sector of MML Blend. Citibank, N.A., 111 Wall Street, New York, New York
10005, acts as custodian of the cash and securities of each Fund. As such, it
holds in custody each Fund's portfolio securities and receives and delivers them
upon purchases and sales.
VII. BROKERAGE ALLOCATION
Each Fund's Investment Management Agreement with MassMutual provides that the
Fund may pay brokerage commissions which are higher than other brokers would
charge if paid to a broker which provides brokerage and research services to
MassMutual and that MassMutual will follow such practices in placing portfolio
transactions for the Fund as may from time to time be set forth in its
prospectus or specified by the Board of Trustees of MML Trust. Consistent with
this agreement, the present policy of the Funds and Advisers is that Advisers,
in placing brokerage transactions for the Funds, is to seek best execution by
responsible brokerage firms at reasonably competitive commission rates. By
virtue of the Sub-Advisory Agreements, Concert is subject to the same rights,
obligations and procedures that apply to MassMutual pursuant to its Investment
Management Agreements with MML Equity and MML Blend. Advisers evaluate the
overall reasonableness of brokerage commissions they negotiate with their
brokers through their familiarity with commissions charged on comparable
transactions, as well as by comparing commissions paid by the Funds to reported
commissions paid by others. Advisers review commission rates, research,
execution and settlement services performed, making internal and external
comparisons.
It is MassMutual's current policy not to enter into soft dollar arrangements
with brokers as to fixed-income purchases or sales. However, MassMutual
reserves it ability to enter into such arrangements if it were to determine that
to do so would be appropriate. In such a case, MassMutual would seek best
execution by responsible brokerage firms at competitive commission rates. To
the extent consistent with this policy, brokerage transactions could be placed
with firms which provide brokerage and research services to MassMutual and such
transactions could be paid for at higher rates than other firms would charge.
In placing principal transactions, MassMutual seeks best price and execution and
generally utilizes principal market makers, but when this primary consideration
has been met, such transactions could be placed with brokers who have provided
brokerage and research services. MassMutual believes that placing brokerage
business with brokers who provide brokerage and research services can be
appropriate in certain circumstances in light of the value of brokerage and
research services in providing investment management to its advisory clients.
With respect to investments by MML Equity and by MML Blend in its Equity Sector,
it is the policy of such Funds and Advisers generally to utilize principal
market makers in placing principal transactions. With respect to investments by
MML Managed Bond and by MML Blend in its Bond Sector, it is anticipated that
most purchases and sales by such Funds will be with underwriters or with major
dealers in debt instruments acting as principals. With respect to investment by
MML Money Market and by MML Blend in its Money Market
21
<PAGE>
Sector, it is anticipated that most purchases and sales by such Funds will be
with the issuers or with major dealers in money market instruments acting as
principals. MML Managed Bond, MML Money Market and MML Blend in its Bond and
Money Market Sectors usually do not pay brokerage commissions, although they
will incur other transaction costs. In connection with all transactions, it is
the Funds' and Advisers' policy to seek best price and execution, but when this
primary consideration has been met, such transactions may be placed with dealers
on the basis of their providing brokerage and research services. The cost of
securities purchased from underwriters includes an underwriting commission or
concession and the prices at which securities are purchased from and sold to
dealers include a dealer's mark-up or mark-down. During 1995, no recapture for
the benefit of MML Trust of any brokerage commissions or similar fees paid by
MML Trust on portfolio transactions has been effected.
With respect to MML Equity and the Equity Sector of MML Blend, Concert seeks
best execution by responsible brokerage firms at competitive commission rates.
To the extent consistent with this policy, brokerage transactions may be placed
with firms which provide brokerage and research services to Concert and may be
paid for at higher rates than other firms would charge. In placing principal
transactions, Concert seeks best price and execution and generally utilizes
principal market makers, but when this primary consideration has been met, such
transactions may be placed with brokers who have provided brokerage and research
services. Concert believes that placing brokerage business with brokers who
provide brokerage and research services is appropriate in light of the value of
brokerage and research services in providing investment management to its
advisory clients. Brokerage and research services received include: advice as
to the value of portfolio securities; the advisability of investing in,
purchasing or selling securities; furnishing analyses and reports concerning
issues, industries, securities, economic factors and trends, portfolio strategy
and performance of accounts; and effecting securities transactions and
performing functions incidental thereto (such as clearance and settlement).
These brokerage and research services will be utilized generally in providing
investment advice and management to accounts over which Advisers exercise
investment discretion, and not all of such services necessarily will be utilized
in providing investment advice and management to the Funds. Advisers believe
that brokerage and research services are very important in providing investment
advice and management to the Funds, but that they cannot be given a dollar
value. The receipt of brokerage and research services may reduce the expenses
of Advisers.
At the beginning of each year, Concert estimates the total amount of commissions
expected to be generated by all of its advisory clients, based on commission
rates, past portfolio turnover rates, assets under management, and cash flow
allocated for common stocks. Concert has agreed on a specific level of
commissions with certain brokers. Concert allocates approximately 12% of the
total estimated commissions for execution purposes only. This amount is used
when the best execution is available only through a firm not providing research
services to Concert. Approximately 70% of the total estimated commissions is
then allocated among those firms providing services of a research or brokerage
nature, with those firms providing relatively more valuable services being
allocated larger shares than those providing less valuable services. These
allocations then serve as Concert's full-year targets as
22
<PAGE>
long as each particular trade falls within Concert's standards for the best
execution including price and commission rate. At midyear, Concert determines
whether the yearly allocations are still appropriate, and adjustments are made
based on any shifts in relative importance of the services provided, or any
change in the total amount of commissions expected to be generated. Also,
brokers providing research on specific securities may be compensated during the
year for their research input. Payments to these so-called "idea firms" may
total 10% to 12% of total commissions for the year.
Employees of MassMutual are primarily responsible for the portfolio decisions of
MML Money Market, MML Managed Bond, and the Money Market Sector and the Bond
Sector of MML Blend. Employees of Concert are primarily responsible for the
portfolio decisions of MML Equity and the Equity Sector of MML Blend. Such
employees are also responsible for placing their portfolio transactions and,
where applicable, negotiating the rate of brokerage commission paid.
In 1995, $438,167,969 of MML Trust's securities transactions involving $581,849
in brokerage commissions were placed with brokers who furnished research
services.
Richard G. Dooley, Chairman of MML Trust's Board of Trustees, is a director of
Jefferies Group Inc., the parent of Jefferies & Co., a registered broker-dealer.
MML Trust paid aggregate brokerage commissions of $5,104 in 1993, $2,845 in 1994
and $0.00 in 1995. During 1995, MML Trust did not pay any of its aggregate
brokerage commissions to Jefferies & Co.
VIII. CAPITAL SHARES
Under Massachusetts law, shareholders could, under certain circumstances, be
held personally liable for obligations of MML Trust. However, MML Trust's
Agreement and Declaration of Trust disclaims liability of the shareholders,
Trustees, or officers of MML Trust for acts or obligations of MML Trust, which
are binding only on the assets and property of MML Trust, and requires that
notice of such disclaimer be given in each agreement, obligation, or instrument
entered into or executed by MML Trust or MML Trustees. The Agreement and
Declaration of Trust provides for indemnification out of MML Trust property for
all loss and expense of any shareholder held personally liable for the
obligations of MML Trust. Thus, the risk of a shareholder incurring financial
loss on account of shareholder liability is limited to circumstances in which
MML Trust itself would be unable to meet its obligations. Management believes
that in view of the above the risk of personal liability to shareholders is
remote.
IX. PURCHASE, REDEMPTION AND PRICING OF SECURITIES BEING OFFERED
23
<PAGE>
MML Trust is a no-load mutual fund. Fund shares are sold at their net asset
value as next computed after receipt of the purchase order, without the addition
of any selling commission or "sales load." Each Fund redeems its shares at
their net asset value as next computed after receipt of the request for
redemption. The redemption price may be paid in cash or wholly or partly in
kind if MML Trustees determine that such payment is advisable in the interest of
the remaining shareholders. In making such payment wholly or partly in kind,
the Fund will, as far as may be practicable, deliver securities or property
which approximate the diversification of its entire assets at the time. No fee
is charged on redemption. The redemption price may be more or less than the
shareholder's cost. Redemption payments will be paid within seven days after
receipt of the written request therefor by the Fund, except that the right of
redemption may be suspended or payments postponed when permitted by applicable
law and regulations.
The net asset value of each Fund's shares is determined once daily at 4:00 as of
the close of the New York Stock Exchange on each day on which the Exchange is
open for trading. The New York Stock Exchange is not open for trading on New
Year's Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Columbus Day, Veteran's Day, Thanksgiving Day (including Friday) and
Christmas Day and on occasion is closed early or entirely due to weather or
other conditions. The net asset value of each Fund share is the total net asset
value of the applicable Fund divided by the number of its shares outstanding.
The total net asset value of each Fund is determined by computing the value of
the total assets of the Fund and deducting total liabilities, including accrued
liabilities. It is the intention of MML Money Market Fund to maintain a per
share net asset value of $1.00, although this cannot be assured.
Except as to MML Money Market, the manner of determining the value of the total
assets of each Fund is briefly discussed below. Equity securities are valued on
the basis of valuations furnished by a pricing service, authorized by the Board
of Trustees, which provides the last reported sale price for securities listed
on a national securities exchange, on the NASDAQ national market system, or are
unlisted. If there is no reported sale price, the bid price of the prior trade
date will be used. Long-term bonds are valued on the basis of valuations
furnished by a pricing service, authorized by the Board of Trustees, which
determines valuations taking into account appropriate factors such as
institutional-size trading in similar groups of securities, yield, quality,
coupon rate, maturity, type of issue, trading characteristics and other market
data. Debt obligations with less than one year but more than sixty days to
maturity are valued on the basis of their market value, and debt obligations
having a maturity of sixty days or less are generally valued at amortized cost
when the Board of Trustees of MML Trust believes that amortized cost
approximates market value. If acquired, preferred stocks will be valued on the
basis of their market value if market quotations are readily available. In all
other cases, assets (including restricted securities) are valued at their fair
value as determined in good faith by the Board of Trustees of MML Trust,
although the actual calculations may be made by persons acting pursuant to the
direction of the Board.
MML Money Market's portfolio instruments are valued on the basis of amortized
cost which involves initially valuing an instrument at its cost and thereafter
making a constant amortiza-
24
<PAGE>
tion to maturity of any discount or premium, regardless of the impact of changes
in market interest rates on the market value of the instrument. While this
method provides certainty of valuation, it may result in periods in which the
value, as determined by amortized cost, is higher or lower than the price MML
Money Market would receive if it sold the instrument. During periods of
declining interest rates, the daily yield on shares of MML Money Market computed
as described below may tend to be higher than a like computation made by a fund
with identical investments utilizing a method of valuation based upon market
prices and estimates of market prices for its portfolio instruments. Thus, if
the use of amortized cost by MML Money Market resulted in a lower aggregate
portfolio value on a particular day, a prospective investor in MML Money Market
would be able to obtain a somewhat higher yield than would result from
investment in a fund utilizing market values, and existing investors in MML
Money Market would receive less investment income. The converse would apply in
a period of rising interest rates.
The valuation of MML Money Market's portfolio instruments based upon their
amortized cost and the concomitant maintenance of MML Money Market Fund's per
share net asset value of $1.00 is permitted in accordance with Rule 2a-7 of the
Securities and Exchange Commission. MML Money Market must maintain a dollar-
weighted average portfolio maturity of 90 days or less, generally may purchase
only instruments having remaining maturities of thirteen months (397 days) or
less, and invest only in United States dollar-denominated securities determined
by the Board of Trustees to be of high quality with minimal credit risks.
The Board of Trustees has established procedures designed to stabilize, to the
extent reasonably possible, MML Money Market's price per share as computed for
the purpose of sales and redemptions at $1.00. Such procedures include review
of MML Money Market's portfolio holdings by the Board of Trustees, at such
intervals as they may deem appropriate, to determine the extent of any deviation
in MML Money Market's net asset value from $1.00 per share calculated by using
available market quotations, and whether such deviation may result in material
dilution or is otherwise unfair to investors or existing shareholders. In the
event the Board of Trustees determines that such a deviation exists, it must
take such corrective action as it regards as necessary and appropriate,
including: the sale of portfolio instruments prior to maturity in order to
realize capital gains or losses or to shorten average portfolio maturity;
withholding dividends; redemptions of shares in kind; or establishing a net
asset value per share by using available market quotations, in which case the
net asset value could possibly be greater or less than $1.00 per share.
Since the net income of MML Money Market is declared as a dividend each time it
is determined, the net asset value per share of MML Money Market remains at
$1.00 per share immediately after each determination and dividend declaration.
Any increase in the value of a shareholder's investment in MML Money Market
representing the reinvestment of dividend income is reflected by an increase in
the number of shares of MML Money Market Fund in the shareholder's account,
which increase is recorded promptly after the end of each calendar month.
25
<PAGE>
Futures contracts are valued based on the market price for the futures contract,
unless such price does not reflect the fair value of the contract, in which case
it will be valued by or under the direction of the Board of Trustees of MML
Trust. When MML Managed Bond or MML Blend enters into a forward commitment to
purchase a security it will record the security as an asset which will be
marked-to-market daily to reflect the value of the security determined in the
manner set forth above. The obligation to pay the purchase price of the
security will be a liability which remains fixed in amount.
X. TAX STATUS
The Treasury Department has issued Regulations under Internal Revenue Code
Section 817(h), that pertain to diversification requirements for variable
annuity and life insurance contracts. A variable contract based upon a separate
account will not receive favorable tax treatment as an annuity or life insurance
contract unless the separate account and underlying regulated investment company
investments are adequately diversified. In determining whether a separate
account is adequately diversified, in certain circumstances the separate account
can look through to the assets of the regulated investment company in which it
has invested.
The Regulations require each of the four Fund's assets to be diversified so that
no single investment represents more than 55% of the value of the Fund's total
assets, no two investments represent more than 70% of the Fund's total assets,
no three investments represent more than 80% of the Fund's total assets and no
four investments represent more than 90% of the Fund's total assets. A "safe
harbor" is available to a separate account if it meets the diversification tests
applicable to registered investment companies and not more than 55% of its
assets constitute cash, cash items, government securities and securities of
other registered investment companies.
The applicable Regulations treat all securities of the same issuer as a single
investment. In the case of "government securities", each government agency or
instrumentality shall be treated as a separate issuer for the purpose of the
diversification test (although not for the purpose of the "safe harbor" test
described above). MML Trust intends to comply with these diversification
requirements. It is the policy of each Fund to comply, and in 1995 each Fund
did comply, with the provisions of the Internal Revenue Code applicable to
regulated investment companies. As a result, none of the Funds will be subject
to federal income tax on any distributed net income or capital gains.
The Funds intend to declare capital gain and ordinary income dividends by the
end of each calendar year and to distribute such dividends no later than January
31 of the following year to the extent necessary to avoid the 4% excise tax on
undistributed regulated investment company income enacted by the Tax Reform Act
of 1986. The 4% excise applies to the excess of the required distribution for
the calendar year over the amount treated as distributed for that year. The
required distribution equals 98% of the Fund's ordinary income for the calendar
year plus 98% of its capital gain net income for the one year period ending
October 31 (or December 31, if the Fund so elects) and any shortfall of income
or gains from the prior year not previously so distributed.
26
<PAGE>
XI. CERTAIN TAX AND ACCOUNTING INFORMATION
As previously indicated, it is the policy of each of the Funds to meet the
requirements of the Internal Revenue Code to qualify as a regulated investment
company under the federal tax law. One of these requirements is that less than
30% of its gross income can be derived from gains from the sale or other
disposition of certain assets (including securities) held for or considered
under Internal Revenue Code rules to have been held for less than three months.
Accordingly, the Funds will be restricted in selling newly acquired positions,
engaging in certain option writing activities and certain hedging activities.
When a Fund writes a call option, an amount equal to the premium received by it
is included in its balance sheet as an asset and as an equivalent liability.
The amount of the liability is subsequently marked-to-market to reflect the
current market value of the option written. The current market value of a
written option is the last sale price on the principal exchange on which such
option is traded or, in the absence of a sale, the mean between the last bid and
offering prices. If an option which a Fund has written on an equity security
expires on its stipulated expiration date, or if the Fund enters into a closing
purchase transaction, it realizes a gain (or loss if the cost of a closing
purchase transaction exceeds the premium received when the option was sold)
without regard to any unrealized gain or loss on the underlying security, and
the liability related to such option is extinguished.
Special rules (including mark-to-market, straddle and wash sale rules) exist for
determining the timing of recognition of income or loss, the character of such
income or loss, and the holding periods of certain of the Fund's assets in the
case of certain transactions involving futures contracts, forward contracts and
options. MML Trust will endeavor to make any available elections pertaining to
such transactions in a manner believed to be in the best interest of MML Trust.
XII. INVESTMENT PERFORMANCE
MML Money Market may advertise investment performance figures, including its
yield and its effective yield. MML Money Market's yield will be calculated by
computing the net change, exclusive of capital changes, in the value of a
hypothetical pre-existing account having a balance of one share at the beginning
of a stated seven-day period and dividing the difference by the value of the
account at the beginning of the base period to obtain the base period return,
and then multiplying the base period return by (365/7). The Fund's effective
yield will be calculated by computing the net change, exclusive of capital
changes, in the value of a hypothetical pre-existing account having a balance of
one share at the beginning of a stated seven-day period and dividing the
difference by the value of the account at the beginning of the base period to
obtain the base period return, and then compounding the base period return by
adding 1, raising the sum to a power equal to 365 divided by 7 and subtracting 1
from the result.
MML Equity, MML Managed Bond and MML Blend may advertise investment performance
figures, including yield. Each Fund's yield will be based upon a stated 30-day
period and
27
<PAGE>
will be computed by dividing the net investment income per share earned during
the period by the maximum offering price per share on the last day of the
period, according to the following formula:
YIELD = 2[((a-b)/cd + 1)/6/ - 1]
Where: a = dividends and interest earned during the period.
b = expenses accrued for the period (net of reimbursements, if any).
c = the average daily number of shares outstanding during the period
that were entitled to receive dividends.
d = the maximum offering price (which is the net asset value) per
share on the last day of the period.
Each of the Funds may advertise its total return and its holding period return.
Total return quotations will be based upon a stated period and will be computed
by finding the average annual compounded rate of return over the stated period
that would equate an initial amount invested to the ending redeemable value of
the investment (assuming reinvestment of all distributions), according to the
following formula:
P(1 + T)/n/ = ERV Where: P = a hypothetical initial payment of $1,000.
T = average annual total return.
n = number of years.
ERV = ending redeemable value at the end of the
stated period of a hypothetical $1,000 payment made
at the beginning of the stated period.
Holding period return will be based upon a stated period and will be computed by
dividing the ending redeemable value of a hypothetical investment by the value
of the initial investment (assuming reinvestment of all distributions). Each
investment performance figure will be carried to the nearest hundredth of one
percent. These investment performance figures do not reflect charges imposed by
the separate investment accounts invested in the Funds which, if included, would
decrease the performance figures.
MML Equity Fund's yield, based on the 30-day period ended December 31, 1995 was
2.86%. The Fund's total returns for the 1, 5, 10 and 15 year periods each ended
December 31, 1995 were 31.13%, 15.71%, 13.77% and 15.09%, respectively. The
Fund's holding period returns for the 1, 5, 10 and 15 year periods each ended
December 31, 1995 were 31.13%, 107.39%, 263.37% and 722.99%, respectively.
MML Money Market Fund's yield for the seven-day period ended December 31, 1995
was 5.25% and its effective yield for such period was 5.39%. The Fund's total
returns for the 1, 5, and 10 year periods each ended December 31, 1995 were
5.58%, 4.32%, and 5.92% respectively. The Fund's total return for the period
beginning December 16, 1981 and ending December 31, 1995 was 6.97%. The Fund's
holding period returns for the 1, 5 and 10 year
28
<PAGE>
periods each ended December 31, 1995 were 5.58%, 23.57%, and 77.79%
respectively. The Fund's holding period return for the period beginning
December 16, 1981 and ending December 31, 1995 was 157.53%.
MML Managed Bond Fund's yield, based on the 30-day period ended December 31,
1995, was 6.39%. The Fund's total returns for the 1, 5, and 10 year periods
each ended December 31, 1995 were 19.14%, 9.92%, and 9.46% respectively. The
Fund's total return for the period beginning December 16, 1981 and ending
December 31, 1995 was 10.93%. The Fund's holding period returns for the 1, 5,
and 10 year periods each ended December 31, 1995 were 19.14%, 60.48%, and
146.88% respectively. The Fund's holding period return for the period beginning
December 16, 1981 and ending December 31, 1995 was 329.02%.
MML Blend Fund's yield, based on the 30-day period ended December 31, 1995 was
3.98%. The Fund's total return for the 1, 5 and 10 year periods ended December
31, 1995 were 23.28%, 13.45%, and 12.31%, respectively. The Fund's total return
for the period beginning February 3, 1984 and ending December 31, 1995 was
13.07%. The Fund's holding period return for the 1, 5 and 10 year periods ended
December 31, 1995 were 23.28%, 87.93% and 219.29%, respectively. The Fund's
holding period return for the period beginning February 3, 1984 and ending
December 31, 1995 was 331.58%.
XIII. EXPERTS
The financial statements of each of the Funds which comprise the MML Series
Investment Fund included in this Statement of Additional Information have been
incorporated herein in reliance on the report of Coopers & Lybrand L.L.P.,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
The name MML Series Investment Fund is the designation of Trustees under a
Declaration of Trust dated December 19, 1984, as amended from time to time. The
obligations of such Trust are not personally binding upon, nor shall resort be
had to the property of, any of the trustees, shareholders, officers, employees
or agents of such Trust, but MML Trust's property only shall be bound.
