MITCHELL HUTCHINS SERIES TRUST/MA/, 497, 2000-06-01

MITCHELL HUTCHINS SERIES TRUST/MA/
497, 2000-06-01

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MITCHELL HUTCHINS SERIES TRUST

MONEY MARKET PORTFOLIO
HIGH GRADE FIXED INCOME PORTFOLIO
STRATEGIC FIXED INCOME PORTFOLIO
STRATEGIC INCOME PORTFOLIO
GLOBAL INCOME PORTFOLIO
HIGH INCOME PORTFOLIO
BALANCED PORTFOLIO
GROWTH AND INCOME PORTFOLIO
TACTICAL ALLOCATION PORTFOLIO
GROWTH PORTFOLIO
AGGRESSIVE GROWTH PORTFOLIO
SMALL CAP PORTFOLIO
GLOBAL EQUITY PORTFOLIO

Each fund offers its Class H and Class I shares only to insurance company
separate accounts that fund certain variable annuity and variable life insurance
contracts. This prospectus should be read together with the prospectus for those
contracts.

PROSPECTUS
May 1, 2000

-------------------------------

AS WITH ALL MUTUAL FUNDS, THE SECURITIES AND EXCHANGE COMMISSION HAS NOT
APPROVED OR DISAPPROVED ANY FUND'S SHARES OR DETERMINED WHETHER THIS PROSPECTUS
IS COMPLETE OR ACCURATE. TO STATE OTHERWISE IS A CRIME.

<PAGE>

<TABLE>
<CAPTION>
Mitchell Hutchins Series Trust
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CONTENTS

THE FUNDS

----------------------------------------------------------
<S> <C> <C>

What every investor Money Market Portfolio
should know about 4 Investment Objective, Strategies and Risks
the funds 5 Performance

High Grade Fixed Income Portfolio
6 Investment Objective, Strategies and Risks
7 Performance

Strategic Fixed Income Portfolio
8 Investment Objective, Strategies and Risks
9 Performance

Strategic Income Portfolio
10 Investment Objective, Strategies and Risks
11 Performance

Global Income Portfolio
12 Investment Objective, Strategies and Risks
13 Performance

High Income Portfolio
14 Investment Objective, Strategies and Risks
15 Performance

Balanced Portfolio
16 Investment Objective, Strategies and Risks
17 Performance

Growth and Income Portfolio
18 Investment Objective, Strategies and Risks
19 Performance

Tactical Allocation Portfolio
20 Investment Objective, Strategies and Risks
21 Performance

Growth Portfolio
22 Investment Objective, Strategies and Risks
23 Performance

Aggressive Growth Portfolio
24 Investment Objective, Strategies and Risks
25 Performance

Small Cap Portfolio
26 Investment Objective, Strategies and Risks
27 Performance

2
<PAGE>

Mitchell Hutchins Series Trust
-------------------------------------------------

<S> <C> <C>
Global Equity Portfolio
28 Investment Objective, Strategies and Risks
29 Performance

30 More About Risks and Investment Strategies

INVESTING IN THE FUNDS
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Information for managing 32 Purchases, Redemptions and Exchanges
your fund account
32 Pricing and Valuation

ADDITIONAL INFORMATION
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Additional important 33 Management
information about
the funds 35 Dividends and Taxes

36 Financial Highlights

Where to learn more Back Cover
about the funds

-------------------------------------------
The funds are not complete or balanced
investment programs.
-------------------------------------------
</TABLE>

3
<PAGE>

Mitchell Hutchins Series Trust Money Market Portfolio
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MONEY MARKET PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Maximum current income consistent with liquidity and conservation of capital.

PRINCIPAL INVESTMENT STRATEGIES

The fund is a money market fund and seeks to maintain a stable price of $1.00
per share. The fund invests in a diversified portfolio of high quality money
market instruments of governmental and private issuers.

Money market instruments are short-term debt obligations and similar securities.
They also include longer term bonds that have variable interest rates or other
special features that give them the financial characteristics of short-term
debt. The fund invests in foreign money market instruments only if they are
denominated in U.S. dollars.

Mitchell Hutchins Asset Management Inc., the fund's investment adviser, selects
money market instruments for the fund based on its assessment of relative values
and changes in market and economic conditions. Mitchell Hutchins considers
safety of principal and liquidity in selecting securities for the fund and thus
may not buy securities that pay the highest yield.

Mitchell Hutchins may use a number of professional money management techniques
to respond to changing economic and money market conditions and to shifts in
fiscal and monetary policies. These techniques include varying the fund's
composition and weighted average maturity based upon its assessment of the
relative values of various money market instruments and future interest rate
patterns. Mitchell Hutchins also may buy or sell money market instruments to
take advantage of yield differences.

PRINCIPAL RISKS

An investment in the fund is not a bank deposit and is neither insured nor
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. While the fund seeks to maintain the value of your investment at $1.00
per share, it is possible to lose money by investing in the fund. Money market
instruments generally have a low risk of loss, but they are not risk free. The
principal risks presented by the fund are:

o CREDIT RISK - Issuers of money market instruments may fail to make payments
when due, or they may become less willing or less able to do so.

o INTEREST RATE RISK - The value of the fund's investments generally will
fall when interest rates rise and its yield will tend to lag behind
prevailing rates.

o FOREIGN INVESTING RISK - The value of the fund's investments in foreign
securities may fall due to adverse political, social and economic
developments abroad. However, because the fund's foreign investments must
be denominated in U.S. dollars, it generally is not subject to the risk of
changes in currency valuations.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

4
<PAGE>

Mitchell Hutchins Series Trust Money Market Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The fund's shares are sold only to insurance company separate accounts that fund
certain variable annuity and variable life contracts. The bar chart and table do
not reflect sales charges or other expenses of these contracts. If those sales
charges and expenses were included, the total returns shown would be lower.

The bar chart shows how the fund's performance has varied from year to year. The
bar chart shows Class H shares, the only class outstanding during the periods
shown.

The table that follows the bar chart shows the average annual returns for Class
H shares over several time periods.

The fund's past performance does not necessarily indicate how it will perform in
the future.

TOTAL RETURN ON CLASS H SHARES

CALENDAR YEAR PERCENTAGES
------------- -----------

1990 5.00%
1991 5.00%
1992 3.00%
1993 2.45%
1994 3.43%
1995 5.22%
1996 4.32%
1997 4.53%
1998 4.51%
1999 3.55%

Best quarter during years shown -- 2nd quarter, 1995: 1.36%
Worst quarter during years shown -- 3rd quarter, 1993: 0.57%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H
(INCEPTION DATE) (5/04/87)
---------------- ---------

One Year........................... 3.55%
Five Years......................... 3.81%
Ten Years.......................... 4.26%
Life of Class...................... 2.37%

5
<PAGE>

Mitchell Hutchins Series Trust High Grade Fixed Income Portfolio
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HIGH GRADE FIXED INCOME PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Primarily, current income consistent with the preservation of capital;
secondarily, capital appreciation.

PRINCIPAL INVESTMENT STRATEGIES

The fund invests primarily in

o U.S. government bonds

o mortgage and asset-backed bonds of both government and private issuers

o investment grade corporate bonds, principally high quality bonds (rated in
one of the two highest rating categories or of comparable quality)

To a lesser extent, the fund invests in securities of foreign issuers that are
denominated in U.S. dollars and traded in U.S. markets (Yankee bonds). The fund
may (but is not required to) use derivatives to help manage its portfolio
"duration." "Duration" is a measure of the fund's exposure to interest rate
risk.

Mitchell Hutchins Asset Management Inc., the fund's investment adviser,
allocates its assets among bond market sectors and industries by deciding which
sectors and industries provide the best relative values under prevailing
conditions. Mitchell Hutchins selects industries and companies within the
corporate bond sector by performing fundamental credit analysis based on cash
flows and the ability of the issuer to make required payments on its debt.
Mitchell Hutchins chooses specific securities that it believes provide the best
combination of income, liquidity and potential for gain relative to risk of
loss.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o INTEREST RATE RISK - The value of the fund's investments generally will
fall when interest rates rise.

o PREPAYMENT RISK - The fund's mortgage- and asset-backed securities may be
prepaid more rapidly than expected, especially when interest rates are
falling, and the fund may have to reinvest those prepayments at lower
interest rates. When interest rates are rising, slower prepayments may
extend the duration of the securities and may reduce their value.

o CREDIT RISK - Bond issuers may fail to make payments when due, or they may
become less willing or less able to do so.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

6
<PAGE>

Mitchell Hutchins Series Trust High Grade Fixed Income Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows how the fund's performance has varied from year to year. The
bar chart shows Class H shares, the only class outstanding during the periods
shown.

The table that follows the bar chart shows the average annual returns for Class
H shares over several time periods. The table compares fund returns to returns
on a broad-based market index that is unmanaged and, therefore, does not include
any sales charges or expenses.

The fund's past performance does not necessarily indicate how it will perform in
the future. This is especially true for periods prior to July 21, 1995, when
Mitchell Hutchins assumed day-to-day portfolio management responsibility from a
sub-adviser.

TOTAL RETURN ON CLASS H SHARES (1994 IS THE FUND'S FIRST FULL
CALENDAR YEAR OF OPERATIONS)

CALENDAR YEAR PERCENTAGES
------------- -----------

1990
1991
1992
1993
1994 -6.56%
1995 15.44%
1996 1.41%
1997 8.13%
1998 6.83%
1999 -3.82%

Best quarter during years shown -- 2nd quarter, 1995: 4.42%
Worst quarter during years shown -- 1st quarter, 1994: (4.79)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H LEHMAN BROTHERS
(INCEPTION DATE) (11/08/93) GOVERNMENT BOND INDEX
---------------- ---------- ---------------------

One Year....................... (3.82)% 2.23%
Five Years..................... 5.40% 7.44%
Life of Class.................. 2.59% 5.27%*

----------------
* Return is for the period 10/31/93 to 12/31/99, annualized.

7
<PAGE>

Mitchell Hutchins Series Trust Strategic Fixed Income Portfolio
--------------------------------------------------------------------------------

STRATEGIC FIXED INCOME PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Total return with low volatility.

PRINCIPAL INVESTMENT STRATEGIES

The fund invests in bonds with varying maturities, although it normally limits
its overall portfolio "duration" to between three and eight years. "Duration" is
a measure of the fund's exposure to interest rate risk. The fund invests
primarily in

o mortgage- and asset-backed securities of both government and private
issuers

o investment grade corporate bonds

o U.S. and foreign government bonds

o money market instruments

The fund also invests, to a lesser extent, in bonds that are below investment
grade. Securities rated below investment grade are commonly known as "junk
bonds." The fund invests in when-issued or delayed delivery bonds as a
leveraging technique to increase its return. The fund may (but is not required
to) use derivatives to help manage its portfolio duration.

The fund's investment adviser, Mitchell Hutchins Asset Management Inc., has
appointed Pacific Investment Management Company ("PIMCO") as the fund's
sub-adviser. PIMCO analyzes U.S. economic and market conditions, as well as
other factors, to decide on a portfolio duration and to allocate fund assets to
bonds of different credit qualities, maturities, types and coupon interest
rates. PIMCO seeks bonds that it believes to be relatively undervalued and
selects bonds based on various factors, including economic forecasts,
anticipated interest rate levels and expected prepayment rates on the mortgages
supporting mortgage-backed bonds. PIMCO selects specific bonds by analyzing
their relative value and risk characteristics.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o INTEREST RATE RISK - The value of the fund's investments generally will
fall when interest rates rise.

o CREDIT RISK - Bond issuers may fail to make payments when due, or they may
become less willing or less able to do so.

o LEVERAGE RISK - Leverage magnifies the effect of changes in market values.
While leverage can increase the fund's income and potential for gain, it
also can increase expenses and the risk of loss. The fund attempts to limit
the magnifying effect of its leverage by managing its portfolio duration.

o FOREIGN INVESTING RISK - The value of the fund's investments in foreign
securities may fall due to adverse political, social and economic
developments abroad and due to decreases in foreign currency values
relative to the U.S. dollar.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

8
<PAGE>

Mitchell Hutchins Series Trust Strategic Fixed Income Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows how the fund's performance has varied from year to year. The
bar chart shows Class H shares, the only class outstanding during the periods
shown.

The fund's past performance does not necessarily indicate how it will perform in
the future. This is especially true for periods prior to September 21, 1995,
when PIMCO assumed portfolio management responsibility from Mitchell Hutchins.

