<PAGE>
MAP-EQUITY FUND
To Our Shareholders:
The U.S. equity markets continued to benefit during the first six months of 1997
from a powerful combination of favorable economic factors, including strong
economic growth, low inflation and stable interest rates. The Standard & Poor's
500 Index, a generally accepted index of unmanaged securities, increased by
20.6% during the first half of 1997, following increases of 23.0% and 37.5%
during 1996 and 1995, respectively.
SOLID RISK-ADJUSTED PERFORMANCE
MAP-Equity Fund participated in this overall market increase, gaining 17.9%
during the first six months of 1997. The Fund produced this result while
maintaining a lower risk profile than the overall market and staying away from
many of the large capitalization stocks that have reached record valuations in
the recent market rally. Markston Investment Management continues to adjust the
portfolio to react to new opportunities in the market while seeking to minimize
the Fund's volatility.
In the letter that follows, Michael Mullarkey, the Fund's lead portfolio
manager, discusses some of the Fund's better and poorer performers of the first
half of 1997.
CONTINUED RECOGNITION AND IMPROVED SALES
We are pleased to report that MORNINGSTAR, INC., the widely-recognized mutual
fund rating service, awarded MAP-Equity Fund its highest five-star (*****)
rating during 1997.(1) The five-star rating is based on the Fund's historical
risk-adjusted performance, and is reserved for the top 10% of funds within a
given investment class. The Fund's heightened recognition, along with increased
promotional activity by our distributor (First Priority Investment Corporation),
has led to an increase in sales in the first half of 1997.
ORGANIZATIONAL CHANGES
In February, Eugene Ciarkowski, who was President and a Director of MAP-Equity
Fund, retired. Gene, who was affiliated with the Fund since its inception in
1971, will be missed greatly. We wish him well in all his future endeavors. I
have assumed Gene's responsibilities as President, and William Clark, President
of First Priority Investment Corporation, has been elected a Director.
The Board of Directors invites your suggestions and comments, and appreciates
your continued support and confidence in the Fund.
Sincerely,
[SIG]
KATHLEEN M. KOERBER
PRESIDENT
August 15, 1997
- ---------
(1)Morningstar's rating reflects historical risk-adjusted performance as of June
30, 1997. The rating is subject to change each month. Past performance is no
guarantee of future results. Morningstar ratings are calculated from the Fund's
3, 5, and 10-year average annual risk- and fee-adjusted performance. These
ratings compare funds with similar investment objectives. For the 3-year rating,
the Fund was compared with 1,997 equity funds, for the 5-year rating, 1,134
funds, and for the 10-year rating, 618 funds. The top 10% of the funds in an
investment category receive five stars, the next 22.5% receive four stars, the
next 35% receive three stars, the next 22.5% receive two stars, and the
remaining 10% receive one star. For a copy of the current Morningstar report,
including its analysis, please call First Priority Investment Corporation.
<PAGE>
REPORT OF THE INVESTMENT ADVISER
Dear Fellow Shareholders:
In a strong equity market your Fund, carrying a "risk level" we estimate at 82%
of the market, produced a return equal to 87% of the market. As noted in the
President's report the numbers were 17.9%, after expenses, for the Fund and
20.6% for the S&P 500 Index which, of course, bears no expenses.
We deliberately decreased market exposure by increasing the cash position to 27%
by the end of the first quarter. This was not so much a view on market direction
as it was a recognition that some of the portfolio holdings, e.g. Intel and
Motorola, had enjoyed strong investor demand for technology stocks. We also
benefited from the "open ending" of a large closed end investment company
position. After a weak March we did some investing, letting cash drift down to a
19% position by the end of June.
CATALINA MARKETING, a marketing service company that distributes coupons in
supermarkets worldwide and medical newsletters in domestic pharmacies, made a
substantial contribution to performance, appreciating about 85% from our
purchase earlier in the period. We bought Catalina because it was a very high-
return-on-assets operation whose price had dropped over 50% because of a
temporary domestic slowdown and a shortfall in Mexico. The company bought back
over 5% of its shares around the same time we bought, and several insiders also
bought.