29
<PAGE>
Report Of Independent Accountants
To the Board of Trustees and Shareholders of
MML Series Investment Fund
We have audited the accompanying statement of assets and liabilities of each of
the Funds which comprise the MML Series Investment Fund (a Massachusetts
business trust), including the schedules of investments, as of December 31,
1995, and the related statement of operations for the year then ended, the
statement of changes in net assets for each of the two years in the period then
ended, and the financial highlights for each of the ten years in the period then
ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1995 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the Funds as of December 31, 1995, the results of their respective operations
for the year then ended, the changes in their respective net assets for each of
the two years in the period then ended, and the financial highlights for each of
the ten years in the period then ended, in conformity with generally accepted
accounting principles.
Coopers & Lybrand L.L.P.
Springfield, Massachusetts
February 2, 1996
1
<PAGE>
MML Series Investment Fund
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1995
<TABLE>
<CAPTION>
MML MML
MML Money Managed MML
Equity Market Bond Blend
Fund Fund Fund Fund
---- ---- ---- ----
<S> <C> <C> <C> <C>
ASSETS
Investments at value (See Schedule of Investments)
(Notes 2A, 2B and 5)
Equities (Identified cost: $784,795,485;
$627,696,809 respectively)............................ $1,155,154,333 $ -- $ -- $1,008,564,451
Bonds and notes (Identified cost: $145,473,365;
$267,817,760 respectively)............................ -- -- 151,903,257 279,948,878
Short-term investments (Identified cost: $146,006,980;
$109,543,253; $2,578,380; $582,413,954 respectively).. 146,000,856 109,543,253 2,578,380 582,150,249
-------------- ------------ -------------- --------------
Total investments.................................... 1,301,155,189 109,543,253 154,481,637 1,870,663,578
Cash.................................................... 8,396 2,440 5,639,136 13,407,050
Interest and dividends receivable....................... 2,502,360 497 2,067,198 6,632,527
Receivable for investments sold......................... 910,994 -- 7,093,878 1,355,885
Receivable for settlement of investments
purchased on a forward commitment basis (Note 2D)...... -- -- -- 1,388,372
Prepaid trustees' fees.................................. 820 522 522 390
-------------- ------------ -------------- --------------
Total assets......................................... 1,304,577,759 109,546,712 169,282,371 1,893,447,802
-------------- ------------ -------------- --------------
LIABILITIES
Payable for investments purchased....................... 7,019,418 -- 7,923,222 14,568,979
Dividends payable (Note 2C)............................. 47,382,259 475,700 2,456,289 53,960,727
Investment management fee payable (Note 4).............. 1,197,689 135,475 187,550 1,722,486
Accrued liabilities..................................... 79,387 15,336 17,172 54,680
-------------- ------------ -------------- --------------
Total liabilities.................................... 55,678,753 626,511 10,584,233 70,306,872
-------------- ------------ -------------- --------------
NET ASSETS.............................................. $1,248,899,006 $108,920,201 $158,698,138 $1,823,140,930
============== ============ ============== ==============
Net assets consist of:
Series shares (par value $.01 per share; an unlimited
number authorized) (Note 6)........................... $ 481,756 $ 1,089,202 $ 127,487 $ 888,515
Additional paid-in capital.............................. 878,072,599 107,830,999 152,990,211 1,428,825,164
Undistributed (overdistributed) net investment income
(Note 2C)............................................. 3,739 9,734 (72,567) (7,094)
Undistributed net realized loss on investments and
forward commitments (Notes 2D and 3).................. -- (9,734) (776,885) --
Overdistributed net realized gain on investments and
forward commitments (Notes 2C and 2D)................. (11,812) -- -- (689,082)
Net unrealized appreciation on:
Investments (Note 2A)................................. 370,352,724 -- 6,429,892 392,735,055
Forward commitments (Note 2D)......................... -- -- -- 1,388,372
-------------- ------------ -------------- --------------
NET ASSETS.............................................. $1,248,899,006 $108,920,201 $ 158,698,138 $1,823,140,930
============== ============ ============== ==============
Outstanding series shares............................... 48,175,574 108,920,201 12,748,690 88,851,472
============== ============ ============== ==============
Net asset value per share............................... $ 25.92 $ 1.00 $ 12.45 $ 20.52
============== ============ ============== ==============
</TABLE>
See Notes to Financial Statements.
2
<PAGE>
MML Series Investment Fund
STATEMENT OF OPERATIONS
For The Year Ended December 31, 1995
<TABLE>
<CAPTION>
MML MML
MML Money Managed MML
Equity Market Bond Blend
Fund Fund Fund Fund
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment income (Note 2B)
Dividends............................................... $ 28,229,106 $ -- $ -- $ 26,802,102
Interest................................................ 6,641,154 5,999,684 10,026,269 49,931,175
-------------- ------------ -------------- --------------
Total income......................................... 34,870,260 5,999,684 10,026,269 76,733,277
-------------- ------------ -------------- --------------
Expenses
Investment management fee (Note 4)...................... 4,178,204 501,924 681,807 6,344,373
Trustees' fees.......................................... 14,625 11,617 11,651 11,900
Audit fees.............................................. 27,433 18,917 24,467 29,567
Tax expense............................................. 6,263 -- -- 6,263
Registration fee........................................ 65,689 5,908 7,745 46,532
Other................................................... 1,892 1,178 1,178 1,180
-------------- ------------ -------------- --------------
Total expenses........................................ 4,294,106 539,544 726,848 6,439,815
-------------- ------------ -------------- --------------
Net investment income (Note 2C)......................... 30,576,154 5,460,140 9,299,421 70,293,462
-------------- ------------ -------------- --------------
Net realized and unrealized gain (loss) on investments
and forward commitments (Notes 2A, 2B and 2D)
Net realized gain (loss) on:
Investments (Notes 2B and 2C).......................... 16,898,835 (841) 866,079 29,289,639
Forward commitments (Note 2D).......................... -- -- 453,016 6,506,024
-------------- ------------ -------------- --------------
Net realized gain (loss).............................. 16,898,835 (841) 1,319,095 35,795,663
-------------- ------------ -------------- --------------
Change in net unrealized appreciation/depreciation on:
Investments (Note 2A).................................. 237,559,436 -- 13,542,298 241,023,762
Forward commitments (Note 2D).......................... -- -- 162,634 2,579,828
-------------- ------------ -------------- --------------
Total change in net unrealized
appreciation/depreciation............................ 237,559,436 -- 13,704,932 243,603,590
-------------- ------------ -------------- --------------
Net gain (loss)......................................... 254,458,271 (841) 15,024,027 279,399,253
-------------- ------------ -------------- --------------
Net increase in net assets resulting from operations.... $ 285,034,425 $ 5,459,299 $ 24,323,448 $ 349,692,715
============== ============ ============== ==============
</TABLE>
See Notes to Financial Statements.
3
<PAGE>
MML Series Investment Fund
STATEMENT OF CHANGES IN NET ASSETS
For The Years Ended December 31, 1995 and 1994
<TABLE>
<CAPTION>
1995
--------------------------------------------------------------------
MML MML
MML Money Managed MML
Equity Market Bond Blend
Fund Fund Fund Fund
---- ---- ---- ----
<S> <C> <C> <C> <C>
Increase (decrease)
in net assets
Operations:
Net investment income................................... $ 30,576,154 $ 5,460,140 $ 9,299,421 $ 70,293,462
Net realized gain (loss)
on investments and
forward commitments................................... 16,898,835 (841) 1,319,095 35,795,663
Change in net unrealized
appreciation/depreciation on
investments and forward
commitments........................................... 237,559,436 -- 13,704,932 243,603,590
-------------- ------------ -------------- --------------
Net increase (decrease) in
net assets resulting from
operations............................................ 285,034,425 5,459,299 24,323,448 349,692,715
Dividends to shareholders
from: (Note 2C)
Distribution of net investment
income............................................... (30,563,214) (5,459,299) (9,294,583) (70,291,011)
Distribution of net realized gains.................... (16,854,045) -- -- (35,463,987)
Distribution in excess of net
realized gains....................................... -- -- -- --
Net increase in capital share
transactions (Note 6)............................... 190,498,822 17,134,168 22,459,621 134,942,076
-------------- ------------ -------------- --------------
Total increase (decrease)............................ 428,115,988 17,134,168 37,488,486 378,879,793
NET ASSETS, at beginning
of the year............................................ 820,783,018 91,786,033 121,209,652 1,444,261,137
-------------- ------------ -------------- --------------
NET ASSETS, at end
of the year............................................ $1,248,899,006 $108,920,201 $ 158,698,138 $1,823,140,930
============== ============ ============== ==============
(Overdistributed) undistributed
net investment income
included in net assets at end
of the year........................................... $ 3,739 $ 9,734 $ (72,567) $ (7,094)
============== ============ ============== ==============
Rate per share of dividends to
shareholders from:
Net investment income................................. $ .634 $ .054 $ .782 $ .811
Net realized gains.................................... .350 -- -- .399
<CAPTION>
1994
--------------------------------------------------------------------
MML MML
MML Money Managed MML
Equity Market Bond Blend
Fund Fund Fund Fund
---- ---- ---- ----
<S> <C> <C> <C> <C>
Increase (decrease)
in net assets
Operations:
Net investment income................................... $ 23,743,493 $ 3,147,135 $ 8,506,956 $ 56,319,900
Net realized gain (loss)
on investments and
forward commitments................................... 9,479,860 (5,364) (2,156,483) 28,803,202
Change in net unrealized
appreciation/depreciation on
investments and forward
commitments........................................... (1,773,621) -- (11,386,882) (49,350,511)
-------------- ------------ -------------- --------------
Net increase (decrease) in
net assets resulting from
operations............................................ 31,449,732 3,141,771 (5,036,409) 35,772,591
Dividends to shareholders
from: (Note 2C)
Distribution of net investment
income............................................... (23,735,788) (3,141,771) (8,503,670) (56,320,396)
Distribution of net realized gains.................... (9,536,463) -- -- (29,300,874)
Distribution in excess of net
realized gains....................................... -- -- -- (254,531)
Net increase in capital share
transactions (Note 6)............................... 159,512,479 18,127,025 5,640,533 197,821,191
-------------- ------------ -------------- --------------
Total increase (decrease)............................ 157,689,960 18,127,025 (7,899,546) 147,717,981
NET ASSETS, at beginning
of the year............................................ 663,093,058 73,659,008 129,109,198 1,296,543,156
-------------- ------------ -------------- --------------
NET ASSETS, at end
of the year............................................ $ 820,783,018 $ 91,786,033 $121,209,652 $1,444,261,137
============== ============ ============== ==============
(Overdistributed) undistributed
net investment income
included in net assets at end
of the year........................................... $ (9,200) $ 8,893 $ (3,270) $ 2,008
============== ============ ============== ==============
Rate per share of dividends to
shareholders from:
Net investment income................................. $ .594 $ .038 $ .792 $ .707
Net realized gains.................................... .238 -- -- .362
</TABLE>
See Notes to Financial Statements.
4
<PAGE>
MML Series Investment Fund
FINANCIAL HIGHLIGHTS
Selected per share data for each series share outstanding throughout
each year ended December 31:
<TABLE>
<CAPTION>
MML EQUITY FUND
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year............ $ 20.520 $ 20.510 $ 19.862 $ 18.735 $ 15.659
-------------- ------------ ------------ -------------- --------------
Income from investment
operations:
Net investment income......... .634 .594 .524 .543 .563
Net realized and unrealized
gain (loss) on investments... 5.754 .248 1.365 1.420 3.440
-------------- ------------ ------------ -------------- --------------
Total from investment
operations................... 6.388 .842 1.889 1.963 4.003
-------------- ------------ ------------ -------------- --------------
Less distributions:
Dividends from net
investment income............ (.634) (.594) (.524) (.543) (.562)
Distribution from net
realized gains............... (.350) (.238) (.717) (.288) (.365)
Distribution in excess of
net realized
gains........................ -- -- -- (.005) --
-------------- ------------ ------------ -------------- --------------
Total distributions........... (.984) (.832) (1.241) (.836) (.927)
-------------- ------------ ------------ -------------- --------------
Net asset value:
End of year.................. $ 25.924 $ 20.520 $ 20.510 $ 19.862 $ 18.735
============== ============ ============ ============== ==============
Total return.................. 31.13% 4.10% 9.52% 10.48% 25.56%
Net assets (in millions):
End of year.................. $ 1,248.90 $ 820.78 $ 663.09 $ 490.62 $ 355.04
Ratio of expenses to
average net
assets...................... .41% .43% .44% .46% .48%
Ratio of net investment
income to
average net assets.......... 2.89% 3.04% 3.23% 3.09% 3.43%
Portfolio turnover rate....... 11.72% 9.99% 11.28% 9.07% 9.37%
<CAPTION>
1990 1989 1988 1987 1986
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year............ $ 16.764 $ 14.929 $ 13.828 $ 15.591 $ 13.832
-------------- ------------ -------------- ------------ --------------
Income from investment
operations:
Net investment income......... .636 .694 .646 .525 .495
Net realized and unrealized
gain (loss) on investments... (.722) 2.746 1.660 (.066) 2.174
-------------- ------------ -------------- ------------ --------------
Total from investment
operations................... (.086) 3.440 2.306 .459 2.669
------------- ------------ ------------ -------------- -------------
Less distributions:
Dividends from net
investment income............ (.665) (.711) (.639) (.988) (.412)
Distribution from net
realized gains............... (.354) (.894) (.566) (1.234) (.498)
Distribution in excess of
net realized
gains........................ -- -- -- -- --
-------------- ------------ -------------- ------------ --------------
Total distributions........... (1.019) (1.605) (1.205) (2.222) (.910)
-------------- ------------ -------------- ------------ --------------
Net asset value:
End of year.................. $ 15.659 $ 16.764 $ 14.929 $ 13.828 $ 15.591
============= ============ ============== ============ ==============
Total return.................. (.51%) 23.04% 16.68% 2.10% 20.15%
Net assets (in millions):
End of year.................. $ 235.45 $ 226.41 $ 172.80 $ 150.41 $ 141.46
Ratio of expenses to
average net
assets...................... .49% .50% .50% .51% .52%
Ratio of net investment
income to
average net assets.......... 4.09% 4.30% 4.05% 3.44% 3.54%
Portfolio turnover rate....... 13.50% 15.71% 15.97% 15.73% 14.73%
</TABLE>
<TABLE>
<CAPTION>
MML MONEY MARKET FUND
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year............. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
-------------- ------------ ------------ -------------- --------------
Income from investment
operations:
Net investment income.......... .054 .038 .027 .034 .059
-------------- ------------ ------------ -------------- --------------
Total from investment
operations.................... .054 .038 .027 .034 .059
-------------- ------------ ------------ -------------- --------------
Less distributions:
Dividends from net
investment income............. (.054) (.038) (.027) (.034) (.059)
-------------- ------------ ------------ -------------- --------------
Total distributions............ (.054) (.038) (.027) (.034) (.059)
-------------- ------------ ------------ -------------- --------------
Net asset value:
End of year................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
============== ============ ============ ============== ==============
Total return................... 5.58% 3.84% 2.75% 3.48% 6.01%
Net assets (in millions):
End of year................... $ 108.92 $ 91.79 $ 73.66 $ 84.56 $ 94.41
Ratio of expenses to
average net
assets....................... .54% .55% .54% .53% .52%
Ratio of net investment
income to
average net assets........... 5.43% 3.81% 2.71% 3.42% 5.91%
<CAPTION>
1990 1989 1988 1987 1986
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year............. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
-------------- ------------- -------------- ------------ --------------
Income from investment
operations:
Net investment income.......... .078 .088 .072 .063 .064
-------------- ------------- -------------- ------------ --------------
Total from investment
operations.................... .078 .088 .072 .063 .064
-------------- ------------- -------------- ------------ --------------
Less distributions:
Dividends from net
investment income............. (.078) (.088) (.072) (.063) (.064)
-------------- ------------- -------------- ------------ --------------
Total distributions............ (.078) (.088) (.072) (.063) (.064)
-------------- ------------- ------------- ------------ --------------
Net asset value:
End of year................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
============== ============ ============= ============ =============
Total return................... 8.12% 9.16% 7.39% 6.49% 6.60%
Net assets (in millions):
End of year................... $ 114.59 $ 70.16 $ 66.35 $ 52.35 $ 33.54
Ratio of expenses to
average net
assets....................... .54% .54% .55% .57% .57%
Ratio of net investment
income to
average net assets........... 7.80% 8.79% 7.20% 6.35% 6.44%
</TABLE>
See Notes to Financial Statements.
5
<PAGE>
MML Series Investment Fund
FINANCIAL HIGHLIGHTS (Continued)
<TABLE>
<CAPTION>
MML MANAGED BOND FUND
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year............. $ 11.141 $ 12.405 $ 12.041 $ 12.219 $ 11.318
-------------- ------------ ------------ -------------- --------------
Income from investment
operations:
Net investment income.......... .782 .792 .785 .870 .903
Net realized and unrealized
gain (loss) on investments
and forward commitments...... 1.307 (1.264) .618 .001 .916
-------------- ------------ ------------ -------------- --------------
Total from investment
operations.................... 2.089 (.472) 1.403 .871 1.819
-------------- ------------ ------------ -------------- --------------
Less distributions:
Dividends from net
investment income............. (.782) (.792) (.784) (.869) (.902)
Distribution from net
realized gains................ -- -- (.255) (.158) (.016)
Distribution in excess of
net realized
gains......................... -- -- -- (.022) --
-------------- ------------ ------------ -------------- --------------
Total distributions............ (.782) (.792) (1.039) (1.049) (.918)
-------------- ------------ ------------ -------------- --------------
Net asset value:
End of year................... $ 12.448 $ 11.141 $ 12.405 $ 12.041 $ 12.219
============== ============ ============ ============== ==============
Total return................... 19.14% (3.76%) 11.81% 7.31% 16.66%
Net assets (in millions):
End of year.................. $ 158.70 $ 121.21 $ 129.11 $ 88.15 $ 66.98
Ratio of expenses to
average net
assets....................... .52% .52% .54% .56% .57%
Ratio of net Investment
Income to
average net assets........... 6.63% 6.69% 6.37% 7.28% 7.96%
Portfolio turnover rate........ 70.00% 32.77% 58.81% 39.51% 61.85%
<CAPTION>
1990 1989 1988 1987 1986
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year............ $ 11.354 $ 10.919 $ 11.052 $ 12.541 $ 11.978
------------ ------------ -------------- ------------ --------------
Income from investment
operations:
Net investment income.......... .943 .918 .906 .969 1.061
Net realized and unrealized
gain (loss) on investments
and forward commitments...... (.036) .454 (.133) (.673) .597
------------ ------------ -------------- ------------ --------------
Total from investment
operations.................... .907 1.372 .773 .296 1.658
------------ ------------ -------------- ------------ --------------
Less distributions:
Dividends from net
investment income............. (.943) (.918) (.906) (1.229) (1.095)
Distribution from net
realized gains................ -- (.019) -- (.556) --
Distribution in excess of
net realized
gains.......................... -- -- -- -- --
------------ ------------ -------------- ------------ --------------
Total distributions............ (.943) (.937) (.906) (1.785) (1.095)
------------ ------------ -------------- ------------ --------------
Net asset value:
End of year................... $ 11.318 $ 11.354 $ 10.919 $ 11.052 $ 12.541
============ ============ ============== ============ ==============
Total return................... 8.38% 12.83% 7.13% 2.60% 14.46%
Net assets (in millions):
End of year.................. $ 43.07 $ 40.03 $ 31.35 $ 26.16 $ 30.38
Ratio of expenses to
average net
assets....................... .57% .59% .61% .60% .60%
Ratio of net Investment
Income to
average net assets........... 8.40% 8.35% 8.25% 8.24% 8.87%
Portfolio turnover rate........ 69.93% 64.77% 74.92% 55.60% 203.76%
</TABLE>
<TABLE>
<CAPTION>
MML BLEND FUND
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year.............. $ 17.672 $ 18.305 $ 17.846 $ 17.307 $ 14.839
-------------- ------------ ------------ -------------- --------------
Income from investment
operations:
Net Investment Income.......... .811 .707 .655 .707 .736
Net realized and unrealized
gain (loss) on investments
and forward commitments...... 3.246 (.271) 1.057 .880 2.771
-------------- ------------ ------------ -------------- --------------
Total from investment
operations.................... 4.057 .436 1.712 1.587 3.507
-------------- ------------ ------------ -------------- --------------
Less distributions:
Dividends from net
investment income............. (.811) (.707) (.655) (.707) (.736)
Distribution from net
realized gains................ (.399) (.359) (.598) (.326) (.303)
Distribution in excess of
net realized gains............ -- (.003) -- (.015) --
-------------- ------------ ------------ -------------- --------------
Total distributions............ (1.210) (1.069) (1.253) (1.048) (1.039)
-------------- ------------ ------------ -------------- --------------
Net asset value:
End of year.................. $ 20.519 $ 17.672 $ 18.305 $ 17.846 $ 17.307
============== ============ ============ ============== ==============
Total return................... 23.28% 2.48% 9.70% 9.36% 24.00%
Net assets (in millions):
End of year.................. $ 1,823.14 $ 1,444.26 $ 1,296.54 $ 1,013.28 $ 797.04
Ratio of expenses to
average net
assets....................... .38% .39% .40% .41% .42%
Ratio of net investment
income to
average net assets........... 4.19% 3.93% 3.60% 4.07% 4.54%
Portfolio turnover rate........ 30.78% 26.59% 20.20% 25.43% 26.92%
<CAPTION>
1990 1989 1988 1987 1986
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of year............ $ 15.428 $ 13.876 $ 13.095 $ 13.774 $ 12.244
------------ ------------ -------------- ------------ --------------
Income from investment
operations:
Net Investment Income.......... .792 .823 .734 .624 .540
Net realized and unrealized
gain (loss) on investments
and forward commitments...... (.445) 1.921 1.000 (.148) 1.653
------------ ------------ -------------- ------------ --------------
Total from investment
operations.................... .347 2.744 1.734 .476 2.193
------------ ------------ -------------- ------------ --------------
Less distributions:
Dividends from net
investment income............. (.811) (.835) (.728) (.747) (.560)
Distribution from net
realized gains................ (.125) (.357) (.225) (.408) (.103)
Distribution in excess of
net realized gains............ -- -- -- -- --
------------ ------------ -------------- ------------ --------------
Total distributions............ (.936) (1.192) (.953) (1.155) (.663)
------------ ------------ -------------- ------------ --------------
Net asset value:
End of year.................. $ 14.839 $ 15.428 $ 13.876 $ 13.095 $ 13.774
============ ============ ============== ============ ==============
Total return................... 2.37% 19.96% 13.40% 3.12% 18.30%
Net assets (in millions):
End of year.................. $ 574.15 $ 524.29 $ 401.22 $ 346.12 $ 236.15
Ratio of expenses to
average net
assets....................... .44% .45% .46% .48% .51%
Ratio of net investment
income to
average net assets........... 5.37% 5.57% 5.29% 4.77% 4.81%
Portfolio turnover rate........ 24.55% 22.39% 25.70% 36.56% 58.75%
</TABLE>
Total return information shown in the Financial Highlights tables does not
reflect expenses that apply at the separate account level or to related
insurance products. Inclusion of these charges would reduce the total return
figures for all periods shown.