TOTAL RETURN ON CLASS H SHARES

CALENDAR YEAR PERCENTAGES
------------- -----------

1990 7.58%
1991 15.17%
1992 6.76%
1993 11.66%
1994 -5.34%
1995 18.51%
1996 3.79%
1997 11.00%
1998 8.62%
1999 -3.32%

Best quarter during years shown -- 2nd quarter, 1995: 6.20%
Worst quarter during years shown -- 1st quarter, 1994: (4.11)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H LEHMAN BROTHERS
(INCEPTION DATE) (7/05/89) MORTGAGE BOND INDEX
---------------- --------- -------------------

One Year.......................... (3.32)% 1.86%
Five Years........................ 7.47% 7.98%
Ten Years......................... 7.21% 7.77%
Life of Class..................... 7.11% 8.14%*

------------------
* Return is for the period 6/30/89 to 12/31/99, annualized.

9
<PAGE>
Mitchell Hutchins Series Trust Strategic Income Portfolio
--------------------------------------------------------------------------------

STRATEGIC INCOME PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Primarily, high level of current income; secondarily, capital appreciation.

PRINCIPAL INVESTMENT STRATEGIES

The fund strategically allocates investments among three bond market sectors:

o U.S. government and investment grade bonds, including mortgage- and
asset-backed securities

o U.S. high yield bonds (sometimes called "junk bonds"), including preferred
stock and bonds that are convertible into common stock

o Foreign and emerging market bonds (including foreign government bonds)

Each of these sectors generally reacts in different ways or at different times
to changes in interest rates or to particular economic events. This means that,
when one sector underperforms the market as a whole, another sector may
outperform the market.

The fund normally invests in each of these three sectors. However, the fund's
investment adviser, Mitchell Hutchins Asset Management Inc., tries to take
advantage of changes in the relative performance of different sectors by
allocating a larger percentage of the fund's assets to those sectors that it
believes are undervalued. Selections of specific securities to buy or sell for
the fund are based on market outlook, investment research, geographic analysis
and forecasts of interest rates and currency exchange rates. The fund may (but
is not required to) use derivatives as part of its investment strategy or to
help manage portfolio risks.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o CREDIT RISK - Bond issuers may fail to make payments when due, or they may
become less willing or less able to do so. This risk is greater for high
yield, lower quality bonds than for bonds that are investment grade.

o INTEREST RATE RISK - The value of the fund's investments generally will
fall when interest rates rise.

o ASSET ALLOCATION RISK - Mitchell Hutchins may not be successful in choosing
the best allocation of the fund's assets among market sectors.

o FOREIGN INVESTING AND EMERGING MARKETS RISKS - The value of the fund's
investments in foreign securities may fall due to adverse political, social
and economic developments abroad and due to decreases in foreign currency
values relative to the U.S. dollar. These risks are greater for investments
in emerging market issuers than for issuers in more developed countries.
Investments in foreign government bonds involve special risks because the
fund may have limited legal recourse in the event of default.

o EQUITY RISK - Stocks and other equity securities generally fluctuate in
value more than bonds. The fund could lose all of its investment in a
company's stock.

o SINGLE ISSUER CONCENTRATION RISK - Because the fund is non-diversified, it
can invest more of its assets in a single issuer than a diversified fund
can. As a result, changes in the market value of a single issuer can have a
greater effect on the fund's performance and share price than if the fund
held a smaller position.

o PREPAYMENT RISK - The fund's mortgage- and asset-backed securities may be
prepaid more rapidly than expected, especially when interest rates are
falling, and the fund may have to reinvest those prepayments at lower
interest rates. When interest rates are rising, prepayments often occur
more slowly than expected, which may extend the duration of the securities
and may reduce their value.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

10
<PAGE>

Mitchell Hutchins Series Trust Strategic Income Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows the fund's performance for its initial calendar year. The
bar chart shows Class H shares because Class I shares were not outstanding for
the full calendar year.

The table that follows the bar chart shows the average annual returns for Class
H shares for one year and the life of the class. Performance for Class I shares
is not included in the table because Class I shares were not outstanding for the
full calendar year. The table compares fund returns to returns on a broad-based
market index that is unmanaged and, therefore, does not include any sales
charges or expenses.

The fund's past performance does not necessarily indicate how it will perform in
the future.

TOTAL RETURN ON CLASS H SHARES (1999 IS THE FUND'S FIRST FULL CALENDAR
YEAR OF OPERATIONS)

CALENDAR YEAR PERCENTAGES
------------- -----------

1990
1991
1992
1993
1994
1995
1996
1997
1998
1999 1.89%

Best quarter during year shown -- 1st quarter, 1999: 2.05%
Worst quarter during year shown -- 2nd quarter, 1999: (0.64)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H LEHMAN BROTHERS AGGREGATE
(INCEPTION DATE) (9/28/98) BOND INDEX
---------------- --------- ----------

One Year...................... 1.89% (0.82)%
Life of Class................. 3.79% (0.39)%*

-----------------
* Return is for the period 9/30/98 to 12/31/99, annualized.

11
<PAGE>

Mitchell Hutchins Series Trust Global Income Portfolio
--------------------------------------------------------------------------------

GLOBAL INCOME PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Primarily, high current income; secondarily, capital appreciation.

PRINCIPAL INVESTMENT STRATEGIES

The fund invests primarily in high quality bonds of governmental and private
issuers in the U.S. and developed foreign countries. These high quality bonds
are rated in one of the two highest rating categories or are of comparable
quality. The fund also invests, to a lesser extent, in lower rated bonds,
including bonds of issuers in emerging markets. These may include bonds that
have very low credit ratings, but that Mitchell Hutchins Asset Management Inc.,
the fund's investment adviser, believes provide a return that is high enough to
justify the additional risk. Some of the fund's bonds may be backed by
mortgages.

Mitchell Hutchins normally invests a portion of the fund's assets in bonds of
U.S. government and private issuers, and allocates the balance of the fund's
portfolio among bonds of issuers in different foreign countries. Mitchell
Hutchins decides which bonds to buy or sell by determining the allocation to
different geographic areas, countries and industries based upon its assessment
of fundamental economic strengths, credit quality and currency and interest rate
trends. The fund may (but is not required to) use derivatives as part of its
investment strategy or to help manage portfolio risks.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o INTEREST RATE RISK - The value of the fund's investments generally will
fall when interest rates rise.

o CREDIT RISK - Bond issuers may fail to make payments when due, or they may
become less willing or less able to do so. This risk is greater for lower
quality bonds than for bonds that are investment grade.

o ASSET ALLOCATION RISK - Mitchell Hutchins may not be successful in choosing
the best allocation of the fund's assets between U.S. and foreign issuers.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN THE CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING SUCH REPORTS).

12
<PAGE>

Mitchell Hutchins Series Trust Global Income Portfolio
--------------------------------------------------------------------------------

PERFORMANCE

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows how the fund's performance has varied from year to year. The
bar chart shows Class H shares, the only class outstanding during the periods
shown.

The fund's past performance does not necessarily indicate how it will perform in
the future.

TOTAL RETURN ON CLASS H SHARES

CALENDAR YEAR PERCENTAGES
------------- -----------

1990 14.92%
1991 10.30%
1992 1.29%
1993 16.65%
1994 -5.56%
1995 13.58%
1996 6.62%
1997 3.50%
1998 9.69%
1999 -4.79%

Best quarter during years shown -- 2nd quarter, 1990: 5.77%
Worst quarter during years shown -- 1st quarter, 1994: (4.44)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

SALOMON SMITH BARNEY
CLASS CLASS H WORLD GOVERNMENT
(INCEPTION DATE) (5/01/88) BOND INDEX
---------------- --------- ----------
One Year....................... (4.79)% (4.27)%
Five Years..................... 5.53% 6.42%
Ten Years...................... 6.36% 8.03%
Life of Class.................. 6.63% 7.48%*

------------------
* Return is for the period 4/30/88 to 12/31/99, annualized.

13
<PAGE>

Mitchell Hutchins Series Trust High Income Portfolio
--------------------------------------------------------------------------------

HIGH INCOME PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

High income.

PRINCIPAL INVESTMENT STRATEGIES

The fund invests primarily in a diversified range of high yield U.S. and foreign
corporate bonds (sometimes called "junk bonds"). The fund also invests, to a
lesser extent, in other types of bonds, preferred stocks and bonds that are
convertible into common stock. The fund may (but is not required to) use
derivatives as part of its investment strategy or to help manage portfolio
risks.

The fund's investment adviser, Mitchell Hutchins Asset Management Inc., uses a
three-step investment process to find the best relative values in the bond
markets in which the fund invests: industry selection, company selection and
security selection.

Mitchell Hutchins allocates the fund's assets among industry groups by analyzing
economic factors, industry dynamics and yield spreads to determine which
industries provide the most attractive investment opportunities. Mitchell
Hutchins selects companies within these industries by performing fundamental
credit analysis based on cash flow, leverage and other balance sheet and income
statement factors. In deciding which securities to buy or sell for the fund,
Mitchell Hutchins chooses from among the types of securities offered by these
companies to select those that appear to offer the best relative values. All
aspects of this process rely on Mitchell Hutchins' economic, credit,
quantitative and market research.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o INTEREST RATE RISK - The value of the fund's investments generally will
fall when interest rates rise.

o EQUITY RISK - Stocks and other equity securities generally fluctuate in
value more than bonds. The fund could lose all of its investment in a
company's stock.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

14
<PAGE>

Mitchell Hutchins Series Trust High Income Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows how the fund's performance for its initial calendar year.
The bar chart shows Class H shares, the only class outstanding during the
periods shown.

The table that follows the bar chart shows the average annual returns for Class
H shares for one year and the life of the class. The table compares fund returns
to returns on a broad-based market index that is unmanaged and, therefore, does
not include any sales charges or expenses.

The fund's past performance does not necessarily indicate how it will perform in
the future.

TOTAL RETURN ON CLASS H SHARES (1999 IS THE FUND'S FIRST FULL
CALENDAR YEAR OF OPERATIONS)

CALENDAR YEAR PERCENTAGES
------------- -----------

1990
1991
1992
1993
1994
1995
1996
1997
1998
1999 5.42%

Best quarter during year shown -- 4th quarter, 1999: 4.29%
Worst quarter during year shown -- 3rd quarter, 1999: (1.01)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H CS FIRST BOSTON HIGH
(INCEPTION DATE) (9/28/98) YIELD BOND INDEX
---------------- --------- ----------------
One Year................... 5.42% 3.28%
Life of Class.............. 8.54% 4.54%*

---------------------
* Return is for the period 9/30/98 to 12/31/99, annualized.

15
<PAGE>
Mitchell Hutchins Series Trust Balanced Portfolio
--------------------------------------------------------------------------------

BALANCED PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

High total return with low volatility.

PRINCIPAL INVESTMENT STRATEGIES

The fund allocates its investments among three investment sectors:

o stocks

o bonds

o cash (money market instruments)

The fund normally has investments in each sector, but it always keeps at least
25% of its total assets in a combination of bonds and cash. This is intended to
limit changes in the value of fund shares compared to funds that invest solely
in stocks.

The fund's bonds are primarily investment grade, but it may invest, to a lesser
extent, in lower quality bonds. The fund may invest in U.S. dollar denominated
securities of foreign issuers. The fund may (but is not required to) use
derivatives to adjust its exposure to different asset classes, to manage the
"duration" of its bond investments and to maintain exposure to stocks or bonds
while maintaining a cash balance for fund management purposes. "Duration" is a
measure of the fund's exposure to interest rate risk.

Mitchell Hutchins Asset Management Inc., the fund's investment adviser, believes
investors tend to reach a consensus as to the likely effect of changes in key
economic variables (for example, interest rates, profits and inflation) on each
asset class. Mitchell Hutchins also believes that prices of securities in each
asset class tend to move toward a level that reflects that consensus, but that
this takes time. By using fundamental valuation techniques, Mitchell Hutchins
attempts to adjust the allocation of the fund's assets among sectors before
prices fully reflect the consensus view.

In buying and selling individual securities for the fund, Mitchell Hutchins uses
the following process:

o STOCKS. Mitchell Hutchins uses its own Factor Valuation Model to identify
companies that appear undervalued. The model ranks companies based on
"value" factors, such as dividends, cash flows, earnings and book values,
as well as on "growth" factors, such as earnings momentum and industry
performance forecasts. Mitchell Hutchins then applies fundamental analysis
to select specific stocks from among those identified by the model.

o BONDS. Mitchell Hutchins selects bonds based on its analysis of their
maturity and risk structures (comparing yields on U.S. Treasury bonds to
yields on riskier types of bonds).

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o ASSET ALLOCATION RISK - Mitchell Hutchins may not be successful in choosing
the best allocation of the fund's assets among the three asset classes.

o EQUITY RISK - Stocks and other equity securities generally fluctuate in
value more than bonds. The fund could lose all of its investment in a
company's stock.

o INTEREST RATE RISK - The value of the fund's bond investments generally
will fall when interest rates rise.

o CREDIT RISK - Bond issuers may fail to make payments when due, or they may
become less willing or less able to do so.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

<PAGE>

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

<PAGE>

Mitchell Hutchins Series Trust Balanced Portfolio
--------------------------------------------------------------------------------

PERFORMANCE

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows how the fund's performance has varied from year to year. The
bar chart shows Class H shares, the only class outstanding during all the
periods shown.