AMERICAN EXPRESS, one of our larger holdings, continued to contribute to
performance during the first half. This was helped by the favorable trend in
interest rates and the robust stock market, both of which affected the company
favorably. The shares also benefited from a re-emergence of rumors that a
Citibank/American Express merger was a real possibility. There is a certain
logic to such a combination since both companies have a large international
presence. Theoretically, a merger could accelerate international growth for the
two companies while simultaneously dropping costs. A merger might even be
favored by the government since acceptance of the American Express card by
domestic bank issuers such as Citibank might neutralize allegations of
anti-competitive behavior by Visa and MasterCard.
BURLINGTON COAT FACTORY was the third largest contributor to portfolio
performance during the period. We initially bought Burlington Coat after we saw
insider buying by two of the officers and stock repurchases by the company. The
price we paid was less than what we thought was a hard book value. At the time
we bought it there were indications that operations would improve and management
promised that if the improvements occurred it would recommend, to the Board of
Directors, that the company pay a dividend. This would make the stock attractive
to a larger group of professional investors. Operations improved more
substantially than we had expected and the stock appreciated.
Shares of AVID TECHNOLOGY, another large holding, also rose substantially. We
bought Avid for several reasons. As a leading supplier of computerized video
editing systems, it clearly is in the path of history as the price of personal
computers drops. A strategic investment by Intel in Avid also assured us that
the company would have substantial help in moving its software from the Apple
Macintosh to the ultimately more promising Intel X86 architecture. The X86 will
be enhanced in late 1997 with an accelerated graphics port and in late 1998 with
a 64-bit processor (The Merced). Both will accelerate graphics applications on
the X86. Aside from these factors, a new CEO, Bill Miller from Quantum, a new
CFO, Bill Flaherty from Dupont, and new executives in charge of marketing and
operations have dramatically changed the culture in the company. Inventory turns
have soared, as has cash flow generation. Continued insider buying, even after
the stock appreciated, has pleased us.
2
<PAGE>
Among the portfolio's underperforming stocks was EASTMAN KODAK which fell
slightly in value during the first half. Kodak appears to be engaged in a mild
pricing battle with Fuji. As a result of this development, as well as the fact
that George Fisher--installed as chairman to lead the company's
renewal--recently sold a substantial amount of his stock, we have materially
reduced our holdings in Kodak.
HEALTH CARE PROPERTY INVESTORS, had muted performance--tracking the bond market.
Analysts are concerned about the reinvestment risk facing the company in the
1998/1999 time frame. Management has taken steps to proactively address this
issue by renegotiating many of its leases before they expire.
PENTAIR, also marked time after a strong 1996. The company continues to buy
businesses where it sees the potential for quickly boosting operating profits
above financing costs. They are careful with their bids and assertive with
regard to cost cutting. Last November, for instance, the company purchased a
privately held company that manufactures battery chargers and welding equipment
for the automotive market. They paid $35 million and in just six months have
earned 10% of that amount on an operating basis. Six month financing costs were
probably 3.2%. This constitutional ability for successful acquisitions is
currently being boosted by marketing success. New products and expanded
distribution continue to produce sales growth in the 20-30% range at Porter
Cable woodworking tools, almost 30% of total Pentair sales. The practice of
buying nondescript businesses does occasionally have its costs. Pentair's
German-based electrical enclosure business is having a rough time in a stagnant
market with a depreciating currency.
We thank you for the continuing opportunity to manage your assets. It is good to
be fellow shareholders with you.