See Notes to Financial Statements.
6
<PAGE>
MML Equity Fund
SCHEDULE OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note 2A)
------ ---------
<S> <C> <C>
EQUITIES - 92.49%
Aerospace & Defense - 2.23%
The Boeing Company................. 202,500 $ 15,870,938
TRW, Inc........................... 154,100 11,942,750
------------ ------------
356,600 27,813,688
------------ ------------
Agribusiness - 1.56%
Archer-Daniels-Midland Company..... 359,975 6,479,550
Pioneer Hi-Bred International,
Inc............................... 235,000 13,071,875
------------ ------------
594,975 19,551,425
------------ ------------
Apparel, Textiles, Shoes - .93%
VF Corporation..................... 220,000 11,605,000
------------ ------------
Automotive & Parts - 4.20%
Ford Motor Company................. 477,000 13,833,000
Genuine Parts Company.............. 433,500 17,773,500
Goodyear Tire & Rubber Company..... 461,000 20,917,875
------------ ------------
1,371,500 52,524,375
------------ ------------
Banking, Savings & Loans - 6.16%
The Bank of New York Company,
Incorporated...................... 435,000 21,206,250
Comerica, Incorporated............. 435,000 17,454,375
CoreStates Financial Corporation... 410,500 15,547,687
Norwest Corporation................ 291,000 9,603,000
Wachovia Corporation............... 288,200 13,185,150
------------ ------------
1,859,700 76,996,462
------------ ------------
Beverages - 1.95%
Brown-Forman Corporation (Class B). 333,000 12,154,500
Pepsico, Incorporated.............. 218,000 12,180,750
------------ ------------
551,000 24,335,250
------------ ------------
Chemicals - 4.03%
Eastman Chemical Company........... 240,000 15,030,000
E.I. du Pont de Nemours and
Company........................... 166,500 11,634,187
The Lubrizol Corporation........... 242,000 6,745,750
Nalco Chemical Company............. 335,000 10,091,875
Rohm & Haas........................ 106,300 6,843,063
------------ ------------
1,089,800 50,344,875
------------ ------------
Communications - 2.18%
AT&T Corporation................... 420,000 27,195,000
------------ ------------
Computers & Office Equipment -
6.41%
Hewlett-Packard Company............ 385,000 32,243,750
International Business Machines
Corporation....................... 121,000 11,101,750
Pitney Bowes, Inc.................. 423,500 19,904,500
Xerox Corporation.................. 123,000 16,851,000
------------ ------------
1,052,500 80,101,000
------------ ------------
Containers - .97%
Temple-Inland, Inc................. 273,500 12,068,188
------------ ------------
Cosmetics & Personal Care - 1.28%
Kimberly-Clark Corporation......... 193,600 16,020,400
------------ ------------
Electric Utilities - 1.84%
Niagara Mohawk Power Corporation... 463,500 4,461,187
NIPSCO Industries, Inc............. 200,000 7,650,000
SCANA Corporation.................. 378,000 10,820,250
------------ ------------
1,041,500 22,931,437
------------ ------------
EQUITIES (Continued)
Electrical Equipment &
Electronics - 7.53%
AMP, Incorporated.................. 580,000 $ 22,257,500
General Electric Company........... 470,000 33,840,000
General Signal Corporation......... 269,500 8,725,063
Honeywell Inc...................... 272,500 13,250,313
Hubbell, Incorporated (Class B).... 242,072 15,916,234
------------ ------------
1,834,072 93,989,110
------------ ------------
Energy - 8.65%
Amoco Corporation.................. 380,000 27,312,500
Atlantic Richfield Company......... 175,500 19,436,625
Chevron Corporation................ 360,000 18,900,000
Kerr-McGee Corporation............. 250,100 15,881,350
Mobil Corporation.................. 197,200 22,086,400
USX Corporation - Marathon Group... 145,000 2,827,500
Union Pacific Resources Group,
Inc............................... 62,100 1,575,787
------------ ------------
1,569,900 108,020,162
------------ ------------
Financial Services - 1.33%
American Express Company........... 400,000 16,550,000
------------ ------------
Foods - 1.57%
CPC International, Inc............. 285,000 19,558,125
------------ ------------
Forest Products & Paper - 2.37%
Westvaco Corporation............... 335,755 9,317,201
Weyerhaeuser Company............... 467,500 20,219,375
------------ ------------
803,255 29,536,576
------------ ------------
Hardware & Tools - 1.30%
The Stanley Works.................. 315,500 16,248,250
------------ ------------
Healthcare - 9.60%
Becton, Dickinson and Company...... 260,000 19,500,000
Bristol-Myers Squibb Company....... 507,500 43,581,562
Pfizer, Incorporated............... 600,000 37,800,000
Schering-Plough Corp............... 347,500 19,025,625
------------ ------------
1,715,000 119,907,187
------------ ------------
Household Products - .91%
The Clorox Company................. 159,500 11,424,188
------------ ------------
Industrial Distribution - 1.25%
W. W. Grainger, Inc................ 236,000 15,635,000
------------ ------------
Industrial Transportation - 1.54%
Norfolk Southern Corporation....... 242,000 19,208,750
------------ ------------
Insurance - 4.92%
Allstate Corporation............... 185,182 7,615,610
Jefferson-Pilot Corporation........ 207,000 9,625,500
MBIA, Inc.......................... 154,000 11,550,000
SAFECO Corporation................. 750,000 25,875,000
Unitrin, Inc....................... 140,000 6,720,000
------------ ------------
1,436,182 61,386,110
------------ ------------
Machinery & Components - 1.62%
Dover Corporation.................. 325,000 11,984,375
Parker-Hannifin Corporation........ 242,050 8,290,213
------------ ------------
567,050 20,274,588
------------ ------------
Metals & Mining - .27%
Reynolds Metals Company............ 60,000 3,397,500
------------ ------------
</TABLE>
7
<PAGE>
MML Equity Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note 2A)
------ ---------
<S> <C> <C>
EQUITIES (Continued)
Miscellaneous - 2.59%
Harsco Corporation................. 169,500 $ 9,852,187
Minnesota Mining &
Manufacturing Company............. 340,000 22,525,000
------------ --------------
509,500 32,377,187
------------ --------------
Photography - 1.21%
Eastman Kodak Company.............. 225,000 15,075,000
------------ --------------
Publishing & Printing - 4.35%
The Dun & Bradstreet Corporation... 308,500 19,975,375
McGraw-Hill Companies, Inc......... 224,000 19,516,000
R. R. Donnelley & Sons Company..... 378,000 14,883,750
------------ --------------
910,500 54,375,125
------------ --------------
Retail - 2.32%
J.C. Penney Company, Inc........... 89,400 4,257,675
The May Department Stores
Company........................... 363,000 15,336,750
Sears Roebuck and Company.......... 242,000 9,438,000
------------ --------------
694,400 29,032,425
------------ --------------
Retail - Grocery - 1.20%
Albertson's, Inc................... 455,200 14,964,700
------------ --------------
Telephone Utilities - 2.64%
Ameritech Corporation.............. 182,000 10,738,000
Frontier Corporation............... 423,500 12,705,000
Southern New England
Telecommunications Corporation.... 240,000 9,540,000
------------ --------------
845,500 32,983,000
------------ --------------
Tobacco - 1.58%
American Brands, Inc............... 442,000 19,724,250
------------ --------------
Total Equities
(Cost $784,795,485)................ 1,155,154,333
--------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
---------
SHORT-TERM INVESTMENTS - 11.69%
<S> <C> <C>
Commercial Paper
Aristar, Inc.
5.600% 2/14/96................ $ 3,480,000 3,456,181
Comdisco, Inc.
6.030% 1/11/96................ 3,545,000 3,539,062
Comdisco, Inc.
6.030% 1/12/96................ 3,300,000 3,293,920
Comdisco, Inc.
6.000% 1/22/96................ 4,610,000 4,593,235
Comdisco, Inc.
5.950% 2/12/96................ 4,790,000 4,756,356
ConAgra, Inc.
5.970% 1/3/96................. 5,585,000 5,583,148
ConAgra, Inc.
5.930% 1/24/96................ 3,615,000 3,601,304
</TABLE>
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
--------- ---------
SHORT-TERM INVESTMENTS (Continued)
<S> <C> <C>
Commercial Paper (Continued)
ConAgra, Inc.
5.930% 2/1/96..............$ 4,590,000 $ 4,566,562
ConAgra, Inc.
5.770% 2/6/96.............. 3,835,000 3,812,872
Dana Credit Corporation
6.000% 1/31/96............. 6,220,000 6,187,578
Dana Credit Corporation
5.950% 2/16/96............. 4,295,000 4,261,793
Dana Credit Corporation
5.820% 3/21/96............. 3,165,000 3,123,042
Dominion Resources, Inc.
6.010% 1/23/96............. 5,200,000 5,180,901
Florida Power & Light Co.
5.580% 2/7/96.............. 2,255,000 2,242,068
GTE Corporation
5.950% 2/2/96.............. 5,225,000 5,197,366
GTE Corporation
5.830% 2/9/96.............. 5,900,000 5,862,737
Illinois Power Company
6.000% 1/25/96............. 3,225,000 3,212,100
Illinois Power Company
6.100% 2/5/96.............. 2,380,000 2,365,885
Illinois Power Company
5.930% 2/8/96.............. 4,000,000 3,974,962
MAPCO Inc.
6.050% 1/5/96.............. 4,575,000 4,571,925
MAPCO Inc.
6.000% 1/8/96.............. 4,385,000 4,379,884
MAPCO Inc.
6.000% 1/10/96............. 4,000,000 3,994,000
ORIX Credit Alliance, Inc.
6.080% 1/17/96............. 5,865,000 5,848,749
ORIX Credit Alliance, Inc.
6.070% 1/19/96............. 5,160,000 5,144,178
ORIX Credit Alliance, Inc.
6.000% 1/26/96............. 4,000,000 3,983,333
ORIX Credit Alliance, Inc.
6.070% 1/30/96............. 4,000,000 3,980,175
ORIX Credit Alliance, Inc.
5.750% 2/14/96............. 8,000,000 7,943,778
Public Service Company of
Colorado
6.000% 1/29/96............. 6,410,000 6,380,087
Rite Aid Corporation
5.900% 2/26/96............. 3,790,000 3,754,926
Rite Aid Corporation
5.980% 1/16/96............. 3,500,000 3,491,057
Texas Utilities Electric Company
5.950% 1/2/96.............. 4,000,000 3,999,339
Textron, Inc.
5.970% 2/29/96............. 1,500,000 1,485,146
Tyson Foods, Inc.
6.050% 1/4/96.............. 1,340,000 1,339,324
Tyson Foods, Inc.
5.990% 1/9/96.............. 2,745,000 2,741,346
Tyson Foods, Inc.
5.990% 1/18/96............. 4,165,000 4,152,537
Total Short-Term Investments
(Cost $146,006,980)................$ 146,650,000 146,000,856
============== ------------
</TABLE>
8
<PAGE>
MML Equity Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Value
(Note 2A)
---------
<S> <C> <C>
Total Investments -
(Cost $930,802,465) (a) 104.18% $1,301,155,189
Other Assets - .27 3,422,570
Liabilities - (4.45) (55,678,753)
------ --------------
Net Assets - 100.00% $1,248,899,006
====== ==============
</TABLE>
(a) Federal Income Tax Information: At
December 31, 1995 the net unrealized
appreciation on investments based
on cost of $930,814,277 for federal
income tax purposes is as follows:
Aggregate gross unrealized
appreciation for all investments in which
there is an excess of market value over tax
cost................................................. $ 378,715,018
Aggregate gross unrealized depreciation for
all investments in which there is an excess
of tax cost over market value........................ (8,374,106)
--------------
Net unrealized appreciation.......................... $ 370,340,912
==============
See Notes to Financial Statements.
9
<PAGE>
MML Money Market Fund
SCHEDULE OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
--------- ---------
<S> <C> <C>
SHORT-TERM INVESTMENTS - 100.57%
Commercial Paper
Anheuser-Busch Companies, Inc.
5.550% 3/7/96............... $ 2,115,000 $ 2,093,480
Aristar, Inc.
5.780% 1/30/96.............. 4,000,000 3,981,375
Atlantic Richfield Corp.
5.600% 2/9/96............... 2,800,000 2,783,013
Baltimore Gas & Electric Company
5.680% 1/19/96.............. 3,015,000 3,006,437
Bell Atlantic Network Funding
Corp.
5.450% 2/22/96.............. 2,035,000 2,018,980
Bell Atlantic Network Funding
Corp.
5.510% 2/23/96.............. 2,265,000 2,246,626
Campbell Soup Company
5.650% 1/16/96.............. 3,210,000 3,202,443
Caterpillar Financial Services
Corp.
5.650% 2/15/96.............. 1,915,000 1,901,475
Coca Cola Company
5.580% 2/2/96............... 1,425,000 1,417,932
Coca Cola Company
5.350% 3/6/96............... 1,000,000 990,340
Coca Cola Financial Corporation
5.580% 2/1/96............... 1,845,000 1,836,135
Consolidated Natural Gas Company
5.630% 2/6/96............... 1,435,000 1,426,921
Dresser Industries, Inc.
5.750% 1/31/96.............. 2,200,000 2,189,458
Dresser Industries, Inc.
5.650% 1/26/96.............. 1,800,000 1,792,938
E.I. du Pont de Nemours and
Company
5.660% 1/17/96.............. 3,015,000 3,007,416
Echlin Inc.
5.710% 1/26/96.............. 2,000,000 1,992,069
Eli Lilly & Company
5.670% 1/19/96.............. 1,890,000 1,884,642
Eli Lilly & Company
5.550% 3/28/96.............. 2,400,000 2,367,810
Ford Motor Credit Company
5.350% 7/22/96.............. 4,000,000 3,879,328
GTE Corporation
5.850% 2/14/96.............. 2,545,000 2,526,803
GTE Corporation
5.840% 2/16/96.............. 230,000 228,284
GTE Corporation
5.600% 3/5/96............... 1,580,000 1,564,270
General Electric Company
5.420% 5/3/96............... 1,125,000 1,104,167
General Motors Acceptance
Corporation
5.570% 3/15/96.............. 2,080,000 2,056,185
General Motors Acceptance
Corporation
5.847% 1/2/96............... 510,000 510,000
Georgia Power Company
5.610% 3/6/96............... 360,000 356,354
Georgia Power Company
5.640% 2/12/96.............. 3,900,000 3,874,338
Great Lakes Chemical Corp.
5.670% 1/22/96.............. 1,735,000 1,729,261
Hercules Incorporated
5.660% 2/16/96.............. 1,870,000 1,856,476
Hercules Incorporated
5.350% 6/19/96.............. 1,600,000 1,559,578
Indianapolis Power & Light Company
5.680% 1/25/96.............. 2,025,000 2,017,332
SHORT-TERM INVESTMENTS (Continued)
Commercial Paper (Continued)
John Deere Capital Corporation
5.680% 2/13/96.............. $ 3,930,000 $ 3,903,337
McCormick & Company Inc.
5.600% 1/29/96.............. 2,855,000 2,842,565
Minnesota Mining and
Manufacturing Company
5.480% 3/14/96.............. 2,460,000 2,432,664
Nestle Capital Corporation
5.660% 1/23/96.............. 1,595,000 1,589,483
Nestle Capital Corporation
5.370% 4/11/96.............. 2,720,000 2,679,021
Northern Illinois Gas Company
5.670% 1/12/96.............. 4,500,000 4,492,204
Northern States Power Company
5.680% 1/18/96.............. 2,020,000 2,014,582
Pacificorp
5.710% 1/5/96............... 1,570,000 1,569,004
Pacificorp
5.700% 2/7/96............... 2,250,000 2,236,819
J.C. Penney Funding Corp.
5.650% 2/8/96............... 3,785,000 3,762,427
Pepsico Inc.
5.700% 1/12/96.............. 820,000 818,572
Pepsico Inc.
5.550% 2/6/96............... 1,770,000 1,760,177
Pioneer Hi-Bred International,
Inc.
5.700% 1/24/96.............. 3,375,000 3,362,709
Pitney Bowes Credit Corporation
5.620% 2/5/96............... 3,060,000 3,043,281
Proctor & Gamble Company
5.610% 2/21/96.............. 4,000,000 3,968,210
Southern New England
Telecommunications
Corporation
5.700% 1/31/96.............. 1,530,000 1,522,733
Southwestern Bell Telephone
Company
5.500% 2/27/96.............. 4,180,000 4,143,599
------------ ------------
Total Short-Term Investments
(Cost $109,543,253) (a)............ $110,345,000 109,543,253
============ ============
Total Investments -
(Cost $109,543,253) (a) 100.57% 109,543,253
Other Assets - .01 3,459
Liabilities - (.58) (626,511)
------ ------------
Net Assets - 100.00% $108,920,201
====== ============
</TABLE>
(a) Federal Income Tax Information: The aggregate cost for investments
for the MML Money Market Fund as of December 31, 1995 is
the same for financial reporting and federal income tax purposes.
December 31, 1995 seven-day average yield for the portfolio: 5.25%
See Notes to Financial Statements.
10
<PAGE>
MML Managed Bond Fund
SCHEDULE OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
--------- ---------
<S> <C> <C>
BONDS AND NOTES - 95.72%
Asset Backed Securities - 10.03%
Auto Receivables
Daimler-Benz Auto Grantor
Trust 1995-A
5.850% 5/15/02............... $ 2,883,620 $ 2,894,433
Daimler-Benz Vehicle Trust
1994-A
5.950% 12/15/00.............. 660,968 662,059
Ford Credit 1994-B Grantor
Trust
7.300% 10/15/99.............. 959,110 977,390
GMAC 1992-E Grantor Trust
4.750% 8/15/97............... 321,666 320,257
Honda Auto Receivables 1992-A
Grantor Trust
4.900% 6/15/98............... 195,325 194,653
Jet Equipment Trust 1995-A
8.235% 5/1/15................ 1,990,986 2,187,895
Midlantic Auto Grantor Trust
1992-1
4.300% 9/15/97............... 93,624 93,594
Nissan Auto Receivables 1994-A
Grantor Trust
6.450% 9/15/99............... 1,547,068 1,560,110
Railcar Trust No. 1992-1
7.750% 6/1/04................ 1,715,380 1,849,385
World Omni 1994-A Automobile
Lease
Securitization Trust
6.450% 9/25/00............... 2,131,553 2,145,110
World Omni 1995-A Automobile
Lease
Securitization Trust
6.050% 11/25/01.............. 3,000,000 3,026,250
------------ ------------
Total Asset Backed Securities
(Cost $15,716,572)................. 15,499,300 15,911,136
------------ ------------
Corporate Debt - 51.52%
American Airlines, Inc.
9.780% 11/26/11.............. 2,000,000 2,364,400
AMR Corporation
9.000% 8/1/12................ 1,000,000 1,127,770
Analog Devices, Inc.
6.625% 3/1/00................ 1,000,000 1,012,980
Associates Corporation of
North America
7.875% 9/30/01............... 2,000,000 2,182,260
Atlantic Richfield Company
7.770% 2/13/02............... 3,000,000 3,275,310
BP America Inc.
8.500% 4/15/01............... 2,000,000 2,240,220
Bell Atlantic Financial
Services, Inc.
6.610% 2/4/00................ 2,000,000 2,064,600
Columbia Gas System, Inc.
6.610% 11/28/02.............. 2,000,000 2,036,220
Commercial Credit Company
7.750% 3/1/05................ 3,000,000 3,333,180
Corning Glass Works, Inc.
8.875% 3/15/16............... 500,000 603,690
Dow Capital
7.125% 1/15/03............... 4,000,000 4,167,880
English China Clays Delaware,
Inc.
7.375% 10/1/02............... 1,000,000 1,059,300
Equifax, Inc.
6.500% 6/15/03............... 1,250,000 1,273,950
ERAC USA Finance Company 144A
7.875% 3/15/98............... 1,500,000 1,576,875
Foster Wheeler Corporation
6.750% 11/15/05.............. 2,000,000 2,061,620
General Electric Capital
Corporation
8.750% 5/21/07............... 1,000,000 1,206,390
General Motors Acceptance
Corporation
6.300% 9/10/97............... 2,500,000 2,529,150
The Goldman Sachs Group, L.P.
144A
6.200% 2/15/01............... $ 2,000,000 $ 2,004,360
Hercules Incorporated
6.625% 6/1/03................ 2,000,000 2,055,180
Imcera Group, Inc.
