SCUDDER CASH INVESTMENT TRUST
485BPOS, 1997-10-24
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     Filed with the Securities and Exchange Commission on October 23, 1997

                                                  File No. 2-55166
                                                  File No. 811-2613

               SECURITIES AND EXCHANGE COMMISSION
                     WASHINGTON, D. C. 20549

                            FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

     Pre-Effective Amendment No.

     Post-Effective Amendment No.    31

                               and

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940

     Amendment No.    21


                          Scudder Cash Investment Trust
               (Exact Name of Registrant as Specified in Charter)
                                
                 Two International Place, Boston, MA 02110-4103
               (Address of Principal Executive Offices) (Zip Code)
                                
       Registrant's Telephone Number, including Area Code: (617) 295-2567
                                
                               Thomas F. McDonough
                         Scudder, Stevens & Clark, Inc.
                    Two International Place, Boston, MA 02110
                     (Name and Address of Agent for Service)
                                

It is proposed that this filing will become effective

          immediately upon filing pursuant to paragraph (b)
          
      X   on November 1, 1997 pursuant to paragraph (b)
          
          60 days after filing pursuant to paragraph (a)(i)
          
          on _______________ pursuant to paragraph (a)(i)
          
          75 days after filing pursuant to paragraph (a)(ii)
          
          on _______________ pursuant to paragraph (a)(ii) of
          Rule 485.

The  Registrant  has filed a declaration  registering  an  indefinite  amount of
securities  pursuant to Rule 24f-2 under the Investment  Company Act of 1940, as
amended.  The Registrant  filed the notice required by Rule 24f-2 for its fiscal
year ended June 30, 1997 on August 29, 1997.

<PAGE>

                  SCUDDER CASH INVESTMENT TRUST
                      CROSS-REFERENCE SHEET
                                
                   Items Required By Form N-1A

PART A

Item No.   Item Caption     Prospectus Caption
                            
   1.      Cover Page       COVER PAGE
                            
   2.      Synopsis         EXPENSE INFORMATION
                            
   3.      Condensed        FINANCIAL HIGHLIGHTS
           Financial        
           Information
                            
   4.      General          INVESTMENT OBJECTIVE AND POLICIES
           Description of   WHY INVEST IN THE FUND?
           Registrant       ADDITIONAL INFORMATION ABOUT POLICIES
                            AND INVESTMENTS
                            FUND ORGANIZATION
                            
   5.      Management of    A MESSAGE FROM SCUDDER'S CHAIRMAN
           the Fund         FUND ORGANIZATION-Investment adviser,
                             Transfer agent
                            SHAREHOLDER BENEFITS-A team approach
                             to investing
                            TRUSTEES AND OFFICERS
                            
  5A.      Management       NOT APPLICABLE
           Discussion of
           Fund
           Performance
                            
   6.      Capital Stock    DISTRIBUTION AND PERFORMANCE
           and Securities    INFORMATION-Dividends and capital
                             gains distributions
                            FUND ORGANIZATION
                            SHAREHOLDER BENEFITS-SAILT-(Scudder
                             Automated Information Line),
                             Dividend reinvestment plan, T.D.D.
                             service for the hearing impaired
                            HOW TO CONTACT SCUDDER
                            
   7.      Purchase of      FUND ORGANIZATION-Underwriter
           Securities       TRANSACTION INFORMATION-Purchasing
           Being Offered     shares
                            PURCHASES
                            SHAREHOLDER BENEFITS-Dividend
                             reinvestment plan
                            SCUDDER TAX-ADVANTAGED RETIREMENT
                             PLANS
                            INVESTMENT PRODUCTS AND SERVICES
                            
   8.      Redemption or    TRANSACTION INFORMATION-Redeeming
           Repurchase        shares
                            EXCHANGES AND REDEMPTIONS
                            
   9.      Pending Legal    NOT APPLICABLE
           Proceedings

                             Cross Reference-Page 1
<PAGE>


PART B

                              Caption in Statement of
Item No.  Item Caption        Additional Information
                              
  10.     Cover Page          COVER PAGE
                              
  11.     Table of Contents   TABLE OF CONTENTS
                              
  12.     General             ORGANIZATION OF THE FUNDS
          Information and
          History
                              
  13.     Investment          THE FUNDS' INVESTMENT OBJECTIVES
          Objectives and      AND POLICIES
          Policies
                              
  14.     Management of the   TRUSTEES AND OFFICERS
          Fund                REMUNERATION
                              
  15.     Control Persons     TRUSTEES AND OFFICERS
          and Principal
          Holders of
          Securities
                              
  16.     Investment          INVESTMENT ADVISER
          Advisory and        ADDITIONAL INFORMATION-Experts,
          Other Services       Other Information
                              
  17.     Brokerage           PORTFOLIO TRANSACTIONS
          Allocation and
          Other Practices
                              
  18.     Capital Stock and   ORGANIZATION OF THE FUNDS
          Other Securities
                              
  19.     Purchase,           PURCHASES
          Redemption and      EXCHANGES AND REDEMPTIONS
          Pricing of          FEATURES AND SERVICES OFFERED BY
          Securities Being     THE FUND- Dividend and Capital
          Offered              Gain Distribution Options
                              SPECIAL PLAN ACCOUNTS
                              DIVIDENDS
                              NET ASSET VALUE
                              
  20.     Tax Status          DIVIDENDS
                              TAXES
                              
  21.     Underwriters        DISTRIBUTOR
                              
  22.     Calculation of      PERFORMANCE INFORMATION
          Performance Data
                              
  23.     Financial           FINANCIAL STATEMENTS
          Statements

                             Cross Reference-Page 2
<PAGE>


This prospectus sets forth concisely the information about Scudder Cash
Investment Trust, an open-end management investment company, that a prospective
investor should know before investing. Please retain it for future reference.

Shares of Scudder Cash Investment Trust are not insured or guaranteed by the
U.S. Government. Scudder Cash Investment Trust seeks to maintain a constant net
asset value of $1.00 per share but there can be no assurance that the stable net
asset value will be maintained.

   
If you require more detailed information, a Statement of Additional Information
dated November 1, 1997, as amended from time to time, may be obtained without
charge by writing Scudder Investor Services, Inc., Two International Place,
Boston, MA 02110-4103 or calling 1-800-225-2470. The Statement, which is
incorporated by reference into this prospectus, has been filed with the
Securities and Exchange Commission and is available along with other related
materials on the SEC's Internet Web site (http://www.sec.gov).
    

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

Contents--see page 4.

Not FDIC-Insured
May Lose Value
No Bank Guarantee

Scudder
Cash Investment
Trust

Prospectus
November 1, 1997

   
A pure no-load(TM) (no sales charges) mutual fund seeking to maintain the
stability of capital and, consistent therewith, to maintain the liquidity of
capital and to provide current income. The Fund seeks to achieve its objective
by investing in money market securities.
    
<PAGE>

Expense information

 How to compare a Scudder pure no-load(TM) fund

 This information is designed to help you understand the various costs and
 expenses of investing in Scudder Cash Investment Trust (the "Fund"). By
 reviewing this table and those in other mutual funds' prospectuses, you can
 compare the Fund's fees and expenses with those of other funds. With Scudder's
 pure no-load(TM) funds, you pay no commissions to purchase or redeem shares, or
 to exchange from one Fund to another. As a result, all of your investment goes
 to work for you. 

1)   Shareholder  transaction  expenses:   Expenses  charged  directly  to  your
     individual account in the Fund for various transactions.

     Sales commissions to purchase shares (sales load)      NONE
     Commissions to reinvest dividends                      NONE
     Redemption fees                                        NONE*
     Fees to exchange shares                                NONE

   
 2)  Annual Fund operating expenses: Expenses paid by the Fund before it
     distributes its net investment income, expressed as a percentage of the
     Fund's average daily net assets for the fiscal year ended June 30, 1997.

     Investment management fee (after waiver)               0.40%** 
     12b-1 fees                                             NONE 
     Other expenses                                         0.45%
                                                            ------- 
     Total Fund operating expenses (after waiver)           0.85%**
                                                            =======
    

 Example

 Based on the level of total Fund operating expenses listed above, the total
 expenses relating to a $1,000 investment, assuming a 5% annual return and
 redemption at the end of each period, are listed below. Investors do not pay
 these expenses directly; they are paid by the Fund before it distributes its
 net investment income to shareholders. (As noted above, the Fund has no
 redemption fees of any kind.)

   
     1 Year           3 Years             5 Years            10 Years
     ------           -------             -------            --------
       $9               $27                 $47                $105
    

 See "Fund organization--Investment adviser" for further information about the
 investment management fee. This example assumes reinvestment of all dividends
 and distributions and that the percentage amounts listed under "Annual Fund
 operating expenses" remain the same each year. This example should not be
 considered a representation of past or future expenses or return. Actual Fund
 expenses and return vary from year to year and may be higher or lower than
 those shown. 

*    You may redeem by writing or calling the Fund or by Write-A-Check. If you
     wish to receive your redemption proceeds via wire, there is a $5 wire
     service fee. For additional information, please refer to "Transaction
     information--Redeeming shares."

   
**   Until October 31, 1998, the Adviser has agreed to waive all or a portion of
     its investment management fee payable by the Fund to the extent necessary
     so that the total annualized expenses of the Fund do not exceed 0.85% of
     the average daily net assets. This expense information has been restated to
     reflect current fees. Actual annualized Fund expenses for the fiscal year
     ended June 30, 1997 were investment management fee 0.41%, other expenses
     0.45% and total operating expenses 0.86%.
    



                                       2
<PAGE>

Financial highlights

The following table includes selected data for a share outstanding throughout
each year and other performance information derived from the audited financial
statements.

   
If you would like more detailed information concerning the Fund's performance, a
complete portfolio listing and audited financial statements are available in the
Fund's Annual Report dated June 30, 1997 and may be obtained without charge by
writing or calling Scudder Investor Services, Inc.