Sincerely,
/s/ Michael J. Mullarkey
MICHAEL J. MULLARKEY
Managing Director
MARKSTON INVESTMENT MANAGEMENT
August 15, 1997
3
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
MAP-EQUITY FUND
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<S> <C>
ASSETS
Investments:
Common stocks (cost $46,150,700).............................................. $ 70,511,513
Preferred stock (cost $37,892)................................................ 50,400
Corporate bonds (cost $166,133)............................................... 223,180
Short-term investments (cost $16,514,793)..................................... 16,514,793
------------
87,299,886
Cash............................................................................ 66,228
Receivable for investment securities sold....................................... 476,746
Receivable for Fund shares sold................................................. 14,853
Dividends and interest receivable............................................... 86,516
Other assets.................................................................... 5,741
------------
Total Assets............................................................ 87,949,970
------------
LIABILITIES
Payable for investment securities purchased..................................... 568,212
Payable for Fund shares redeemed................................................ 2,131
Accrued investment advisory fee................................................. 104,845
Accounts payable and accrued expenses........................................... 47,369
------------
Total Liabilities....................................................... 722,557
------------
Net Assets.............................................................. $ 87,227,413
------------
------------
NET ASSETS
Capital stock (3,581,764 shares of $1.00 par value capital stock outstanding,
21,000,000 shares authorized)................................................. $ 3,581,764
Capital paid-in................................................................. 50,432,419
Accumulated undistributed net investment income................................. 572,991
Accumulated undistributed net realized gain from security transactions.......... 8,209,871
Net unrealized appreciation of investments...................................... 24,430,368
------------
Net Assets.............................................................. $ 87,227,413
------------
------------
Net asset value and redemption price per share ($87,227,413 DIVIDED BY
3,581,764 shares of capital stock outstanding)................................ $24.35
------------
------------
Computation of maximum public offering price per share -- $24.35 DIVIDED BY
.9525 (on sales of $50,000 or more, the maximum sales charge and, accordingly,
the offering price, is reduced)............................................... $25.56
------------
------------
</TABLE>
STATEMENT OF OPERATIONS
MAP-EQUITY FUND
SIX MONTHS ENDED JUNE 30, 1997 (UNAUDITED)
<TABLE>
<S> <C>
Investment Income:
Dividends..................................................................... $ 435,338
Interest...................................................................... 362,596
------------
797,934
Expenses:
Investment advisory fee....................................................... 177,141
Custodian..................................................................... 38,479
Transfer Agent................................................................ 37,652
Audit......................................................................... 13,700
Legal......................................................................... 10,081
Filing Fees................................................................... 8,355
State taxes................................................................... 8,262
Insurance expense............................................................. 6,505
Printing...................................................................... 5,590
Directors' fees............................................................... 3,750
Miscellaneous................................................................. 2,454
------------
311,969
------------
Net Investment Income................................................... 485,965
------------
Realized and Unrealized Gain on
Investments:
Net realized gain from security transactions.................................. 7,757,374
Increase in unrealized appreciation of investments............................ 4,988,194
------------
Net Gain on Investments..................................................... 12,745,568
------------
Net Increase in Net Assets Resulting from Operations........................ $ 13,231,533
------------
------------
</TABLE>
See notes to financial statements.
4
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
MAP-EQUITY FUND
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1997 1996
------------- -------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS
Net investment income..................................... $ 485,965 $ 1,188,756
Net realized gain from security transactions ($7,751,037
and $9,352,010, respectively, for federal income tax
purposes)............................................... 7,757,374 9,760,046
Increase in unrealized appreciation of investments........ 4,988,194 3,273,899
------------- -------------
Net Increase in Net Assets Resulting from Operations.... 13,231,533 14,222,701
------------- -------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income ($0 and $.36, per
share, respectively).................................... 0 (1,177,663)
Distributions from net realized gain from security
transactions ($0 and $2.86, per share, respectively).... 0 (8,902,823)
------------- -------------
Total Distributions to Shareholders..................... 0 (10,080,486)
------------- -------------
FROM CAPITAL SHARE TRANSACTIONS
Net increase in net assets from capital share
transactions............................................ 405,266 8,981,118
------------- -------------
Net Increase in Net Assets.............................. 13,636,799 13,123,333
NET ASSETS
Beginning of period....................................... 73,590,614 60,467,281
------------- -------------
End of period (including undistributed net investment
income of $572,991 and $87,026, respectively)........... $ 87,227,413 $ 73,590,614
------------- -------------
------------- -------------
</TABLE>
See notes to financial statements.