The table that follows the bar chart shows the average annual returns for Class
H shares over several time periods. Performance for Class I shares is not
included in the table because Class I shares were not outstanding for the full
1999 calendar year. The table compares fund returns to returns on a broad-based
market index that is unmanaged and that, therefore, does not include any sales
charges or expenses.

The fund's past performance does not necessarily indicate how the fund will
perform in the future.

TOTAL RETURN ON CLASS H SHARES

CALENDAR YEAR PERCENTAGES
------------- -----------

1990 2.63%
1991 18.73%
1992 5.18%
1993 15.76%
1994 -9.59%
1995 23.27%
1996 16.82%
1997 24.86%
1998 16.81%
1999 1.82%

Best quarter during years shown -- 4th quarter, 1998: 14.29%
Worst quarter during years shown -- 2nd quarter, 1994: (5.55)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H S&P 500 COMPOSITE
(INCEPTION DATE) (6/01/88) STOCK INDEX
---------------- -------- -----------
One Year..................... 1.82% 21.03%
Five Years................... 16.42% 28.54%
Ten Years.................... 11.11% 18.19%
Life of Class................ 10.96% 19.11%*

------------
* Return is for the period 5/31/88 to 12/31/99, annualized.

17
<PAGE>

Mitchell Hutchins Series Trust Growth and Income Portfolio
--------------------------------------------------------------------------------

GROWTH AND INCOME PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Current income and capital growth.

PRINCIPAL INVESTMENT STRATEGIES

The fund invests in a combination of securities to obtain both growth and
income. To obtain growth, the fund invests in stocks that Mitchell Hutchins
Asset Management Inc., its investment adviser, believes have substantial
potential for capital growth. To obtain current income, the fund invests in
dividend paying stocks and, to a lesser extent, convertible bonds and money
market instruments.

The fund generally invests in large capitalization companies. Some of the fund's
investments may be in U.S. dollar denominated securities of foreign investors.
The fund may (but is not required to) use derivatives as part of its investment
strategy or to help manage portfolio risks.

In buying and selling stocks for the fund, Mitchell Hutchins uses its own Factor
Valuation Model to identify stocks with growth potential that appear to be
undervalued. The model ranks companies based on "value" factors, such as
dividends, cash flows, earnings and book values, as well as on "growth" factors,
such as earnings momentum and industry performance forecasts. Mitchell Hutchins
then applies fundamental analysis to select specific stocks from among those
identified by the model.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o EQUITY RISK - Stocks and other equity securities generally fluctuate in
value more than bonds. The fund could lose all of its investment in a
company's stock.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

18
<PAGE>

Mitchell Hutchins Series Trust Growth and Income Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows how the fund's performance has varied from year to year. The
bar chart shows Class H shares, the only class outstanding during all the
periods shown.

The table that follows the bar chart shows the average annual returns for Class
H shares over several time periods. Performance for Class I shares is not
included in the table because Class I shares were not outstanding for the full
1999 calendar year. The table compares fund returns to returns on a broad-based
market index that is unmanaged and, therefore, does not include any sales
charges or expenses.

The fund's past performance does not necessarily indicate how it will perform in
the future.

TOTAL RETURN ON CLASS H SHARES (1993 IS THE FUND'S FIRST FULL CALENDAR
YEAR OF OPERATIONS)

CALENDAR YEAR PERCENTAGES
------------- -----------

1990
1991
1992
1993 -2.26%
1994 -6.18%
1995 30.52%
1996 22.12%
1997 32.45%
1998 16.32%
1999 10.33%

Best quarter during years shown -- 4th quarter, 1998: 19.73%
Worst quarter during years shown -- 3rd quarter, 1998: (14.91)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H S&P 500 COMPOSITE
(INCEPTION DATE) (1/02/92) STOCK INDEX
---------------- -------- -----------
One Year.................. 10.33% 21.03%
Five Years................ 22.06% 28.54%
Life of Class............. 12.52% 19.69%*

----------------
* Return is for the period 12/31/91 to 12/31/99, annualized.

19
<PAGE>

Mitchell Hutchins Series Trust Tactical Allocation Portfolio
--------------------------------------------------------------------------------

TACTICAL ALLOCATION PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Total return, consisting of long-term capital appreciation and current income.

PRINCIPAL INVESTMENT STRATEGIES

The fund allocates its assets between

o a stock portion that is designed to track the performance of the S&P 500
Composite Stock Index and

o a fixed income portion that consists of either five-year U.S. Treasury
notes or U.S. Treasury bills with remaining maturities of 30 days.

Mitchell Hutchins Asset Management Inc., the fund's investment adviser,
reallocates the fund's assets in accordance with the recommendations of its own
Tactical Allocation Model on the first business day of each month.

The Tactical Allocation Model attempts to track the performance of the S&P 500
Index in periods of strong market performance. The Model attempts to take a more
defensive posture by reallocating assets to bonds or cash when the Model signals
a potential bear market, prolonged downturn in stock prices or significant loss
in value. The Model can recommend stock allocations of 100%, 75%, 50%, 25% or
0%.

If the Tactical Allocation Model recommends a stock allocation of less than
100%, the Model also recommends a fixed income allocation for the remainder of
the fund's assets. The Model uses a bond risk premium determination to decide
whether to recommend five-year U.S. Treasury notes or 30-day U.S. Treasury
bills.

When the Tactical Allocation Model recommends a fixed income allocation of more
than 50%, the fund must invest in other high quality bonds or money market
instruments to the extent needed to limit the fund's investments in U.S.
Treasury obligations to no more than 55% of its assets. This limit is imposed by
Internal Revenue Code diversification requirements for segregated asset accounts
used to fund variable annuity or variable life contracts.

The fund may (but is not required to) use derivatives to adjust its exposure to
different asset classes or to maintain exposure to stocks or bonds while
maintaining a cash balance for fund management purposes. Mitchell Hutchins also
may use these instruments to reduce the risk of adverse price movements while
investing cash received when investors buy fund shares, to facilitate trading
and to reduce transaction costs.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o ASSET ALLOCATION RISK - The Tactical Allocation Model may not correctly
predict the appropriate time to shift the fund's assets from one asset
class to another.

o EQUITY RISK - Stocks and other equity securities generally fluctuate in
value more than bonds. The fund could lose all of its investment in a
company's stock.

o INDEX TRACKING RISK - The fund expects a close correlation between the
performance of its stock investments and that of the S&P 500 Index in both
rising and falling markets. The performance of the fund's stock investments
generally will not be identical to that of the Index because of the fees
and expenses borne by the fund and investor purchases and sales of fund
shares, which can occur daily.

o INTEREST RATE RISK - The value of the fund's bond investments generally
will fall when interest rates rise.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

o FOREIGN INVESTING RISK - The S&P 500 Index includes some U.S. dollar
denominated foreign securities. The value of the fund's investments in
foreign securities may fall due to adverse political, social and economic
developments abroad. However, because the fund's foreign investments must
be denominated in U.S. dollars, it generally is not subject to the risk of
changes in currency valuations.

<PAGE>

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

<PAGE>

Mitchell Hutchins Series Trust Tactical Allocation Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows the fund's performance for its initial calendar year. The
bar chart shows Class H shares because Class I shares were not outstanding for
the full calendar year.

The fund's past performance does not necessarily indicate how it will perform in
the future.

TOTAL RETURN ON CLASS H SHARES (1999 IS THE FUND'S FIRST FULL
CALENDAR YEAR OF OPERATIONS)

CALENDAR YEAR PERCENTAGES
------------- -----------

1990
1991
1992
1993
1994
1995
1996
1997
1998
1999 18.43%

Best quarter during year shown -- 4th quarter, 1999: 13.08%
Worst quarter during year shown -- 3rd quarter, 1999: 6.16%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H S&P 500 COMPOSITE
(INCEPTION DATE) (9/28/98) STOCK INDEX
---------------- --------- -----------
One Year...................... 18.43% 21.03%
Life of Class................. 36.66% 35.94%*

----------------
* Return is for the period 9/30/98 to 12/31/99, annualized.

21
<PAGE>

Mitchell Hutchins Series Trust Growth Portfolio
--------------------------------------------------------------------------------

GROWTH PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Long-term capital appreciation.

PRINCIPAL INVESTMENT STRATEGIES

The fund invests primarily in stocks of companies that Mitchell Hutchins Asset
Management Inc., its investment adviser, believes have substantial potential for
capital growth.

The fund generally invests in larger capitalization companies but has the
flexibility to invest in companies having any market capitalization. Some of the
fund's investments may be in U.S. dollar denominated securities of foreign
issuers and the fund also may invest in bonds. The fund may (but is not required
to) use derivatives as part of its investment strategy or to help manage
portfolio risks.

In buying and selling stocks for the fund, Mitchell Hutchins uses its own
Multi-Factor Growth Model to identify companies that appear to have potential
for above-average growth in earnings, cash flow and/or book value. The model
ranks companies based on "growth" factors, such as earnings momentum, stock
price movement, economic sensitivity and industry performance forecasts.
Mitchell Hutchins then applies fundamental analysis to select specific stocks
from among those identified by the model. When investing in smaller companies,
Mitchell Hutchins also considers the trading volume of the company's stock.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o EQUITY RISK - Stocks and other equity securities generally fluctuate in
value more than bonds. The fund could lose all of its investment in a
company's stock.

o LIMITED CAPITALIZATION RISK - Equity risk is greater for the common stocks
of mid and small cap companies because they generally are more vulnerable
than larger companies to adverse business or economic developments and they
may have more limited resources. In general, these risks are greater for
small cap companies than for mid cap companies.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

22
<PAGE>

Mitchell Hutchins Series Trust Growth Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows how the fund's performance has varied from year to year. The
bar chart shows Class H shares, the only class outstanding during all the
periods shown.

The table that follows the bar chart shows the average annual returns for Class
H shares over several time periods. Performance for Class I shares is not
included in the table because Class I shares were not outstanding for the full
1999 calendar year. The table compares fund returns to returns on a broad-based
market index that is unmanaged and, therefore, does not include any sales
charges or expenses.

The fund's past performance does not necessarily indicate how it will perform in
the future.

TOTAL RETURN ON CLASS H SHARES

CALENDAR YEAR PERCENTAGES
------------- -----------

1990 -8.15%
1991 42.10%
1992 5.83%
1993 19.61%
1994 -11.65%
1995 32.50%
1996 18.70%
1997 15.41%
1998 30.59%
1999 33.61%

Best quarter during years shown -- 4th quarter, 1998: 30.29%
Worst quarter during years shown -- 3rd quarter, 1990: (16.09)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H S&P 500 COMPOSITE
(INCEPTION DATE) (5/04/87) STOCK INDEX
---------------- --------- -----------
One Year................ 33.61% 21.03%
Five Years.............. 25.93% 28.54%
Ten Years............... 16.54% 18.19%
Life of Class........... 16.80% 16.79%*

--------------
* Return is for the period 4/30/87 to 12/31/99, annualized.

23
<PAGE>

Mitchell Hutchins Series Trust Aggressive Growth Portfolio
--------------------------------------------------------------------------------

AGGRESSIVE GROWTH PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Maximizing long-term capital appreciation.

PRINCIPAL INVESTMENT STRATEGIES

The fund invests primarily in common stocks of U.S. companies that its
sub-adviser expects to grow faster than the average rate of companies in the S&P
500 Composite Stock Index. The fund has the flexibility to invest in companies
of any size, including small capitalization ("small cap") companies. In general,
however, the fund invests the majority of its assets in mid capitalization ("mid
cap") companies.

Some of the fund's investments may be in U.S. dollar denominated securities of
foreign issuers and the fund also may invest in bonds. The fund may (but is not
required to) use derivatives as part of its investment strategy or to help
manage portfolio risks.

The fund invests in companies that are diversified over a cross-section of
industries. The fund's investments may include growth companies, cyclical
companies or companies that its sub-adviser believes to be undergoing a basic
change in operations or markets that would result in a significant improvement
in earnings.

The fund's investment adviser, Mitchell Hutchins Asset Management Inc., has
appointed Nicholas-Applegate Capital Management as the fund's sub-adviser. In
selecting investments for the fund, Nicholas-Applegate uses a proprietary
investment methodology to identify companies with attractive earnings and growth
potential and to evaluate their investment prospects.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o EQUITY RISK - Stocks and other equity securities generally fluctuate in
value more than bonds. The fund could lose all of its investment in a
company's stock.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

24
<PAGE>

Mitchell Hutchins Series Trust Aggressive Growth Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows how the fund's performance has varied from year to year. The
bar chart shows Class H shares, the only class outstanding during the periods
shown.