<TABLE>
<CAPTION>
                                                                                Years Ended June 30,

                                            1997    1996    1995    1994     1993    1992    1991    1990     1989    1988
 ----------------------------------------------------------------------------------------------------------------------------
 <S>                                      <C>      <C>     <C>     <C>     <C>      <C>     <C>     <C>     <C>      <C>   
 Net asset value, beginning of           ------------------------------------------------------------------------------------
    period .............................  $1.000   $1.000  $1.000  $1.000  $1.000   $1.000  $1.000  $1.000  $1.000   $1.000
                                         ------------------------------------------------------------------------------------
 Net investment income .................    .046     .048    .048    .027    .027     .047    .069    .080    .082     .064
 Distributions from net investment
    income and net realized capital     
    gains ..............................   (.046)   (.048)  (.048)  (.027)  (.027)   (.047)  (.069)  (.080)  (.082)   (.064)
                                          -----------------------------------------------------------------------------------
 Net asset value, end of period ........  $1.000   $1.000  $1.000  $1.000  $1.000   $1.000  $1.000  $1.000  $1.000   $1.000
 ----------------------------------------------------------------------------------------------------------------------------
 Total Return (%) ......................    4.73     4.89    4.90    2.77    2.75     4.76    7.13    8.23    8.49     6.59
 Ratios and Supplemental Data           
 Net assets, end of period ($ millions).   1,431    1,387   1,520   1,430   1,119    1,361   1,736   1,644   1,563    1,370
 Ratio of operating expenses, net to
    average daily net assets (%)........     .86      .83     .78     .82     .78      .70     .66     .67     .66      .68
 Ratio of operating expenses before
    expense reduction, to average
    daily net assets (%)................     .86      .83     .78     .82     .78      .70     .66     .67     .66      .68 
 Ratio of net investment income
    to average daily net assets (%).....    4.63     4.79    4.84    2.78    2.72     4.58    6.91    7.93    8.21     6.44     
</TABLE>
    




                                       3
<PAGE>

A message from Scudder's chairman

   
Scudder, Stevens & Clark, Inc., investment adviser to the Scudder Family of
Funds, was founded in 1919. We offered America's first no-load mutual fund in
1928. Today, we manage in excess of $125 billion for many private accounts and
over 50 mutual fund portfolios. We manage the mutual funds in a special program
for the American Association of Retired Persons, as well as the fund options
available through Scudder Horizon Plan, a tax-advantaged variable annuity. We
also advise The Japan Fund and nine closed-end funds that invest in countries
around the world.
    

The Scudder Family of Funds is designed to make investing easy and less costly.
It includes money market, tax free, income and growth funds as well as IRAs,
401(k)s, Keoghs and other retirement plans.

Services available to all shareholders include toll-free access to the
professional service representatives of Scudder Investor Relations, easy
exchange among funds, shareholder reports, informative newsletters and the
walk-in convenience of Scudder Investor Centers.

All Scudder mutual funds are pure no-load(TM). This means you pay no commissions
to purchase or redeem your shares or to exchange from one fund to another. There
are no "12b-1" fees either, which many other funds now charge to support their
marketing efforts. All of your investment goes to work for you. We look forward
to welcoming you as a shareholder.

                                                                /s/Daniel Pierce

Scudder Cash Investment Trust

   
Investment objective
    

o    stability of capital and, consistent therewith, to maintain the liquidity
     of capital and to provide current income

   
o    seeks to achieve its objective by investing in money market securities
    

Investment characteristics

o    stable share price

o    fluctuating yield

o    daily liquidity and free check writing

o    dividends declared daily and paid monthly

Contents

   
Investment objective and policies                      5
Why invest in the Fund?                                6
Additional information about policies and investments  6
Distribution and performance information               7
Fund organization                                      7
Transaction information                                9
Shareholder benefits                                  12
Purchases                                             15
Exchanges and redemptions                             16
Investment products and services                      18
How to contact Scudder                                19
    


                                       4
<PAGE>

Investment objective and policies

Investment objective

   
The investment objective of Scudder Cash Investment Trust (the "Fund"), a
diversified, open-end management investment company, is to seek to maintain the
stability of capital and, consistent therewith, to maintain the liquidity of
capital and to provide current income. The Fund seeks to achieve its objective
by investing in money market securities. The Fund also seeks to maintain a
constant net asset value of $1.00 per share and declares dividends daily.
    

Except as otherwise indicated, the Fund's investment objective and policies are
not fundamental and may be changed without a vote of shareholders. If there is a
change in the investment objective, shareholders should consider whether the
Fund remains an appropriate investment in light of their then current financial
position and needs. There can be no assurance that the Fund's objective will be
met.

Investments

The Fund purchases U.S. dollar-denominated securities with remaining maturities
of 397 calendar days or less, except in the case of U.S. Government securities
which may have remaining maturities of 762 calendar days or less. The
dollar-weighted average maturity of the Fund's portfolio will vary with money
market conditions, but is always 90 days or less. All securities in the Fund's
portfolio must meet credit quality standards pursuant to procedures established
by the Trustees. Generally, the Fund may purchase only securities which are
rated, or issued by a company with comparable securities rated, within the two
highest quality rating categories of one or more of the following rating
agencies: Moody's Investors Service, Inc. ("Moody's"), Standard & Poor's ("S&P")
and Fitch Investors Service, Inc. ("Fitch"). If a security is unrated, the Fund
may purchase the security if, in the opinion of the Fund's investment adviser,
Scudder, Stevens & Clark, Inc. (the "Adviser"), the credit quality of the
security is deemed equivalent to the rated securities mentioned above.
Amendments have been proposed to the federal rules regulating quality, maturity
and diversification requirements of money market funds, like the Fund. If the
amendments are adopted, the Fund intends to comply with such new requirements.

The Fund may invest in short-term securities consisting of: obligations issued
or guaranteed by the U.S. Government, its agencies or instrumentalities;
obligations of supranational organizations such as the International Bank for
Reconstruction and Development (the World Bank); obligations of domestic banks
and foreign branches of domestic banks, including bankers' acceptances,
certificates of deposit, deposit notes and time deposits; and obligations of
savings and loan institutions.

   
The Fund may also invest in: instruments whose credit has been enhanced by banks
(letters of credit), insurance companies (surety bonds) or other corporate
entities (corporate guarantees); corporate obligations, including commercial
paper, notes, bonds, loans and loan participations; securities with variable or
floating interest rates; when-issued securities, asset-backed securities,
including certificates, participations and notes; municipal securities,
including notes, bonds and participation interests, either taxable or tax free;
and illiquid or restricted securities.
    

In addition, the Fund may invest in repurchase agreements and securities with
put features.

Each of the above referenced eligible investments and investment practices have
certain risks associated with them. For a more complete description, please
refer to the Fund's Statement of Additional Information.


                                       5
<PAGE>

Why invest in the Fund?

The Fund can be appropriate for investors who are concerned about stability of
principal. If investors are just starting out and want their assets to grow in a
stable investment, if they want to keep their nest egg safe and handy, or if
they are simply looking to "park" their investment capital for a short time, a
money market fund may be a good choice.

One appealing characteristic of a money market fund is that it seeks to maintain
a stable share price. Thus, not only should investors have the value of their
initial investment maintained, they ordinarily will have earnings on that
investment, plus earnings on those earnings, if dividends are reinvested.

In general, the level of income from a money market fund is affected by the
quality of the Fund's investments. The Fund invests in a broad range of money
market securities which are of high quality.

Another important feature of the Fund is daily liquidity. Investors can gain
access to their cash by toll-free telephone redemption or with our convenient
check writing option. Shareholders may write checks of at least $100.

In addition, the Fund offers all the benefits of the Scudder Family of Funds.
Scudder, Stevens & Clark, Inc. manages a diverse family of pure no-load(TM)
funds and provides a wide range of services to help investors meet their
investment needs. Please refer to "Investment products and services" for
additional information.

Additional information about policies and investments

Investment restrictions

   
The Fund has adopted certain fundamental policies which may not be changed
without a vote of shareholders and which are designed to reduce the Fund's
investment risk. The Fund may not borrow money except as a temporary measure for
extraordinary or emergency purposes or except in connection with reverse
repurchase agreements and may not make loans except through the lending of
portfolio securities, the purchase of debt obligations or through repurchase
agreements.
    

A complete description of these and other policies and restrictions is contained
under "Investment Restrictions" in the Fund's Statement of Additional
Information.

The high quality securities in which the Fund invests are divided into "first
tier" and "second tier" securities. First tier securities are those securities
generally rated in the highest category by at least two rating agencies (or one,
if only one rating agency has rated the security). Securities which are
generally rated in the two highest categories by at least two rating agencies
(or one, if only one rating agency has rated the security) and which do not
qualify as first tier securities are second tier securities. The Adviser may
determine, pursuant to procedures approved by the Trustees, that an unrated
security is equivalent to a first tier or second tier security.
       

Repurchase agreements

As a means of earning income for periods as short as overnight, the Fund may
enter into repurchase agreements with selected banks and broker/dealers. Under a
repurchase agreement, the Fund acquires securities, subject to the seller's
agreement to repurchase those securities at a specified time and price. If the
seller under a repurchase agreement becomes insolvent, the Fund's right to
dispose of the securities might be restricted, or the value of the securities
may decline before the Fund is able to dispose of them. In the event of the
commencement of bankruptcy or insolvency proceedings with respect to the seller
of the securities before repurchase under a repurchase agreement, the Fund may
encounter delay and incur costs, including a decline in the value of the

                                       6
<PAGE>

securities, before being able to sell the securities.

   
When-issued securities

The Fund may purchase securities on a when-issued or forward delivery basis, for
payment and delivery at a later date. The price and yield are generally fixed on
the date of commitment to purchase. During the period between purchase and
settlement, no interest accrues to the Fund. At the time of settlement, the
market value of the security may be more or less than the purchase price.
    

Distribution and performance information

Dividends and capital gains distributions

Dividends are declared daily and distributed monthly to shareholders. The Fund
may take into account capital gains and losses (other than net long-term capital
gains) in its daily dividend declaration. The Fund may make additional
distributions for tax purposes, if necessary. Any dividends or capital gains
distributions declared in October, November or December with a record date in
such a month and paid during the following January will be treated by
shareholders for federal income tax purposes as if received on December 31 of
the calendar year declared. According to preference, shareholders may receive
distributions in cash or have them reinvested in additional shares of the Fund.
If an investment is in the form of a retirement plan, all dividends and capital
gains distributions must be reinvested into the shareholder's account.

