MEDICAL RESEARCH INVESTMENT FUND, INC.
SUPPLEMENT DATED JULY 23, 1996
TO PROSPECTUS DATED DECEMBER 29, 1995
At a meeting held July 17, 1996, the Board of Directors of Medical Research
Investment Fund, Inc. ("Fund") approved the following proposals, several of
which are subject to approval of Fund shareholders at a meeting to be held
August 29, 1996:
1. To change the Fund's structure to a "hub-and-spoke" (TM) arrangement,
subject to shareholder approval. Under this arrangement, the Fund, as
"spoke," would have a new investment policy to invest all its investable
assets in a corresponding "hub" portfolio having substantially the same
investment objective, policies and restrictions as the Fund. The Fund's
current investment adviser, G/A Capital Management ("G/A"), would become
investment adviser to the hub pursuant to a new investment advisory
agreement with the hub. The new investment advisory agreement would retain
the current advisory fee schedule but would (a) add additional breakpoints
(reductions) applicable at such time as the Fund's assets reach $500
million and (b) would add a performance fee providing for fees to G/A to be
increased or decreased in the event the hub over- or under-performs the
Standard & Poor's Index of 500 Common Stocks for the preceding 36-month
period.
2. To replace the Fund's present administrator, Capstone Asset Management
Company, with Eaton Vance Management; and to replace the Fund's present
distributor, Capstone Asset Planning Company, with Eaton Vance
Distributors, Inc. The Eaton Vance organization, founded in 1924 and based
in Boston, advises, administers and distributes more than 150 mutual funds
investing in more than 60 different investment portfolios with assets of
over $16 billion. In connection with this change, the Fund's shares will
be sold with a maximum 4.75% front-end sales charge. Shareholders of
record on the effective date of the restructuring will be permitted to
purchase additional shares of the Fund with no sales charge for as long as
they remain shareholders.
3. To nominate six new directors to replace the Fund's current Board, which
would resign. The new directors must be elected by shareholders.
4. To eliminate, reclassify and amend certain of the Fund's fundamental and
non-fundamental investment restrictions, subject to shareholder approval.
The changes are intended primarily to reflect current applicable regulatory
requirements.
If shareholders approve the proposed changes, Eaton Vance has agreed to
maintain the Fund's total expenses to ensure that they do not exceed 2.0% of the
Fund's average daily net assets through August 31, 1999.
These changes will be described in greater detail in a proxy statement to
be distributed shortly to shareholders.