The fund's past performance does not necessarily indicate how it will perform in
the future.

TOTAL RETURN ON CLASS H SHARES (1994 IS THE FUND'S FIRST FULL YEAR
OF OPERATIONS)

CALENDAR YEAR PERCENTAGES
------------- -----------

1990
1991
1992
1993
1994 -2.90%
1995 21.04%
1996 25.23%
1997 20.76%
1998 15.30%
1999 25.07%

Best quarter during years shown -- 4th quarter, 1998: 18.30%
Worst quarter during years shown -- 3rd quarter, 1998: (15.45)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H S&P 500 COMPOSITE
(INCEPTION DATE) (11/02/93) STOCK INDEX
---------------- --------- -----------
One Year................ 25.07% 21.03%
Five Years.............. 21.43% 28.54%
Life of Class........... 16.42% 22.87%*

------------
* Return is for the period 10/31/93 to 12/31/99, annualized.

25
<PAGE>

Mitchell Hutchins Series Trust Small Cap Portfolio
--------------------------------------------------------------------------------

SMALL CAP PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Long-term capital appreciation.

PRINCIPAL INVESTMENT STRATEGIES

The fund invests primarily in stocks of small capitalization ("small cap")
companies that Mitchell Hutchins Asset Management Inc., its investment adviser,
believes have substantial potential for capital growth. The fund considers
companies with market capitalizations of up to $1.5 billion to be small cap.

The fund also invests, to a lesser extent, in stocks of larger companies and in
bonds and money market instruments. Some of the fund's investments may be in
U.S. dollar denominated securities of foreign issuers. The fund may (but is not
required to) use derivatives as part of its investment strategy or to help
manage portfolio risks.

In buying and selling stocks for the fund, Mitchell Hutchins uses its own Factor
Valuation Model to identify companies that appear to be undervalued. The model
ranks companies based on "value" factors, such as dividends, cash flows,
earnings and book values, as well as on "growth" factors, such as earnings
momentum and industry performance forecasts. Mitchell Hutchins then applies
fundamental analysis to select specific stocks from among those small cap
companies identified by the model.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o EQUITY RISK - Stocks and other equity securities generally fluctuate in
value more than bonds. The fund could lose all of its investment in a
company's stock.

o LIMITED CAPITALIZATION RISK - Equity risk is greater for the common stocks
of small cap companies because they generally are more vulnerable than
large or mid cap companies to adverse business or economic developments and
they may have more limited resources.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN ITS CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING THESE REPORTS).

26
<PAGE>

Mitchell Hutchins Series Trust Small Cap Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows the fund's performance for its initial calendar year. The
bar chart shows Class H shares because Class I shares were not outstanding for
the full calendar year.

The table that follows the bar chart shows the average annual returns for Class
H shares for one year and the life of the class. Performance for Class I shares
is not included in the table because Class I shares were not outstanding for the
full calendar year. The table compares fund returns to returns on two
broad-based market indices of small cap companies that are unmanaged and,
therefore, do not include any sales charges or expenses.

The fund's past performance does not necessarily indicate how it will perform in
the future.

TOTAL RETURN ON CLASS H SHARES (1999 IS THE FUND'S FIRST FULL CALENDAR YEAR OF
OPERATIONS)

CALENDAR YEAR PERCENTAGES
------------- -----------

1990
1991
1992
1993
1994
1995
1996
1997
1998
1999 6.13%

Best quarter during year shown -- 4th quarter, 1999: 16.48%
Worst quarter during year shown -- 1st quarter, 1999: (15.50)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H S&P SMALLCAP 600 RUSSELL 2000
(INCEPTION DATE) (9/28/98) INDEX INDEX
---------------- --------- ----- -----
One Year............ 6.13% 12.41% 21.26%
Life of Class....... 29.45% 25.01%* 31.66%*

------------------
* Return is for the period 9/30/98 to 12/31/99, annualized.

27
<PAGE>

Mitchell Hutchins Series Trust Global Equity Portfolio
--------------------------------------------------------------------------------

GLOBAL EQUITY PORTFOLIO

INVESTMENT OBJECTIVE, STRATEGIES AND RISKS
------------------------------------------

FUND OBJECTIVE

Long-term capital appreciation.

PRINCIPAL INVESTMENT STRATEGIES

The fund invests primarily in stocks of companies in the United States and in
foreign countries that are represented in the MSCI Europe, Australasia and Far
East Index. The EAFE Index reflects stocks in most developed countries outside
North America. The fund also invests, to a lesser extent, in stocks of issuers
in other countries, including emerging markets, and in U.S. and foreign bonds.

The fund's investment adviser, Mitchell Hutchins Asset Management Inc.,
allocates the fund's assets between U.S. and foreign markets based on how it
expects U.S. stock markets to perform in comparison to stock markets in certain
of the EAFE countries. Mitchell Hutchins may increase the allocation of the
fund's assets to either the U.S. or foreign markets if it believes that one of
those markets has a greater potential for high returns, relative to the risk of
loss. The fund may (but is not required to) use derivatives as part of its
investment strategy or to help manage portfolio risks.

Mitchell Hutchins has appointed Invista Capital Management, LLC as the
sub-adviser for the fund's foreign investments. In buying and selling foreign
stocks for the fund, Invista analyzes the fundamental business prospects of
industries and of individual companies and assesses the relative risks presented
by the countries in which those companies operate.

In buying and selling U.S. stocks for the fund, Mitchell Hutchins uses its own
Factor Valuation Model to identify companies that appear undervalued. The model
ranks companies based on "value" factors, such as dividends, cash flows,
earnings and book values, as well as on "growth" factors, such as earnings
momentum and industry performance forecasts. Mitchell Hutchins then applies
fundamental analysis to select specific stocks from among those identified by
the model.

PRINCIPAL RISKS

An investment in the fund is not guaranteed; you may lose money by investing in
the fund. The principal risks presented by the fund are:

o EQUITY RISK - Stocks and other equity securities generally fluctuate in
value more than bonds. The fund could lose all of its investment in a
company's stock.

o ASSET ALLOCATION RISK - Mitchell Hutchins may not be successful in choosing
the best allocation of the fund's assets between U.S. and foreign issuers.

o DERIVATIVES RISK - The fund's investments in derivatives may rise or fall
more rapidly than other investments.

More information about these and other risks of an investment in the fund is
provided below in "More About Risks and Investment Strategies."

INFORMATION ON THE FUND'S INVESTMENT STRATEGIES AND RECENT HOLDINGS CAN BE FOUND
IN THE CURRENT ANNUAL/SEMI-ANNUAL REPORTS (SEE BACK COVER FOR INFORMATION ON
ORDERING SUCH REPORTS).

28
<PAGE>

Mitchell Hutchins Series Trust Global Equity Portfolio
--------------------------------------------------------------------------------

PERFORMANCE
-----------

RISK/RETURN BAR CHART AND TABLE

The following bar chart and table provide information about the fund's
performance and thus give some indication of the risks of an investment in the
fund.

The bar chart shows how the fund's performance has varied from year to year. The
bar chart shows Class H shares, the only class outstanding during all the
periods shown.

The table that follows the bar chart shows the average annual returns for Class
H shares over several time periods. Performance for Class I shares is not
included in the table because Class I shares were not outstanding for the full
1999 calendar year. The table compares fund returns to returns on a broad-based
market index that is unmanaged and, therefore, does not include any sales
charges or expenses.

The fund's past performance does not necessarily indicate how it will perform in
the future. This is especially true for the period prior to November 2, 1998,
when Mitchell Hutchins and Invista assumed day-to-day management of the fund's
assets. Prior to that date, another sub-adviser was responsible for managing all
the fund's assets.

TOTAL RETURN ON CLASS H SHARES

CALENDAR YEAR PERCENTAGES
------------- -----------

1990 7.53%
1991 4.93%
1992 -7.55%
1993 40.02%
1994 -11.94%
1995 -3.54%
1996 15.14%
1997 7.16%
1998 13.50%
1999 18.47%

Best quarter during years shown -- 4th quarter, 1998: 19.55%
Worst quarter during years shown -- 3rd quarter, 1998: (18.97)%

AVERAGE ANNUAL TOTAL RETURNS
as of December 31, 1999

CLASS CLASS H MSCI WORLD
(INCEPTION DATE) 05/04/87 INDEX
---------------- -------- -----
One Year.................. 18.47% 25.34%
Five Years................ 9.86% 20.25%
Ten Years................. 7.50% 11.96%
Life of Class............. 7.92% 11.65%*

--------------------
* Return is for the period 4/30/87 to 12/31/99, annualized.

29
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Mitchell Hutchins Series Trust
------------------------------------------------------

MORE ABOUT RISKS AND INVESTMENT STRATEGIES
------------------------------------------

PRINCIPAL RISKS

The main risks of investing in the funds are described below. Not all of these
risks apply to each fund. You can find a list of the main risks that apply to a
particular fund by looking under the "Investment Objective, Strategies and
Risks" heading for that fund.

Other risks of investing in a fund, along with further details about some of the
risks described below, are discussed in the funds' Statement of Additional
Information ("SAI"). Information on how you can obtain the SAI is on the back
cover of this prospectus.

ASSET ALLOCATION RISK. Mitchell Hutchins may not be successful in choosing the
best allocation of a fund's assets among different asset classes or geographic
or other market sectors. A fund that allocates its assets among different asset
classes or market sectors is more dependent on Mitchell Hutchins' ability to
successfully assess the relative values in each asset class or sector than are
funds that do not do so.

For Tactical Allocation Portfolio, the Mitchell Hutchins Tactical Allocation
Model may not correctly predict the times to shift the fund's assets from one
asset class to another.

CREDIT RISK. Credit risk is the risk that the issuer of a bond will not make
principal or interest payments when they are due. Even if an issuer does not
default on a payment, a bond's value may decline if the market believes that the
issuer has become less able, or less willing, to make payments on time. Even
high quality bonds are subject to some credit risk. However, credit risk is
greater for lower quality bonds. Bonds that are not investment grade involve
high credit risk and are considered speculative. Some of these low quality bonds
may be in default when purchased by a fund. Low quality bonds may fluctuate in
value more than higher quality bonds and, during periods of market volatility,
may be more difficult to sell at the time and price a fund desires.

DERIVATIVES RISK. The value of "derivatives" - so-called because their value
"derives" from the value of an underlying asset, reference rate or index - may
rise or fall more rapidly than other investments. For some derivatives, it is
possible for a fund to lose more than the amount it invested in the derivative.
Options, futures contracts and forward currency contracts are examples of
derivatives. A fund's use of derivatives may not succeed for various reasons,
including unexpected changes in the values of the derivatives or the assets
underlying them. Also, if a fund uses derivatives to adjust or "hedge" the
overall risk of its portfolio, the hedge will not succeed if changes in the
values of the derivatives are not matched by opposite changes in the values of
the assets being hedged.

EMERGING MARKETS RISK. Securities of issuers located in emerging market
countries are subject to all of the risks of other foreign securities (see
below). However, the level of those risks often is higher due to the fact that
social, political, legal and economic systems in emerging market countries may
be less fully developed and less stable than those in developed countries.
Emerging market securities also may be subject to additional risks, such as
lower liquidity and larger or more rapid changes in value.

EQUITY RISK. The prices of common stocks and other equity securities generally
fluctuate more than those of other investments. They reflect changes in the
issuing company's financial condition and changes in the overall market. A fund
may lose a substantial part, or even all, of its investment in a company's
stock.

FOREIGN INVESTING RISK. Foreign investing involve risks relating to political,
social and economic developments abroad to a greater extent than investing in
the securities of U.S. issuers. In addition, there are differences between U.S.
and foreign regulatory requirements and market practices. Foreign investments
denominated in foreign currencies are subject to the risk that the value of a
foreign currency will fall in relation to the U.S. dollar. Currency exchange
rates can be volatile and can be affected by, among other factors, the general
economics of a country, the actions of U.S. and foreign governments or central
banks, the imposition of currency controls and speculation.

Investments in foreign government bonds involve special risks because the
investors may have limited legal recourse in the event of default. Political
conditions, especially a country's willingness to meet the terms of its debt
obligations, can be of considerable significance.

<PAGE>

INDEX TRACKING RISK. Tactical Allocation Portfolio expects a close correlation
between the performance of its stock investments and that of the S&P 500 Index
in both rising and falling markets. The performance of the fund's stock
investments generally will not be identical to that of the Index because of fees
and expenses borne by the fund and shareholder purchases and sales of shares,
which can occur daily.