Generally, dividends from net investment income are taxable to shareholders as
ordinary income whether received in cash or additional shares.

Long-term capital gains distributions, if any, are taxable as long-term capital
gains regardless of the length of time shareholders have owned their shares.
Short-term capital gains and any other taxable income distributions are taxable
as ordinary income. It is not expected that dividends will qualify for the
dividends-received deduction for corporations.

The Fund sends detailed tax information to shareholders about the amount and
type of its distributions by January 31 of the following year.

Performance information

From time to time, quotations of the Fund's performance may be included in
advertisements, sales literature or shareholder reports. All performance figures
are historical, show the performance of a hypothetical investment and are not
intended to indicate future performance. The "yield" of the Fund refers to
income generated by an investment in the Fund over a specified seven-day period.
Yield is expressed as an annualized percentage. The "effective yield" of the
Fund is expressed similarly but, when annualized, the income earned by an
investment in the Fund is assumed to be reinvested and will reflect the effects
of compounding. "Total return" is the change in value of an investment in the
Fund for a specified period. The "average annual total return" of the Fund is
the average annual compound rate of return of an investment in the Fund assuming
the investment has been held for one year, five years and ten years as of a
stated ending date. "Cumulative total return" represents the cumulative change
in value of an investment in the Fund for various periods. All types of total
return calculations assume that all dividends and capital gains distributions
during the period were reinvested in shares of the Fund. Performance will vary
based upon, among other things, changes in market conditions and the level of
the Fund's expenses.

Fund organization

Scudder Cash Investment Trust is a diversified, open-end management investment
company registered under the Investment Company Act of 1940 (the "1940 Act").
The Fund was organized as a Massachusetts business trust in December 1975.

                                       7
<PAGE>

The Fund's activities are supervised by its Board of Trustees. Shareholders have
one vote for each share held on matters on which they are entitled to vote. The
Fund is not required to and has no current intention of holding annual
shareholder meetings, although special meetings may be called for purposes such
as electing or removing Trustees, changing fundamental investment policies or
approving an investment management agreement. Shareholders will be assisted in
communicating with other shareholders in connection with removing a Trustee as
if Section 16(c) of the 1940 Act were applicable.

Investment adviser

The Fund retains the investment management firm of Scudder, Stevens & Clark,
Inc., a Delaware corporation, to manage the Fund's daily investment and business
affairs subject to the policies established by the Board of Trustees. The
Trustees have overall responsibility for the management of the Fund under
Massachusetts law.

   
The Adviser received an investment management fee for its services which totaled
0.41% of the Fund's average daily net assets during the fiscal year ended June
30, 1997. The fee is graduated so that increases in the Fund's net assets may
result in a lower average fee rate and decreases in the Fund's net assets may
result in a higher average fee rate.

The Fund's fee is payable monthly, provided that the Fund will make such interim
payments as may be requested by the Adviser not to exceed 75% of the amount of
the fee then accrued on the books of the Fund and unpaid.

Until October 31, 1998, the Adviser has agreed to waive all or a portion of its
investment management fee payable by the Fund to the extent necessary so that
the total annualized expenses of the Fund do not exceed 0.85% of average daily
net assets of the Fund.

All of the Fund's expenses are paid out of gross investment income. Shareholders
pay no direct charges or fees for investment or administrative services.

Scudder, Stevens & Clark, Inc., is located at Two International Place, Boston,
Massachusetts.

Scudder has entered into an agreement with Zurich Insurance Company ("Zurich"),
an international insurance and financial services organization, pursuant to
which Scudder will form a new global investment organization by combining with
Zurich's subsidiary, Zurich Kemper Investments, Inc., and change its name to
Scudder Kemper Investments, Inc. After the transaction is completed, Zurich will
own approximately 70% of the new organization with the balance owned by the new
organization's officers and employees.

Consummation of the transaction is subject to a number of contingencies,
including regulatory approvals. The transaction is expected to close in the
fourth quarter of 1997. Upon consummation of the transaction the investment
management agreement with Scudder, Stevens & Clark, Inc., will terminate. The
Trustees have approved an investment management agreement with Scudder Kemper
Investments, Inc. which is substantially identical to the current investment
management agreement to become effective upon the termination of the current
investment management agreement.
    

Transfer agent

Scudder Service Corporation, P.O. Box 2291, Boston, Massachusetts 02107-2291, a
subsidiary of the Adviser, is the transfer, shareholder servicing and
dividend-paying agent for the Fund.

Underwriter

Scudder Investor Services, Inc., a subsidiary of the Adviser, is the Fund's
principal underwriter. Scudder Investor Services, Inc. confirms, as agent, all
purchases of shares of the Fund. Scudder Investor Relations is a telephone
information service provided by Scudder Investor Services, Inc.

                                       8
<PAGE>

Fund accounting agent

Scudder Fund Accounting Corporation, a subsidiary of the Adviser, is responsible
for determining the daily net asset value per share and maintaining the general
accounting records of the Fund.

Custodian

State Street Bank and Trust Company is the Fund's custodian.

Transaction information

Purchasing shares

Purchases are executed at the next calculated net asset value per share after
the Fund's transfer agent receives the purchase request in good order. Purchases
are made in full and fractional shares. (See "Share price.")

By check. If you purchase shares with a check that does not clear, your purchase
will be canceled and you will be subject to any losses or fees incurred in the
transaction. Checks must be drawn on or payable through a U.S. bank. If you
purchase shares by check and redeem them within seven business days of purchase,
the Fund may hold redemption proceeds until the purchase check has cleared. If
you purchase shares by federal funds wire, you may avoid this delay. Redemption
requests by telephone or by "Write-A-Check" prior to the expiration of the
seven-day period will not be accepted.

By wire. To open a new account by wire, first call Scudder at 1-800-225-5163 to
obtain an account number. A representative will instruct you to send a
completed, signed application to the transfer agent. Accounts cannot be opened
without a completed, signed application and a Scudder fund account number.
Contact your bank to arrange a wire transfer to:

        The Scudder Funds
        State Street Bank and Trust Company
        Boston, MA 02101
        ABA Number 011000028
        DDA Account 9903-5552

Your wire instructions must also include:

- --   the name of the fund in which the money is to be invested,
- --   the account number of the fund, and
- --   the name(s) of the account holder(s).

The account will be established once the application and money order are
received in good order.

You may also make additional investments of $100 or more to your existing
account by wire.

By exchange. The Fund may be exchanged for shares of other funds in the Scudder
Family of Funds unless otherwise determined by the Board of Trustees. Your new
account will have the same registration and address as your existing account.

The exchange requirements for corporations, other organizations, trusts,
fiduciaries, agents, institutional investors and retirement plans may be
different from those for regular accounts. Please call 1-800-225-5163 for more
information, including information about the transfer of special account
features.

You can also make exchanges among your Scudder fund accounts on SAIL, the
Scudder Automated Information Line, by calling 1-800-343-2890.

   
By "QuickBuy." If you elected "QuickBuy" for your account, you can call
toll-free to purchase shares. The money will be automatically transferred from
your predesignated bank checking account. Your bank must be a member of the
Automated Clearing House for you to use this service. If you did not elect
"QuickBuy," call 1-800-225-5163 for more information.

To purchase additional shares, call 1-800-225-5163. Purchases may not be for
more than $250,000. Proceeds in the amount of your purchase will be transferred
    

                                       9
<PAGE>

from your bank checking account in two or three business days following your
call. For requests received by the close of regular trading on the Exchange,
shares will be purchased at the net asset value per share calculated at the
close of trading on the day of your call. "QuickBuy" requests received after the
close of regular trading on the Exchange will begin their processing and be
purchased at the net asset value calculated the following business day.

If you purchase shares by "QuickBuy" and redeem them within seven days of the
purchase, the Fund may hold the redemption proceeds for a period of up to seven
business days. If you purchase shares and there are insufficient funds in your
bank account, the purchase will be canceled and you will be subject to any
losses or fees incurred in the transaction. "QuickBuy" transactions are not
available for most retirement plan accounts. However, "QuickBuy" transactions
are available for Scudder IRA accounts.

Redeeming shares

The Fund allows you to redeem shares (i.e., sell them back to the Fund) without
redemption fees.

By telephone. This is the quickest and easiest way to sell Fund shares. If you
provided your banking information on your application, you can call to request
that federal funds be sent to your authorized bank account. If you did not
include your banking information on your application, call 1-800-225-5163 for
more information.

Redemption proceeds will be wired to your bank unless otherwise requested. If
your bank cannot receive federal reserve wires, redemption proceeds will be
mailed to your bank. There will be a $5 charge for all wire redemptions.

You can also make redemptions from your Scudder fund account on SAIL by calling
1-800-343-2890.

If you open an account by wire, you cannot redeem shares by telephone until the
Fund's transfer agent has received your completed and signed application.
Telephone redemption is not available for shares held in Scudder IRA accounts
and most other Scudder retirement plan accounts.

In the event that you are unable to reach the Fund by telephone, you should
write to the Fund; see "How to contact Scudder" for the address.

   
By "QuickSell." If you elected "QuickSell" for your account, you can call
toll-free to redeem shares. The money will be automatically transferred to your
predesignated bank checking account. Your bank must be a member of the Automated
Clearing House for you to use this service. If you did not elect "QuickSell,"
call 1-800-225-5163 for more information.

To redeem shares, call 1-800-225-5163. Redemptions must be for at least $250.
Proceeds in the amount of your redemption will be transferred to your bank
checking account in two or three business days following your call. For requests
received by the close of regular trading on the Exchange, shares will be
redeemed at the net asset value per share calculated at the close of trading on
the day of your call. "QuickSell" requests received after the close of regular
trading on the Exchange will begin their processing and be redeemed at the net
asset value calculated the following business day.