5
<PAGE>
SCHEDULE OF PORTFOLIO INVESTMENTS
MAP-EQUITY FUND
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
NUMBER
OF
SHARES MARKET VALUE
- -------------- -------------
<C> <S> <C>
COMMON STOCKS (80.84%)
AGRICULTURE (0.30%)
7,600 IMC Global, Inc....................................................... $ 266,000
-------------
AUTOMOTIVE (0.51%)
19,600 First Brands Corp..................................................... 449,575
-------------
BANKING AND FINANCE (6.61%)
42,900 American Express Co................................................... 3,196,050
26,600 Northern Trust Corp................................................... 1,286,775
28,722 Popular, Inc.......................................................... 1,148,880
2,900 Wilmington Trust Corp................................................. 132,675
-------------
5,764,380
-------------
BUILDING (3.70%)
15,100 Lone Star Industries, Inc............................................. 684,219
19,600 Morgan Products Ltd.*................................................. 147,000
30,500 Vulcan Materials Co................................................... 2,394,250
-------------
3,225,469
-------------
CHEMICALS (1.08%)
6,600 Lubrizol Corp......................................................... 276,788
22,400 Valspar Corp.......................................................... 663,600
-------------
940,388
-------------
COMPUTERS AND COMPUTING (5.74%)
3,200 Adobe Systems, Inc.................................................... 112,200
52,000 Avid Technology, Inc.*................................................ 1,371,500
14,500 Bay Networks, Inc.*................................................... 385,156
1,600 Calcomp Technology, Inc.*............................................. 3,050
17,000 Electronic Data Systems Corp.......................................... 697,000
12,020 Imation Corp.*........................................................ 317,027
5,000 Integrated Systems, Inc*.............................................. 58,125
53,100 National Computer Systems, Inc........................................ 1,413,788
500 Storage Technology Corp.*............................................. 22,250
117 Wang Laboratories, Inc., warrants*.................................... 731
50,000 Xircom, Inc.*......................................................... 621,875
-------------
5,002,702
-------------
CONGLOMERATES (5.71%)
14,200 Minnesota Mining & Manufacturing Co................................... 1,448,400
41,100 National Service Industries, Inc...................................... 2,001,056
20,600 Ogden Corp............................................................ 448,050
32,988 Pentair, Inc.......................................................... 1,084,481
-------------
4,981,987
-------------
<CAPTION>
NUMBER
OF
SHARES MARKET VALUE
- -------------- -------------
<C> <S> <C>
CONSUMER GOODS AND SERVICES (12.02%)
8,000 American Greetings Corp., Class A..................................... $ 296,000
59,400 Catalina Marketing Corp.*............................................. 2,858,625
8,800 Clorox Co............................................................. 1,161,600
24,200 Eastman Kodak Co...................................................... 1,857,350
11,788 Gillette Co........................................................... 1,116,913
5,300 Hasbro, Inc........................................................... 150,387
19,500 Heritage Media Corp.*................................................. 368,062
8,621 Mattel, Inc........................................................... 292,036
23,800 Olsten Corp........................................................... 462,613
3,600 Stanhome, Inc......................................................... 118,350
34,200 Time Warner, Inc...................................................... 1,650,150
4,100 Tupperware Corp....................................................... 149,650
-------------
10,481,736
-------------
ELECTRICAL AND ELECTRONICS (3.33%)
56,800 Checkpoint Systems, Inc.*............................................. 912,350
52,900 Glenayre Technologies, Inc.*.......................................... 866,237
1,100 Intel Corp............................................................ 155,719
5,000 Motorola, Inc......................................................... 380,000
20,476 Vishay Intertechnology, Inc.*......................................... 592,524
-------------
2,906,830
-------------
FOOD AND BEVERAGES (7.65%)
103,600 Archer Daniels Midland Co............................................. 2,434,600
5,800 CPC International, Inc................................................ 535,412
18,600 Coca-Cola Co.......................................................... 1,255,500
13,300 McDonald's Corp....................................................... 642,556
3,800 Pete's Brewing Co.*................................................... 25,888
21,400 Quaker Oats Co........................................................ 960,325
15,250 Showbiz Pizza Time, Inc.*............................................. 402,219
34,700 Vicorp Restaurants, Inc.*............................................. 416,400
-------------
6,672,900
-------------
HEALTHCARE AND MEDICAL (3.28%)
30,800 Cooper Companies, Inc.*............................................... 716,100
21,757 Medpartners, Inc.*.................................................... 470,495
21,000 Schering-Plough Corp.................................................. 1,005,375
12,400 Shared Medical System Corp............................................ 666,500
-------------
2,858,470
-------------
INSURANCE (4.01%)