INTEREST RATE RISK. The value of bonds generally can be expected to fall when
interest rates rise and to rise when interest rates fall. Interest rate risk is
the risk that interest rates will rise, so that the value of a fund's
investments in bonds will fall. Because interest rate risk is the primary risk

30
<PAGE>

Mitchell Hutchins Series Trust
------------------------------------------------------

presented by U.S. government and other very high quality bonds, changes in
interest rates may actually have a larger effect on the value of those bonds
than on lower quality bonds.

LEVERAGE RISK. Leverage involves increasing the total assets in which a fund can
invest beyond the level of its net assets. Because leverage increases the amount
of a fund's assets, it can magnify the effect on the fund of changes in market
values. As a result, while leverage can increase a fund's income and potential
for gain, it also can increase expenses and the risk of loss. Strategic Fixed
Income Portfolio, which uses leverage by investing in when-issued and delayed
delivery bonds, attempts to limit the potential magnifying effect of the
leverage by managing its portfolio duration.

LIMITED CAPITALIZATION RISK. Securities of mid and small cap companies generally
involve greater risk than securities of larger companies because they may be
more vulnerable to adverse business or economic developments. Mid and small cap
companies also may have limited product lines, markets or financial resources,
and they may be dependent on a relatively small management group. Securities of
mid and small cap companies may be less liquid and more volatile than securities
of larger companies or the market averages in general. In addition, small cap
companies may not be well-known to the investing public, may not have
institutional ownership and may have only cyclical, static or moderate growth
prospects. In general, all these risks are greater for small cap companies than
for mid cap companies.

PREPAYMENT RISK. Payments on bonds that are backed by mortgage loans or similar
assets may be received earlier or later than expected due to changes in the rate
at which the underlying loans are prepaid. Faster prepayments often happen when
market interest rates are falling. As a result, a fund may need to reinvest
these early payments at those lower interest rates, thus reducing its income.
Conversely, when interest rates rise, prepayments may happen more slowly,
causing the underlying loans to be outstanding for a longer time. This can cause
the market value of the security to fall because the market may view its
interest rate as too low for a longer term investment.

SINGLE ISSUER CONCENTRATION RISK. Global Income Portfolio and Strategic Income
Portfolio are non-diversified. A non-diversified fund may invest more than 5% of
its total assets in securities of a single issuer to a greater extent than a
diversified fund. When a fund holds a large position in the securities of one
issuer, changes in the financial condition or in the market's assessment of that
issuer may cause larger changes in the fund's total return and in the price of
its shares than if the fund held only a smaller position.

ADDITIONAL INVESTMENT STRATEGIES

DEFENSIVE POSITIONS; CASH RESERVES. To protect itself from adverse market
conditions, a fund may take a defensive position that is different from its
normal investment strategy. This means that the fund may temporarily invest a
larger-than-normal part, or even all, of its assets in cash or money market
instruments. Since these investments provide relatively low income, a defensive
position may not be consistent with achieving a fund's investment objective.

Strategic Income Portfolio and Balanced Portfolio each may invest in money
market instruments on an unlimited basis as part of its ordinary investment
strategy. Tactical Allocation Portfolio may invest up to 100% of its assets in
U.S. Treasury bills with remaining maturities of less than 30 days and other
high quality money market instruments when recommended by the Tactical
Allocation Model. Money Market Portfolio invests exclusively in money market
instruments. Each of the other funds may invest up to 35% of its total assets in
cash or money market instruments as a cash reserve for liquidity or other
purposes.

PORTFOLIO TURNOVER. Each fund may engage in frequent trading to achieve its
investment objective. Frequent trading can result in portfolio turnover of 100%
or more (high portfolio turnover).

31
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Mitchell Hutchins Series Trust
------------------------------------------------------

INVESTING IN THE FUNDS

PURCHASES, REDEMPTIONS AND EXCHANGES
------------------------------------

Shares of the funds are sold only to insurance company separate accounts that
fund benefits under variable annuity or variable life insurance contracts. These
separate accounts are the shareholders of the funds - not the individual
contract owners. However, the separate accounts may pass through voting rights
to the contract owners.

The funds offer both Class H and Class I shares to insurance company separate
accounts:

o Class H shares are sold and redeemed at net asset value and do not pay any
12b-1 fees.

o Class I shares also are sold and redeemed at net asset value. However,
under a rule 12b-1 plan adopted by each fund, Class I shares pay an annual
distribution fee of 0.25% of average net assets. The funds pay this fee to
insurance companies for the sale of Class I shares and for services that
the insurance company provides to contract owners. Because these 12b-1 fees
are paid out of a fund's assets on an ongoing basis, over time they will
increase the cost of a contract owner's investment and may cost more than
paying other types of sales charges.

An insurance company separate account may exchange shares of one fund for shares
of the same class in another Mitchell Hutchins Series Trust fund at their
relative net asset values per share, provided that the separate account invests
in both funds. A particular insurance company separate account may not invest in
all Mitchell Hutchins Series Trust funds or classes of fund shares.

The funds and Mitchell Hutchins (for Class I shares) reserve the right to reject
any purchase order and to suspend the offering of a fund's shares for a period
of time.

PRICING AND VALUATION

Insurance company separate accounts buy, sell or exchange fund shares at their
net asset values. Each fund calculates net asset value separately for each class
as of the close of trading on the New York Stock Exchange (generally, 4:00 p.m.,
Eastern time). The NYSE normally is not open, and the funds do not price their
shares, on most national holidays and on Good Friday. If trading on the NYSE is
halted for the day before 4:00 p.m., Eastern time, the funds' net asset value
per share will be calculated as of the time trading was halted.

MONEY MARKET PORTFOLIO'S net asset value per share is expected to be $1.00 per
share, although this value is not guaranteed. Money Market Portfolio values its
securities at their amortized cost. This method uses a constant amortization to
maturity of the difference between the cost of the instrument to the fund and
the amount due at maturity.

OTHER FUNDS. Each other fund calculates its net asset value based on the current
market value for its portfolio securities. The funds normally obtain market
values for their securities from independent pricing services that use reported
last sales prices, current market quotations or valuations from computerized
"matrix" systems that derive values based on comparable securities. If a market
value is not available from an independent pricing source for a particular
security, that security is valued at a fair value determined by or under the
direction of the funds' board of trustees. The funds normally use the amortized
cost method to value bonds that will mature in 60 days or less.

Judgment plays a greater role in valuing thinly traded securities, including
many lower-rated bonds, because there is less reliable, objective data
available.

The funds calculate the U.S. dollar value of investments that are denominated in
foreign currencies daily, based on current exchange rates. A fund may own
securities, including some securities that trade primarily in foreign markets,
that trade on weekends or other days on which a fund does not calculate net
asset value. As a result, a fund's net asset value may change on days when you
will not be able to buy and sell fund shares. If a fund concludes that a
material change in the value of a foreign security has occurred after the close
of trading in the principal foreign market but before the close of the NYSE, the
fund may use fair value methods to reflect those changes. This policy is
intended to assure that the fund's net asset value fairly reflects security
values as of the time of pricing.

32
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Mitchell Hutchins Series Trust
------------------------------------------------------

MANAGEMENT
----------

INVESTMENT ADVISERS

Mitchell Hutchins Asset Management Inc. is the investment adviser and
administrator of each fund. Mitchell Hutchins is located at 51 West 52nd Street,
New York, New York 10019-6114, and is a wholly owned asset management subsidiary
of PaineWebber Incorporated, which is wholly owned by Paine Webber Group Inc., a
publicly owned financial services holding company. On February 29, 2000,
Mitchell Hutchins was adviser or sub-adviser to 31 investment companies with 76
separate funds and aggregate assets of approximately $54.4 billion.

Pacific Investment Management Company is the sub-adviser for Strategic Fixed
Income Portfolio. It is located at 840 Newport Center Drive, Suite 300, Newport
Beach, California 92660. On December 31, 1999, PIMCO had approximately $86
billion in assets under management and was the adviser or sub-adviser of 18
investment companies with 65 portfolios and aggregate net assets of
approximately $53 billion.

Nicholas-Applegate Capital Management is the sub-adviser for Aggressive Growth
Portfolio. It is located at 600 West Broadway, 29th Floor, San Diego, California
92101. On February 29, 2000, Nicholas-Applegate had approximately $48.5 billion
in assets under management and was the adviser or sub-adviser of 14 investment
companies with 32 portfolios and aggregate net assets of approximately $7.8
billion.

Invista Capital Management, LLC is the sub-adviser for Global Equity Portfolio's
foreign investments. It is located at 1900 Hub Tower, 699 Walnut, Des Moines,
Iowa 50309. As of December 31, 1999, Invista managed approximately $35.3 billion
in client assets.

The funds have received an exemptive order from the SEC that permits their board
to appoint and replace sub-advisers and to amend sub-advisory contracts without
obtaining shareholder approval. A fund's shareholders must approve this policy
before the board may implement it. The shareholders of Strategic Fixed Income
Portfolio and Global Equity Portfolio have approved this policy. As of the date
of this prospectus, the shareholders of the other funds have not been asked to
do so.

ADVISORY FEES

The funds paid advisory fees to Mitchell Hutchins for the most recent fiscal
year at the following annual contract rates based on average daily net assets.

Money Market Portfolio 0.50%
High Grade Fixed Income Portfolio 0.50%
Strategic Fixed Income Portfolio 0.50%
Strategic Income Portfolio 0.75%
Global Income Portfolio 0.75%
High Income Portfolio 0.50%
Balanced Portfolio 0.75%
Growth and Income Portfolio 0.70%
Tactical Allocation Portfolio 0.50%
Growth Portfolio 0.75%
Aggressive Growth Portfolio 0.80%
Small Cap Portfolio 1.00%
Global Equity Portfolio 0.75%

PORTFOLIO MANAGERS

Unless otherwise noted, all portfolio managers are employees of Mitchell
Hutchins. Most of these individuals serve as portfolio managers for more than
one fund. Information about their positions with Mitchell Hutchins and their
business experience follows this section. All relevant information about
portfolio managers who are employees of a sub-adviser is provided in this
section.

HIGH GRADE FIXED INCOME PORTFOLIO. Dennis L. McCauley is primarily responsible
for the day-to-day management of the fund's portfolio. Nirmal Singh and
Julieanna Berry assist Mr. McCauley in managing the fund's portfolio. Messrs.
McCauley and Singh have held their management responsibilities for the fund
since July 1995. Ms. Berry assumed her management responsibilities for the fund
in February 2000.

STRATEGIC FIXED INCOME PORTFOLIO. William C. Powers, a PIMCO Managing Director,
is primarily responsible for the day-to-day management of the fund's portfolio.
Mr. Powers has been a senior member of the fixed income portfolio management
group of PIMCO since 1991 and assumed his management responsibilities for the
fund in September 1996.

STRATEGIC INCOME PORTFOLIO. Dennis L. McCauley is the fund's allocation manager.
Nirmal Singh and Julieanna Berry share responsibility as sector managers for the
day-to-day management of the fund's U.S. government and investment grade

33
<PAGE>

Mitchell Hutchins Series Trust
------------------------------------------------------

securities. James F. Keegan is the sector manager responsible for the day-to-day
management of the fund's U.S. high yield, high risk securities. Stuart Waugh is
the sector manager responsible for the day-to-day management of the fund's
foreign and emerging market bonds.

Messrs. McCauley, Singh and Waugh have held their day-to-day management
responsibilities for the fund since its inception. Mr. Keegan has held
day-to-day management responsibilities for the fund since its inception but
assumed his sector manager responsibilities for the fund's U.S. high yield, high
risk securities in February 2000. Ms. Berry has held her day-to-day management
responsibilities for the fund since February 2000.

GLOBAL INCOME PORTFOLIO. Stuart Waugh and William King are primarily responsible
for the day-to-day management of the fund's portfolio. Mr. Waugh has been
involved with the fund since its inception, first as an analyst and as portfolio
manager since 1993. Mr. King assumed his present management responsibilities for
the fund in 1997.

HIGH INCOME PORTFOLIO. James F. Keegan is responsible for the day-to-day
management of the fund's portfolio. Mr. Keegan has held his management
responsibilities for the fund since February 2000.

BALANCED PORTFOLIO. T. Kirkham Barneby is responsible for the asset allocation
decisions for the fund. Mark A. Tincher is primarily responsible for the
day-to-day management of the fund's equity portion. Dennis L. McCauley is
primarily responsible for the day-to-day management of the fund's fixed income
portion. Nirmal Singh and Susan Ryan assist Mr. McCauley in managing the fund's
fixed income investments.

Messrs. Barneby, McCauley, Singh and Tincher and Ms. Ryan have held their
management responsibilities for the fund since August 1995.

GROWTH AND INCOME PORTFOLIO. Mark A. Tincher is primarily responsible for the
day-to-day management of the fund. Mr. Tincher has held his management
responsibilities for the fund since April 1995.