"QuickSell" transactions are not available for Scudder IRA accounts and most
other retirement plan accounts.

Signature guarantees. For your protection and to prevent fraudulent redemptions,
on written redemption requests in excess of $100,000 we require an original
signature and an original signature guarantee for each person in whose name the
account is registered. (The Fund reserves the right, however, to require a
signature guarantee for all redemptions.) You can obtain a signature guarantee
from most banks, credit unions or savings associations, or from broker/dealers,
municipal securities broker/dealers, government securities broker/dealers,
national securities exchanges, registered securities associations or clearing
agencies deemed eligible by the Securities and Exchange Commission. 
    

                                       10
<PAGE>


Signature   guarantees  by  notaries  public  are  not  acceptable.   Redemption
requirements for corporations, other organizations, trusts, fiduciaries, agents,
institutional  investors and  retirement  plans may be different  from those for
regular accounts. For more information, please call 1-800-225-5163.

By "Write-A-Check." You may redeem shares by writing checks against your account
balance for at least $100. Your Fund investments will continue to earn dividends
until your check is presented to the Fund for payment.

Checks will be returned by the Fund's transfer agent if there are insufficient
shares to meet the withdrawal amount. You should not attempt to close an account
by check because the exact balance at the time the check clears will not be
known when the check is written.

Telephone transactions

Shareholders automatically receive the ability to exchange by telephone and the
right to redeem by telephone up to $100,000 to their address of record.
Shareholders also may, by telephone, request that redemption proceeds be sent to
a predesignated bank account. The Fund uses procedures designed to give
reasonable assurance that telephone instructions are genuine, including
recording telephone calls, testing a caller's identity and sending written
confirmation of telephone transactions. If the Fund does not follow such
procedures, it may be liable for losses due to unauthorized or fraudulent
telephone instructions. The Fund will not be liable for acting upon instructions
communicated by telephone that it reasonably believes to be genuine.

Share price

Purchases and redemptions, including exchanges, are made at net asset value.
Scudder Fund Accounting Corporation determines net asset value per share as of
twelve o'clock noon and as of the close of regular trading on the New York Stock
Exchange (the "Exchange"), normally 4 p.m. eastern time, on each day the
Exchange is open for trading. Net asset value per share is calculated by
dividing the value of total Fund assets, less all liabilities, by the total
number of shares outstanding. In calculating the net asset value per share, the
Fund uses the current market value of the securities. However, for securities
with sixty days or less to maturity, the Fund uses the amortized cost value.

Processing time

Purchases made by wire and received by the Fund's transfer agent before noon on
any business day are executed at noon on that day and begin earning income the
same day. Those made by wire between noon and the close of regular trading on
the Exchange on any business day are executed at the close of trading the same
day and begin earning income the next business day. Purchases made by check are
executed on the day the check is received in good order by the Fund's transfer
agent and begin earning income on the next business day. Redemption requests
received in good order by the Fund's transfer agent between noon and the close
of regular trading on the Exchange are executed at the net asset value
calculated at the close of regular trading on that day and will earn a dividend
on the redeemed shares that day. If a redemption request is received by noon,
proceeds will normally be wired that day, if requested by the shareholder, but
no dividend will be earned on the redeemed shares on that day.

If you wish to make a purchase of $500,000 or more, you should notify Scudder
Investor Relations by calling 1-800-225-5163.

The Fund will normally send redemption proceeds within one business day
following the redemption request, but may take up to seven business days (or
longer in the case of shares recently purchased by check).

   
Purchase restrictions
    

The Fund and Scudder Investor Services, Inc. each reserves the right to reject
purchases of Fund shares (including exchanges) for any reason.

                                       11
<PAGE>

Tax identification number

   
Be sure to complete the Tax Identification Number section of the Fund's
application when you open an account. Federal tax law requires the Fund to
withhold 31% of taxable dividends and capital gains distributions from accounts
(other than those of certain exempt payees) without a correct certified Social
Security or tax identification number and certain other certified information or
upon notification from the IRS or a broker that withholding is required. The
Fund reserves the right to reject new account applications without a correct
certified Social Security or tax identification number. The Fund also reserves
the right, following 30 days' notice, to redeem all shares in accounts without a
correct certified Social Security or tax identification number. A shareholder
may avoid involuntary redemption by providing the Fund with a tax identification
number during the 30-day notice period.
    

Minimum balances

Shareholders should maintain a share balance worth at least $2,500, which amount
may be changed by the Board of Trustees. Scudder retirement plans and certain
other accounts have similar or lower minimum share balance requirements. A
shareholder may open an account with at least $1,000, if an automatic investment
plan of $100/month is established.

Shareholders who maintain a non-fiduciary account balance of less than $2,500 in
the Fund, without establishing an automatic investment plan, will be assessed an
annual $10.00 per fund charge with the fee to be paid to the Fund. The $10.00
charge will not apply to shareholders with a combined household account balance
in any of the Scudder Funds of $25,000 or more. The Fund reserves the right,
following 60 days' written notice to shareholders, to redeem all shares in
accounts below $250, including accounts of new investors, where a reduction in
value has occurred due to a redemption or exchange out of the account. The Fund
will mail the proceeds of the redeemed account to the shareholder. Reductions in
value that result solely from market activity will not trigger an involuntary
redemption. Retirement accounts and certain other accounts will not be assessed
the $10.00 charge or be subject to automatic liquidation. Please refer to
"Exchanges and Redemptions--Other Information" in the Fund's Statement of
Additional Information for more information.

Third party transactions

If purchases and redemptions of Fund shares are arranged and settlement is made
at an investor's election through a member of the National Association of
Securities Dealers, Inc., other than Scudder Investor Services, Inc., that
member may, at its discretion, charge a fee for that service.

Shareholder benefits

Experienced professional management

Scudder, Stevens & Clark, Inc., one of the nation's most experienced investment
management firms, actively manages your Scudder fund investment. Professional
management is an important advantage for investors who do not have the time or
expertise to invest directly in individual securities.

A team approach to investing

Scudder Cash Investment Trust is managed by a team of Scudder investment
professionals who each play an important role in the Fund's management process.
Team members work together to develop investment strategies and select
securities for the Fund's portfolio. They are supported by Scudder's large staff
of economists, research analysts, traders, and other investment specialists who
work in Scudder's offices across the United States and abroad. Scudder believes
its team approach benefits Fund investors by bringing together many disciplines
and leveraging Scudder's extensive resources.

Lead Portfolio Manager David B. Wines assumed responsibility for the Fund's
day-to-day management in 1996. Mr. Wines focuses on overall investment strategy

                                       12
<PAGE>

   
and has over 14 years of experience as a portfolio manager in the securities
business, including 8 years in the mutual fund business. Debra A. Hanson,
Portfolio Manager, who joined the team in 1995, develops and executes investment
strategy for the Fund. Ms. Hanson joined Scudder in 1983 and has over 14 years'
experience trading and managing fixed-income portfolios.
    

K. Sue Cote, Portfolio Manager, joined Scudder in 1983 and has 14 years'
experience working with short-term fixed-income investments.

SAIL(TM)--Scudder Automated Information Line

For personalized account information including fund prices, yields and account
balances, to perform transactions in existing Scudder fund accounts, or to
obtain information on any Scudder fund, shareholders can call Scudder's
Automated Information Line (SAIL) at 1-800-343-2890, 24 hours a day. During
periods of extreme economic or market changes, or other conditions, it may be
difficult for you to effect telephone transactions in your account. In such an
event you should write to the Fund; please see "How to contact Scudder" for the
address.

Investment flexibility

   
Scudder offers toll-free telephone exchange between funds at current net asset
value. You can move your investments among money market, income, growth,
tax-free and growth and income funds with a simple toll-free call or, if you
prefer, by sending your instructions through the mail or by fax. (The exchange
privilege may not be available for certain Scudder funds. For more information,
please call 1-800-225-5163.) Telephone and fax redemptions and exchanges are
subject to termination and their terms are subject to change at any time by the
Fund or the transfer agent. In some cases, the transfer agent or Scudder
Investor Services, Inc. may impose additional conditions on telephone
transactions.
    

Personal Counsel(SM) -- A Managed Fund Portfolio Program

If you would like to receive direct guidance and management of your overall
mutual fund portfolio to help you pursue your investment goals, you may be
interested in Personal Counsel from Scudder. Personal Counsel, a program of
Scudder Investor Services, Inc., a registered investment adviser and a
subsidiary of Scudder, Stevens & Clark, Inc., combines the benefits of a
customized portfolio of pure no-load Scudder Funds with ongoing portfolio
monitoring and individualized service, for an annual fee of generally 1% or less
of assets (with a $1,000 minimum). In addition, it draws upon Scudder's more
than 75-year heritage of providing investment counsel to large corporate and
private clients. If you have $100,000 or more to invest initially and would like
more information about Personal Counsel, please call 1-800-700-0183.

Dividend reinvestment plan

You may have dividends and distributions automatically reinvested in additional
Fund shares. Please call 1-800-225-5163 to request this feature.

Shareholder statements

You receive a detailed account statement every time you purchase or redeem
shares. All of your statements should be retained to help you keep track of
account activity and the cost of shares for tax purposes.

Shareholder reports

In addition to account statements, you receive periodic shareholder reports
highlighting relevant information, including investment results and a review of
portfolio changes.

To reduce the volume of mail you receive, only one copy of most Fund reports,
such as the Fund's Annual Report, may be mailed to your household (same surname,
same address). Please call 1-800-225-5163 if you wish to receive additional
shareholder reports.

                                       13
<PAGE>

Newsletters

Four times a year, Scudder sends you Perspectives, an informative newsletter
covering economic and investment developments, service enhancements and other
topics of interest to Scudder fund investors.

   
Scudder Investor Centers

As a convenience to shareholders who like to conduct business in person, Scudder
Investor Services, Inc. maintains Investor Centers in Boca Raton, Boston,
Chicago, New York and San Francisco.
    

T.D.D. service for the hearing impaired

Scudder's full range of investor information and shareholder services is
available to hearing impaired investors through a toll-free T.D.D. (Telephone
Device for the Deaf) service. If you have access to a T.D.D., call
1-800-543-7916 for investment information or specific account questions and
transactions.