6.000% 10/15/03.............. 2,000,000 1,924,780
ITT Corporation (New)
7.375% 11/15/15.............. 3,500,000 3,608,500
Leucadia National Corporation
7.750% 8/15/13............... 2,000,000 2,070,380
Lockheed Corporation
5.650% 4/1/97................ 2,000,000 1,995,500
McDonnell Douglas Corporation
9.250% 4/1/02................ 1,400,000 1,630,160
Newmont Mining Corporation
8.625% 4/1/02................ 2,000,000 2,209,980
News America Holdings
Incorporated
9.250% 2/1/13................ 1,000,000 1,177,840
Penske Truck Leasing Co., L.P.
7.750% 5/15/99............... 1,250,000 1,305,450
Polaroid Corporation
7.250% 1/15/97............... 1,000,000 1,013,290
Polaroid Corporation
8.000% 3/15/99............... 1,000,000 1,056,350
Ralston Purina Company
7.750% 10/1/15............... 3,000,000 3,222,240
Rolls-Royce Capital Inc.
7.125% 7/29/03............... 1,500,000 1,564,890
Service Corporation
International
7.000% 6/1/15................ 2,250,000 2,507,018
Tenaga Nasional Berhad 144A
7.875% 6/15/04............... 1,250,000 1,373,563
Textron Inc.
9.550% 3/19/01............... 1,000,000 1,136,100
Thomas & Betts Corporation
8.250% 1/15/04............... 1,500,000 1,645,035
Time Warner, Inc.
7.750% 6/15/05............... 3,000,000 3,123,090
US West Capital Funding
Corporation
8.375% 10/18/99.............. 3,000,000 3,262,140
Union Oil of California
8.750% 8/15/01............... 1,500,000 1,669,890
United Air Lines, Inc.
10.110% 2/19/06............... 476,860 540,998
Valassis Communications, Inc.
9.550% 12/1/03............... 2,000,000 2,039,240
Westinghouse Electric
Corporation
8.375% 6/15/02............... 1,200,000 1,237,680
W.R. Grace & Co.
7.750% 10/1/02............... 2,100,000 2,273,250
------------ ------------
Total Corporate Debt
(Cost $78,945,707) 76,676,860 81,762,699
------------ ------------
</TABLE>
11
<PAGE>
MML Managed Bond Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
--------- ---------
BONDS AND NOTES (Continued)
<S> <C> <C>
U.S. Government Agency Obligations - 19.01%
Federal Home Loan Mortgage
Corporation (FHLMC) - 4.06%
Collateralized Mortgage Obligations - 3.91%
FHLMC Series 1080 Class D
7.000% 7/15/20........................ $ 2,000,000 $ 2,032,500
FHLMC Series 1322 Class G
7.500% 2/15/07........................ 2,000,000 2,088,740
FHLMC Series 1460 Class H
7.000% 5/15/07........................ 2,000,000 2,072,500
------------ -----------
6,000,000 6,193,740
Pass-Through Securities - .15%
FHLMC
9.000% 3/1/17......................... 228,281 242,521
------------ -----------
6,228,281 6,436,261
------------ -----------
Federal National Mortgage
Association (FNMA) - 3.32%
Collateralized Mortgage Obligations - 2.81%
FNMA Series 1993-175 Class PL
5.000% 10/25/02....................... 2,000,000 1,980,000
FNMA Series 1993-191 Class PD
5.400% 3/25/04........................ 1,500,000 1,486,395
FNMA Series 1993-221 Class PD
6.000% 12/25/08....................... 1,000,000 989,680
------------ -----------
4,500,000 4,456,075
Pass-Through Securities - .51%
FNMA
9.000% 5/1/09......................... 761,881 809,971
------------ -----------
5,261,881 5,266,046
------------ -----------
Government National Mortgage
Association (GNMA) - 9.10%
Collateralized Mortgage Obligations - .60%
JHM Acceptance Corporation,
Series E Class 5
8.960% 4/1/19......................... 895,053 956,587
------------ -----------
Pass-Through Securities - 8.50%
GNMA
8.000% 6/15/06 - 3/15/08.............. 6,449,335 6,833,391
GNMA - ARMS
6.000% 7/20/25 - 12/20/25............. 6,586,262 6,659,175
------------ -----------
13,035,597 13,492,566
------------ -----------
13,930,650 14,449,153
------------ -----------
U.S. Government Guaranteed Notes - 2.53%
1994-A Atlanta, GA
5.780% 8/1/98......................... 130,000 130,637
1994-A Baxter Springs, KS
5.780% 8/1/98......................... 700,000 703,430
1994-A Boston, MA
5.780% 8/1/98......................... 745,000 748,650
1994-A Detroit, MI
5.780% 8/1/98......................... 385,000 386,887
1994-A Egg Harbor, NJ
5.780% 8/1/98......................... 260,000 261,274
1994-A Kansas City, MO
5.780% 8/1/98......................... 550,000 552,695
1994-A Mayaguez, PR
5.780% 8/1/98......................... 295,000 296,446
1994-A Rochester, NY
5.780% 8/1/98......................... 300,000 301,470
1994-A Sacramento, CA
5.780% 8/1/98......................... 55,000 55,270
1994-A Saginaw, MI
5.780% 8/1/98......................... 315,000 316,544
1994-A Youngstown, OH
5.780% 8/1/98......................... 265,000 266,299
------------ -----------
4,000,000 4,019,602
------------ -----------
Total U.S. Government Agency Obligations
(Cost $29,136,748) 29,420,812 30,171,062
------------ -----------
U.S. Treasury Obligations - 15.16%
U.S. Treasury Bonds - 9.28%
U.S. Treasury Bond
8.875% 8/15/17........................ 11,000,000 14,733,070
------------ -----------
U.S. Treasury Notes - 3.50%
U.S. Treasury Note
7.250% 5/15/04........................ 5,000,000 5,550,000
------------ -----------
U.S. Treasury Strips - 2.38%
U.S. Treasury Strip - Principal Only
0.000% 2/15/15........................ 12,200,000 3,775,290
------------ -----------
Total U.S. Treasury Obligations
(Cost $21,674,338)........................ 28,200,000 24,058,360
------------ -----------
Total Bonds and Notes
(Cost $145,473,365) $149,796,972 151,903,257
============ -----------
</TABLE>
12
<PAGE>
MML Managed Bond Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
--------- ---------
<S> <C> <C>
SHORT-TERM INVESTMENTS - 1.62%
Commercial Paper
ORIX Credit Alliance, Inc.
6.400% 1/5/96....................... $ 2,185,000 $ 2,183,446
Ryder System Inc.
6.000% 1/2/96....................... 395,000 394,934
------------ -------------
Total Short-Term Investments
(Cost $2,578,380) $ 2,580,000 2,578,380
============ -------------
<CAPTION>
<S> <C> <C>
Total Investments
(Cost $148,051,745) (a) 97.34% 154,481,637
Other Assets - 9.33 14,800,734
Liabilities - (6.67) (10,584,233)
-------- -------------
Net Assets - 100.00% $ 158,698,138
======== =============
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
(a) Federal Income Tax Information: At
December 31, 1995 the net unrealized
appreciation on investments based on
cost of $148,061,936 for federal income
tax purposes is as follows:
Aggregate gross unrealized appreciation for
all investments and forward commitments in
which there is an excess of market value over
tax cost.............................................. $ 7,077,046
Aggregate gross unrealized depreciation for
all investments and forward commitments in
which there is an excess of tax cost over
market value.......................................... (657,345)
-------------
Net unrealized appreciation......................... $ 6,419,701
=============
</TABLE>
See Notes to Financial Statements.
13
<PAGE>
MML BLEND FUND
SCHEDULE OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note 2A)
-------- ---------
EQUITIES - 55.32%
<S> <C> <C>
Aerospace & Defense - 1.42%
The Boeing Company........................ 193,500 $ 15,165,563
TRW, Inc.................................. 138,500 10,733,750
------------- -------------
332,000 25,899,313
------------- -------------
Agribusiness - .95%
Archer-Daniels-Midland Company............ 318,017 5,724,306
Pioneer Hi-Bred International, Inc........ 208,000 11,570,000
------------- -------------
526,017 17,294,306
------------- -------------
Apparel, Textiles, Shoes - .60%
VF Corporation............................ 208,000 10,972,000
------------- -------------
Automotive & Parts - 2.57%
Ford Motor Company........................ 410,000 11,890,000
Genuine Parts Company..................... 397,000 16,277,000
Goodyear Tire & Rubber Company............ 412,200 18,703,575
------------- -------------
1,219,200 46,870,575
------------- -------------
Banking, Savings & Loans - 3.85%
The Bank of New York
Company, Incorporated..................... 390,000 19,012,500
Comerica, Incorporated.................... 397,000 15,929,625
CoreStates Financial Corporation.......... 374,800 14,195,550
Norwest Corporation....................... 262,000 8,646,000
Wachovia Corporation...................... 270,600 12,379,950
------------- -------------
1,694,400 70,163,625
------------- -------------
Beverages - 1.25%
Brown-Forman Corporation (Class B)........ 319,500 11,661,750
Pepsico, Incorporated..................... 200,000 11,175,000
------------- -------------
519,500 22,836,750
------------- -------------
Chemicals - 2.12%
Eastman Chemical Company.................. 216,475 13,556,747
E.I. du Pont de Nemours and Company....... 146,000 10,201,750
The Lubrizol Corporation.................. 216,000 6,021,000
Nalco Chemical Company.................... 295,000 8,886,875
------------- -------------
873,475 38,666,372
------------- -------------
Communications - .66%
AT&T Corporation.......................... 185,000 11,978,750
------------- -------------
Computers & Office Equipment - 3.88%
Hewlett-Packard Company................... 343,000 28,726,250
International Business Machines Corporation 106,000 9,725,500
Pitney Bowes, Inc......................... 371,000 17,437,000
Xerox Corporation......................... 108,000 14,796,000
------------- -------------
928,000 70,684,750
------------- -------------
Cosmetic & Personal Care - .80%
Kimberly-Clark Corporation................ 176,200 14,580,550
------------- -------------
Electric Utilities - 1.11%
Niagara Mohawk Power Corporation.......... 416,000 4,004,000
NIPSCO Industries, Inc.................... 178,000 6,808,500
SCANA Corporation......................... 326,000 9,331,750
------------- -------------
920,000 20,144,250
------------- -------------
Electrical Equipment & Electronics - 4.63%
AMP, Inc.................................. 530,000 20,338,750
General Electric Company.................. 420,000 30,240,000
General Signal Corporation................ 243,000 7,867,125
Honeywell Inc............................. 243,000 11,815,875
Hubbell, Incorporated (Class B)........... 215,940 14,198,055
------------- -------------
1,651,940 84,459,805
------------- -------------
EQUITIES (Continued)
Energy - 5.08%
Amoco Corporation......................... 332,000 $ 23,862,500
Atlantic Richfield Company................ 151,000 16,723,250
Chevron Corporation....................... 324,000 17,010,000
Kerr-McGee Corporation.................... 216,000 13,716,000
Mobil Corporation......................... 177,100 19,835,200
Union Pacific Resources Group, Inc........ 55,400 1,405,775
------------- -------------
1,255,500 92,552,725
------------- -------------
Financial Services - .80%
American Express Company.................. 352,500 14,584,688
------------- -------------
Foods - 1.07%
CPC International, Inc.................... 285,000 19,558,125
------------- -------------
Forest Products & Paper - 1.54%
Westvaco Corporation...................... 363,012 10,073,583
Weyerhaeuser Company...................... 415,000 17,948,750
------------- -------------
778,012 28,022,333
------------- -------------
Hardware & Tools - .81%
The Stanley Works......................... 285,300 14,692,950
------------- -------------
Healthcare - 5.96%
Becton, Dickinson and Company............. 247,800 18,585,000
Bristol-Myers Squibb Company.............. 450,000 38,643,750
Pfizer, Incorporated...................... 540,000 34,020,000
Schering-Plough Corp...................... 318,400 17,432,400
------------- -------------
1,556,200 108,681,150
------------- -------------
Household Products - .57%
The Clorox Company........................ 146,000 10,457,250
------------- -------------
Industrial Distribution - .77%
W. W. Grainger, Inc....................... 212,300 14,064,875
------------- -------------
Industrial Transportation - .92%
Norfolk Southern Corporation.............. 212,000 16,827,500
------------- -------------
Insurance - 2.99%
Allstate Corporation...................... 165,501 6,806,228
Jefferson-Pilot Corporation............... 183,000 8,509,500
MBIA, Inc................................. 135,000 10,125,000
SAFECO Corporation........................ 668,000 23,046,000
Unitrin, Inc.............................. 125,000 6,000,000
------------- -------------
1,276,501 54,486,728
------------- -------------
Machinery & Components - 1.05%
Dover Corporation......................... 286,000 10,546,250
Parker-Hannifin Corporation............... 251,750 8,622,438
------------- -------------
537,750 19,168,688
------------- -------------
Metals & Mining - .17%
Reynolds Metals Company................... 55,000 3,114,375
------------- -------------
Miscellaneous - 1.62%
Harsco Corporation........................ 159,050 9,244,781
Minnesota Mining &
Manufacturing Company.................... 305,000 20,206,250
------------- -------------
464,050 29,451,031
------------- -------------
Photography - .73%
Eastman Kodak Company..................... 198,500 13,299,500
------------- -------------
</TABLE>
14
<PAGE>
MML Blend Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note 2A)
-------- ---------
EQUITIES (Continued)
<S> <C> <C>
Publishing & Printing - 2.66%
The Dun & Bradstreet Corporation.......... 276,000 $ 17,871,000
McGraw-Hill Companies, Inc................ 200,000 17,425,000
R.R. Donnelley & Sons Company............. 334,000 13,151,250
------------- -------------
810,000 48,447,250
------------- -------------
Retail - 1.42%
J.C. Penney Company, Inc.................. 81,000 3,857,625
The May Department Stores Company......... 324,000 13,689,000
Sears Roebuck and Company................. 216,000 8,424,000
------------- -------------
621,000 25,970,625
------------- -------------
Retail - Grocery - .75%
Albertson's, Inc.......................... 418,300 13,751,612
------------- -------------
Telephone Utilities - 1.63%
Ameritech Corporation..................... 170,000 10,030,000
Frontier Corporation...................... 371,000 11,130,000
Southern New England
Telecommunications Corporation........... 216,000 8,586,000
------------- -------------
757,000 29,746,000
------------- -------------
Tobacco - .94%
American Brands, Inc...................... 384,000 17,136,000
------------- -------------
Total Equities
(Cost $627,696,809) 1,008,564,451
-------------
<CAPTION>
Principal
Amount
---------
BONDS AND NOTES - 15.36%
<S> <C> <C>
Asset Backed Securities - 1.16%
Auto Receivables
Daimler-Benz Auto Grantor Trust 1995-A
5.850% 5/15/02...................... $ 2,403,016 2,412,028
Daimler-Benz Vehicle Trust 1994-A
5.950% 12/15/00..................... 1,321,937 1,324,118
Ford Credit Auto Loan Master Trust,
Series 1992-1
6.875% 1/15/99...................... 1,500,000 1,520,625
Ford Credit 1994-B Grantor Trust
7.300% 10/15/99..................... 1,278,813 1,303,187
GMAC 1992-E Grantor Trust
4.750% 8/15/97...................... 193,000 192,154
Honda Auto Receivables 1992-A Grantor Trust
4.900% 6/15/98...................... 195,325 194,653
Nissan Auto Receivables 1994-A Grantor Trust
6.450% 9/15/99...................... 4,177,084 4,212,297
Railcar Trust No. 1992-1
7.750% 6/1/04....................... 1,552,419 1,673,694
World Omni 1994-A Automobile Lease
Securitization Trust
6.450% 9/25/00...................... 4,689,417 4,719,242
World Omni 1995-A Automobile Lease
Securitization Trust
6.050% 11/25/01..................... 3,500,000 3,530,625
------------- -------------
Total Asset Backed Securities
(Cost $20,966,611) 20,811,011 21,082,623
------------- -------------
<CAPTION>
Market
Principal Value
Amount (Note 2A)
--------- ---------
BONDS AND NOTES (Continued)
<S> <C> <C>
Corporate Debt - 5.49%
AMR Corporation
9.000% 8/1/12....................... $ 2,000,000 $ 2,255,540
American Airlines, Inc.
9.780% 11/26/11..................... 5,000,000 5,911,000
American Brands, Inc.
8.750% 2/15/96...................... 1,000,000 1,002,850
American General Finance Corporation
7.750% 1/15/97...................... 2,000,000 2,041,440
Analog Devices, Inc.
6.625% 3/1/00....................... 1,500,000 1,519,470
Bell Atlantic Financial Services Inc.
6.610% 2/4/00....................... 1,000,000 1,032,300
Cardinal Distribution, Inc.
8.000% 3/1/97....................... 2,000,000 2,051,560
Chrysler Financial Corp.
6.620% 4/29/97...................... 2,000,000 2,023,180
Columbia Gas System, Inc.
6.610% 11/28/02..................... 3,000,000 3,054,330
Commercial Credit Company
7.750% 3/1/05....................... 2,500,000 2,777,650
Corning Glass Works, Inc.
8.875% 3/15/16...................... 500,000 603,690
Delta Air Lines, Inc.
8.540% 1/2/07....................... 4,578,616 4,962,075
ERAC USA Finance Company 144A
7.875% 3/15/98...................... 4,000,000 4,205,000
English China Clays Delaware, Inc.
7.375% 10/1/02...................... 1,000,000 1,059,300
Ford Motor Credit Company
8.450% 7/15/06...................... 1,500,000 1,521,360
GTE Corporation
9.100% 6/1/03....................... 1,000,000 1,162,710
General Electric Capital Corporation
8.750% 5/21/07...................... 1,500,000 1,809,585
General Motors Acceptance Corporation
9.125% 7/15/01...................... 1,500,000 1,710,120
The Goldman Sachs Group, L.P. 144A
6.200% 2/15/01...................... 4,000,000 4,008,720
ITT Corporation (New)
7.375% 11/15/15..................... 5,000,000 5,155,000
Leucadia National Corporation
7.750% 8/15/13...................... 3,000,000 3,105,570
McDonnell Douglas Corporation
9.250% 4/1/02....................... 2,200,000 2,561,680
Newmont Mining Corporation
8.625% 4/1/02....................... 5,000,000 5,524,950
News America Holdings Incorporated
9.250% 2/1/13....................... 2,000,000 2,355,680
North Finance (Bermuda) Limited 144A
7.000% 9/15/05...................... 4,000,000 4,080,000
Polaroid Corporation
7.250% 1/15/97...................... 4,500,000 4,559,805
Ralston Purina Company
7.750% 10/1/15...................... 2,000,000 2,148,160
Rolls-Royce Capital Inc.
7.125% 7/29/03...................... 2,000,000 2,086,520
Service Corporation International
7.000% 6/1/15....................... 4,500,000 5,014,035
Tele-Communications, Inc.
7.550% 9/2/03....................... 3,000,000 3,168,390
Tenaga Nasional Berhad 144A
7.875% 6/15/04...................... 2,500,000 2,747,125
Thomas & Betts Corporation
8.250% 1/15/04...................... 1,000,000 1,096,690
</TABLE>
15
<PAGE>
MML Blend Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
--------- ---------
BONDS AND NOTES (Continued)
<S> <C> <C>
Time Warner, Inc.
7.750% 6/15/05...................... $ 3,000,000 $ 3,123,090
The Toro Company
11.000% 8/1/17....................... 2,000,000 2,000,000
United States Leasing
International, Inc.
8.750% 5/1/96....................... 3,500,000 3,533,635
Valassis Communications, Inc.