TACTICAL ALLOCATION PORTFOLIO. T. Kirkham Barneby is responsible for the fund's
asset allocation decisions and the day-to-day management of its portfolio. Mr.
Barneby has held his management responsibilities for the fund since its
inception.

GROWTH PORTFOLIO. Ellen R. Harris has been primarily responsible for the
day-to-day management of the fund's portfolio since its inception.

AGGRESSIVE GROWTH PORTFOLIO. The Systems Driven Internal Research team at
Nicholas-Applegate, which is primarily responsible for the day-to-day management
of Aggressive Growth Portfolio, has been under the supervision of portfolio
manager John Kane for the past five years. Mr. Kane has been the lead portfolio
manager for the team since he joined the firm in 1994. The team has held its
management responsibilities for the fund since its inception.

SMALL CAP PORTFOLIO. Donald R. Jones is primarily responsible for the day-to-day
management of the fund. He has held his management responsibilities for the fund
since its inception.

GLOBAL EQUITY PORTFOLIO. T. Kirkham Barneby is responsible for allocating the
fund's assets between U.S. investments and foreign investments. Mark A. Tincher
is primarily responsible for the day-to-day management of the fund's U.S.
investments.

Scott D. Opsal and Kurtis D. Spieler are primarily responsible for the
day-to-day management of Global Equity Portfolio's foreign investments. Mr.
Opsal is an executive vice president and chief investment officer of Invista,
where he has been employed since 1986. Mr. Spieler is a portfolio manager
specializing in the management of international equity portfolios. He has been
employed by Invista since 1994.

Messrs. Barneby, Tincher, Opsal and Spieler assumed their management
responsibilities for the fund on November 2, 1998.

* * *

Ms. Ryan is responsible for the day-to-day management of Money Market Portfolio
and management of the cash portion of all the other funds except Aggressive
Growth, Strategic Fixed Income and Global Equity Portfolios. She has held her
Money Market Portfolio responsibilities since its inception.

Other members of Mitchell Hutchins' fixed income and equity investments groups
provide input on market outlook, interest rate forecasts, investment research
and other considerations pertaining to each fund's investments.

<PAGE>

POSITIONS WITH MITCHELL HUTCHINS AND BUSINESS EXPERIENCE OF MITCHELL HUTCHINS
EMPLOYEES.

T. KIRKHAM BARNEBY is a managing director and chief investment officer -
quantitative investments of Mitchell Hutchins, where he has been employed since
1994.

JULIEANNA BERRY is a first vice president of Mitchell Hutchins, where she has
been employed as a portfolio manager since 1989.

34
<PAGE>

Mitchell Hutchins Series Trust
------------------------------------------------------

ELLEN R. HARRIS is a managing director of Mitchell Hutchins and has been with
Mitchell Hutchins since 1983.

DONALD R. JONES has been a first vice president of Mitchell Hutchins since
February 1996. Prior to joining Mitchell Hutchins, he was a vice president in
the Asset Management Group of First Fidelity Bancorporation, which he joined in
1983.

JAMES F. KEEGAN is a senior vice president of Mitchell Hutchins. Prior to
joining Mitchell Hutchins in March 1996, Mr. Keegan was a director with Merrion
Group, L.P.

WILLIAM KING joined Mitchell Hutchins in November 1995. Prior to 1995, he was at
IBM Corporation, where he was responsible for the management of IBM Pension
Fund's global bond portfolio. Mr. King is a Chartered Financial Analyst.

DENNIS L. MCCAULEY is a managing director and chief investment officer - fixed
income of Mitchell Hutchins responsible for overseeing all active fixed income
investments, including domestic and global taxable and tax-exempt mutual funds.
Mr. McCauley joined Mitchell Hutchins in 1994.

SUSAN RYAN is a senior vice president of Mitchell Hutchins and has been with
Mitchell Hutchins since 1982.

NIRMAL SINGH is a senior vice president of Mitchell Hutchins, where he has been
employed since 1993.

MARK A. TINCHER is a managing director and chief investment officer of equities
(stocks) of Mitchell Hutchins, where he has been employed since March 1995.

STUART WAUGH is a managing director of Mitchell Hutchins responsible for global
fixed income investments and currency trading. He has been with Mitchell
Hutchins since 1983. Mr. Waugh is a Chartered Financial Analyst.

35
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Mitchell Hutchins Series Trust
------------------------------------------------------

DIVIDENDS AND TAXES

DIVIDENDS

Dividends are paid in additional shares of the distributing fund unless the
shareholder requests otherwise.

Money Market Portfolio declares dividends daily and pays them monthly; it does
not expect to realize gains. The other funds normally declare and pay dividends
and distribute any gains annually.

Class I shares have higher expenses because of their distribution fees and thus
are expected to have lower dividends than Class H shares.

TAXES

Fund shares are offered only to insurance company separate accounts that fund
certain variable annuity and variable life contracts. These accounts generally
are not subject to tax on dividends from the funds or when fund shares are
exchanged or redeemed. See the applicable contract prospectus for a discussion
of the federal income tax status of

o the insurance company separate accounts that purchase and hold shares of
the funds and

o the holders of contracts funded through those separate accounts.

Each fund must satisfy certain diversification requirements imposed by the
Internal Revenue Code on segregated asset accounts used to fund variable annuity
or variable life contracts. Failure of a fund to do so would result in taxation
of the insurance company issuing the contracts and treatment of the contract
holders other than as described in the contract prospectus.

See the SAI for a more detailed discussion. Prospective investors are urged to
consult their tax advisers.

36
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Mitchell Hutchins Series Trust
------------------------------------------------------

FINANCIAL HIGHLIGHTS

The following financial highlights tables are intended to help you understand
the funds' financial performance for the past 5 years. Shorter periods are shown
for funds that have existed for less than 5 years. Certain information reflects
financial results for a single fund share. In the tables, "total investment
return" represents the rate that an investor would have earned (or lost) on an
investment in a fund, assuming reinvestment of all dividends. This information
has been audited by Ernst & Young LLP, independent auditors, whose report, along
with the funds' financial statements, are included in the funds' Annual Reports
to Shareholders. The Annual Reports may be obtained without charge by calling
1-800-986-0088.

Please note that not every fund had Class I shares outstanding during the
periods shown.

The information in these tables pertains only to the funds and does not reflect
charges related to the insurance company separate accounts that invest in the
funds. See the appropriate variable annuity or variable life contract prospectus
for information concerning these charges.

37
<PAGE>

Mitchell Hutchins Series Trust Money Market Portfolio
--------------------------------------------------------------------------------

MONEY MARKET PORTFOLIO

--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

CLASS H

--------------------------------------------------------------------
FOR THE YEARS ENDED DECEMBER 31,
--------------------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year.......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---- ---- ---- ---- ----
Net investment income....................... 0.03 0.04 0.04 0.04 0.05
---- ---- ---- ---- ----
Dividends from net investment
income................................... (0.03) (0.04) (0.04) (0.04) (0.05)
------ ------ ------ ------ ------
Net asset value, end of year................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
===== ===== ==== ==== ====
Total investment return(1).................. 3.55% 4.51% 4.53% 4.32% 5.22%
===== ===== ==== ==== ====
Ratios/Supplemental Data:

Net assets, end of year (000's)............. $ 5,590 $ 9,582 $ 8,906 $ 12,287 $ 21,974

Expenses to average net assets.............. 1.64% 1.15% 1.22% 1.17% 0.79%

Net investment income to
average net assets....................... 3.52% 4.42% 4.43% 4.27% 5.23%

-------------------

(1) Total investment return is calculated assuming a $1,000 investment on the first day of each year reported,
reinvestment of all dividends at net asset value on the payable dates, and a sale at net asset value on the last
day of each year reported. The figures do not include additional contract level charges; results would be lower if
such charges were included.

</TABLE>

38
<PAGE>

Mitchell Hutchins Series Trust High Grade Fixed Income Portfolio
-----------------------------------------------------------------------------------------------------

HIGH GRADE FIXED INCOME PORTFOLIO

------------------------------------------------------------------------------------------------------------

CLASS H

----------------------------------------------------------------

FOR THE YEARS ENDED
DECEMBER 31,

----------------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year...... $ 9.17 $ 9.29 $ 9.10 $ 9.49 $ 8.71
---- ---- ---- ---- ----

Net investment income................... 0.54 0.56 0.55 0.50 0.56

Net realized and unrealized gains
(losses) from investments............ (0.89) 0.07 0.19 (0.37) 0.79
------- ----- ---- ------ ----
Net increase (decrease) from
investment operations................ (0.35) 0.63 0.74 0.13 1.35
------- ----- ---- ---- ----
Dividends from net investment
income............................... -- (0.56) (0.55) (0.52) (0.57)

Distributions from net realized gains on
investments.......................... -- (0.19) -- -- --
------ ------ ----- ----- -----

Total dividends and distributions....... 0.00 (0.75) (0.55) (0.52) (0.57)
---- ------ ------ ------ ------

Net asset value, end of year............ $ 8.82 $ 9.17 $ 9.29 $ 9.10 $ 9.49
==== ==== ==== ==== ====

Total investment return(1).............. (3.82)% 6.83% 8.13% 1.41% 15.44%
====== ==== ==== ==== =====
Ratios/Supplemental Data:

Net assets, end of year (000's)......... $ 4,568 $6,770 $ 7,345 $7,902 $9,147

Expenses to average net assets.......... 1.91% 1.27% 1.43% 1.62% 1.01%

Net investment income to
average net assets................... 4.65% 5.39% 5.54% 5.04% 5.56%

Portfolio turnover rate................. 166% 101% 95% 282% 136%

---------------------------

(1) Total investment return is calculated assuming a $1,000 investment on the first day of each year reported,
reinvestment of all dividends and other distributions, if any, at net asset value on the payable dates and a sale
at net asset value on the last day of each year reported. The figures do not include additional contract level
charges; results would be lower if such charges were included.
</TABLE>

39
<PAGE>

Mitchell Hutchins Series Trust Strategic Fixed Income Portfolio
------------------------------------- ---------------------------------

<TABLE>
<CAPTION>
STRATEGIC FIXED INCOME PORTFOLIO

-------------------------------------------------------------------------------------------------------------------

CLASS H

-----------------------------------------------------------------------

FOR THE YEARS ENDED
DECEMBER 31,

-----------------------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>

Net asset value, beginning of year........ $ 10.78 $ 10.64 $ 10.21 $ 10.61 $ 10.34
------ ------ ----- ----- -----
Net investment income..................... 0.72 0.70 0.69 0.70 0.88

Net realized and unrealized gains
(losses) from investments, futures,
options and foreign currency
transactions........................... (1.08) 0.21 0.44 (0.31) 1.03
------ ----- ---- ------ ----
Net increase (decrease) from
investment operations.................. (0.36) 0.91 1.13 0.39 1.91
------ ----- ---- ---- ----
Dividends from net investment
income................................. -- (0.68) (0.70) (0.70) (0.88)

Distributions from net realized
gains on investments................... 0.00++ (0.09) -- (0.09) (0.76)
---- ------ ----- ------ ------

Total dividends and distributions......... 0.00 (0.77) (0.70) (0.79) (1.64)
---- ------- ------ ------ ------

Net asset value, end of year.............. $ 10.42 $ 10.78 $ 10.64 $ 10.21 $ 10.61
===== ====== ===== ===== =====

Total investment return(1)................ (3.32)% 8.62% 11.00% 3.79% 18.51%
====== ==== ===== ==== =====

Ratios/Supplemental Data:

Net assets, end of year (000's)........... $ 6,250 $ 9,469 $ 9,891 $ 10,689 $ 13,741

Expenses to average net assets............ 1.82%+ 1.10%+ 1.00% 1.52% 0.99%

Net investment income to
average net assets..................... 5.34% 5.88% 6.04% 5.88% 6.35%

Portfolio turnover........................ 503% 245% 175% 317% 234%

-------------------

+ Includes 0.10% and 0.14% of interest expense related to the reverse repurchase agreements during the years ended
December 31, 1999 and December 31, 1998, respectively.

++ The Fund paid a distribution of less than $0.005 per share for the year ended December 31, 1999.