1,800 Allmerica Financial Group............................................. 71,775
76,600 Allmerica Property & Casualty Companies, Inc. ........................ 2,508,650
6,000 Argonaut Group, Inc................................................... 177,000
56,100 Reliance Group Holdings, Inc.......................................... 666,188
3,200 USF&G Corp............................................................ 76,800
-------------
3,500,413
-------------
MACHINERY AND EQUIPMENT (0.37%)
37,700 3-D Systems Corp.*.................................................... 325,163
-------------
</TABLE>
6
<PAGE>
SCHEDULE OF PORTFOLIO INVESTMENTS -- CONTINUED
MAP-EQUITY FUND
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
NUMBER
OF
SHARES MARKET VALUE
- -------------- -------------
<C> <S> <C>
OIL AND GAS (2.61%)
9,500 Amoco Corp............................................................ $ 825,906
774 Apache Corp........................................................... 25,155
2,200 Petroleum Helicopters, Inc., voting................................... 34,650
5,800 Petroleum Helicopters, Inc., non-voting............................... 87,000
5,000 Piedmont Natural Gas, Inc............................................. 128,438
21,600 Royal Dutch Petroleum Co.............................................. 1,174,500
-------------
2,275,649
-------------
PRINTING AND PUBLISHING (6.63%)
40,800 Access Health, Inc.*.................................................. 999,600
95,266 ACNielsen Corp.*...................................................... 1,869,595
9,600 Cognizant Corp........................................................ 388,800
9,600 Dun & Bradstreet Corp................................................. 252,000
41,400 Meredith Corp......................................................... 1,200,600
20,800 Nelson, Thomas Inc.................................................... 288,600
14,200 Times Mirror Co., Series A............................................ 784,550
-------------
5,783,745
-------------
REAL ESTATE INVESTMENT (2.04%)
29,500 Health Care Property
Investors, Inc...................................................... 1,039,875
51,900 United Dominion Realty Trust, Inc..................................... 736,331
-------------
1,776,206
-------------
RETAIL TRADE (6.52%)
90,900 Burlington Coat Factory
Warehouse Corp.*.................................................... 1,772,550
49,323 CVS Corp.............................................................. 2,527,804
27,309 Cash America International, Inc....................................... 286,744
52,259 Genovese Drug Stores, Inc., Class A................................... 1,028,849
4,000 Mazel Stores, Inc.*................................................... 69,000
-------------
5,684,947
-------------
TEXTILE & APPAREL (3.04%)
44,000 Global Directmail Corp.*.............................................. 1,146,750
7,900 Hartmarx Corp.*....................................................... 65,175
66,100 Oshkosh B'Gosh, Inc., Class A......................................... 1,437,675
-------------
2,649,600
-------------
UTILITIES -- ELECTRIC AND GAS (3.87%)
16,800 Cinergy Corp.......................................................... 584,850
47,413 Duke Power Co......................................................... 2,272,843
6,500 Eastern Utilities Assoc............................................... 118,625
9,100 Noram Energy Corp..................................................... 138,775
9,150 Northwest Natural Gas Co.............................................. 239,044
1,500 Tucson Electric Power Co.*............................................ 21,750
-------------
3,375,887
-------------
<CAPTION>
NUMBER
OF
SHARES MARKET VALUE
- -------------- -------------
<C> <S> <C>
UTILITIES -- TELEPHONE (1.82%)
17,600 GTE Corp.............................................................. $ 772,200
15,530 Sprint Corp........................................................... 817,266
-------------
1,589,466
-------------
TOTAL COMMON STOCKS................................................... 70,511,513
-------------
PREFERRED STOCK (0.06%)
CONSUMER GOODS AND SERVICES
3,200 Craig Corp., Class A*................................................. 50,400
-------------
<CAPTION>
PRINCIPAL
AMOUNT
- --------------
<C> <S> <C>
CORPORATE BONDS (0.25%)
$ 129,000 CII Financial, Inc.,
7.50% conv. sub. deb.,
due September 15, 2001.............................................. 121,260
-------------
112,000 National Education Corp.,
6.50% conv. sub. deb.,
due May 15, 2011.................................................... 101,920
-------------
TOTAL CORPORATE BONDS................................................. 223,180
-------------
SHORT-TERM INVESTMENTS (18.93%)
16,580,000 U.S. Treasury Bills, 4.39% to 5.05%,
due July 10 to August 21, 1997...................................... 16,514,793
-------------
TOTAL INVESTMENTS (100.08%)........................................... 87,299,886
-------------
Liabilities, less cash, receivables and other assets (-0.08%)......... (72,473)
-------------
NET ASSETS (100.00%).................................................. $ 87,227,413
-------------
-------------
</TABLE>
- ---------
* Non-income producing security.
The percentage shown for each investment category is the total value of that
category expressed as a percentage of the total net assets of the Fund.
See notes to financial statements.
7
<PAGE>
NOTES TO FINANCIAL STATEMENTS
MAP-EQUITY FUND (UNAUDITED)
NOTE A -- ACCOUNTING POLICIES
MAP-Equity Fund (the "Fund") is a diversified, open-end, management investment
company registered under the Investment Company Act of 1940, as amended.