9.550% 12/1/03...................... 2,000,000 2,039,240
Westinghouse Electric Corporation
8.375% 6/15/02...................... 1,000,000 1,031,400
------------- ------------
Total Corporate Debt
(Cost $94,662,584)........................ 93,778,616 100,042,850
------------- ------------
U.S. Government Agency Obligations - 4.03%
Federal Home Loan Mortgage
Corporation (FHLMC) - .93%
Collateralized Mortgage Obligations - .67%
FHLMC Series 1080 Class D
7.000% 7/15/20...................... 5,000,000 5,081,250
FHLMC Series 1322 Class G
7.500% 2/15/07...................... 5,000,000 5,221,850
FHLMC Series 1460 Class 4
7.000% 5/15/07...................... 1,789,000 1,853,851
------------- ------------
11,789,000 12,156,951
------------- ------------
Pass-Through Securities - .26%
FHLMC
9.000% 3/1/17....................... 684,843 727,563
------------- ------------
12,473,843 12,884,514
------------- ------------
Federal National Mortgage
Association (FNMA) - .28%
Collateralized Mortgage Obligations - .08%
FNMA Series 1993-191 Class PD
5.400% 3/25/04...................... 1,500,000 1,486,395
------------- ------------
Pass-Through Securities - .20%
FNMA
5.000% 10/25/02..................... 4,130,000 4,088,700
FNMA
8.000% 5/1/13....................... 3,474,720 3,626,739
------------- ------------
7,604,720 7,715,439
------------- ------------
9,104,720 9,201,834
------------- ------------
Government National Mortgage
Association (GNMA) - 1.64%
Collateralized Mortgage Obligations - .10%
JHM Acceptance Corporation, Series E Class 5
8.960% 4/1/19....................... 1,790,105 1,913,175
------------- ------------
Pass-Through Securities - 1.54%
GNMA
8.000% 1/15/04-5/15/08.............. 8,755,864 9,277,277
GNMA
9.000% 8/15/08-9/15/09.............. 2,679,591 2,900,658
GNMA - ARMS
6.000% 7/20/25-12/20/25............. 15,725,551 15,900,693
------------- ------------
27,161,006 28,078,628
------------- ------------
28,951,111 29,991,803
------------- ------------
BONDS AND NOTES (Continued)
Government National Mortgage
Association (GNMA) (Continued)
U.S. Government Guaranteed Notes - 1.18%
1994-A Abilene, TX
5.780% 8/1/98....................... $ 70,000 $ 70,343
1994-A Bakersfield, CA
5.780% 8/1/98....................... 245,000 246,200
1994-A Barberton, OH
5.780% 8/1/98....................... 75,000 75,367
1994-A Buffalo, NY
5.780% 8/1/98....................... 375,000 376,837
1991-A Caguas, PR
8.740% 8/1/01....................... 280,000 317,719
1991-A Council Bluffs, IA
8.740% 8/1/01....................... 155,000 175,880
1994-A Cumberland, MD
5.780% 8/1/98....................... 55,000 55,269
1994-A Elizabeth, NJ
5.780% 8/1/98....................... 75,000 75,367
1994-A Erie, PA
5.780% 8/1/98....................... 70,000 70,343
1994-A Euclid, OH
5.780% 8/1/98....................... 105,000 105,514
1994-A Fairfax County, VA
5.780% 8/1/98....................... 110,000 110,539
1991-A Fairfax County, VA
8.740% 8/1/01....................... 85,000 96,450
1991-A Fajardo, PR
8.740% 8/1/01....................... 210,000 238,289
1994-A Fort Myers, FL
5.040% 8/1/96....................... 120,000 119,700
1994-A Fort Myers, FL
5.780% 8/1/98....................... 135,000 135,661
1991-A Gasden, AL
8.740% 8/1/01....................... 100,000 113,471
1994-A Jacksonville, FL
5.040% 8/1/96....................... 200,000 199,500
1994-A Lawrence, MA
5.040% 8/1/96....................... 35,000 34,913
1994-A Lawrence, MA
5.780% 8/1/98....................... 40,000 40,196
1994-A Little Rock, AK
5.040% 8/1/96....................... 310,000 309,225
1994-A LA County, CA
5.040% 8/1/96....................... 145,000 144,638
1994-A LA County, CA
5.780% 8/1/98....................... 175,000 175,858
1991-A Lorain, OH
8.740% 8/1/01....................... 30,000 34,041
1994-A Macon, GA
5.040% 8/1/96....................... 25,000 24,938
1994-A Mayaguez, PR
5.780% 8/1/98....................... 65,000 65,319
1991-A Mayaguez, PR
8.740% 8/1/01....................... 150,000 170,207
1994-A Mobile, AL
5.780% 8/1/98....................... 205,000 206,005
1994-A Montgomery County, PA
5.780% 8/1/98....................... 230,000 231,126
1994-A Montgomery County, PA
5.040% 8/1/96....................... 215,000 214,463
1994-A New Orleans, LA
5.780% 8/1/98....................... 175,000 175,857
</TABLE>
16
<PAGE>
MML Blend Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
--------- ---------
BONDS AND NOTES (Continued)
<S> <C> <C>
U.S. Government Guaranteed Notes (Continued)
1994-A Ocean Shores, WA
5.780% 8/1/98....................... $ 110,000 $ 110,539
1994-A Pasadena, CA
5.780% 8/1/98....................... 140,000 140,686
1994-A Providence, RI
5.040% 8/1/96....................... 40,000 39,900
1994-A Providence, RI
5.780% 8/1/98....................... 50,000 50,245
1994-A Reading, PA
5.040% 8/1/96....................... 15,000 14,962
1994-A Reading, PA
5.780% 8/1/98....................... 65,000 65,319
1994-A Roanoke, VA
5.780% 8/1/98....................... 210,000 211,029
1994-A Rochester, NY
5.040% 8/1/96....................... 155,000 154,613
1994-A Rochester, NY
5.780% 8/1/98....................... 165,000 165,809
1991-A Rochester, NY
8.650% 8/1/00....................... 4,295,000 4,784,029
1994-A Sacramento, CA
5.040% 8/1/96....................... 125,000 124,688
1994-A Sacramento, CA
5.780% 8/1/98....................... 300,000 301,470
1994-A St. Joseph, MO
5.040% 8/1/96....................... 70,000 69,825
1994-A Salt Lake City, UT
5.040% 8/1/96....................... 135,000 134,662
1994-A Schaumburg, IL
5.040% 8/1/96....................... 60,000 59,850
1994-A Syracuse, NY
5.040% 8/1/96....................... 50,000 49,875
1994-A Syracuse, NY
5.780% 8/1/98....................... 50,000 50,245
1994-A Tacoma, WA
5.040% 8/1/96....................... 130,000 129,675
1994-A Tacoma, WA
5.780% 8/1/98....................... 155,000 155,759
1994-A Trenton, NJ
5.040% 8/1/96....................... 120,000 119,700
1994-A Trenton, NJ
5.780% 8/1/98....................... 130,000 130,637
1994-A Virginia Beach, VA
5.780% 8/1/98....................... 260,000 261,274
1994-A Waterford Township, MI
5.780% 8/1/98....................... 55,000 55,269
1994-A Waterford Township, MI
5.040% 8/1/96....................... 50,000 49,875
1994-A West Palm Beach, FL
5.780% 8/1/98....................... 105,000 105,515
U.S. Department of Housing and Urban
Development, Series 1995-A
8.240% 8/1/02....................... 8,475,000 9,557,681
------------- ------------
19,780,000 21,502,366
------------- ------------
Total U.S. Government Agency Obligations
(Cost $69,632,270)........................ 70,309,674 73,580,517
------------- ------------
BONDS AND NOTES (Continued)
U.S. Treasury Obligations - 4.68%
U.S. Treasury Bonds - 2.04%
U.S. Treasury Bond
8.750% 5/15/17...................... $ 28,125,000 $ 37,195,313
------------- ------------
U.S. Treasury Notes - 2.43%
U.S. Treasury Note
6.375% 1/15/99...................... 30,000,000 30,932,700
U.S. Treasury Note
7.250% 5/15/04...................... 12,000,000 13,320,000
------------- ------------
42,000,000 44,252,700
------------- ------------
U.S. Treasury Strips - .21%
U.S. Treasury Strip - Principal Only
0.000% 2/15/10...................... 8,750,000 3,794,875
------------- ------------
Total U.S. Treasury Obligations
(Cost $82,556,295)........................ 78,875,000 85,242,888
------------- ------------
Total Bonds and Notes
(Cost $267,817,760)....................... $ 263,774,301 279,948,878
============= ============
SHORT-TERM INVESTMENTS - 31.93%
Commercial Paper
Bausch & Lomb, Inc.
5.700% 1/26/96...................... $ 6,745,000 6,716,181
Campbell Soup Company
5.670% 1/2/96....................... 9,165,000 9,163,447
Central and South West Corporation
5.700% 1/22/96...................... 11,250,000 11,209,087
Central and South West Corporation
5.720% 1/19/96...................... 12,170,000 12,132,685
Coca Cola Company
5.580% 2/1/96....................... 11,140,000 11,079,013
Coca Cola Company
5.350% 3/6/96....................... 10,860,000 10,742,048
Comdisco, Inc.
6.000% 1/3/96....................... 14,695,000 14,690,102
ConAgra, Inc.
5.780% 2/21/96...................... 12,350,000 12,244,180
ConAgra, Inc.
5.640% 3/20/96...................... 13,875,000 13,693,276
Consolidated Natural Gas Company
5.650% 1/23/96...................... 5,000,000 4,981,263
Consolidated Natural Gas Company
5.630% 2/6/96....................... 3,525,000 3,503,778
Dana Credit Corporation
5.900% 3/15/96...................... 7,200,000 7,111,450
Dana Credit Corporation
5.880% 3/13/96...................... 10,000,000 9,880,208
Dana Credit Corporation
5.700% 3/21/96...................... 8,995,000 8,875,754
Dean Witter, Discover & Company
5.680% 1/31/96...................... 13,860,000 13,787,754
Dean Witter, Discover & Company
5.700% 2/7/96....................... 16,500,000 16,396,203
Deere Capital Corporation
5.560% 2/29/96...................... 17,070,000 16,900,959
Dial Corp.
5.650% 3/11/96...................... 4,820,000 4,763,800
Echlin Inc.
5.710% 1/23/96...................... 5,265,000 5,245,270
</TABLE>
17
<PAGE>
MML Blend Fund
SCHEDULE OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
Market
Principal Value
Amount (Note 2A)
--------- ---------
SHORT-TERM INVESTMENTS (Continued)
<S> <C> <C>
Commercial Paper (Continued)
Echlin Inc.
5.710% 1/24/96...................... $ 7,815,000 $ 7,783,872
GTE California, Inc.
5.780% 2/27/96...................... 7,960,000 7,886,302
GTE Northwest, Inc.
5.580% 3/29/96...................... 11,645,000 11,475,743
Georgia Power Company
5.650% 3/4/96....................... 10,000,000 9,894,583
Hercules Incorporated
5.660% 2/16/96...................... 13,650,000 13,544,463
Hercules Incorporated
5.350% 6/19/96...................... 7,990,000 7,769,221
IBM Credit Corporation
5.630% 2/22/96...................... 16,370,000 16,224,640
IBM Credit Corporation
5.550% 3/5/96....................... 8,650,000 8,557,433
Monsanto Company
5.680% 1/30/96...................... 8,290,000 8,248,913
Nestle Capital Corporation
5.530% 2/23/96...................... 10,000,000 9,908,036
Nestle Capital Corporation
5.530% 2/26/96...................... 10,940,000 10,838,759
Nestle Capital Corporation
5.470% 3/14/96...................... 11,985,000 11,839,516
Northern Illinois Gas Company
5.680% 1/9/96....................... 6,900,000 6,890,644
Northern States Power Company
5.680% 1/18/96...................... 10,725,000 10,692,908
NYNEX Corp.
5.700% 2/2/96....................... 10,000,000 9,945,311
NYNEX Corp.
5.750% 2/8/96....................... 14,625,000 14,528,963
NYNEX Corp.
5.550% 3/19/96...................... 4,680,000 4,619,453
ORIX Credit Alliance, Inc.
6.050% 1/29/96...................... 8,445,000 8,404,588
ORIX Credit Alliance, Inc.
6.000% 2/20/96...................... 7,645,000 7,581,831
ORIX Credit Alliance, Inc.
5.750% 3/21/96...................... 5,900,000 5,821,784
ORIX Credit Alliance, Inc.
5.700% 3/8/96....................... 8,529,000 8,433,641
PHH Corporation
5.680% 1/17/96...................... 10,000,000 9,972,291
Pennsylvania Power & Light Company
6.000% 1/11/96...................... 2,195,000 2,191,342
J.C. Penney Funding Corporation
5.650% 2/12/96...................... 10,000,000 9,929,763
J.C. Penney Funding Corporation
5.620% 2/28/96...................... 7,100,000 7,031,997
PepsiCo, Inc.
5.700% 1/12/96...................... 9,360,000 9,342,549
Pitney Bowes Credit Corporation
5.620% 2/5/96....................... 10,545,000 10,483,279
Proctor & Gamble Company
5.650% 1/25/96...................... 7,600,000 7,567,894
Proctor & Gamble Company
5.620% 2/14/96...................... 10,000,000 9,924,686
Proctor & Gamble Company
5.570% 3/1/96....................... 7,525,000 7,449,279
Public Service Company of Colorado
5.820% 3/22/96...................... 12,000,000 11,839,000
Commercial Paper (Continued)
Public Service Electric and Gas Company
5.900% 1/29/96...................... $ 585,000 $ 582,315
Rite Aid Corporation
5.750% 1/8/96....................... 11,575,000 11,561,267
Rite Aid Corporation
5.920% 2/9/96....................... 7,720,000 7,669,395
Sierra Pacific Power Company
5.950% 1/26/96...................... 5,000,000 4,979,340
SUPERVALU, Inc.
6.020% 2/6/96....................... 7,615,000 7,569,155
Textron Inc.
6.000% 1/16/96...................... 10,500,000 10,473,172
Textron Inc.
5.930% 2/15/96...................... 9,670,000 9,594,296
Textron Inc.
6.000% 1/4/96....................... 8,360,000 8,355,820
Tyson Foods, Inc.
5.850% 1/10/96...................... 10,000,000 9,984,491
Tyson Foods, Inc.
5.870% 1/11/96...................... 7,175,000 7,162,434
Tyson Foods, Inc.
5.910% 1/5/96....................... 8,945,000 8,938,956
VF Corporation
5.850% 2/9/96....................... 5,500,000 5,463,947
Xerox Corporation
5.630% 2/13/96...................... 10,150,000 10,076,519
------------- ------------
Total Short-Term Investments
(Cost $582,413,954) $ 586,349,000 582,150,249
============= ------------
<CAPTION>
Total Investments -
<S> <C> <C>
(Cost $1,477,928,523) (a) 102.61% 1,870,663,578
Other Assets - 1.25 22,784,224
Liabilities - (3.86) (70,306,872)
-------- --------------
Net Assets - 100.00% $1,823,140,930
======== ==============
<CAPTION>
Table of Open Forward Commitment Contracts
Forward Aggregate Expiration
Commitment Face Value of of Unrealized
Contracts Contracts Contracts Appreciation
---------- ------------- ---------- ------------
<S> <C> <C> <C>
United States of America
6.500% due 8/15/05 $51,200,000 February 1996 $ 1,388,372
------------
Total Forward Commitment
Contracts $ 1,388,372
============
<CAPTION>
<S> <C>
(a) Federal Income Tax Information: At
December 31, 1995 the net unrealized
appreciation on investments and forward
commitment contracts based on cost of
$1,531,480,367 for federal income tax
purposes is as follows:
Aggregate gross unrealized appreciation for
all investments and forward commitments in
which there is an excess of market value
over tax cost........................................... $400,196,547
Aggregate gross unrealized depreciation for
all investments and forward commitments in
which there is an excess of tax cost over
market value.......................................... (6,519,128)
-------------
Net unrealized appreciation........................... $393,677,419
=============
</TABLE>
See Notes to Financial Statements.
18
<PAGE>
MML Series Investment Fund
Notes To Financial Statements
1. History
MML Series Investment Fund (the "MML Trust") is registered under the
Investment Company Act of 1940 as a no-load, registered open end, diversified
management investment company. MML Equity Fund, MML Money Market Fund, MML
Managed Bond Fund and MML Blend Fund (the "Funds"") are the four series of
shares of the MML Trust. The MML Trust is organized under the laws of the
Commonwealth of Massachusetts pursuant to an Agreement and Declaration of Trust.
The MML Trust was established by Massachusetts Mutual Life Insurance Company
("MassMutual") for the purpose of providing vehicles for the investment of
assets of various separate investment accounts established by MassMutual and by
life insurance companies which are subsidiaries of MassMutual. Shares of the MML
Trust are not offered to the general public. MassMutual at December 31, 1995,
was the beneficial owner of 1.1% of MML Blend Fund's shares.
2. Significant Accounting Policies
The following is a summary of significant accounting policies followed
consistently by each Fund in the preparation of the financial statements in
conformity with generally accepted accounting principles.
A. Investment Valuation
Equity securities are valued on the basis of valuations furnished by a
pricing service, authorized by the Board of Trustees, which provides the
last reported sale price for securities listed on a national securities
exchange, or on the NASDAQ national market system. If securities are
unlisted, or there is no reported sale price, the bid price of the prior
trade date will be used. Long-term bonds are valued on the basis of
valuations furnished by a pricing service, authorized by the Board of
Trustees, which determines valuations taking into account appropriate
factors such as institutional-size, trading in similar groups of securities,
yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other market data.
For MML Equity Fund, MML Managed Bond Fund, and MML Blend Fund, short-term
securities with more than sixty days to maturity from the date of purchase
are valued at market and short-term securities having a maturity from the
date of purchase of sixty days or less are valued at amortized cost. MML
Money Market Fund's portfolio securities are valued at amortized cost in
accordance with a rule of the Securities and Exchange Commission pursuant to
which MML Money Market Fund must adhere to certain conditions. It is the
intention of MML Money Market Fund to maintain a per share net asset value
of $1.00.
B. Accounting For Investments
Investment transactions are accounted for on trade date. Dividend income is
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. Premiums and discounts on short-term securities are amortized in
determining interest income.
The cost basis of long-term bonds is not adjusted for amortization of
premium or accrual of discount since MML Managed Bond Fund and MML Blend
Fund do not generally intend to hold such investments until maturity;
however, the MML Trust has elected to accrue for financial reporting
purposes, certain discounts which are required to be accrued for federal
income tax purposes.
Realized gains and losses on investment transactions and unrealized
appreciation and depreciation of investments are reported for financial
statement and federal income tax purposes on the identified cost method.
C. Federal Income Tax
The MML Trust has established a policy for each of the Funds to comply with
the provisions of the Internal Revenue Code applicable to regulated
investment companies. As a result, the Funds will not be subject to federal
income tax on any net investment income and any net capital gains to the
extent they are distributed or are deemed to have been distributed to
shareholders. Distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to the deferral of wash sale losses, and
paydowns on certain mortgage-backed securities. As a result, net investment
income (loss) and net realized gain (loss) on investment transactions for a
reporting period may differ significantly from distributions during such
period. Accordingly, the Funds may periodically make reclassifications among
certain of their capital accounts without impacting the net asset value of
the Funds.
19
<PAGE>
Notes To Financial Statements (Continued)
D. Forward Commitments
Each Fund may purchase or sell securities on a "when issued" or delayed
delivery or on a forward commitment basis. The Funds use forward commitments
to manage interest rate exposure or as a temporary substitute for purchasing
or selling particular debt securities. Forward commitments are not used for
purposes of trading. Settlement for securities purchased on a forward
commitment basis can take place a month or more after the date of the
transaction. The Fund generally does not take delivery on these forward
commitments, but such commitments are instead settled with offsetting
transactions. When a forward commitment contract is closed, the Funds record
a realized gain or loss. Forward commitments involve a risk of loss if the
value of the security to be purchased declines prior to the settlement date.
The Funds could also be exposed to loss if they can not close out their
forward commitments because of an illiquid secondary market, or the
inability of counterparties to perform. The Fund monitors exposure to ensure
counterparties are credit worthy and concentration of exposure is minimized.
The Funds instruct the custodian to segregate liquid high quality assets in
a separate account with a current market value at least equal to the amount
of its forward purchase commitments. The price of the underlying security
and the date when the securities will be delivered and paid for are fixed at
the time the transaction is negotiated. The value of the forward commitment
is determined by management using a commonly accepted pricing model and
fluctuates based upon changes in the value of the underlying security and
market repo rates. Such rates equate the counterparty's cost to purchase and
finance the underlying security to the earnings received on the security and
forward delivery proceeds. The Funds record on a daily basis the unrealized
appreciation/depreciation based upon changes in the value of the forward
commitment. At December 31, 1995, the cost (value) of forward commitments to
purchase securities amounted to $53,105,836 ($54,494,208) for the MML Blend
Fund.
E. Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
3. Capital Loss Carryforward
The accumulated net realized loss on investments for the MML Money Market Fund
results in a capital loss carryforward of $9,734 which is available for federal
income tax purposes to offset future capital gains. Of the total carryforward,
$485 expires December 31, 1997, $1,639 expires December 31, 1998, $1,204 expires
December 31, 2000, $201 expires December 31, 2001, $5,364 expires December 31,
2002 and $841 expires December 31, 2003.
The accumulated net realized loss on investments for the MML Managed Bond Fund
results in a capital loss carryforward of $840,829 which is available for
federal income tax purposes to offset future capital gains. This carryforward
expires December 31, 2002.
4. Investment Management Fee
MassMutual provides all investment advisory, management and administrative
services needed by the Funds. For acting as such, MassMutual receives a
quarterly fee from each Fund at the annual rate of .50% of the first
$100,000,000 of the average daily net asset value of each Fund, .45% of the next
$200,000,000, .40% of the next $200,000,000, and .35% of any excess over
$500,000,000.
MassMutual has entered into an investment sub-advisory agreement with Concert
Capital Management, Inc. ("Concert"), a wholly-owned subsidiary of Babson
Acquisition Corporation which is a controlled subsidiary of MassMutual. The
agreement provides that Concert manage the assets of MML Equity Fund and the
assets of the Equity Sector of MML Blend Fund. MassMutual pays Concert a
quarterly fee equal to an annual rate of .13% of the average daily net asset
value of MML Equity Fund and the Equity Sector of MML Blend Fund.
MassMutual has agreed, at least through April 30, 1997, to bear the expenses of
the Funds to the extent that the aggregate expenses (excluding each Fund's
management fee, interest, taxes, brokerage commissions and extraordinary
expenses) incurred during each Fund's fiscal year exceed .11% of the average
daily net asset value of each Fund for such year. For the year ended December
31, 1995, MassMutual was not required to reimburse the Funds for any expenses.