40
<PAGE>

Mitchell Hutchins Series Trust Strategic Income Portfolio
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

STRATEGIC INCOME PORTFOLIO
-----------------------------------------------------------------------------------------------------------------------------------

CLASS H CLASS I
--------------------------------------------- ----------------------
FOR THE PERIOD FOR THE PERIOD
FOR THE SEPTEMBER 28, JANUARY 5,
YEAR ENDED 1998+ THROUGH 1999++THROUGH
DECEMBER 31, 1999 DECEMBER 31, 1998 DECEMBER 31, 1999
----------------- ----------------- -----------------
<S> <C> <C> <C>

Net asset value, beginning of period...................... $12.19 $ 12.00 $ 12.22
------- ------- -------
Net investment income..................................... 0.77@ 0.14 0.76@

Net realized and unrealized gains (losses) from (0.54)@ 0.20 (0.56)@
investments, foreign currency and futures contracts.... ------ ----- -------

Net increase from investment operations................... 0.23 0.34 0.20
---- ----- -----
Dividends from net investment income...................... (0.68) (0.14) (0.68)

Distributions from net realized gains from investments.... -- (0.01) --

Distributions from paid in capital........................ (0.01) -- (0.01)
------ --- ------
Total dividends and distributions to shareholders......... (0.69) (0.15) (0.69)
------ ------- -------
Net asset value, end of period............................ $11.73 $ 12.19 $ 11.73
====== ====== ======
Total investment return(1)................................ 1.89% 2.84% 1.63%
==== ===== =====
Ratios/Supplemental data:

Net assets, end of period (000's)......................... $11,423 $ 10,328 $ 1,335

Expenses to average net assets, before waiver from adviser 1.62% 1.44%* 1.87%*

Expenses to average net assets, after waiver from adviser. 1.62% 1.44%* 1.62%*

Net investment income to average net assets, before
waiver from adviser.................................... 6.20% 5.09%* 5.75%*

Net investment income to average net assets, after waiver
from adviser........................................... 6.20% 5.09%* 6.00%*

Portfolio turnover rate................................... 403% 81% 403%

-------------------

+ Commencement of operations.

++ Commencement of issuance of shares.

* Annualized.

@ Calculated using the average daily shares outstanding for the period.

(1) Total investment return is calculated assuming a $1,000 investment on the first day of the period reported,
reinvestment of all dividends and other distributions, if any, at net asset value on the payable dates and a sale
at net asset value on the last day of the period reported. The figures do not include additional contract level
charges; results would be lower if such charges were included. Total investment return for periods of less than one
year has not been annualized.
</TABLE>

41
<PAGE>

Mitchell Hutchins Series Trust Global Income Portfolio
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

GLOBAL INCOME PORTFOLIO
------------------------------------------------------------------------------------------------------------

CLASS H

------------------------------------------------------------------------

FOR THE YEARS ENDED
DECEMBER 31,

------------------------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value, beginning
of year........................ $ 11.07 $ 10.81 $ 11.14 $ 11.20 $ 10.88
----- ----- ----- ----- -----
Net investment income (loss)...... 0.59 0.69 0.75 0.87 (0.05)

Net realized and unrealized gains
(losses) from investments and
foreign currency............... (1.12) 0.36 (0.36) (0.13) 1.52
------- ----- ------ ------ ----
Net increase (decrease) from
investment operations.......... (0.53) 1.05 0.39 0.74 1.47
------ ----- ---- ---- ----
Dividends from net investment
income......................... -- (0.61) (0.71) (0.79) (1.15)

Distributions from net realized
gains from investments......... -- (0.18) (0.01) (0.01) --
--- ------ ------ ------ ----

Total dividends and distributions. -- (0.79) (0.72) (0.80) (1.15)
--- ------- ------ ------ ------

Net asset value, end of year...... $ 10.54 $ 11.07 $ 10.81 $ 11.14 $ 11.20
===== ===== ===== ===== =====

Total investment return(1)........ (4.79)% 9.69% 3.50% 6.62% 13.58%
====== ==== ==== ==== =====

Ratios/Supplemental Data:

Net assets, end of year (000's)... $ 8,828 $ 14,702 $ 17,730 $ 24,436 $ 35,700

Expenses to average net assets.... 2.09% 1.68% 1.52% 1.56% 1.19%

Net investment income to
average net assets............. 4.62% 5.53% 6.34% 6.56% 7.21%

Portfolio turnover rate........... 43% 104% 142% 134% 160%

-------------------

(1) Total investment return is calculated assuming a $1,000 investment on the first day of each year reported,
reinvestment of all dividends and distributions at net asset value on the payable dates and a sale at net asset
value on the last day of each year reported. The figures do not include additional contract level charges; results
would be lower if such charges were included.
</TABLE>

42
<PAGE>

Mitchell Hutchins Series Trust High Income Portfolio
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

HIGH INCOME PORTFOLIO
-----------------------------------------------------------------------------------------------------------------------

CLASS H

---------------------------------------------
FOR THE PERIOD

FOR THE SEPTEMBER 28,
YEAR ENDED 1998+ THROUGH
DECEMBER 31, 1999 DECEMBER 31, 1998
------------------- --------------------
<S> <C> <C>

Net asset value, beginning of period.................................... $ 12.40 $ 12.00
------- -------
Net investment income................................................... 1.21 0.20

Net realized and unrealized gains (losses) from investments............. (0.54) 0.42
------ -----
Net increase from investment operations................................. 0.67 0.62
---- ----
Dividends from net investment income.................................... (1.21) (0.20)

Distributions from net realized gains from investments.................. (0.11) (0.02)
------ -------
Total dividends and distributions....................................... (1.32) (0.22)
------ -------
Net asset value, end of period.......................................... $ 11.75 $ 12.40
======= ======
Total investment return(1).............................................. 5.42% 5.16%
==== =======
Ratios/Supplemental data:

Net assets, end of period (000's)....................................... $12,561 $ 10,933

Expenses to average net assets.......................................... 1.35% 1.20%*

Net investment income to average net assets............................. 9.44% 7.04%*

Portfolio turnover rate................................................. 69% 21%

-------------------

+ Commencement of operations.

* Annualized.

43
<PAGE>

Mitchell Hutchins Series Trust Balanced Portfolio
----------------------------------------------------------------------
<TABLE>
<CAPTION>

BALANCED PORTFOLIO
-----------------------------------------------------------------------------------------------------------------------------------

CLASS H CLASS I
------------------------------------------------------------------------ --------------------

FOR THE YEARS ENDED FOR THE PERIOD
DECEMBER 31, AUGUST 17, 1999+
------------------------------------------------------------------------ THROUGH
1999 1998 1997 1996 # 1995 DECEMBER 31, 1999
---- ---- ---- ----- ---- -----------------
<S> <C> <C> <C> <C> <C> <C>

Net asset value, beginning
of period...................... $ 11.54 $ 11.33 $ 10.95 $ 10.70 $ 9.54 $ 11.37
----- ----- ----- ----- ---- -------

Net investment income............. 0.26 0.28 0.28 0.29 0.35 0.04

Net realized and unrealized gains
(losses) from investments and (0.05) 1.61 2.44 1.49 1.88 0.34
futures........................ ------ ----- ---- ---- ---- ----

Net increase from
investment operations.......... 0.21 1.89 2.72 1.78 2.23 0.38
---- ----- ---- ---- ---- ----
Dividends from net investment
income......................... -- (0.27) (0.28) (0.28) (0.35) --

Distributions from net realized
gains on investments........... (0.00)++ (1.41) (2.06) (1.25) (0.72) (0.00)++
------ ------- ------ ------ ------ ------

Total dividends and distributions. (0.00) (1.68) (2.34) (1.53) (1.07) (0.00)
------ ------- ------ ------ ------ ------

Net asset value, end of period.... $ 11.75 $ 11.54 $ 11.33 $ 10.95 $10.70 $ 11.75
======= ====== ===== ===== ===== =======

Total investment return(1)........ 1.82% 16.81% 24.86% 16.82% 23.27% 3.34%
==== ===== ===== ===== ===== ====

Ratios/Supplemental data:

Net assets, end of period (000's). $21,418 $28,549 $28,211 $29,224 $23,413 $ 596

Expenses to average net assets, 1.25% 0.97% 1.19% 1.24% 1.09% 1.57%*
net of waivers (2).............

Net investment income to
average net assets, net of 1.81% 2.08% 2.06% 2.29% 2.88% 1.39%*
waivers (3)....................

Portfolio turnover................ 206% 177% 169% 235% 171% 206%

-------------------

+ Commencement of issuance of shares.

# Prior to the close of business on January 26, 1996, the Balanced Portfolio was known as the Asset Allocation
Portfolio.

++ The Portfolio made a distribution of less than $0.005 per share during the year ended December 31, 1999.

* Annualized.

(1) Total investment return is calculated assuming a $1,000 investment on the first day of each period reported,
reinvestment of all dividends and other distributions, if any, at net asset value on the payable dates and a sale
at net asset value on the last day of each period reported. The figures do not include additional contract level
charges; results would be lower if such charges were included. Total investment return for periods of less than one
year has not been annualized.

(2) During the period ended December 31, 1999, Mitchell Hutchins waived a portion of its fees. The ratios excluding the
waiver would have been 1.25% and 1.82% for Class H and Class I, respectively.

(3) During the period ended December 31, 1999, Mitchell Hutchins waived a portion of its fees. The ratios excluding the
waiver would have been 1.81% and 1.14% for Class H and Class I, respectively.
</TABLE>

44
<PAGE>

Mitchell Hutchins Series Trust Growth and Income Portfolio
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

GROWTH AND INCOME PORTFOLIO
------------------------------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------

CLASS H CLASS I
----------------------------------------------------------------- -------------------
FOR THE PERIOD
FOR THE YEARS ENDED DECEMBER 31, JANUARY 5, 1999+
----------------------------------------------------------------- THROUGH
1999 1998 1997 1996 1995 DECEMBER 31, 1999
---- ---- ---- ---- ---- -------------------
<S> <C> <C> <C> <C> <C> <C>

Net asset value, beginning of period... $ 14.81 $ 13.69 $ 12.27 $ 11.83 $ 9.16 $ 14.70
------- ------- ------- ------- ------ -------
Net investment income ................. 0.05@ 0.07 0.10 0.06 0.10 0.04@

Net realized and unrealized gains from
investments......................... 1.48@ 2.16 3.88 2.53 2.70 1.61@
---- ----- ---- ---- ---- ----
Net increase from
investment operations............... 1.53 2.23 3.98 2.59 2.80 1.65
---- ----- ---- ---- ---- ----
Dividends from net investment
income.............................. (0.00)# (0.07) (0.10) (0.06) (0.10) (0.00)#

Distributions from net realized
gains from investments.............. -- (1.04) (2.46) (2.09) (0.03) --
----- ------- ------ ------ ------ ----

Total dividends and other distributions (0.00)# (1.11) (2.56) (2.15) (0.13) (0.00)#
------- ------- ------ ------ ------ ------

Net asset value, end of period......... $ 16.34 $ 14.81 $ 13.69 $ 12.27 $ 11.83 $ 16.35
===== ===== ===== ===== ===== =====

Total investment return(1)............. 10.33% 16.32% 32.45% 22.12% 30.52% 11.23%
===== ===== ===== ===== ===== =====
Ratios/Supplemental Data:

Net assets, end of period (000's)...... $22,457 $ 24,497 $ 18,493 $14,520 $14,797 $6,201

Expenses to average net assets, before
waiver from adviser................. 1.23% 1.04% 1.04% 1.58% 1.37% 1.48%*

Expenses to average net assets, after
waiver from adviser................. 1.23% 1.04% 1.04% 1.58% 1.37% 1.23%*

Net investment income to average net
assets, before waiver from adviser.. 0.36% 0.46% 0.71% 0.49% 0.94% 0.04%*

Net investment income to average net
assets, after waiver from adviser... 0.36% 0.46% 0.71% 0.49% 0.94% 0.29%*

Portfolio turnover rate................ 65% 69% 92% 99% 134% 65%

-------------------

+ Commencement of issuance of shares.

* Annualized.

@ Calculated using the average monthly shares outstanding for the period.

# The Portfolio made a distribution of less than $0.005 per share during the year ended December 31, 1999.
</TABLE>

45
<PAGE>

Mitchell Hutchins Series Trust Tactical Allocation Portfolio

--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

TACTICAL ALLOCATION PORTFOLIO
---------------------------------------------------------------------------------------------------------- -------------------------

CLASS H CLASS I
----------------------------------------------------- ----------------------
FOR THE PERIOD FOR THE PERIOD
FOR THE SEPTEMBER 28, JANUARY 5, 1999++
YEAR ENDED 1998+ THROUGH THROUGH
DECEMBER 31, 1999 DECEMBER 31, 1998 DECEMBER 31, 1999
----------------- ----------------- -----------------
<S> <C> <C> <C>

Net asset value, beginning of period............... $ 14.91 $ 12.00 $ 14.89
------- ------- -------
Net investment income.............................. 0.11@ 0.02 0.11@

Net realized and unrealized gains from investments. 2.64@ 2.99 2.65@
---- ---- ----
Net increase from investment operations............ 2.75 3.01 2.76
---- ----- -----
Dividends from net investment income............... (0.06) (0.02) (0.06)

Distributions from net realized gains from
investments..................................... (1.11) (0.08) (1.11)
------ ------- ------

Total dividends and distributions.................. (1.17) (0.10) (1.17)
------ ------- -------

Net asset value, end of period..................... $ 16.49 $ 14.91 $ 16.48
===== ====== ======

Total investment return(1)......................... 18.43% 24.98% 18.52%
===== ====== ======
Ratios/Supplemental data:

Net assets, end of period (000's).................. $36,714 $ 22,494 $ 54,413

Expenses to average net assets, before waiver from
adviser......................................... 0.74% 0.95%* 0.99%*

Expenses to average net assets, after waiver from
adviser......................................... 0.74% 0.95%* 0.74%*

Net investment income to average net assets,
before waiver from adviser...................... 0.71% 0.77%* 0.56%*

Net investment income to average net assets, after
waiver from adviser............................. 0.71% 0.77%* 0.81%*

Portfolio turnover rate............................ 110% 6% 110%

-------------------

+ Commencement of operations.