Significant accounting policies of the Fund are as follows:
INVESTMENTS: Investments, except for short-term investments which are stated at
amortized cost which approximates market value, are valued at closing prices on
national securities exchanges. Securities traded on a national securities
exchange for which there are no sales on the valuation date and securities
traded over-the-counter, are valued at closing bid prices. Investment security
transactions are recorded on the date of purchase or sale. Realized gains and
losses on investment transactions are determined on the basis of identified
cost.
FEDERAL INCOME TAXES: The Fund does not provide for federal income taxes since
it intends to continue to qualify as a "regulated investment company" under the
Internal Revenue Code and to maintain this qualification by distributing each
year substantially all of its taxable net income and net realized capital gains
to its shareholders. Income dividends and capital gain distributions are
determined in accordance with Federal income tax regulations which may differ
from generally accepted accounting principles. Dividends and distributions which
exceed net investment income and net realized capital gains for financial
reporting purposes, but not for tax purposes, are reported as distributions in
excess of net investment income and distributions in excess of net realized
capital gains.
DIVIDENDS: Dividends receivable on investment securities and dividends payable
to shareholders are recorded on the ex-dividend date.
ESTIMATES: The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts and disclosures in the financial
statements. Actual results could differ from those estimates.
NOTE B -- INVESTMENT ADVISORY AND SERVICE AGREEMENTS
The Fund has investment advisory and service agreements with Markston Investment
Management ("Adviser"), a partnership between Markston International, Inc.
("Markston") and MBL Sales Corporation ("MBL Sales"). Markston is a 49% general
partner of Adviser, and MBL Sales is a 51% general partner. MBL Sales is a
wholly-owned subsidiary of MBLLAC Holding Corporation which is a wholly-owned
subsidiary of the MBL Life Assurance Corporation ("MBL Life"). Under the
investment advisory and service agreements, the Fund pays Adviser a periodic fee
(basic fee) at the annual rate of .50% of the first $200,000,000 of the Fund's
net assets, .45% of the next $100,000,000 of such value, .40% of the next
$100,000,000 of such value, and .35% of such value in excess of $400,000,000.
The basic fee may be adjusted by an amount determined according to a formula
based on the Fund's performance in relation to the Standard & Poor's 500 Index
("Index"). The formula provides for a weekly increase or decrease in the basic
fee by an amount equal to .05% of net assets per annum for each full two
percentage points that the Fund's investment performance, over a 24-month
period, is better or worse than that of the Index. The maximum adjustment is
.30%. The fee is computed and accrued daily and paid quarterly. For the period
ended June 30, 1997, the basic advisory fee amounted to $194,167. The actual fee
amounted to $177,141 which reflected a downward performance adjustment of
$17,026.
In addition, the Fund has a distribution agreement with First Priority
Investment Corporation ("FPIC"), a wholly-owned subsidiary of MBLLAC Holding
Corporation. During the period ended June 30, 1997, the Fund
8
<PAGE>
NOTE B -- INVESTMENT ADVISORY AND SERVICE AGREEMENTS -- CONTINUED
was advised that FPIC received $21,247 as distributor of the Fund's shares. From
this amount, FPIC paid commissions to its sales force, as well as the cost of
printing prospectuses, advertising and other sales literature.
The compensation of each disinterested director is paid by the Fund at the rate
of $400 per meeting attended, plus an annual retainer of $900. Aggregate fees
paid during the period to the Fund's disinterested directors amounted to $3,750.
Two of the directors of the Fund and all officers of the Fund are either
officers or employees of MBL Life. The compensation of the directors, officers
and any employees of the Fund affiliated with Adviser or FPIC is paid by the
affiliated entities.
At June 30, 1997, MBL Life owned 1,794,449 Fund shares.