                                       14
<PAGE>


<TABLE>
<CAPTION>


Purchases

<S>                  <C>
 Opening             Minimum initial investment: $2,500; IRAs $1,000
 an account          Group retirement plans (401(k), 403(b), etc.) have similar or lower minimums.
                     See appropriate plan literature.

 Make checks         o  By Mail              Send your completed and signed application and check
 payable to "The
 Scudder Funds."
                                                 by regular mail to:        or            by express, registered,
                                                                                          or certified mail to:

                                                 The Scudder Funds                        Scudder Shareholder Service
                                                 P.O. Box 2291                            Center
                                                 Boston, MA                               42 Longwater Drive
                                                 02107-2291                               Norwell, MA
                                                                                          02061-1612

                     o  By Wire              Please see Transaction information--Purchasing shares-- By
                                             wire for details, including the ABA wire transfer number. Then call
                                             1-800-225-5163 for instructions.

   
                     o  In Person            Visit one of our Investor Centers to complete your application with the
                                             help of a Scudder representative. Investor Center locations are listed
                                             under Shareholder benefits.
    

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


 
 Purchasing          Minimum additional investment: $100; IRAs $50
 additional shares   Group retirement plans (401(k), 403(b), etc.) have similar or lower minimums.
                     See appropriate plan literature.

 Make checks         o By Mail               Send a check with a Scudder investment slip, or with a letter of 
 payable to "The                             instruction including your account number and the
 Scudder Funds."                             complete Fund name, to  the appropriate address listed above.

                     o By Wire               Please see Transaction information--Purchasing shares-- By
                                             wire for details, including the ABA wire transfer number.

   
                     o In Person             Visit one of our Investor Centers to make an additional
                                             investment in your Scudder fund account. Investor Center locations
                                             are listed under Shareholder benefits.
    

                     o  By Telephone         Please see Transaction information--Purchasing shares--
                                             By QuickBuy for more details.

                     o  By Automatic         You may arrange to make investments on a regular basis through automatic 
                        Investment Plan      deductions from your bank checking account. Please call 1-800-225-5163    
                        ($50 minimum)        for more information and an enrollment form.
                         
                        

                                       15
<PAGE>

Exchanges and redemptions


 
Exchanging shares  Minimum investments:         $2,500 to establish a new account;
                                                $100 to exchange among existing accounts

                   o By Telephone     To speak with a service representative, call 1-800-225-5163 from
                                      8 a.m. to 8 p.m. eastern time or to access SAIL(TM), Scudder's Automated
                                      Information Line, call 1-800-343-2890 (24 hours a day).

                   o By Mail          Print or type your instructions and include:
                     or Fax             -   the name of the Fund and the account number you are exchanging from;
                                        -   your name(s) and address as they appear on your account;
                                        -   the dollar amount or number of shares you wish to exchange;
                                        -   the name of the Fund you are exchanging into;
                                        -   your signature(s) as it appears on your account; and
                                        -   a daytime telephone number.

                                      Send your instructions

                                      by regular mail to:      or   by express, registered,   or   by fax to:
                                                                    or certified mail to:

                                      The Scudder Funds             Scudder Shareholder            1-800-821-6234
                                      P.O. Box 2291                 Service Center
                                      Boston, MA 02107-2291         42 Longwater Drive
                                                                    Norwell, MA
                                                                    02061-1612
 -----------------------------------------------------------------------------------------------------------------------

 Redeeming shares  o By Telephone     To speak with a service representative, call 1-800-225-5163 from 8 a.m. to 8 p.m.
                                      eastern time or to access SAIL(TM), Scudder's Automated Information Line, call
                                      1-800-343-2890 (24 hours a day). You may have redemption proceeds sent to your
                                      predesignated bank account, or redemption proceeds of up to $100,000 sent to your
                                      address of record.

                   o By "Write-       You may redeem shares by writing checks against your account balance as often as
                     A-Check"         you like for at least $100, but not more than $5,000,000.

                   o By Mail          Send your instructions for redemption to the appropriate address or fax number
                     or Fax           above and include:

                                       - the name of the Fund and account number you are redeeming from; 
                                       - your name(s) and address as they appear on your account; 
                                       - the dollar amount or number of shares you wish to redeem; 
                                       - your signature(s) as it appears on your account; and 
                                       - a daytime telephone number.

                                      A signature guarantee is required for redemptions over $100,000. See Transaction
                                      information--Redeeming shares.

                   o By Automatic     You may arrange to receive automatic cash payments periodically. Call  
                     Withdrawal       1-800-225-5163 for more information and an enrollment form.
                     Plan


</TABLE>

                                       16
<PAGE>

Scudder tax-advantaged retirement plans

Scudder offers a variety of tax-advantaged retirement plans for individuals,
businesses and non-profit organizations. These flexible plans are designed for
use with the Scudder Family of Funds (except Scudder tax-free funds, which are
inappropriate for such plans). Scudder Funds offer a broad range of investment
objectives and can be used to seek almost any investment goal. Using Scudder's
retirement plans can help shareholders save on current taxes while building
their retirement savings.

o    Scudder No-Fee IRAs. These retirement plans allow a maximum annual
     contribution of up to $2,000 per person for anyone with earned income (up
     to $2,000 per individual for married couples if only one spouse has earned
     income). Many people can deduct all or part of their contributions from
     their taxable income, and all investment earnings accrue on a tax-deferred
     basis. The Scudder No-Fee IRA charges you no annual custodial fee.

o    401(k) Plans. 401(k) plans allow employers and employees to make
     tax-deductible retirement contributions. Scudder offers a full service
     program that includes recordkeeping, prototype plan, employee
     communications and trustee services, as well as investment options.

o    Profit Sharing and Money Purchase Pension Plans. These plans allow
     corporations, partnerships and people who are self-employed to make annual,
     tax-deductible contributions of up to $30,000 for each person covered by
     the plans. Plans may be adopted individually or paired to maximize
     contributions. These are sometimes known as Keogh plans. The Scudder Keogh
     charges you no annual custodial fee.

o    403(b) Plans. Retirement plans for tax-exempt organizations and school
     systems to which employers and employees may both contribute.

o    SEP-IRAs. Easily administered retirement plans for small businesses and
     self-employed individuals. The maximum annual contribution to SEP-IRA
     accounts is adjusted each year for inflation. The Scudder SEP-IRA charges
     you no annual custodial fee.

o    Scudder Horizon Plan. A no-load variable annuity that lets you build assets
     by deferring taxes on your investment earnings. You can start with $2,500
     or more.

Scudder Trust Company (an affiliate of the Adviser) is Trustee or Custodian for
some of these plans and is paid an annual fee for some of the above retirement
plans. For information about establishing a Scudder No-Fee IRA, SEP-IRA, Profit
Sharing Plan, Money Purchase Pension Plan or a Scudder Horizon Plan, please call
1-800-225-2470. For information about 401(k)s or 403(b)s please call
1-800-323-6105. To effect transactions in existing IRA, SEP-IRA, Profit Sharing
or Pension Plan accounts, call 1-800-225-5163.

The variable annuity contract is provided by Charter National Life Insurance
Company (in New York State, Intramerica Life Insurance Company [S 1802]). The
contract is offered by Scudder Insurance Agency, Inc. (in New York State, Nevada
and Montana, Scudder Insurance Agency of New York, Inc.). CNL, Inc. is the
Principal Underwriter. Scudder Horizon Plan is not available in all states.

   
Scudder Investor Relations is a service provided through Scudder Investor
Services, Inc., Distributor.
    

                                       17
<PAGE>

Investment products and services


The Scudder Family of Funds+++
- --------------------------------------------------------------------------------
Money Market
- ------------
   
  Scudder U.S. Treasury Money Fund
  Scudder Cash Investment Trust
  Scudder Money Market Series -- 
     Premium Shares*
     Managed Shares*
  Scudder Government Money Market Series -- 
     Managed Shares*
    

Tax Free Money Market+
- ----------------------
  Scudder Tax Free Money Fund
  Scudder Tax Free Money Market Series--
     Managed Shares*
  Scudder California Tax Free Money Fund**
  Scudder New York Tax Free Money Fund**

Tax Free+
- ---------
  Scudder Limited Term Tax Free Fund
  Scudder Medium Term Tax Free Fund
  Scudder Managed Municipal Bonds
  Scudder High Yield Tax Free Fund
  Scudder California Tax Free Fund**
  Scudder Massachusetts Limited Term Tax Free Fund**
  Scudder Massachusetts Tax Free Fund**
  Scudder New York Tax Free Fund**
  Scudder Ohio Tax Free Fund**
  Scudder Pennsylvania Tax Free Fund**

U.S. Income
- -----------
  Scudder Short Term Bond Fund
  Scudder Zero Coupon 2000 Fund
  Scudder GNMA Fund
  Scudder Income Fund
  Scudder High Yield Bond Fund

Global Income
- -------------
  Scudder Global Bond Fund
  Scudder International Bond Fund
  Scudder Emerging Markets Income Fund

   
Asset Allocation
- ----------------
  Scudder Pathway Conservative Portfolio
  Scudder Pathway Balanced Portfolio
  Scudder Pathway Growth Portfolio
  Scudder Pathway International Portfolio

U.S. Growth and Income
- ----------------------
  Scudder Balanced Fund
  Scudder Growth and Income Fund
  Scudder S&P 500 Index Fund
    

U.S. Growth
- -----------
  Value
    Scudder Large Company Value Fund
    Scudder Value Fund
    Scudder Small Company Value Fund
    Scudder Micro Cap Fund

  Growth
    Scudder Classic Growth Fund
    Scudder Large Company Growth Fund
    Scudder Development Fund
    Scudder 21st Century Growth Fund

Global Growth
- -------------
   
  Worldwide
    Scudder Global Fund
    Scudder International Growth and Income Fund
    Scudder International Fund
    Scudder Global Discovery Fund
    Scudder Emerging Markets Growth Fund
    Scudder Gold Fund
    

  Regional
    Scudder Greater Europe Growth Fund
    Scudder Pacific Opportunities Fund
    Scudder Latin America Fund
    The Japan Fund, Inc.