++ Commencement of issuance of shares.

* Annualized.

@ Calculated using the average monthly shares outstanding for the period.

(1) Total investment return is calculated assuming a $1,000 investment on the first day of the period reported,
reinvestment of all dividends and distributions, if any, at net asset value on the payable dates and a sale at net
asset value on the last day of the period reported. The figures do not include additional contract level charges;
results would be lower if such charges were included. Total investment return for periods of less than one year has
not been annualized.
</TABLE>

46
<PAGE>

Mitchell Hutchins Series Trust Growth Portfolio
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

GROWTH PORTFOLIO
------------------------------------------------------------------------------------------------------------------------------------

CLASS H CLASS I
----------------------------------------------------------------------- --------------------
FOR THE PERIOD
FOR THE YEARS ENDED DECEMBER 31, JULY 18, 1999+
----------------------------------------------------------------------- THROUGH
1999 1998 1997 1996 1995 DECEMBER 31, 1999
---- ---- ---- ---- ---- --------------------
<S> <C> <C> <C> <C> <C> <C>

Net asset value, beginning of year.. $ 18.03 $ 15.63 $ 17.48 $ 17.57 $ 14.56 $ 20.59
------- ------- ------- ------- ------- -------

Net investment income (loss)........ (0.14) (0.07) 0.03 (0.06) 0.04 (0.03)

Net realized and unrealized gains
from investments................. 6.20 4.79 2.69 3.29 4.68 3.53
---- ----- ---- ---- ---- ----

Net increase from investment
operations....................... 6.06 4.72 2.72 3.23 4.72 3.50
---- ----- ---- ---- ---- ----

Dividends from net investment
income........................... -- -- (0.03) -- (0.08) --

Distributions from net realized
gains from investments........... (0.00)++ (2.32) (4.54) (3.32) (1.63) (0.00)++
-------- ------- ------ ------ ------ ------

Total dividends and distributions... (0.00) (2.32) (4.57) (3.32) (1.71) (0.00)
------ ------- ------ ------ ------ ------

Net asset value, end of year....... $ 24.09 $ 18.03 $ 15.63 $ 17.48 $ 17.57 $ 24.09
======= ====== ====== ====== ====== ======

Total investment return(1).......... 33.61% 30.59% 15.41% 18.70% 32.50% 17.00%
===== ===== ===== ===== ===== =====
Ratios/Supplemental data:

Net assets, end of year (000's)..... $36,428 $36,830 $30,586 $36,357 $42,784 $ 2,375

Expenses to average net assets...... 1.11% 1.05% 1.05% 1.14% 1.02% 1.14%*

Net investment income (loss) to
average net assets............... (0.58)% (0.37)% 0.12% (0.29)% 0.23% (0.58)%*

Portfolio turnover rate............. 23% 50% 89% 53% 41% 23%

-------------------
* Annualized.

+ Commencement of issuance of shares.

++ The Fund paid a distribution of less than $0.005 per share for the period ended December 31, 1999.

(1) Total investment return is calculated assuming a $1,000 investment on the first day of each period reported,
reinvestment of all dividends and other distributions, if any, at net asset value on the payable dates and a sale
at net asset value on the last day of each year reported. The figures do not include additional contract level
charges; results would be lower if such charges were included. Total investment return for periods of less than one
year has not been annualized.

(2) During the period ended December 31, 1999 Mitchell Hutchins waived a portion of its fees. The ratios excluding the
waiver would have been 1.11% and 1.39% for Class H and Class I, respectively.

(3) During the period ended December 31, 1999 Mitchell Hutchins waived a portion of its fees. The ratios excluding the
waiver would have been (0.58)% and (0.83)% for Class H and Class I, respectively.
</TABLE>

47
<PAGE>

Mitchell Hutchins Series Trust Aggressive Growth Portfolio
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

AGGRESSIVE GROWTH PORTFOLIO
--------------------------------------------------------------------------------------------------------------------
CLASS H

--------------------------------------------------------------------

FOR THE YEARS ENDED
DECEMBER 31,

--------------------------------------------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>

Net asset value, beginning of year.......... $13.64 $ 13.40 $13.09 $11.34 $ 9.65
------ ------ ------ ------ -----

Net investment income (loss)................ (0.18) (0.12) (0.09) (0.10) 0.03

Net realized and unrealized gains from
investments.............................. 3.60 2.15 2.78 2.93 2.00
---- ----- ---- ---- ----
Net increase from
investment operations.................... 3.42 2.03 2.69 2.83 2.03
---- ----- ---- ---- ----

Dividends from net investment income........ -- -- -- -- (0.02)

Distributions from net realized gains from
investments.............................. -- (1.79) (2.38) (1.08) (0.32)
----- ------- ------ ------ ------

Total dividends and distributions........... -- (1.79) (2.38) (1.08) (0.34)
----- ------- ------ ------ ------

Net asset value, end of year................ $17.06 $ 13.64 $13.40 $13.09 $11.34
===== ====== ====== ====== ======

Total investment return(1).................. 25.07% 15.30% 20.76% 25.23% 21.04%
===== ===== ===== ===== =====
Ratios/Supplemental data:

Net assets, end of year (000's)............. $15,491 $18,715 $19,076 $19,167 $17,660

Expenses to average net assets.............. 1.38% 1.21% 1.18% 1.52% 1.29%

Net investment income (loss) to average net
assets................................... (0.95)% (0.70)% (0.59)% (0.74)% 0.23%

Portfolio turnover rate..................... 135% 73% 89% 115% 119%

-------------------

48
<PAGE>

Mitchell Hutchins Series Trust Small Cap Portfolio
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

SMALL CAP PORTFOLIO

------------------------------------------------------------------------------------------------------------------------------------

CLASS H CLASS I
------------------------------------------------- -------------------
FOR THE PERIOD FOR THE PERIOD
FOR THE SEPTEMBER 28, JULY 6, 1999++
YEAR ENDED 1998+ THROUGH THROUGH
DECEMBER 31, 1999 DECEMBER 31, 1998 DECEMBER 31, 1999
----------------- ----------------- -------------------
<S> <C> <C> <C>

Net asset value, beginning of period....................... $ 14.90 $ 12.00 $ 14.70
------- ------- -------

Net investment loss........................................ (0.41) (0.04) (0.12)

Net realized and unrealized gains from investments......... 1.32 3.67 1.22
---- ---- ----

Net increase from investment operations.................... 0.91 3.63 1.10
---- ----- -----

Distributions from net realized gains from investments..... (0.55) (0.73) (0.55)
------ ------- -------

Net asset value, end of period............................. $15.26 $ 14.90 $ 15.25
====== ====== ======

Total investment return(1)................................. 6.13% 30.36% 7.51%
==== ====== =====

Ratios/Supplemental Data:

Net assets, end of period (000's).......................... $4,769 $ 4,057 $ 301

Expenses to average net assets, net of waivers (2)......... 3.86% 1.94%* 3.80%*

Net investment loss to average net assets, net of waivers
(3)..................................................... (3.09)% (1.27)%* (3.13)%*

Portfolio turnover rate.................................... 98% 17% 98%

-------------------
+ Commencement of operations.

++ Commencement of issuance of shares.

* Annualized.

(2) During the period ended December 31, 1999, Mitchell Hutchins waived a portion of its fees. The ratios excluding the
waiver would have been 3.86% and 4.05% for Class H and Class I, respectively.

(3) During the period ended December 31, 1999, Mitchell Hutchins waived a portion of its fees. The ratios excluding the
waiver would have been (3.09)% and (3.38)% for Class H and Class I, respectively.
</TABLE>

49
<PAGE>

Mitchell Hutchins Series Trust Global Equity Portfolio
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

GLOBAL EQUITY PORTFOLIO

------------------------------------------------------------------------------------------------------------------------------------

CLASS H CLASS I
------------------------------------------------------------- ----------------
FOR THE PERIOD
FOR THE YEARS ENDED DECEMBER 31, AUGUST 5, 1999+
------------------------------------------------------------- THROUGH
1999 1998 1997 1996 1995 DECEMBER 31, 1999
---- ---- ---- ---- ---- -----------------
<S> <C> <C> <C> <C> <C> <C>

Net asset value, beginning of period........ $ 13.74 $ 14.62 $13.74 $12.00 $12.44 $14.43
------- ------ ------ ------ ------ ------

Net investment income (loss)................ (0.03) 0.08 0.04 0.07 0.01 0.01

Net realized and unrealized gains (losses)
from investments, futures and foreign 2.56 1.92 0.94 1.75 (0.45) 1.82
currency transactions.................... ---- ----- ---- ---- ------ ----

Net increase (decrease) from investment
operations............................... 2.53 2.00 0.98 1.82 (0.44) 1.83
---- ----- ---- ---- ------ ----

Dividends from net investment income........ (0.05) -- (0.04) (0.08) -- (0.05)

Distributions from net realized gains from
investments.............................. (0.01) (2.88) (0.06) -- -- (0.01)
------ ------ ------ ----- ------ -------

Total dividends and other distributions..... (0.06) (2.88) (0.10) (0.08) 0.00 (0.06)
------ ------ ------ ------ ---- ------

Net asset value, end of period.............. $16.21 $ 13.74 $14.62 $13.74 $12.00 $16.20
====== ===== ====== ====== ===== ======

Total investment return (1)................. 18.47% 13.50% 7.16% 15.14% (3.54)% 12.74%
===== ===== ==== ===== ====== =====
Ratios/Supplemental Data:

Net assets, end of period (000's)........... $13,015 $15,799 $21,215 $25,701 $28,507 $ 387

Expenses to average net assets, net of
waivers(2)............................... 1.85% 1.33% 1.07% 1.10% 1.96% 2.00%*
Net investment income (loss) to average
net assets, net of waivers(3)............ 0.13% 0.46% 0.26% 0.46% 0.10% (0.64)%*
Portfolio turnover rate..................... 63% 154% 81% 44% 157% 63%

-------------------

+ Commencement of issuance of shares.

* Annualized.

(1) Total investment return is calculated assuming a $1,000 investment on the first day of the period reported,
reinvestment of all dividends and other distributions, if any, at net asset value on the payable dates and a sale
at net asset value on the last day of each period. The figures do not include additional contract level charges;
results would be lower if such charges were included. Total investment return for periods of less than one year has
not been annualized.

(2) During the period ended December 31, 1999 Mitchell Hutchins waived a portion of its fees. The ratios excluding the
waiver would have been 1.85% and 2.25% for Class H and Class I, respectively.

(3) During the period ended December 31, 1999 Mitchell Hutchins waived a portion of its fees. The ratios excluding the
waiver would have been 0.13% and (0.89)% for Class H and Class I, respectively.
</TABLE>

50
<PAGE>

If you want more information about the funds, the following documents are
available free upon request:

ANNUAL/SEMI-ANNUAL REPORTS:

Additional information about the funds' investments is available in the
funds' annual and semi-annual reports to shareholders. In the funds'
annual reports, you will find a discussion of the market conditions and
investment strategies that significantly affected the funds'
performance during the last fiscal year.

STATEMENT OF ADDITIONAL INFORMATION (SAI) AND CONTRACT PROSPECTUS:

The SAI provides more detailed information about the funds and is
incorporated by reference into this prospectus. Investors are advised
to also read the applicable contract prospectus.

You may discuss your questions about the funds, obtain free copies of annual and
semi-annual reports and the SAI, or request other information, by contacting the
funds directly at 1-800-986-0088.

You may review and copy information about the funds, including shareholder
reports and the SAI, at the Public Reference Room of the Securities and Exchange
Commission. You may obtain information about the operations of the SEC's Public
Reference Room by calling the SEC at 1-202-942-8090. You can get text-only
copies of reports and other information about the funds:

o For a fee, by electronic request at [email protected] or by writing the
SEC's Public Reference Room, Washington, D.C. 20549-0102; or

o Free, from the EDGAR Database on the SEC's Internet website at:
http://www.sec.gov

Mitchell Hutchins Series Trust
Investment Company Act File No. - 811-4919