NOTE C -- CAPITAL STOCK
A summary of capital share transactions follows:
<TABLE>
<CAPTION>
Six Months Ended June 30, 1997 Year Ended December 31, 1996
--------------------------------- ---------------------------------
Shares Amount Shares Amount
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Shares sold.................................. 75,797 $ 1,647,601 62,033 $ 1,297,411
Shares issued in reinvestment of income
dividends and capital gain distributions... 0 0 478,896 9,781,641
------------- ------------- ------------- -------------
75,797 1,647,601 540,929 11,079,052
Less shares repurchased...................... (56,528) (1,242,335) (101,992) (2,097,934)
------------- ------------- ------------- -------------
Net increase in number of shares outstanding
and net assets resulting from capital share
transactions............................... 19,269 $ 405,266 438,937 $ 8,981,118
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
</TABLE>
NOTE D -- PURCHASES AND SALES OF INVESTMENTS
Purchases and proceeds from sales of investments during the period ended June
30, 1997, other than short-term investments, aggregated $20,815,369 and
$28,818,680, respectively.
The identified cost of investments owned at June 30, 1997 for federal income tax
purposes was $62,869,518. At June 30, 1997, gross unrealized appreciation of
investments was $24,833,863 and gross unrealized depreciation was $403,495
resulting in net unrealized appreciation of $24,430,368 for federal income tax
purposes.
NOTE E -- DISTRIBUTIONS AND DIVIDENDS
A capital gain distribution and income dividend of $0.14 and $0.16 per share,
respectively, was declared by the Board of Directors on August 11, 1997, and
paid on August 20, 1997 to shareholders of record on August 12, 1997.
------------------------------------------------------------------------------
9
<PAGE>
FINANCIAL HIGHLIGHTS
MAP-EQUITY FUND
(UNAUDITED)
Selected data for each share of capital stock outstanding throughout the periods
indicated:
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED DECEMBER 31,
JUNE 30, -------------------------------------------------------------------------------
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period............................ $ 20.66 $ 19.36 $ 16.67 $ 18.13 $ 20.02 $ 19.66 $ 15.84 $ 17.46 $ 14.27 $ 11.65
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net investment income............... 0.13 0.36 0.43 0.37 0.36 0.42 0.49 0.52 0.36 0.32
Net realized and unrealized gain
(loss) on investments............. 3.56 4.16 4.90 0.13 1.32 1.65 3.87 (1.41) 3.68 3.13
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net increase (decrease) in net
assets from operations............ 3.69 4.52 5.33 0.50 1.68 2.07 4.36 (0.89) 4.04 3.45
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Dividends from net investment
income............................ -- (0.36) (0.43) (0.37) (0.36) (0.43) (0.49) (0.54) (0.41) (0.31)
Distributions from net realized gain
from security transactions........ -- (2.86) (2.07) (1.59) (3.21) (1.28) (0.05) (0.19) (0.44) (0.52)
Distribution required for tax
purposes over amounts recorded for
financial reporting purposes...... -- -- (0.14) -- -- -- -- -- -- --
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions................. -- (3.22) (2.64) (1.96) (3.57) (1.71) (0.54) (0.73) (0.85) (0.83)
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net Asset Value, End of Period...... $ 24.35 $ 20.66 $ 19.36 $ 16.67 $ 18.13 $ 20.02 $ 19.66 $ 15.84 $ 17.46 $ 14.27
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total Return(1)..................... 17.86% 23.82% 32.50% 2.76% 8.67% 10.53% 27.69% -5.09% 28.18% 29.92%
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Ratios/Supplemental Data:
Net Assets, End of Period
(thousands)....................... $87,227 $73,591 $60,467 $48,130 $49,438 $48,602 $46,228 $37,148 $35,947 $20,752
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Ratio of Expenses to Average Net
Assets............................ 0.40% 0.74% 0.81% 1.07% 1.04% 1.01% 0.85% 1.01% 1.45% 1.52%
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Ratio of Net Investment Income to
Average Net Assets................ 0.62% 1.82% 2.30% 2.03% 1.76% 2.01% 2.69% 3.32% 2.47% 2.57%
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Portfolio Turnover Rate............. 31.67% 52.88% 39.40% 39.31% 19.55% 17.60% 9.12% 6.22% 14.34% 16.85%
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Average Commission Rate Paid........ $0.0257 $0.0261 -- -- -- -- -- -- -- --
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
----------- ------- ------- ------- ------- ------- ------- ------- ------- -------
</TABLE>
- -------------
(1) Total return does not reflect the sales commission (maximum 4.75%) charged
on Fund shares.
See notes to financial statements.
10
<PAGE>
NET ASSET VALUES AND PAYOUTS (UNAUDITED)
Following is a tabular illustration of the Fund's history since shares of the
Fund were first offered for sale on January 21, 1971. Prior to May 1, 1995, the
Fund was known as the Mutual Benefit Fund.