Retirement Programs
  IRA
  SEP IRA
  Keogh Plan
  401(k), 403(b) Plans
  Scudder Horizon Plan **+++ +++
    (a variable annuity)

   
Closed-End Funds#
- --------------------------------------------------------------------------------
  The Argentina Fund, Inc.
  The Brazil Fund, Inc.
  The Korea Fund, Inc.
  The Latin America Dollar Income Fund, Inc.
  Montgomery Street Income Securities, Inc.
  Scudder New Asia Fund, Inc.
  Scudder New Europe Fund, Inc.
  Scudder Spain and Portugal Fund, Inc.
  Scudder World Income Opportunities
    Fund, Inc.

For complete information on any of the above Scudder funds, including management
fees and expenses, call or write for a free prospectus. Read it carefully before
you invest or send money.  +++Funds  within  categories are listed in order from
expected least risk to most risk. Certain Scudder funds may not be available for
purchase or exchange  +A portion of the income  from the  tax-free  funds may be
subject to  federal,  state,  and local  taxes.  *A class of shares of the Fund.
**Not  available  in all states.  +++ +++A  no-load  variable  annuity  contract
provided by Charter National Life Insurance  Company and its affiliate,  offered
by  Scudder's  insurance  agencies,  1-800-225-2470.  #These  funds,  advised by
Scudder, Stevens & Clark, Inc., are traded on various stock exchanges.
    


 


                                       18
<PAGE>
 
<TABLE>
<CAPTION>

How to contact Scudder

Account Service and Information:
<S>      <C>
        
         For existing account service and transactions
                  Scudder Investor Relations -- 1-800-225-5163

          For 24 hour account information, fund information, exchanges, and an
          overview of all the services available to you

                  Scudder Electronic Account Services -- http://funds.scudder.com

         For personalized information about your Scudder accounts, exchanges and redemptions

                  Scudder Automated Information Line (SAIL) -- 1-800-343-2890

Investment Information:

         For information about the Scudder funds, including additional
         applications and prospectuses, or for answers to investment questions

                  Scudder Investor Relations -- 1-800-225-2470
                                                   [email protected]

                  Scudder's World Wide Web Site -- http://funds.scudder.com

         For establishing 401(k) and 403(b) plans

                  Scudder Defined Contribution Services -- 1-800-323-6105

Scudder Brokerage Services:

         To receive information about this discount brokerage service and to obtain an application

                  Scudder Brokerage Services* -- 1-800-700-0820

   
Personal Counsel(SM) -- A Managed Fund Portfolio Program:

         To receive information about this mutual fund portfolio guidance and management program

                  Personal Counsel from Scudder -- 1-800-700-0183 
    

Please address all correspondence to:

                  The Scudder Funds
                  P.O. Box 2291
                  Boston, Massachusetts
                  02107-2291

   
Or Stop by a Scudder Investor Center:
    

         Many shareholders enjoy the personal, one-on-one service of the Scudder
         Investor Centers. Check for an Investor Center near you--they can be
         found in the following cities:

                   Boca Raton       Chicago           San Francisco
                   Boston           New York

   
Scudder Investor Relations and Scudder Investor Centers are services provided
through Scudder Investor Services, Inc., Distributor.
    

*        Scudder Brokerage Services, Inc., 42 Longwater Drive, Norwell, MA
         02061--Member NASD/SIPC.
</TABLE>
 


                                       19
<PAGE>

                          SCUDDER CASH INVESTMENT TRUST


   
          A Pure No-load(TM) (No Sales Charges) Mutual Fund Seeking to
          Maintain the Stability of Capital and, consistent therewith,
       to Maintain the Liquidity of Capital and to Provide Current Income.
                   The Fund Seeks to Achieve Its Objective by
                      Investing in Money Market Securities.
    

                                       and

                        SCUDDER U.S. TREASURY MONEY FUND

   
     A Pure No-load(TM) (No Sales Charges) Money Market Fund Seeking Safety,
  Liquidity and Stability of Capital and, consistent therewith, Current Income.
             The Fund Seeks to Achieve Its Objective by Investing in
                     Short-Term U.S. Government Securities.
    




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



                       STATEMENT OF ADDITIONAL INFORMATION

                                November 1, 1997


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



         This combined  Statement of Additional  Information is not a prospectus
and  should  be read in  conjunction  with  the  prospectuses  of  Scudder  Cash
Investment  Trust and Scudder U.S.  Treasury  Money Fund each dated  November 1,
1997,  as may be  amended  from time to time,  copies  of which may be  obtained
without charge by writing to Scudder Investor Services,  Inc., Two International
Place, Boston, Massachusetts 02110-4103.



<PAGE>

   
<TABLE>
<CAPTION>

                                TABLE OF CONTENTS
                                                                                                                  Page

<S>                                                                                                                 <C>
THE FUNDS' INVESTMENT OBJECTIVES AND POLICIES........................................................................1
         General Investment Objectives and Policies of Scudder Cash Investment Trust.................................1
         General Investment Objectives and Policies of Scudder U.S. Treasury Money Fund..............................3
         Specialized Investment Techniques of the Funds..............................................................4
         Investment Restrictions.....................................................................................6

PURCHASES...........................................................................................................10
         Additional Information About Opening an Account............................................................10
         Checks.....................................................................................................10
         Wire Transfer of Federal Funds.............................................................................11
         Additional Information About Making Subsequent Investments by QuickBuy.....................................11
         Share Price................................................................................................11
         Share Certificates.........................................................................................12
         Other Information..........................................................................................12

EXCHANGES AND REDEMPTIONS...........................................................................................12
         Exchanges..................................................................................................12
         Redemption by Telephone....................................................................................13
         Redemption By QuickSell....................................................................................14
         Redemption by Mail or Fax..................................................................................14
         Redemption by Write-a-Check................................................................................15
         Other Information..........................................................................................15

FEATURES AND SERVICES OFFERED BY THE FUNDS..........................................................................16
         The Pure No-Load(TM) Concept...............................................................................16
         Internet Access............................................................................................17
         Dividend and Capital Gain Distribution Options.............................................................18
         Scudder Investor Centers...................................................................................18
         Diversification............................................................................................18
         Reports to Shareholders....................................................................................18
         Transaction Summaries......................................................................................18

THE SCUDDER FAMILY OF FUNDS.........................................................................................18

SPECIAL PLAN ACCOUNTS...............................................................................................23
         Scudder Retirement Plans:  Profit-Sharing and Money Purchase Pension Plans for Corporations and
              Self-Employed Individuals.............................................................................23
         Scudder 401(k): Cash or Deferred Profit-Sharing Plan for Corporations and Self-Employed Individuals........23
         Scudder IRA:  Individual Retirement Account................................................................23
         Scudder 403(b) Plan........................................................................................24
         Automatic Withdrawal Plan..................................................................................24
         Group or Salary Deduction Plan.............................................................................25
         Automatic Investment Plan..................................................................................25
         Uniform Transfers/Gifts to Minors Act......................................................................25

DIVIDENDS...........................................................................................................26

PERFORMANCE INFORMATION.............................................................................................27
         Yield......................................................................................................27
         Effective Yield............................................................................................27
         Average Annual Total Return................................................................................27
         Cumulative Total Return....................................................................................28
         Total Return...............................................................................................29
         Comparison of Fund Performance.............................................................................29

ORGANIZATION OF THE FUNDS...........................................................................................32

INVESTMENT ADVISER..................................................................................................33
         Scudder Cash Investment Trust..............................................................................34
         Scudder U.S. Treasury Money Fund...........................................................................35
         SCIT and Treasury Fund.....................................................................................36
         Personal Investments by Employees of the Adviser...........................................................37

    


<PAGE>

                           TABLE OF CONTENTS (cont'd)
                                                                                                                  Page
   
TRUSTEES AND OFFICERS...............................................................................................37
         Scudder Cash Investment Trust..............................................................................37
         Scudder U.S. Treasury Money Fund...........................................................................39

REMUNERATION........................................................................................................40
         Responsibilities of the Board--Board and Committee Meetings................................................40
         Compensation of Officers and Trustees......................................................................40

DISTRIBUTOR.........................................................................................................41
         Scudder Cash Investment Trust..............................................................................41
         Scudder U.S. Treasury Money Fund...........................................................................42

TAXES...............................................................................................................42

PORTFOLIO TRANSACTIONS..............................................................................................44

NET ASSET VALUE.....................................................................................................45

ADDITIONAL INFORMATION..............................................................................................45
         Experts....................................................................................................45
         Shareholder Indemnification................................................................................46
         Other Information..........................................................................................46

FINANCIAL STATEMENTS................................................................................................47
         Scudder Cash Investment Trust..............................................................................47
         Scudder U.S. Treasury Money Fund...........................................................................47

APPENDIX
         Ratings of Municipal Obligations
         Commercial Paper Ratings
</TABLE>

    

                                       ii
<PAGE>



                  THE FUNDS' INVESTMENT OBJECTIVES AND POLICIES

                  (See "Investment objectives and policies" and
                   "Additional information about policies and
                    investments" in each Fund's prospectus.)

         Scudder  Cash  Investment  Trust  sometimes  is  referred  to herein as
"SCIT."  Scudder  U.S.  Treasury  Money Fund  sometimes is referred to herein as
"Treasury Fund." SCIT and Treasury Fund sometimes are jointly referred to herein
as the "Funds" or "Scudder Money Market Funds."

   
         Master/feeder  structure.  The Funds'  Boards of Trustees may determine
that the  objective  of the Funds  would be  achieved  more  efficiently,  while
retaining its current distribution arrangement, by investing in a master fund in
a master/feeder  fund structure as described  below,  and in that case cause the
Funds to do so without prior approval by shareholders.