20
<PAGE>
Notes To Financial Statements (Continued)
5. Purchases and Sales of Investments and Forward Commitments
<TABLE>
<CAPTION>
Proceeds
For the Year Ended Acquisition from Sales
December 31, 1995 Cost and Maturities
- ------------------ ----------- --------------
<S> <C> <C>
Investments
- -----------
MML EQUITY FUND
Equities................................................................................... $ 229,128,687 $ 111,920,115
Short-term investments..................................................................... 1,173,976,609 1,111,406,690
MML MONEY MARKET FUND
Short-term investments..................................................................... 655,453,234 644,100,630
MML MANAGED BOND FUND
Bonds and notes............................................................................ 49,417,797 31,634,617
U.S. Government investments - long-term.................................................... 66,464,380 60,934,135
Short-term investments..................................................................... 535,089,316 540,413,398
MML BLEND FUND
Equities................................................................................... 117,991,665 171,211,503
Bonds and notes............................................................................ 55,930,726 27,095,542
U.S. Government investments - long-term.................................................... 176,774,268 197,430,879
Short-term investments..................................................................... 2,401,405,335 2,275,579,310
<CAPTION>
Cost
Forward Commitments of Contracts
- ------------------- ------------
<S> <C>
MML MANAGED BOND FUND
U.S. Treasury and GNMA Forward Commitment Contracts:
Contracts opened.......................................................................... $ 14,301,523
Contracts closed.......................................................................... 21,317,004
Outstanding at December 31, 1995......................................................... --
MML BLEND FUND
U.S. Treasury and GNMA Forward Commitment Contracts:
Contracts opened.......................................................................... 218,072,828
Contracts closed.......................................................................... 224,132,699
Outstanding at December 31, 1995......................................................... 53,105,836
6. Net Increase from Capital Share Transactions
<CAPTION>
MML MML
MML Money Managed MML
For the Year Ended Equity Market Bond Blend
December 31, 1995 Fund Fund Fund Fund
- ------------------ -------- -------- --------- --------
<S> <C> <C> <C> <C>
Shares
Reinvestment of dividends.................................. 1,621,795 5,376,748 763,489 5,184,192
Sales of shares............................................ 8,464,024 92,327,266 2,219,273 6,885,480
Redemptions of shares...................................... (1,909,273) (80,569,846) (1,113,390) (4,944,135)
--------------- -------------- ------------- --------------
Net increase............................................... 8,176,546 17,134,168 1,869,372 7,125,537
=============== ============== ============= ==============
Amount
Reinvestment of dividends.................................. $ 33,282,252 $ 5,376,748 $ 8,979,443 $ 96,495,329
Sales of shares............................................ 203,078,940 92,327,266 26,776,179 135,128,246
Redemptions of shares...................................... (45,862,370) (80,569,846) (13,296,001) (96,681,499)
--------------- -------------- ------------- --------------
Net increase............................................... $ 190,498,822 $ 17,134,168 $ 22,459,621 $ 134,942,076
=============== ============== ============= ==============
<CAPTION>
MML MML
MML Money Managed MML
For the Year Ended Equity Market Bond Blend
December 31, 1994 Fund Fund Fund Fund
- ----------------- -------- -------- --------- --------
<S> <C> <C> <C> <C>
Shares
Reinvestment of dividends.................................. 1,956,594 2,918,570 930,847 5,115,478
Sales of shares............................................ 7,668,310 63,560,555 1,691,878 9,445,934
Redemptions of shares...................................... (1,955,939) (48,352,100) (2,151,153) (3,664,257)
--------------- -------------- ------------- --------------
Net increase............................................... 7,668,965 18,127,025 471,572 10,897,155
=============== ============== ============= ==============
Amount
Reinvestment of dividends.................................. $ 40,128,959 $ 2,918,570 $ 11,006,790 $ 92,494,374
Sales of shares............................................ 159,968,984 63,560,555 19,994,563 171,986,353
Redemptions of shares....................................... (40,585,464) (48,352,100) (25,360,820) (66,659,536)
--------------- -------------- ------------- --------------
Net increase................................................ $ 159,512,479 $ 18,127,025 $ 5,640,533 $ 197,821,191
=============== ============== ============= ==============
</TABLE>
21
<PAGE>
APPENDIX--Securities Ratings
This is a description of Standard & Poor's Corporation ("S&P") and Moody's
Investors Service, Inc. ("Moody's") commercial paper and bond ratings:
I. Commercial Paper Ratings:
S&P Commercial Paper Ratings--are graded into four categories, ranging from 'A'
for the highest quality obligations to 'D' for the lowest. 'A' Issues assigned
the highest rating are regarded as having the greatest capacity for timely
payment. Issues in this category are delineated with the numbers 1, 2, and 3 to
indicate the relative degree of safety. The A-1 and A-2 categories are
described as follows:
"A-1": This designation indicates that the degree of safety regarding timely
payment is strong. Those issues determined to possess extremely strong safety
characteristics are denoted with a plus (+) sign designation.
"A-2": Capacity for timely payment on issues with this designation is
satisfactory. However, the relative degree of safety is not as high as for
issues designated 'A-1'.
Moody's Commercial Paper Ratings--employs three designations, all judged to be
investment grade, to indicate the relative repayment ability of rated issuers.
The two highest designations are as follows:
Prime-1: Issuers rated Prime-1 (or related supporting institutions) have a
superior ability for repayment of senior short-term debt obligations. Prime-1
repayment ability will often be evidenced by many of the following
characteristics:
. Leading market positions in well-established industries.
. High rates of return on funds employed.
. Conservative capitalization structure with moderate reliance on debt and
ample asset protection.
. Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.
. Well established access to a range of financial markets and assured sources
of alternate liquidity.
Prime-2: Issuers rated Prime-2 (or related supporting institutions) have a
strong ability for repayment of senior short-term promissory obligations.
This will normally be evidenced by many of the characteristics cited above,
but to a lesser degree. Earnings trends and coverage ratios, while sound, may
be more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
II. Bond Ratings
31
<PAGE>
S&P describes its four highest ratings for corporate debt as follows:
A: AAA--Debt rated AAA has the highest rating assigned by S&P. Capacity to
pay interest and repay principal is extremely strong.
AA--Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the higher rated issues only in small degree.
A--Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes
in circumstances and economic conditions than debt in higher rated
categories.
B: BBB--Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits 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 debt in this category than in higher
rated categories.
The ratings from AA to CCC may be modified by the addition of a plus or minus
sign to show relative standing within the major rating categories.
Moody's describes its four highest corporate bond ratings as follows:
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 edged." 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 than 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 the 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 some time 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.
Moody's applies numerical modifiers, 1, 2 and 3 in each generic rating
classification from Aa through B in its corporate bond rating system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3
<PAGE>
indicates that the issue ranks in the lower end of its generic rating category.
S&P describes its below investment grade ratings for corporate debt as follows:
BB,B,CCC,CC,C - Debt rated 'BB', 'B', 'CCC', 'CC' and 'C' is regarded, on
balance, as predominantly speculative with respect to capacity to pay interest
and repay principal in accordance with the terms of the obligation, 'BB'
indicates the lowest degree of speculation and 'C' the highest degree of
speculation. While such debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposures to adverse conditions.
BB - Debt rated 'BB' has less near-term vulnerability to default than other
speculative issues. However, it faces major ongoing uncertainties or exposure
to adverse business, financial, or economic conditions which could lead to
inadequate capacity to meet timely interest and principal payments. The 'BB'
rating category is also used for debt subordinated to senior debt that is
assigned an actual or implied 'BBB-' rating.
B - Debt rated 'B' has a greater vulnerability to default but currently has
the capacity to meet interest payments and principal repayments. Adverse
business, financial, or economic conditions will likely impair capacity or
willingness to pay interest and repay principal. The 'B' rating category is
also used for debt subordinated to senior debt that is assigned an actual or
implied 'BB' or 'BB-' rating.
CCC - Debt rated 'CCC' has a currently identifiable vulnerability to default,
and is dependent upon favorable business, financial, and economic conditions
to meet timely payment of interest and repayment of principal. In the event
of adverse business, financial, or economic conditions, it is not likely to
have the capacity to pay interest and repay principal. The 'CCC' rating
category is also used for debt subordinated to senior debt that is assigned an
actual or implied 'B' or 'B-' rating.
CC - The rating 'CC' is typically applied to debt subordinated to senior debt
that is assigned an actual or implied 'CCC' rating.
C - The rating 'C' is typically applied to debt subordinated to senior debt
which is assigned an actual or implied 'CCC-' debt rating. The 'C' rating may
be used to cover a situation where a bankruptcy petition has been filed, but
debt service payments are continued.
C1 - The rating 'C1' is reserved for income bonds on which no interest is
being paid.
D - Debt rated 'D' is in payment default. The 'D' rating category is used
when interest payments or principal payments are not made on the date due even
if the applicable grace period has not expired, unless S&P believes that such
payments will be made during such grace period. The 'D' rating also will be
used upon the filing of a bankruptcy petition if debt service payments are
jeopardized.
Moody's describes its below investment grade corporate bond ratings as follows:
Ba - Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of interest
and principal payments may be very
<PAGE>
moderate and thereby not well safeguarded during other good and bad times over
the future. Uncertainty of position characterizes bonds in this class.
B - Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.
Caa - Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal
or interest.
Ca - Bonds which are rated Ca represent obligations which are speculative in a
high degree. Such issues are often in default or have other marked
shortcomings.
C - Bonds which are rated C are the lowest rated class of bonds and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.
<PAGE>
PART C: OTHER INFORMATION
Item 24: Financial Statements and Exhibits
(a) Financial Statements:
Financial Statement Information Included in Part A
Supplementary Per Share Information for MML Equity Fund, MML Money
Market Fund, MML Managed Bond Fund and MML Blend Fund.
Financial Statements Included in Part B
Report of Independent Accountants
Statement of Assets and Liabilities as of December 31, 1995
Statement of Operations for the year ended December 31, 1995
Statement of Changes in Net Assets for the years
ended December 31, 1995 and 1994
Financial Highlights
Schedule of Investments as of December 31, 1995
Notes to Financial Statements
(b) Exhibits:
Exhibit 1: Registrant's Agreement and Declaration of Trust, as restated May
14, 1993, incorporated by reference to Exhibit 1 of Post-
Effective Amendment No. 32 to Registrant's Registration Statement
on Form N-1A.
Exhibit 2: Registrant's By-Laws, as amended and restated August 6, 1993,
incorporated by reference to Exhibit 2 of Post-Effective
Amendment No. 32 to Registrant's Registration Statement on Form
N-1A.
Exhibit 3: None.
Exhibit 4: None.
Exhibit 5(a) Copy of executed Investment Management Agreements between each of
Registrant's four series and Massachusetts Mutual Life Insurance
Company ("MassMutual"), as approved by shareholders of the Trust
on April 16, 1993, incorporated by reference to Exhibit 5(a) of
Post-Effective Amendment No. 32 to Registrant's Registration
Statement on Form N-1A.
<PAGE>
Exhibit 5(b) Copy of executed Investment Sub-Advisory Agreement between
MassMutual and Concert Capital Management Inc. ("Concert"), with
respect to the provision of investment advice as to MML Equity
and the Equity Sector of MML Blend, as approved by shareholders
of the Trust on April 16, 1993, incorporated by reference to
Exhibit 5(b) of Post-Effective Amendment No. 32 to Registrant's
Registration Statement on Form N-1A.
Exhibit 6: None.
Exhibit 7: None.
Exhibit 8: Conformed copies of Custodian Agreements between each of the
Funds and Citibank, N.A. incorporated by reference to Exhibit 8
of the Post-Effective Amendment No. 33 to Registrant's
Registration Statement on Form N-1A.
Exhibit 9: None.
Exhibit 10: Opinion of counsel as to the legality of shares being registered,
incorporated by reference to Registrant's Rule 24f-2 Notice filed
on February 22, 1995.
Exhibit 11: Consent of Independent Accountants.
Exhibit 12: None.
Exhibit 13: None.
Exhibit 14: None.
Exhibit 15: None.
Exhibit 16: Schedule of computations of Performance Quotations, incorporated
by reference to Exhibit 16 of Post Effective Amendment No. 27 to
Registrant's Registration Statement on Form N-1A.
Exhibit 17: N/A
Exhibit 18: None
Item 25: Person Controlled by or Under Common Control with Registrant
------------------------------------------------------------
At the date of this Post-Effective Amendment, Registrant did not, directly or
indirectly, control any person. Registrant was organized by MassMutual
primarily for the purpose of providing a vehicle for the investment of assets of
various separate investment accounts established by MassMutual and life
insurance company subsidiaries of MassMutual. The assets in such separate
accounts are, under state law, assets of the life insurance companies which have
established such accounts. Thus, at any time MassMutual and its life insurance
company subsidiaries will own such outstanding shares of Registrant's series as
are purchased with separate account assets; however, where required to do so,
MassMutual and its subsidiaries will vote such shares only in accordance with
instructions received
<PAGE>
from owners of the contracts pursuant to which sums are placed in such separate
accounts. The following entities are, or may be deemed to be, controlled by
MassMutual through the direct or indirect ownership of such entities' stock.
1. MassMutual Holding Company, a Delaware corporation, all the stock of which
is owned by MassMutual.
2. MML Series Investment Fund, a registered open-end investment company
organized as a Massachusetts business trust, all of the shares of which are
owned by separate accounts of MassMutual and companies controlled by
MassMutual.
3. MassMutual Institutional Funds, a registered open-end investment company
organized as a Massachusetts business trust, all of the shares are owned by
MassMutual.
4. MML Bay State Life Insurance Company, a Missouri corporation, all the stock
of which is owned by MassMutual.
5. MassMutual of Ireland, Ltd., incorporated in the Republic of Ireland, to
operate a group life and health claim office for MassMutual, all of the
stock of which is owned by MassMutual.
6. DHC, Inc., a Connecticut holding company, all the stock of which is owned
by MassMutual.
7. CM Assurance Company, a Connecticut life, accident, disability and health
insurer, all the stock of which is owned by MassMutual.
8. CM Benefit Insurance Company, a Connecticut life, accident, disability and
health insurer, all the stock of which is owned by MassMutual.
9. C.M. Life Insurance Company, a Connecticut life, accident, disability and
health insurer, all the stock of which is owned by MassMutual.
10. CM Transnational, S.A., a Luxembourg corporation that sells life insurance
endowments and annuity contracts. MassMutual owns 99.7% of the outstanding
shares and DHC, Inc. owns the remaining 0.3% of the shares.
11. Connecticut Mutual Investment Accounts, Inc., a registered open-end
investment company organized as a Maryland corporation. MassMutual and its
subsidiaries own approximately 30% of the outstanding shares.
12. Sunriver Properties, Inc., an inactive Oregon corporation, whose name is
associated with a development project. MassMutual owns all the shares of
outstanding stock.
13. Connecticut Mutual Financial Services Series Fund I, Inc., a registered
open-end investment company organized as a Maryland corporation. Shares of
the fund are sold only to MassMutual and its affiliates.
<PAGE>
14. Connecticut Mutual Financial Services, LLC, a registered broker-dealer
incorporated as a limited liability company in Connecticut. MassMutual has
a 99% ownership interest and CM Strategic Ventures has a 1% ownership
interest.
15. Cornerstone Real Estate Advisers, Inc., a Massachusetts equity real estate
advisory corporation, all the stock of which is owned by MassMutual Holding
Company.
16. DLB Acquisition Corporation ("DLB"), a Delaware corporation. MassMutual
Holding Company owns 83.7% of the outstanding capital stock of DLB, which
serves as a holding company for certain investment advisory subsidiaries of
MassMutual.
17. MML Investors Services, Inc., registered broker-dealer incorporated in
Massachusetts, all the stock of which is owned by MassMutual Holding
Company.
18. MML Realty Management Corporation, a property manager incorporated in
Massachusetts, all the stock of which is owned by MassMutual Holding
Company.
19. MassMutual International, Inc., a Delaware holding company of foreign
insurance companies. MassMutual Holding Company owns all of the stock of
MassMutual International, Inc.
20. MML Reinsurance (Bermuda) Ltd., a property and casualty reinsurer
incorporated in Bermuda, all of the stock of which is owned by MassMutual
Holding Company.
21. MML International (Bermuda) Ltd., a writer of variable life insurance for
overseas markets that was incorporated in Bermuda, all of the stock of
which is owned by MassMutual Holding Company
22. Mass Seguros de Vida S.A. (Chile), a life insurance company incorporated in
Chile. MassMutual Holding Company owns 33.5% of the outstanding capital
stock of Mass Seguros de Vida S.A.
23. MassLife Seguros de Vida S.A. (Argentine), a life insurance company
incorporated in Argentine. MassMutual Holding Company owns 99.99% of the
outstanding capital stock of MassLife Seguros de Vida S.A.
24. Oppenheimer Acquisition Corporation is a Delaware corporation ("OAC").
MassMutual Holding Company owns 81.3% of the capital stock of OAC, which
serves as a holding company for OppenheimerFunds, Inc.
25. Charter Oak Capital Management, Inc., a Delaware corporation, is a
registered investment adviser. MassMutual Holding Company owns 80% of the
outstanding shares of Charter Oak Capital Management, Inc.
26. Westheimer 335 Suites, Inc., was incorporated in Delaware to serve as a
general partner of the Westheimer 335 Suites Limited Partnership.
MassMutual Holding Company owns all the stock of Westheimer 335 Suites,
Inc.
<PAGE>
27. CM Advantage, Inc., a Connecticut corporation that acts as a general
partner in real estate limited partnerships. DHC, Inc. owns all of the
outstanding stock.
28. CM Insurance Services, Inc., a licensed insurance broker incorporated in
Connecticut, all of the stock of which is owned by DHC, Inc.
29. G.R. Phelps & Company, Inc., a registered investment adviser incorporated
in Connecticut, all the stock of which is owned by DHC, Inc.
30. CM International, Inc., a Delaware corporation that holds a mortgage pool
and issues collateralized bond obligations. DHC, Inc. owns all the
outstanding stock.
31. CM Property Management, Inc., a Connecticut real estate holding company,
all the stock of which is owned by DHC, Inc.
32. State House 1 Corporation, a Delaware corporation, that acts as a general
partner of CML Investments I L.P. and State House I L.P. DHC, Inc. owns
all the outstanding stock.
33. Urban Properties, Inc., a Delaware real estate holding and development
company, all the stock of which is owned by DHC, Inc.
34. Concert Capital Management, Inc., a registered investment adviser
incorporated in Massachusetts, all the stock of which is owned by DLB
Acquisition Corporation.
35. David L. Babson and Company, Incorporated, a registered investment adviser
incorporated in Massachusetts, all of the stock of which is owned by DLB
Acquisition Corporation.
36. Babson Securities Corporation, a registered broker-dealer incorporated in
Massachusetts, all of the stock of which is owned by David L. Babson and
Company, Incorporated.
37. Potomac Babson Incorporated, a Massachusetts corporation, is a registered
investment adviser. David L. Babson and Company Incorporated owns 60% of
the outstanding shares of Potomac Babson Incorporated.
38. MML Insurance Agency, Inc., a licensed insurance broker incorporated in
Massachusetts, all of the stock of which is owned by MML Investors
Services, Inc.
39. MML Securities Corporation, a Massachusetts securities corporation, all of
the stock of which is owned by MML Investors Services, Inc.
40. MML Insurance Agency of Nevada, Inc., a Nevada corporation, all of the
stock of which is owned by MML Insurance Agency, Inc.
41. MML Insurance Agency of Ohio, Inc., a subsidiary of MML Insurance Agency,
Inc., is incorporated in the state of Ohio. The outstanding capital stock
is controlled by MML Insurance Agency, Inc. by means of a voting trust.
<PAGE>
42. MML Insurance Agency of Texas, Inc., a subsidiary of MML Insurance Agency,
Inc., is incorporated in the state of Texas. The outstanding capital stock
is controlled by MML Insurance Agency, Inc. by means of a voting trust.
43. CM Insurance Services, Inc. (Arkansas), a licensed insurance broker
incorporated in Arkansas, all of the stock of which is owned by CM
Insurance Services, Inc.
44. CM Insurance Services, Inc. (Texas) a licensed insurance broker
incorporated in Texas. CM Insurance Services, Inc. controls 100% of the
shares of outstanding stock by means of a voting trust.
45. Diversified Insurance Services Agency of America, Inc. (DISA Ohio), a
licensed insurance broker incorporated in Ohio. CM Insurance Services,
Inc. controls 100% of the shares of outstanding stock by means of a voting
trust.
46. Diversified Insurance Services Agency of America, Inc. (DISA
Massachusetts), a licensed insurance broker incorporated in Massachusetts.
CM Insurance Services, Inc. owns all the shares of outstanding stock.
47. Diversified Insurance Services Agency of America, Inc. (DISA Alabama), a
licensed insurance broker incorporated in Alabama. CM Insurance Services,
Inc. owns all the shares of outstanding stock.
48. Diversified Insurance Services Agency of America, Inc. (DISA New York), a
licensed insurance broker incorporated in New York. CM Insurance Services,
Inc. owns all the shares of outstanding stock.
49. Diversified Insurance Services Agency of America, Inc. (DISA Hawaii), a
licensed insurance broker incorporated in Hawaii. CM Insurance Services,
Inc. owns all the shares of outstanding stock.
50. MassMutual Corporate Value Limited, a Cayman Islands corporation that owns
approximately 93% of MassMutual Corporate Value Partners Limited.
MassMutual Holding Company owns 43.68% of the outstanding capital stock of
MassMutual Corporate Value Limited.
51. CM Strategic Ventures, Inc., a Connecticut corporation that serves as
general partner in limited partnerships, all of the stock of which is owned
by G. R. Phelps & Co., Inc.
52. CML Investments I Corp., a Delaware corporation organized to issue and sell
notes and bonds secured by non-investment grade corporate debt obligations.
CML Investments I L.P. owns all the outstanding stock.
53. Oppenheimer Value Stock Fund ("OVSF) is a series of Oppenheimer Integrity
Funds, a Massachusetts business Trust. OVSF is a registered open-end
investment company of which MassMutual owns 29% of the outstanding shares
of beneficial interest.
54. OppenheimerFunds, Inc., a registered investment adviser incorporated in
Colorado, all of the stock of which is owned by Oppenheimer Acquisition
Corporation
<PAGE>
55. Centennial Asset Management Corporation, a Delaware corporation that serves
as the investment adviser and general distributor of the Centennial Funds.
OppenheimerFunds, Inc. owns all the stock of Centennial Asset Management
Corporation.
56. HarbourView Asset Management Corporation, a registered investment adviser
incorporated in New York, all the stock of which is owned by
OppenheimerFunds, Inc.
57. Main Street Advisers, Inc., a Delaware corporation, all the stock of which
is owned by OppenheimerFunds, Inc.
58. OppenheimerFunds Distributor, Inc., a registered broker-dealer incorporated
in New York, all the stock of which is owned by OppenheimerFunds, Inc.
59. Oppenheimer Partnership Holdings, Inc., a Delaware holding company, all the
stock of which is owned by OppenheimerFunds, Inc.