<TABLE>
<CAPTION>
Per share
--------------------------
Dividends
Net asset from net Capital
value investment gains
Period ended per share income distributions
- ----------------------------------------------------------
<S> <C> <C> <C>
December 31, 1971 $ 10.81 $ .09 --
December 31, 1972 11.27 .10 $ .02
December 31, 1973 8.98 .08 --
December 31, 1974 6.52 .17 --
December 31, 1975 8.26 .155 --
December 31, 1976 9.70 .18 --
December 31, 1977 9.05 .225 --
December 31, 1978 8.86 .33 --
December 31, 1979 9.46 .43 --
December 31, 1980 10.77 .53 --
December 31, 1981 10.55 .45 --
December 31, 1982 11.60 .775 1.39
December 31, 1983 13.93 .37 .28
December 31, 1984 11.08 .39 2.51
December 31, 1985 12.89 .38 1.01
December 31, 1986 13.65 .315 1.66
December 31, 1987 11.65 .475 1.03
December 31, 1988 14.27 .31 .52
December 31, 1989 17.46 .41 .44
December 31, 1990 15.84 .54 .19
December 31, 1991 19.66 .49 .05
December 31, 1992 20.02 .43 1.28
December 31, 1993 18.13 .36 3.21
December 31, 1994 16.67 .37 1.59
December 31, 1995 19.36 .43 2.21
December 31, 1996 20.66 .36 2.86
June 30, 1997 24.35 -- --
- ----------------------------------------------------------
</TABLE>
PORTFOLIO CHANGES (UNAUDITED)
For the period ended June 30, 1997:
INVESTMENTS ADDED
Access Health, Inc.
Adobe Systems, Inc.
Allmerica Financial Corp.
Anixter International, Inc.
Archer Daniels Midland Co.
Avid Technology, Inc.
CVS Corp.
Catalina Marketing Corp.
Checkpoint Systems, Inc.
Duke Power Co.
Glenayre Technologies, Inc.
Global Directmail Corp.
Hartmarx Corp.
Heritage Media Corp.
Integrated Systems, Inc.
Mazel Stores, Inc.
Olsten Corp.
Pete's Brewing Co.
Reliance Group Holdings, Inc.
Stanhome, Inc.
3-D Systems Corp.
Tupperware Corp.
Wang Laboratories, Inc. (warrants)
Xircom, Inc.
INVESTMENTS ELIMINATED
Allegheny Teledyne, Inc.
Alltel Corp.
Anixter International, Inc.
Avnet, Inc.
Data General Corp.
Dean Witter Government Income Trust
Gemini II, Inc. (income shares)
Kellogg Co.
Luby's Cafeterias, Inc.
National Education Corp.
Novell, Inc.
PanEnergy Corp.
Quaker State Corp.
Quest for Value Dual Purpose Fund, Inc.
(income and capital shares)
Revco D.S., Inc.
Sequent Computer Systems, Inc.
Symantec Corp.
360 Communications Co.
Universal International, Inc.
11
<PAGE>
MAP-EQUITY FUND
520 Broad Street
Newark, New Jersey 07102-3111
1-800-559-5535
FUND DIRECTORS
William G. Clark
Horace J. DePodwin
Herbert M. Groce, Jr.
Kathleen M. Koerber
Jerome M. Scheckman
INVESTMENT ADVISER
Markston Investment Management
1 North Lexington Avenue
White Plains, New York 10601-1702
DISTRIBUTOR
First Priority Investment Corporation
520 Broad Street
Newark, New Jersey 07102-3111
1-800-559-5535
CUSTODIAN and TRANSFER AGENT
State Street Bank & Trust Co.
P.O. Box 8500
Boston, Massachusetts 02266-8500
1-800-343-0529
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
THIS REPORT HAS BEEN PREPARED FOR THE SHAREHOLDERS OF THE FUND. IT IS NOT
AUTHORIZED FOR OTHER DISTRIBUTION UNLESS PRECEDED OR ACCOMPANIED BY A CURRENT
PROSPECTUS, WHICH INCLUDES INFORMATION CONCERNING THE FUND AND THE SALES
COMMISSION CHARGED ON FUND SHARES.
FS-306 (8-97)
15152
[LOGO]
SEMI-ANNUAL REPORT
JUNE 30, 1997
--------------------