         A  master/feeder  fund  structure  is one in  which a fund  (a  "feeder
fund"), instead of investing directly in a portfolio of securities,  invests all
of its  investment  assets in a  separate  registered  investment  company  (the
"master fund") with substantially the same investment  objective and policies as
the feeder fund.  Such a structure  permits the pooling of assets of two or more
feeder funds preserving separate identities, management or distribution channels
at the feeder fund level.  Based on the premise  that certain of the expenses of
operating an investment  portfolio are  relatively  fixed,  a larger  investment
portfolio may eventually  achieve a lower ratio of operating expenses to average
net assets. An existing  investment  company is able to convert to a feeder fund
by  selling  all  of  its  investments,   which  involves  brokerage  and  other
transaction costs and realization of a taxable gain or loss.
    

General Investment Objectives and Policies of Scudder Cash Investment Trust

         Scudder  Cash  Investment  Trust  is  a  pure  no-load(TM),   open-end,
diversified  management investment company.  SCIT's investment objectives are to
maintain the  stability of capital and,  consistent  therewith,  to maintain the
liquidity  of capital and to provide  current  income.  SCIT seeks to maintain a
constant net asset value of $1.00 per share,  although in certain  circumstances
this may not be possible.  SCIT's management seeks to improve  investment income
by  keeping  money  at  work  in what it  considers  to be the  most  attractive
short-term  debt  investments  consistent with the objectives of maintaining the
stability and liquidity of capital. There is no assurance that SCIT's investment
objectives  will be achieved.  The  investment  objectives  and policies of SCIT
stated  under this  caption may be changed by the  Trustees  without a vote of a
majority  of the  outstanding  voting  securities  of the Fund,  as that term is
defined below in "Investment  Restrictions." All of the securities in which SCIT
may invest are U.S.  dollar-denominated.  Shares of the Fund are not  insured or
guaranteed by an agency of the U.S. Government.

         SCIT may invest in short-term  obligations  issued or guaranteed by the
U.S. Government, its agencies or instrumentalities; obligations of supranational
organizations  such as those listed  below;  obligations  of domestic  banks and
foreign branches of domestic banks, including bankers' acceptances, certificates
of deposit, deposit notes and time deposits; and obligations of savings and loan
institutions.

         SCIT may also invest in:  instruments whose credit has been enhanced by
banks (letters of credit), insurance companies (surety bonds) or other corporate
entities  (corporate  guarantees);  corporate  obligations  and  obligations  of
trusts, finance companies and other entities, including commercial paper, notes,
bonds,  loans and loan  participations;  securities  with  variable  or floating
interest rates; asset-backed securities, including certificates,  participations
and notes; and municipal  securities,  including notes,  bonds and participation
interests,  either taxable or tax free;  and illiquid or restricted  securities.
Securities  and  instruments  in which the Fund may  invest may be issued by the
U.S.  Government,  its agencies  and  instrumentalities,  corporations,  trusts,
banks, finance companies and other business entities.

         In addition,  SCIT may invest in repurchase  agreements  and securities
with put features.  Obligations which are subject to repurchase  agreements will
be limited to those of the type and quality  described  below. The Fund may also
hold cash.

   
         Investments in municipal  securities will be limited to those which are
rated at the time of purchase by Moody's  Investors  Service,  Inc.  ("Moody's")
within its two highest rating categories for municipal  obligations--Aaa and Aa,
or within Moody's short-term municipal  obligations top rating categories of MIG
1 and MIG 2--or are rated at the time of purchase  by Standard & Poor's  ("S&P")
    

                                       
<PAGE>

   
within S&P's two highest rating categories for municipal  obligations AAA/AA and
SP-1+/SP-1 or are rated at the time of purchase by Fitch Investors Service, Inc.
("Fitch")   within   Fitch's  two  highest   rating   categories  for  municipal
obligations--  AAA/AA or within Fitch's highest short term rating  categories of
F-1 and F-2, all in such proportions as management will determine. SCIT also may
invest in securities rated within the two highest rating  categories by only one
of those rating  agencies if no other rating agency has rated the  security.  In
some cases, short-term municipal obligations are rated using the same categories
as are used for corporate obligations. In addition, unrated municipal securities
will be considered as being within the foregoing  quality ratings if the issuer,
or other equal or junior municipal  securities of the same issuer,  has a rating
within the foregoing  ratings of Moody's,  S&P or Fitch. SCIT may also invest in
municipal securities which are unrated if, in the opinion of Scudder,  Stevens &
Clark, Inc. (the "Adviser"), such securities possess creditworthiness comparable
to those rated securities in which the Fund may invest.
    

         Foreign   Securities.    Supranational   entities   are   international
organizations  designated  or  supported  by  governmental  entities  to promote
economic  reconstruction or development and international  banking  institutions
and related  government  agencies.  Examples include the International  Bank for
Reconstruction  and  Development  (the World Bank),  the European Coal and Steel
Community,  The Asian Development Bank and the  InterAmerican  Development Bank.
Obligations of supranational entities are backed by the guarantee of one or more
foreign governmental parties which sponsor the entity.

         Municipal  Securities.  Municipal Securities are issued by or on behalf
of  states,  territories  and  possessions  of  the  U.S.  and  their  political
subdivisions,  agencies and instrumentalities to obtain funds for various public
purposes.  The interest on these  obligations  is generally  exempt from federal
income tax in the hands of most investors, except for the possible applicability
of the alternative  minimum tax. The two principal  classifications of municipal
securities  are "Notes"  and  "Bonds."  Municipal  Notes are  generally  used to
provide for short-term  capital needs and generally have  maturities of one year
or less.  Municipal Notes include:  Tax Anticipation Notes; Revenue Anticipation
Notes;  Bond Anticipation  Notes; and Construction Loan Notes.  Municipal Bonds,
which meet longer term capital needs and generally have  maturities of more than
one year when issued, have two principal  classifications:  "General Obligation"
Bonds and "Revenue" Bonds.

         Industrial  Development and Pollution Control Bonds (which are types of
private activity bonds), although nominally issued by municipal authorities, are
generally not secured by the taxing power of the municipality but are secured by
the revenues of the  authority  derived from  payments by the  industrial  user.
Under Federal tax legislation, certain types of Industrial Development Bonds and
Pollution Control Bonds may no longer be issued on a tax-exempt basis,  although
previously-issued  bonds of these types and certain refundings of such bonds are
not affected.

         Bank  and  Savings  and Loan  Obligations.  These  obligations  include
negotiable certificates of deposit,  bankers' acceptances,  deposit notes, fixed
time deposits or other short-term bank obligations.  Certificates of deposit are
negotiable  certificates  evidencing  the  obligations  of a bank to repay funds
deposited  with  it  for  a  specified  period  of  time.  SCIT  may  invest  in
certificates  of deposit of large domestic banks (i.e.,  banks which at the time
of their most recent annual financial  statements show total assets in excess of
$1 billion),  and of smaller banks as described  below. The Fund does not invest
in certificates  of deposit of foreign banks.  Although the Fund recognizes that
the size of a bank is important,  this fact alone is not necessarily  indicative
of its creditworthiness. Investment in certificates of deposit issued by foreign
branches of domestic banks involves  investment risks that are different in some
respects from those associated with investment in certificates of deposit issued
by domestic  branches of domestic  banks,  including the possible  imposition of
withholding  taxes  on  interest  income,   the  possible  adoption  of  foreign
governmental  restrictions which might adversely affect the payment of principal
and interest on such  certificates  of deposit,  or other  adverse  political or
economic  developments.  In addition,  it might be more  difficult to obtain and
enforce a judgment against a foreign branch of a domestic bank.

         SCIT may also  invest in  certificates  of deposit  issued by banks and
savings and loan institutions which had, at the time of their most recent annual
financial  statements,  total assets of less than $1 billion,  provided that (i)
the principal  amounts of such  certificates of deposit are insured by an agency
of the U.S.  Government,  (ii) at no time will the Fund hold more than  $100,000
principal  amount of  certificates of deposit of any one such bank, and (iii) at
the time of acquisition, no more than 10% of the Fund's assets (taken at current
value) are invested in certificates of deposit of such banks having total assets
not in excess of $1 billion.

                                       2
<PAGE>

         Banker's acceptances are credit instruments  evidencing the obligations
of a bank to pay a draft drawn on it by a customer.  These  instruments  reflect
the obligation  both of the bank and of the drawer to pay the face amount of the
instrument upon maturity.

         Time  deposits  are  non-negotiable  deposits  maintained  in a banking
institution  for a  specified  period of time at a stated  interest  rate.  Time
deposits which may be held by SCIT will not benefit from insurance from the Bank
Insurance Fund or the Savings  Association  Insurance Fund  administered  by the
Federal Deposit Insurance  Corporation.  Fixed time deposits may be withdrawn on
demand by the investor,  but may be subject to early  withdrawal  penalties that
vary with market conditions and the remaining maturity of the obligation.  Fixed
time  deposits  subject  to  withdrawal  penalties  maturing  in more than seven
calendar days are subject to the Fund's  limitation on  investments  in illiquid
securities.

         Eurodollar    Obligations.     Eurodollar    bank    obligations    are
dollar-denominated  certificates of deposit and time deposits issued outside the
U.S.  capital  markets by foreign  branches of U.S.  banks and U.S.  branches of
foreign banks. Eurodollar obligations are subject to the same risks that pertain
to  domestic  issues,  notably  credit  risk,  market risk and  liquidity  risk.
Additionally, Eurodollar obligations are subject to certain sovereign risks.

         Commercial  Paper.  Commercial paper consists of short-term,  unsecured
promissory notes issued to finance short-term credit needs. The commercial paper
purchased by SCIT will consist only of direct obligations issued by domestic and
foreign entities.  The other corporate  obligations in which the Fund may invest
consist of high quality short term bonds and notes  (including  variable  amount
master  demand  notes)  issued by domestic and foreign  corporations,  including
banks.