60. Shareholder Financial Services, Inc., a transfer agent incorporated in
Colorado, all the stock of which is owned by OppenheimerFunds, Inc.
61. Shareholder Services, Inc., a transfer agent incorporated in Colorado, all
the stock of which is owned by OppenheimerFunds, Inc.
62. Centennial Capital Corporation, a former sponsor of unit investment trust
incorporated in Delaware, all the stock of which is owned by Centennial
Asset Management Corporation.
MassMutual is the investment adviser the following investment companies, and as
such may be deemed to control them.
1. MassMutual Corporate Investors, a registered closed-end Massachusetts
business trust.
2. MassMutual Participation Investors, a registered closed-end Massachusetts
business trust.
3. MML Series Investment Fund, a registered open-end Massachusetts business
trust, all of the shares are owned by separate accounts of MassMutual and
companies controlled by MassMutual.
4. MassMutual Institutional Funds, a registered open-end Massachusetts
business trust, all of the shares are owned by MassMutual.
5. MassMutual/Carlson CBO N.V., a Netherlands Antilles corporation that issued
Collateralized Bond Obligations on or about May 1, 1991, owned equally by
MassMutual interests (MassMutual and MassMutual Holding Company) and
Carlson Investment Management Co.
6. MassMutual Corporate Value Partners, Ltd., an off-shore unregistered
investment company.
<PAGE>
Item 26: Number of Holders of Securities
- ----------------------------------------
As of May 1, 1996, the number of holders of record of each class of securities
of Registrant was as follows:
Title of Class Number of Record Holders
-------------- ------------------------
Shares of
Beneficial 2
Interest
Item 27: Indemnification
- ------------------------
Article VIII of Registrant's Agreement and Declaration of Trust provides for the
indemnification of Registrant's Trustees and officers. Registrant undertakes to
apply the indemnification provisions of its Agreement and Declaration of Trust
in a manner consistent with Securities and Exchange Commission Release No. IC-
11330 so long as the interpretation of Section 17(h) and
17(i) of the Investment Company Act of 1940 set forth in such Release shall
remain in effect and be consistently applied.
Trustees and officers of Registrant are also indemnified by MassMutual pursuant
to its by-laws which apply to subsidiaries, including Registrant. No
indemnification is provided with respect to any liability to any entity which is
registered as an investment company under the Investment Company Act of 1940 or
to the security holders thereof, where the basis for such liability is willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of office.
MassMutual's directors' and officers' liability insurance program, which covers
Registrant's Trustees and officers, consists of two distinct coverage. The
first coverage reimburses MassMutual, subject to specified limitations, for
amounts which MassMutual is legally obligated to pay out under its
indemnification by-law, discussed above. The second coverage directly protects
a Trustee or officer of Registrant against liability shareholder derivative and
similar lawsuits which are indemnifiable under the law. There are, however,
specific acts giving rise to liability which are excluded from this coverage.
For example, no Trustee or officer is insured against personal liability for
libel or slander, acts of deliberate dishonesty, fines or penalties, illegal
personal profit or advantage at the expense of Registrant or its shareholders,
violation of employee benefit plans, regulatory statutes, and similar acts which
would traditionally run contrary to public policy and hence reimbursement by
insurance.
MassMutual's present insurance coverage has an overall limit of $45 million
annually ($15 million of which is underwritten by National Union Fire Insurance
Company, $15 million of which is underwritten by Executive Risk Indemnity, Inc.
and $15 million of which is underwritten by Sargasso Mutual Insurance Company).
There is a deductible of $200,000 per claim under the corporate coverage. There
is no deductible for individual trustees or officers.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to trustees, officers and controlling persons of
Registrant pursuant to the foregoing provisions, or otherwise, Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933, and is,
<PAGE>
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by Registrant of expenses incurred or
paid by a trustee, officer or controlling person of Registrant in the successful
defense of any action, suit or proceeding) is asserted by such trustee, officer
or controlling person in connection with the securities being registered,
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act of 1933 and will be governed by the final
adjudication of such issue.
Item 28: Business and Other Connections of the Investment Adviser
- -----------------------------------------------------------------
MassMutual is the investment adviser for Registrant. MassMutual conducts a life
insurance business in all states of the United States, the District of Columbia
and certain provinces of Canada. MassMutual was incorporated in Massachusetts
in 1851. As a mutual company, MassMutual belongs to its members. The insurance
premiums which MassMutual receives are invested primarily in debt securities,
and the income which it receives from its investments in excess of the amounts
it must reserve for the payment of insurance benefits is credited to its
members. It conducts no other business which is substantial in relation to its
business as a mutual life insurance company. As of December 31, 1995, it had
total assets of approximately $50 billion and assets under management in excess
of $100 billion. Effective February 29, 1996, Connecticut Mutual Life Insurance
Company merged into MassMutual. Effective March 31, 1996, MassMutual sold its
group life and health insurance business.
<PAGE>
The directors and executive vice presidents of MassMutual, their positions and
their other business affiliations and business experience for the past five
years are listed below.
Directors
ROGER G. ACKERMAN, Director and Member, Auditing and Human Resources Committees
President and Chief Operating Officer, Corning Incorporated (manufacturer of
specialty materials, communication equipment and consumer products), One
Riverfront Plaza, Corning, New York; Director (since 1993), Dow Corning
Corporation (producer of silicone products), 2200 West Salzburg Road, Midland,
Michigan; Director, The Pittson Company (mining and marketing of coal for
electric utility and steel industries) One Pickwick Plaza, Greenwich,
Connecticut.
JAMES R. BIRLE, Director, Chairman, Dividend Policy Committee and Member,
Investment Committee
President and Founder (since 1994), Resolute Partners, Incorporated (private
merchant bank), 2 Greenwich Plaza, Suite 100, Greenwich Connecticut; General
Partner (1988-1994), The Blackstone Group, 345 Park Avenue, New York, New York;
Co-Chairman and Chief Executive Officer, Wickes Companies, Inc. (diversified
manufacturer and distributor), 3340 Ocean Park Boulevard, Santa Monica,
California; Director: Drexel Industries, Inc., Connecticut Health and Education
Facilities Authority, and Transparency International; Trustee, Villanova
University and The Sea Research Foundation; Director (1991-1996), Connecticut
Mutual Life Insurance Company, 140 Garden Street, Hartford, Connecticut.
FRANK C. CARLUCCI, III, Director and Member, Board Affairs and Dividend Policy
Committee
Chairman (since 1993), Vice Chairman (1989-1993), The Carlyle Group (merchant
banking corporation), 1001 Pennsylvania Avenue, N.W., Washington, D.C.;
Director: Ashland Inc. (producer of petroleum products), 1000 Ashland Drive,
Russell, Kentucky; BDM International, Inc. (professional and technical services
to public and private sector), 7915 Jones Branch Drive, McLean, Virginia; Bell
Atlantic Corporation (telecommunications), 1717 Arch Street, Philadelphia,
Pennsylvania; CB Commercial Real Estate Group, Inc. (real estate broker
subsidiary of Carlyle Holding Corporation), 533 Fremont Avenue, Los Angeles,
California; East New York Savings Bank; General Dynamics Corporation
(manufacturer of military equipment), 3190 Fairview Park Drive, Falls Church,
Virginia; Kaman Corporation (diversified manufacturer), 1332 Blue Hills Avenue,
Bloomfield, Connecticut; Neurogen Corporation; Northern Telecom Ltd. (digital
telecommunications systems), 2920 Matheson Boulevard East, Mississauga, Ontario,
Canada; The Quaker Oats Company (manufacturer of food products), 321 North Clark
Street, Chicago, Illinois; The Rand Corporation; Sun Resorts Ltd., N.V.;
Westinghouse Electric Corporation (electronic systems, electric power generating
equipment and broadcasting), 11 Stanwix Street, Pittsburgh, Pennsylvania;
Director (1989-1996), Connecticut Mutual Life Insurance Company, 140 Garden
Street, Hartford, Connecticut.
GENE CHAO, Director and Member, Auditing and Dividend Policy Committees
<PAGE>
Chairman and Chief Executive Officer (since 1991), Computer Projections, Inc.
(computer graphics), 733 S.W. Vista Avenue, Portland, Oregon; Chairman and Chief
Executive Officer (1990), American Leadership Forum (non-profit leadership and
community building organization); Director (1990-1996), Connecticut Mutual Life
Insurance Company, 140 Garden Street, Hartford, Connecticut.
PATRICIA DIAZ DENNIS, Director and Member Auditing and Human Resources Committee
Senior Vice President and Assistant General Counsel (since 1995), SBC
Communications Inc. (telecommunications), 175 East Houston, San Antonio, Texas;
Special Counsel-Communication Law Matters (1993-1995), Sullivan & Cromwell (law
firm), 1701 Pennsylvania Avenue, N.W., Washington, D.C.; Assistant Secretary of
State for Human Rights and Humanitarian Affairs (1992-1993), U.S. Department of
State, Washington, D.C.; Trustee (since 1995), Federal Communications Bar
Association Foundation; Trustee (since 1993), Radio and Television News
Directors Foundation; Director (since 1993), National Public Radio; Director
(since 1991), Reading Is Fundamental; Director (since 1989), Foundation for
Women's Resources; Trustee (since 1991), Tomas Rivera Center; Director (1995-
1996), Connecticut Mutual Life Insurance Company, 140 Garden Street, Hartford,
Connecticut.
ANTHONY DOWNS, Director and Member, Dividend Policy and Investment Committees
Senior Fellow, The Brookings Institution (non-profit policy research center),
1775 Massachusetts Avenue, N.W., Washington, D.C.; Director: The Pittway
Corporation (publications and security equipment), 200 South Wacker Drive, Suite
700, Chicago, Illinois; National Housing Partnerships Foundation (non-profit
organization to own and manage rental housing), 1225 Eye Street, N.W.,
Washington, D.C.; Bedford Properties, Inc. (real estate investment trust), 3658
Mt. Diable Boulevard, Lafayette, California; General Growth Properties, Inc.
(real estate investment trust), 215 Keo Way, Des Moines, Iowa; NAACP Legal and
Educational Defense Fund, Inc. (civil rights organization), 99 Hudson Street,
New York, New York; Consultant, Aetna Realty Investors (real estate
investments), 242 Trumbull Street, Hartford, Connecticut; and Salomon Brothers
Inc (investment banking), 7 World Trade Center, New York, New York; Trustee:
Urban Institute (public policy research organization), 2100 M Street, N.W.,
Washington, D.C. and Urban Land Institute (educational and research
organization, 625 Indiana Avenue, N.W., Washington, D.C.
JAMES L. DUNLAP, Director and Member, Human Resources and Board Affairs
Committees
Senior Vice President of Texaco, Inc. (producer of petroleum products), 2000
Westchester Avenue, White Plains, New York and President (1987-1994), Texaco
USA, 1111 Bagby, Houston, Texas.
WILLIAM B. ELLIS, Director and Member, Auditing and Investment Committees
Senior Fellow (since 1995) Yale University School of Forestry and Environmental
Studies, New Haven, Connecticut; Chairman (1983-1995) and Chief Executive
Officer (1983-1993), Northeast Utilities (electric utility), 107 Selden Street,
Berlin, Connecticut; Director (since 1991), The Hartford Steam Boiler Inspection
and Insurance Company (property and casualty insurer), One State Street,
Hartford, Connecticut; Director (since 1996), Advest Group, Inc. (financial
services holding company), 280 Trumbull Street, Hartford, Connecticut; Director
(since 1995), Catalytica Combustion Systems, Inc.; Director, The National Museum
of National History of the Smithsonian Institution, Washington, D.C.; Director
(1985-1996), Connecticut Mutual Life Insurance Company, 140 Garden Street,
<PAGE>
Hartford, Connecticut.
ROBERT M. FUREK, Director and Member, Dividend Policy and Investment Committees
President and Chief Executive Officer, Heublein, Inc. (beverage distributor),
450 Columbus Boulevard, Hartford, Connecticut; Director, The Dexter Corporation
(producer of specialty chemicals and papers), One Elm Street, Windsor Locks,
Connecticut; Corporator, Hartford Hospital and The Bushnell Memorial, Hartford,
Connecticut; Trustee, Colby College, Mayflower Hill Drive, Waterville Maine;
Director (1990-1996), Connecticut Mutual Life Insurance Company, 140 Garden
Street, Hartford, Connecticut.
CHARLES K. GIFFORD, Director and Member, Investment and Auditing Committees
Chairman and Chief Executive Officer (since 1995) and President, The First
National Bank of Boston and Bank of Boston Corporation (bank holding company),
100 Federal Street, Boston, Massachusetts; Director, Member of Audit Committee,
Boston Edison Co. (public utility electric company), 800 Boylston Street,
Boston, Massachusetts.
WILLIAM N. GRIGGS, Director, Chairman, Auditing Committee and Member, Investment
committee
Managing Director, Griggs & Santow Inc. (business consultants) 75 Wall Street,
New York, New York; Director, T/SF Communications, Inc. (diversified publishing
and communications company), Tulsa, Oklahoma; Trustee (1983-1991), MassMutual
Integrity Funds (open-end investment company advised by MassMutual).
JAMES G. HARLOW, JR., Director and Member, Auditing and Board Affairs Committee
Chairman, Chief Executive Officer (since 1995), and President (1973-1995),
Oklahoma Gas and Electric Company (electric utility), Corporate Tower, 101 N.
Robinson, Oklahoma City, Oklahoma; Director, Fleming Companies (wholesale food
distributors), 6301 Waterford Boulevard, Oklahoma City, Oklahoma; Director
(since 1994), Associated Electric & Gas Insurance Services Limited, Harborside
Financial Center, 700 Plaza Two, Jersey City, New Jersey.
GEORGE B. HARVEY, Director, Chairman, Human Resources Committee and Member,
Board Affairs Committee
Chairman, President and Chief Executive Officer, Pitney Bowes, Inc. (office
machines manufacturer), One Elmcroft Road, Stamford, Connecticut; Director:
Merrill Lynch & Company (financial services holding company), New York, New
York; The McGraw Hill Companies (multimedia publishing and information
services), 1221 Avenue of the Americas, New York, New York; Stamford Hospital,
Stamford, Connecticut; Pfizer, Inc. (pharmaceutical and health-care products),
235 East 42nd Street, New York, New York; The Catalyst; Member, Board of
Overseers, Wharton School of Finance, University of Pennsylvania; Director
(1989-1996), Connecticut Mutual Life Insurance Company, 140 Garden Street,
Hartford, Connecticut.
BARBARA B. HAUPTFUHRER, Director, Member Board Affairs and Investment Committees
<PAGE>
Director and Member, Compensation, Nominating and Audit Committees, The Vanguard
Group of Investment Companies including among others the following funds:
Vanguard/Windsor Fund, Vanguard/Wellington Fund, Vanguard/Morgan Growth Fund,
Vanguard/Wellesley Income Fund, Vanguard/Gemini Fund, Vanguard/Explorer Fund,
Vanguard Municipal Bond Fund, Vanguard Fixed Income Securities Fund, Vanguard
Index Trust, Vanguard World Fund, Vanguard/Star Fund, Vanguard Ginnie Mae Fund,
Vanguard/Primecap Fund, Vanguard Convertible Securities Fund, Vanguard
Quantitative Fund, Vanguard/Trustees Commingled Equity Fund, Vanguard/Trustees
Commingled Fund-International, Vanguard Money Market Trust, Vanguard/Windsor II,
Vanguard Asset Allocation Fund and Vanguard Equity Income Fund (principal
offices, Drummers Lane, Valley Forge, Pennsylvania); Director, Chairman of
Retirement Benefits Committee and Pension Fund Investment Review - USA and
Canada and Member, Audit, Finance and Executive Committees, The Great Atlantic
and Pacific Tea Company, Inc. (operator of retail food stores), 2 Paragon Drive,
Montvale, New Jersey; Director, Chairman of Nominating Committee and Member,
Compensation Committee, Knight-Ridder, Inc. (publisher of daily newspapers and
operator of cable television and business information systems), One Herald
Plaza, Miami, Florida; Director and Member, Compensation Committee, Raytheon
Company (electronics manufacturer), 141 Spring Street, Lexington, Massachusetts;
Director and Member, Executive Committee and Chairman, Human Resources and
Independent Directors Committees, Alco Standard Corp. (diversified office
products and paper distributor), 825 Duportail Road, Valley Forge, Pennsylvania.
SHELDON B. LUBAR, Director, Chairman, Board Affairs Committee and Member,
Investment Committee
Chairman, Lubar & Co. Incorporated (investment management and advisory company)
777 East Wisconsin Avenue, Milwaukee, Wisconsin; Chairman and Director, The
Christiana Companies, Inc. (real estate development); Director: Firstar Bank,
Firstar Corporation (bank holding company), SLX Energy, Inc. (oil and gas
exploration); Member, Advisory Committee, Venture Capital Fund, L.P. (principal
offices, 777 East Wisconsin Avenue, Milwaukee, Wisconsin); Director: Grey Wolf
Drilling Co. (contract oil and gas drilling), 2000 Post Oak Boulevard, Houston,
Texas; Marshall Erdman and Associates, Inc. (design, engineering, and
construction firm), 5117 University Avenue, Madison, Wisconsin; MGIC Investment
Corporation (investment company), MGIC Plaza, 111 E. Kilbourn Avenue, Milwaukee,
Wisconsin; Director (since 1995), Energy Ventures, Inc., 5 Post Oak Park,
Houston, Texas; Director (since 1993), Ameritech, Inc. (regional holding company
for telephone companies), 30 South Wacker Drive, Chicago, Illinois; Director
(1989-1995), Prideco, Inc. (drill collar manufacturer), 6039 Thomas Road,
Houston, Texas; Director (1989-1994), Schwitzer, Inc. (holding company for
engine parts manufacturers), P.O. Box 15075, Asheville, North Carolina; and
Briggs & Stratton (small engine manufacturer) 3300 North 124th Street,
Milwaukee, Wisconsin; Director (1986-1991), Square D Company (manufacturer of
electrical equipment and electronics products), Executive Plaza, Palatine,
Illinois and Milwaukee Insurance Group, Inc., 809 W. Michigan Street, Milwaukee,
Wisconsin; Director (1987-1991), Lubar Management, Inc. (investment company) 777
East Wisconsin Avenue, Milwaukee, Wisconsin.
WILLIAM B. MARX, JR., Director and Member, Dividend Policy and Board Affairs
Committees
<PAGE>
Senior Executive Vice President (since 1995), Lucent Technologies (public
telecommunications systems and software), 600 Mountain Road, Murray Hill, New
Jersey; Executive Vice President and Chief Executive Officer, Multimedia
Products Group (1994-1995) and Network Systems Group (1993-1994), AT&T (global
communications and network computing company), 295 North Maple Avenue, Basking
Ridge, New Jersey; Group Executive and President (1989-1993), AT&T Network
Systems (manufacturer and marketer of network telecommunications equipment), 475
South Street, Morristown, New Jersey; Member (since 1996), Advisory Council,
Graduate School of Business, Stanford University, Stanford, California.
JOHN F. MAYPOLE, Director and Member, Board Affairs and Human Resources
Committee
Managing Partner, Peach State Real Estate Holding Company (real estate
investment company), P.O. Box 1223, Toccoa, Georgia; Consultant to institutional
investors; Co-owner of family businesses (including Maypole Chevrolet-Geo, Inc.
and South Georgia Car Rentals, Inc.); Director, Chairman, Finance Committee and
Member, Executive Committee and Human Resources Committee on Directors, Bell
Atlantic Corporation (telecommunications), 1717 Arch Street, Philadelphia,
Pennsylvania; Director and Chairman, Compensation Committee, Briggs Industries,
Inc. (plumbing fixtures), 4350 W. Cypress Street, Tampa, Florida; Director,
Chairman, Audit Committee and Member, Compensation Committee, Blodgett
Corporation; Director, Chairman, Products Committee and Member, Compensation and
Audit Committee, Igloo Corporation (portable coolers), 1001 W. Sam Houston
Parkway North, Houston, Texas; Director and Member, Senior Management Committee,
Dan River, Inc. (textile manufacturer), 2291 Memorial Drive, Danville, Virginia;
Director, Davies, Turner & Company; Director (1989-1996), Connecticut Mutual
Life Insurance Company, 140 Garden Street, Hartford, Connecticut.
DONALD F. MCCULLOUGH, Director and Member, Dividend Policy and Auditing
Committees
Retired (since 1988); former Chairman and Chief Executive Officer, Collins &
Aikman Corp. (manufacturer of textile products) 210 Madison Avenue, New York,
New York; Director: Bankers Trust New York Corp. (bank holding company) and
Bankers Trust Company (principal offices, 280 Park Avenue, New York, New York);
Melville Corporation (specialty retailer), One Theall Road, Rye, New York.
JOHN J. PAJAK, Vice Chairman, Director and Member, Dividend Policy and
Investment Committees
Vice Chairman, Director and Chief Administrative Officer (since 1996), Executive
Vice President (1987-1996) of MassMutual; Director (since 1994): MassMutual
Holding Company (wholly-owned holding company subsidiary of MassMutual);
Director (1994-1996), MassMutual Holding Company Two, Inc. (former wholly-owned
holding company subsidiary of MassMutual); MassMutual Holding Company Two MSC,
Inc. (former wholly-owned holding company subsidiary of MassMutual Holding
Company Two, Inc.); and Mirus Insurance Company (formerly MML Pension Insurance
Company, a wholly-owned insurance subsidiary of MassMutual Holding Company Two
MSC, Inc.) (principal offices, 1295 State Street, Springfield, Massachusetts);
Director (1995-1996), National Capital Health Plan, Inc. (health maintenance
organization), Washington, D.C.
BARBARA S. PREISKEL, Director and Member, Auditing and Human Resources
Committees
<PAGE>
Attorney-at-Law, 60 East 42nd Street, New York, New York; Director: Textron,
Inc. (diversified manufacturing company), 40 Westminster Street, Providence,
Rhode Island; General Electric Company (diversified manufacturer electrical
products), 3135 Easton Turnpike, Fairfield, Connecticut; The Washington Post
Company (publisher of daily newspaper), Washington, D.C.; American Stores
Company (operator of supermarkets and drugstores), 709 East South Temple, Salt
Lake City, Utah.
DAVID E. SAMS, JR., President, Chief Operating Officer, Director and Member,
Board Affairs, Dividend Policy and Investment Committees
President, Chief Operating Officer and Director (since 1996) of MassMutual, 1295
State Street, Springfield, Massachusetts; Chairman (1994-1996), President and
Chief Executive Officer (1993-1996), Connecticut Mutual Life Insurance Company,
140 Garden Street, Hartford, Connecticut; President and Chief Executive Officer-
Agency Group (1987-1993), Providian Corporation (formerly Capital Holding
Corporation, a holding company for insurance companies), Louisville, Kentucky;
Director (since 1995), Health Insurance of Vermont, Inc. and Kentucky Medical
Insurance Company; Director (1995), United States Chamber of Commerce;
Corporator, Saint Francis Hospital and Medical Center, Hartford, Connecticut.
THOMAS B. WHEELER, Chairman, Chief Executive Officer, Chairman, Investment
Committee and Member, Dividend Policy and Board Affairs Committees
Chairman (since 1996), Chief Executive Officer (since 1988), and President
(1987-1996) of MassMutual; Chairman and Chief Executive Officer (since 1995),
DLB Acquisition Corporation (holding company for investment advisers); Chairman
of the Board of Directors (1994-1996), Mirus Insurance Company (formerly MML
Pension Insurance Company, a wholly-owned insurance subsidiary of MassMutual
Holding Company Two MSC, Inc.) (principal offices, 1295 State Street,
Springfield, Massachusetts); Director, The First National Bank of Boston and
Bank of Boston Corporation (bank holding company), 100 Federal Street, Boston,
Massachusetts and Massachusetts Capital Resources Company, 545 Boylston Street,
Boston, Massachusetts; Chairman and Director, Oppenheimer Acquisition Corp.
(parent of OppenheimerFunds, Inc., an investment management company), Two World
Trade Center, New York, New York; Director (since 1993), Textron, Inc.
(diversified manufacturing company), 40 Westminster Street, Providence, Rhode
Island; Chairman of the Board of Directors (1992-1995), Concert Capital
Management, Inc. (wholly-owned investment advisory subsidiary of DLB Acquisition
Corporation), One Memorial Drive, Cambridge, Massachusetts.
ALFRED M. ZEIEN, Director and Member Board Affairs and Human Resources
Committees
Chairman and Chief Executive Officer, The Gillette Company (manufacturer of
personal care products), Prudential Tower Building, Boston, Massachusetts;
Director: Polaroid Corporation (manufacturer of photographic products), 549
Technology Square, Cambridge, Massachusetts; Repligen Corporation (bio-
technology), One Kendall Square, Cambridge, Massachusetts; Bank of Boston
Corporation (bank holding company), 100 Federal Street, Boston, Massachusetts;
and Raytheon Corporation (electronics manufacturer), 141 Spring Street,
Lexington, Massachusetts; Trustee, University Hospital of Boston, Massachusetts;
Trustee (since 1994), Marine Biology Laboratory and Woods Hole Oceanographic
Institute, Woods Hole, Massachusetts.
Executive Vice Presidents
<PAGE>
LAWRENCE V. BURKETT, Executive Vice President and General Counsel
Executive Vice President and General Counsel (since 1993), Senior Vice President
and Deputy General Counsel (1992-1993), and Senior Vice President and Associate
General Counsel (1988-1992) of MassMutual; Director (since 1993), MassMutual
Holding Company (wholly-owned holding company subsidiary of MassMutual);
Director (1994-1996), MassMutual Holding Company Two, Inc. (former wholly-owned
holding company subsidiary of MassMutual), MassMutual Holding Company Two MSC,
Inc. (former wholly-owned holding company subsidiary of MassMutual Holding
Company Two, Inc.) and Mirus Insurance Company (formerly MML Pension Insurance
Company, a wholly-owned insurance subsidiary of MassMutual Holding Company Two
MSC, Inc.) (principal offices, 1295 State Street, Springfield, Massachusetts);
Director (since 1994), Cornerstone Real Estate Advisers, Inc. (wholly-owned real
estate investment adviser subsidiary of MassMutual Holding Company), 1500 Main
Street, Suite 1400, Springfield, Massachusetts; Director (since 1993), Sargasso
Mutual Insurance Co., Ltd., Victoria Hall, Victoria Street, Hamilton, Bermuda;
MassMutual of Ireland, Ltd. (wholly-owned subsidiary of MassMutual to provide
group insurance claim services), IDA Industrial Estate, Tipperary Town, Ireland;
Chairman (since 1994), Director (since 1993), MML Reinsurance (Bermuda) Ltd.
(wholly-owned property and casualty reinsurance subsidiary of MassMutual Holding
Company) and Director (since 1995), MassMutual International (Bermuda) Ltd.
(wholly-owned subsidiary of MassMutual Holding Company that distributes variable
insurance products in overseas markets) (principal offices, 41 Cedar Avenue,
Hamilton, Bermuda).
JOHN B. DAVIES, Executive Vice President
Executive Vice President (since 1994), Associate Executive Vice President (1993-
1994), General Agent (1982-1993) of MassMutual, 1295 State Street, Springfield,
Massachusetts; Director (since 1994), MML Investors Services, Inc. (wholly-
owned broker-dealer subsidiary of MassMutual Holding Company), MML Insurance
Agency, Inc. (wholly-owned subsidiary of MML Investors Services, Inc.), MML
Insurance Agency of Ohio, Inc. (subsidiary of MML Insurance Agency, Inc.) and
Director (since 1995), MML Insurance Agency of Nevada, Inc. (subsidiary of MML
Insurance Agency, Inc.) (principal offices, 1414 Main Street, Springfield,
Massachusetts); Director (since 1994), Cornerstone Real Estate Advisers, Inc.
(wholly-owned real estate investment adviser subsidiary of MassMutual Holding
Company), 1500 Main Street, Suite 1400, Springfield, Massachusetts; Director
(since 1994), Life Underwriter Training Council, 7625 Wisconsin Avenue,
Bethesda, Maryland.
DANIEL J. FITZGERALD, Executive Vice President, Corporate Financial Operations
Executive Vice President, Corporate Financial Operations (since 1994), Senior
Vice President (1991-1994) of MassMutual; Vice President (since 1994), Director
(since 1993), MassMutual Holding Company; (wholly-owned holding company
subsidiary of MassMutual); Vice President and Director (1994-1996), MassMutual
Holding Company Two, Inc. and MassMutual Holding Company Two MSC, Inc. (former
direct and indirect wholly-owned holding company subsidiaries of MassMutual);
Director (1994-1996), Mirus Insurance Company (formerly MML Pension Insurance
Company, a wholly-owned insurance subsidiary of MassMutual Holding Company Two
MSC, Inc.); Director (since 1994), MML Bay State Life Insurance Company (wholly-
owned insurance subsidiary of MassMutual); MML Realty Management Corporation
(wholly-owned real estate management subsidiary of MassMutual Holding Company);
Director (since 1995), DLB Acquisition Corporation (holding company for
investment advisers); Director (1994-1995), MML Real Estate Corporation (wholly-
owned real estate management subsidiary of MassMutual Holding Company)
(principal offices, 1295 State Street, Springfield,
<PAGE>
Massachusetts); Director (since 1994), Concert Capital Management, Inc. (wholly-
owned investment advisory subsidiary of DLB Acquisition Corporation), One
Memorial Drive, Cambridge, Massachusetts; Director and Member, Compensation
Committee (since 1994), Cornerstone Real Estate Advisers, Inc., 1500 Main
Street, Suite 1400, Springfield, Massachusetts; Director, and Member, Audit and
Compensation Committees (since 1994), MML Investors Services, Inc. (wholly-owned
broker dealer subsidiary of MassMutual Holding Company) and Director (1992-
1993), MML Insurance Agency, Inc. (wholly-owned subsidiary of MML Investors
Services, Inc.) (principal offices, 1414 Main Street, Springfield,
Massachusetts) Director (since 1994), MassMutual of Ireland, Ltd. (wholly-owned
subsidiary of MassMutual to provide group insurance claim services), IDA
Industrial Estate, Tipperary Town, Ireland.
LAWRENCE L. GRYPP, Executive Vice President
Executive Vice President of MassMutual; Director (since 1995), DLB Acquisition
Corporation (holding company for investment advisers) (principal offices, 1295
State Street, Springfield, Massachusetts); Chairman and Member Executive and
Compensation Committees, MML Investors Services, Inc. (wholly-owned broker-
dealer subsidiary of MassMutual Holding Company) and Director (1991-1993), MML
Insurance Agency (wholly-owned insurance subsidiary of MML Investors Services,
Inc.) (principal offices, 1414 Main Street, Springfield, Massachusetts);
Director, Oppenheimer Acquisition Corp. (parent of OppenheimerFunds, Inc., an
investment management company), Two World Trade Center, New York, New York:
Director (since 1993), Concert Capital Management, Inc. (wholly-owned investment
advisory subsidiary of DLB Acquisition Corporation), One Memorial Drive,
Cambridge, Massachusetts; Trustee, The American College, Bryn Mawr,
Pennsylvania.
JOHN M. NAUGHTON, Executive Vice President
Executive Vice President of MassMutual; Trustee and Member, Investment Pricing
Committee (since 1994), MassMutual Institutional Funds (open-end investment
company); Director (since 1995), DLB Acquisition Corporation (holding company
for investment advisers) (principal offices, 1295 State Street, Springfield,
Massachusetts); Chairman and Director (since 1995), Trustee (1990-1995), SIS
Bank (formerly, Springfield Institution for Savings), 1441 Main Street,
Springfield, Massachusetts; Trustee, BayState Health Systems, 759 Chestnut
Street, Springfield, Massachusetts; and American International College, 1000
State Street, Springfield, Massachusetts; Director, Oppenheimer Acquisition
Corp. (parent of OppenheimerFunds, Inc., an investment management company), Two
World Trade Center, New York, New York; Director (since 1993), Association of
Private Pension and Welfare Plans; Trustee (since 1994), University of
Massachusetts, Amherst, Massachusetts; Director (1992-1995), Concert Capital
Management, Inc. (wholly-owned investment advisory subsidiary of DLB Acquisition
Corporation), One Memorial Drive, Cambridge, Massachusetts and Colebrook Group
(commercial real estate management and development), 1441 Main Street,
Springfield, Massachusetts.
GARY E. WENDLANDT, Executive Vice President and Chief Investment Officer
Chief Investment Officer (since 1993), Executive Vice President (since 1992)
Senior Vice president (1983-1992) of MassMutual; Chairman (since 1995), Trustee
(since 1986) and President (1983-1995), MassMutual Corporate Investors and
Chairman (since 1995), Trustee (since 1988) and President (1988-1995),
MassMutual Participation Investors (closed-end investment companies); Chairman
(since 1995), Vice Chairman and Trustee (1993-1995) and President (1988-1993),
MML Series Investment Fund (open-end investment company); Chairman, Chief
Executive Officer and Member, Investment
<PAGE>
Pricing Committee (since 1994), MassMutual Institutional Funds (open-end
investment company); Chairman and Chief Executive Officer (since 1994),
President (since 1993) and Director, MassMutual Holding Company (wholly-owned
holding company subsidiary of MassMutual); Chairman, President and Chief
Executive Officer (1994-1996), MassMutual Holding Company Two, Inc. (former
wholly-owned holding company subsidiary of MassMutual); Chairman and President
(1994-1996), Chief Executive Officer (1995-1996), MassMutual Holding Company Two
MSC, Inc. (former wholly-owned holding company subsidiary of MassMutual Holding
Company Two, Inc.); Chairman (since 1994) and Director (since 1993), MML Realty
Management Corporation (wholly-owned real estate management subsidiary of
MassMutual Holding Company); President and Director (since 1995), DLB
Acquisition Corporation (holding company for investment advisers); Chairman
(1994-1995) and Director (1993-1995), MML Real Estate Corporation (wholly-owned
real estate management subsidiary of MassMutual Holding Company) (principal
offices, 1295 State Street, Springfield, Massachusetts); Chairman, Chief
Executive Officer and Member Executive and Compensation Committees (since 1994)
and Member, Audit Committee (since 1995), Cornerstone Real Estate Advisers,
Inc., 1500 Main Street, Springfield, Massachusetts; President and Chief
Executive Officer (since 1994) and Director, Concert Capital Management, Inc.
(wholly-owned investment advisory subsidiary of DLB Acquisition Corporation),
One Memorial Drive, Cambridge, Massachusetts; Director, Oppenheimer Acquisition
Corporation (parent of OppenheimerFunds, Inc., an investment management
company), Two World Trade Center, New York, New York; Supervisory Director,
MassMutual/Carlson CBO N.V. (collateralized bond fund), 14 John Gorsiraweg,
Willemstad, Curacao, Netherlands Antilles; Director, Merrill Lynch Derivative
Products, Inc., World Financial Center, North Tower, New York, New York;
Director (since 1994), MassMutual Corporate Value Partners Limited (investor in
debt and equity securities) and MassMutual Corporate Value Limited (parent of
MassMutual Corporate Value Partners Limited) (principal offices, c/o BankAmerica
Trust and Banking Corporation, Box 1092, George Town, Grand Cayman, Cayman
Islands, British West Indies); Director (since 1995), Mass Seguros de Vida,
S.A., Huerfanos No.770, Santiago, Chile; President and Director (since 1995),
MassMutual International (Bermuda) Ltd. (wholly-owned subsidiary of MassMutual
Holding Company that distributes variable insurance products in overseas
markets), 41 Cedar Avenue, Hamilton, Bermuda.
The directors and executive officers of Concert Capital, their positions and
their other business affiliations and business experience for the past two years
are as follows:
Directors
DANIEL J. FITZGERALD, Director
Director (since 1994), Concert Capital Management, Inc. (wholly-owned investment
advisory subsidiary of DLB Acquisition Corporation), One Memorial Drive,
Cambridge, Massachusetts. See Executive Vice Presidents of MassMutual, above,
for further details.
LAWRENCE L. GRYPP, Director
Director (since 1993), Concert Capital Management, Inc. (wholly-owned investment
advisory subsidiary of DLB Acquisition Corporation), One Memorial Drive,
Cambridge, Massachusetts. See Executive Vice Presidents of MassMutual, above,
for further details.
PETER C. SCHLIEMANN, Director
<PAGE>
Director (since 1995), Concert Capital Management, Inc. (wholly-owned investment
advisory subsidiary of DLB Acquisition Corporation), One Memorial Drive,
Cambridge, Massachusetts; Executive Vice President (since 1992), Senior Vice
President (1984-1992) and Director, David L. Babson and Company, Incorporated
(registered investment adviser), One Memorial Drive, Cambridge, Massachusetts.
PETER C. THOMPSON, Director
Director (since 1995), Concert Capital Management, Inc. (wholly-owned investment
advisory subsidiary of DLB Acquisition Corporation), One Memorial Drive,
Cambridge, Massachusetts; President and Director, David L. Babson and Company,
Incorporated (registered investment adviser), One Memorial Drive, Cambridge,
Massachusetts.
GARY E. WENDLANDT, President, Director and Chief Executive Officer
President and Chief Executive Officer (since 1994) and Director, Concert Capital
Management, Inc. (wholly-owned investment advisory subsidiary of DLB Acquisition
Corporation), One Memorial Drive, Cambridge, Massachusetts. See Executive Vice
Presidents of MassMutual, above, for further details.
Executive Officers:
JAMES W. MACALLEN, Senior Vice President
Senior Vice President (since 1996), Concert Capital Management, Inc., One
Memorial Drive, Cambridge, Massachusetts; Principal (1994-1995), Hagler,
Mastrovita & Hewitt (investment counsel), 225 Franklin Street, Boston,
Massachusetts; President (1992-1994), Chief Investment Officer (1991-1994), and
Vice President (1983-1992), Wilmington Capital Management, Inc. (investment
counsel), 1 Rodney Square, Wilmington, Delaware.
JOHN V. MURPHY, Chief Operating Officer
Chief Operating Officer (since 1993), Concert Capital Management, Inc., One
Memorial Drive, Cambridge, Massachusetts; Chief Financial Officer (1985-1993),
Liberty Financial Companies, Boston, Massachusetts.
EDWARD W. BICKFORD, Senior Vice President and Director of Marketing
Senior Vice President and Director of Marketing (since 1994), Concert Capital
Management, Inc., One Memorial Drive, Cambridge, Massachusetts; Senior Vice
President and Vice President (1985-1994), State Street Research (investments),
Boston Massachusetts.
MICHAEL K. CAPLAN, Senior Vice President
Senior Vice President (since 1995), Concert Capital Management, Inc., One
Memorial Drive,
<PAGE>
Cambridge, Massachusetts; Portfolio Manager (1990-1994), State Street Bank &
Trust Company, Boston Massachusetts.
GEORGE M. ULRICH, Senior Vice President
Senior Vice President of Concert Capital Management, Inc., One Memorial Drive,
Cambridge, Massachusetts.
For information as to the business, profession, vocation or employment of a
substantial nature of some of the officers and trustees of MML Series Investment
Fund, reference is made to Part B of this registration statement and to the
registration on Form ADV filed by the Massachusetts Mutual Life Insurance
Company and Concert Capital Management, Inc., under the Investment Advisers Act
of 1940, which are incorporated herein by reference.
Item 29: Principal Underwriters Not Applicable.
- -------------------------------
Item 30: Location of Accounts and Records
- -----------------------------------------
Each account, book or other document required to be maintained by Registrant
pursuant to Section 31 (a) of the Investment Company Act of 1940 and Rules 31a-1
to 31a-3 thereunder are maintained by Registrant at 1295 State Street,
Springfield, Massachusetts 01111.
Item 31: Management Services Not Applicable.
- ----------------------------
Item 32: Undertakings Not Applicable.
- ---------------------
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, Registrant certifies that it has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereto
duly authorized, in the City of Springfield and in the Commonwealth of
Massachusetts on the day of April, 1996. The Registrant certifies that
this Post-Effective Amendment meets the requirements for effectiveness pursuant
to Rule 485(b) under the Securities Act of 1933.
MML SERIES INVESTMENT FUND
By: Hamline C. Wilson*
--------------------
Hamline C. Wilson
Vice President and Chief Financial Officer
*By: Stephen L. Kuhn
----------------
Stephen L. Kuhn
Attorney-in-Fact
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities and
on this day of April, 1996.
Signature Title
--------- -----
Gary E. Wendlandt* Chairman and Trustee
------------------
Gary E. Wendlandt
Richard G. Dooley* Vice-Chairman and
------------------ Trustee
Richard G. Dooley
Mary E. Boland* Trustee
---------------
Mary E. Boland*
Ronald J. Abdow* Trustee
----------------
Ronald J. Abdow
Charles J. McCarthy* Trustee
--------------------
Charles J. McCarthy
John H. Southworth* Trustee
-------------------
John H. Southworth
<PAGE>
Stuart H. Reese* President
---------------- (Principal Executive Officer)
Stuart H. Reese
Hamline C. Wilson*
--------------------
Hamline C. Wilson Chief Financial Officer
(Principal Financial &
Accounting Officer)
*By: Stephen L. Kuhn
----------------
Stephen L. Kuhn
Attorney-in-Fact
The name MML Series Investment Fund is the designation of the Trustees under an
Declaration of Trust dated December 19, 1984, as amended from time to time. The
obligations of MML Trust are not personally binding upon, nor shall resort be
had to the property of, any of the Trustees, shareholders, officers, employees
or agents of MML Trust, but MML Trust's property only shall be bound.
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit No. Title of Exhibit
- ----------- ----------------
<S> <C>
99.B11 Consent of Independent Accountants
27 Financial Data Schedule
</TABLE>
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees of
MML Series Investment Fund
We consent to the inclusion in Post-Effective Amendment No. 34 to the
Registration Statement No. 2-39334 of MML Series Investment Fund on Form N-1A
(File No. 811-2224) of our report dated February 2, 1996 on our audit of the
financial statements and financial highlights of each of the Funds which
comprise MML Series Investment Fund for the year ended December 31, 1995. We
also consent to the reference to our Firm under the caption "experts" in the
Statement of Additional Information.
Springfield, Massachusetts
April 26, 1996
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 2,666,325,986
<INVESTMENTS-AT-VALUE> 3,435,843,657
<RECEIVABLES> 21,951,711
<ASSETS-OTHER> 19,059,276
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,476,854,644
<PAYABLE-FOR-SECURITIES> 29,511,619
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 107,684,750
<TOTAL-LIABILITIES> 137,196,369
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 0
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 13,473
<OVERDISTRIBUTION-NII> 79,661
<ACCUMULATED-NET-GAINS> (786,619)
<OVERDISTRIBUTION-GAINS> (700,894)
<ACCUM-APPREC-OR-DEPREC> 770,906,043
<NET-ASSETS> 3,339,658,275
<DIVIDEND-INCOME> 55,031,208
<INTEREST-INCOME> 72,598,282
<OTHER-INCOME> 0
<EXPENSES-NET> 12,000,313
<NET-INVESTMENT-INCOME> 115,629,177
<REALIZED-GAINS-CURRENT> 54,012,752
<APPREC-INCREASE-CURRENT> 494,867,958
<NET-CHANGE-FROM-OPS> 664,509,887
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 115,608,107
<DISTRIBUTIONS-OF-GAINS> 52,318,032
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 861,618,435
<ACCUMULATED-NII-PRIOR> 10,901
<ACCUMULATED-GAINS-PRIOR> (2,179,007)
<OVERDISTRIB-NII-PRIOR> 12,470
<OVERDIST-NET-GAINS-PRIOR> 1,088,912
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 2,908,849,058
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