         Participation Interests.  SCIT may purchase from financial institutions
participation   interests  in  securities  in  which  the  Fund  may  invest.  A
participation  interest gives the Fund an undivided  interest in the security in
the  proportion  that the Fund's  participation  interest bears to the principal
amount of the security.  These instruments may have fixed,  floating or variable
interest  rates,  with  remaining  maturities  of  397  days  or  less.  If  the
participation  interest is unrated,  or has been given a rating below that which
is  permissible  for purchase by the Fund,  the  participation  interest will be
backed by an irrevocable letter of credit or guarantee of a bank, or the payment
obligation otherwise will be collateralized by U.S. Government  securities,  or,
in the case of unrated participation  interest,  determined by the Adviser to be
of comparable  quality to those  instruments  in which the Fund may invest.  For
certain participation interests, the Fund will have the right to demand payment,
on not  more  than  seven  days'  notice,  for  all or any  part  of the  Fund's
participation  interests in the  security,  plus accrued  interest.  As to these
instruments,  the Fund intends to exercise its right to demand payment only upon
a default under the terms of the security.

         Asset-backed  securities.  Asset backed securities may include pools of
mortgages, loans, receivables or other assets. Payment of principal and interest
may be largely dependent upon the cash flows generated by the assets backing the
securities.
       

General Investment Objectives and Policies of Scudder U.S. Treasury Money Fund

   
         Scudder  U.S.  Treasury  Money  Fund is a pure  no-load(TM),  open-end,
diversified management investment company. Treasury Fund's investment objectives
are to provide  safety,  liquidity  and  stability  of capital,  and  consistent
therewith,  to provide current income. The Fund seeks to maintain a constant net
asset value of $1.00 and  declares  dividends  daily.  There can be no assurance
that the Fund's objectives will be met.

         The Fund  provides  investors  with  current  income and  stability  of
capital through a portfolio  consisting  primarily of short-term  U.S.  Treasury
obligations and similar investments.  The Fund is a "fixed-price" fund; that is,
it seeks to maintain a constant  share price of $1.00,  although  under  certain
circumstances  this may not be  possible.  The Fund's price  stability  makes it
suitable for investors who are seeking  current  income and who are unwilling to
accept stock or bond market risk.  The Fund is also designed to minimize  credit
risk. It invests exclusively in short-term securities unconditionally guaranteed
by the U.S.  Government  (as to  payment of both  principal  and  interest)  and
repurchase agreements backed fully by U.S. Treasury obligations. At least 80% of
the Fund's  assets will be invested in either  U.S.  Treasury  securities  or in
repurchase agreements  collateralized by U.S. Treasury  obligations.  All of the
    

                                       3
<PAGE>

   
securities  in which the Fund may invest are U.S.  dollar-denominated.  The Fund
may also invest in when-issued securities and illiquid or restricted securities.
    

Specialized Investment Techniques of the Funds

         Maintenance of $1.00 Net Asset Value and Credit Quality.  Pursuant to a
Rule of the Securities and Exchange  Commission  (the "SEC"),  each Fund effects
sales,  redemptions and  repurchases at the net asset value per share,  normally
$1.00,   rounded  to  the  nearest   whole  cent.   In   fulfillment   of  their
responsibilities  under  that  Rule,  the  Trustees  of each Fund have  approved
policies established by the Funds' Adviser reasonably calculated to prevent each
Fund's net asset  value per share,  as so  rounded,  from  deviating  from $1.00
except under  unusual or  extraordinary  circumstances  and the Trustees of each
Fund will  periodically  review the Adviser's  operations under such policies at
regularly  scheduled  Trustees'  meetings.   Those  policies  include  a  weekly
monitoring  by the  Adviser  of  unrealized  gains  and  losses  in each  Fund's
portfolio,  and  when  necessary,  in  an  effort  to  avoid  deviation,  taking
corrective  action,  such as  adjusting  the maturity of the  portfolio,  or, if
possible,  realizing  gains or losses to  offset  in part  unrealized  losses or
gains. The result of those policies may be that the yield on shares of each Fund
will be lower than would be the case if the  policies  were not in effect.  Such
policies  also provide for certain  action to be taken with respect to portfolio
securities which experience a downgrade in rating or suffer a default.

         Securities  eligible for  investment by the Funds are those  securities
which are  generally  rated (or issued by an issuer with  comparable  securities
rated) in the highest rating category by at least two rating services (or by one
rating  service,  if no other rating  agency has issued a rating with respect to
that  security).   These  securities  are  known  as  "first  tier  securities."
Securities  generally rated (or issued by an issuer with  comparable  securities
rated) in the top two  categories  by at least two rating  agencies  (or one, if
only one rating  agency has rated the  security)  which do not  qualify as first
tier securities are known as "second tier  securities." To ensure diversity of a
Fund's  investments,  as a matter of non-fundamental  policy, each Fund will not
invest more than 5% of its total assets in the  securities  of a single  issuer,
other than the U.S. Government.  Each Fund may, however,  invest more than 5% of
its total assets in the first tier securities of a single issuer for a period of
up to three business days after purchase, although a Fund may not make more than
one such  investment  at any time.  Each Fund may not invest more than 5% of its
total assets in securities  which were second tier  securities  when acquired by
the Fund.  Further,  each Fund may not invest more than the greater of (1) 1% of
its total  assets,  or (2) one million  dollars,  in the  securities of a single
issuer which were second tier securities when acquired by the Fund.

         Portfolio  Maturity.  The assets of each Fund consist  entirely of cash
items and investments having a stated maturity date of 397 calendar days or less
(except in the case of Government  securities,  762 calendar  days) from date of
purchase (including investment in repurchase agreements,  in which case maturity
is measured  by the  repurchase  date,  without  respect to the  maturity of the
obligation).  The term "Government securities," as used herein, means securities
issued or  guaranteed  as to principal or interest by the U.S.  Government,  its
agencies or  instrumentalities.  The  portfolio  of each Fund will be managed so
that the average maturity of all instruments (on a  dollar-weighted  basis) will
be 90 days or  less.  The  average  maturity  of the two  portfolios  will  vary
according to the management's  appraisal of money market  conditions.  Each Fund
will invest  only in  securities  determined  by or under the  direction  of the
Trustees to be of high quality with minimal credit risks.

         Portfolio  Turnover.  The Funds may sell  portfolio  securities to take
advantage of investment  opportunities  arising from  changing  market levels or
yield relationships.  Although such transactions involve additional costs in the
form of  spreads,  they will be  undertaken  in an  effort  to  improve a Fund's
overall investment return, consistent with its objectives.

         U.S. Government  Securities.  U.S. Government Securities are securities
issued  or  guaranteed  by  the  U.S.  Treasury,  by  federal  agencies,  or  by
instrumentalities  established or sponsored by the U.S. Government.  Obligations
issued by the U.S.  Treasury are backed by the full faith and credit of the U.S.
Government.  They include Treasury bills, notes and bonds, which differ in their
interest rates, maturities and times of issuance.  Obligations guaranteed by the
U.S. Treasury include  Government  National Mortgage  Association  participation
certificates. Obligations of a federal agency or U.S. Government instrumentality
may be supported in various ways,  including the limited authority of the issuer
to borrow from the U.S.  Treasury,  such as  securities of the Federal Home Loan
Bank; the discretionary authority of the U.S. Government to purchase obligations
of the agency or instrumentality,  such as Federal National Mortgage Association
bonds;  or the credit only of the  issuing  agency or  instrumentality,  such as
Student Loan Marketing Association. In the case of obligations not backed by the

                                       4
<PAGE>

full faith and credit of the U.S. Government,  the Fund must look principally to
the agency issuing or guaranteeing the obligations for ultimate repayment, which
agency may be privately  owned.  These  securities  may bear fixed,  floating or
variable rates of interest. Interest may fluctuate based on generally recognized
reference rates or the relationship of rates.

   
         When-issued and Forward Delivery Securities.  Government securities are
frequently  offered on a  "when-issued"  or "forward  delivery"  basis.  When so
offered, the price, which is generally expressed in yield terms, is fixed at the
time the  commitment  to  purchase  is made,  but  delivery  and payment for the
when-issued or forward  delivery  securities take place at a later date normally
within 45 days after the date of the  commitment to purchase.  During the period
between  purchase and settlement,  no payment is made by the Funds to the issuer
and no interest accrues to the Funds. To the extent that assets of the Funds are
not invested prior to the settlement of a purchase of securities, the Funds will
earn no income;  however,  it is intended that both Funds will be fully invested
to the extent practicable and subject to the policies stated herein. When-issued
or forward delivery  purchases are negotiated  directly with the other party and
are not traded on an exchange.  While when-issued or forward delivery securities
may be sold prior to the  settlement  date,  it is intended that both Funds will
purchase such  securities  with the purpose of actually  acquiring them unless a
sale appears  desirable for  investment  reasons.  At the time SCIT and Treasury
Fund make the  commitment to purchase  securities  on a  when-issued  or forward
delivery  basis,  they will record the  transaction and reflect the value of the
security in determining their respective net asset values. Neither Fund believes
that its net asset value or income will be adversely affected by its purchase of
securities on a when-issued or forward  delivery  basis.  SCIT and Treasury Fund
will  establish a segregated  account in which to maintain cash or liquid assets
equal in value to commitments  for when-issued or forward  delivery  securities.
Such segregated  securities  either will mature or, if necessary,  be sold on or
before the settlement date.  Neither SCIT nor Treasury Fund will enter into such
transactions for leverage purposes.
    

         Repurchase  Agreements.  Each Fund may enter into repurchase agreements
with any member bank of the Federal Reserve System or any broker/dealer which is
recognized as a reporting  government  securities dealer if the creditworthiness
of the bank or  broker/dealer  has been determined by the Adviser to be at least
as high as that of other  obligations  the Funds may  purchase or to be at least
equal to that of issuers  of  commercial  paper  rated  within  the two  highest
ratings categories assigned by Moody's, S&P or Fitch.

         A  repurchase  agreement  provides a means for a Fund to earn income on
funds for periods as short as overnight.  It is an  arrangement  under which the
purchaser  (i.e.,  a Fund)  acquires  a security  ("Obligation")  and the seller
agrees,  at the time of sale, to repurchase  the  Obligation at a specified time
and price. Securities subject to a repurchase agreement are held in a segregated
account and, as described in more detail below,  the value of such securities is
kept at least equal to the  repurchase  price on a daily basis.  The  repurchase
price may be higher than the purchase  price,  the difference  being income to a
Fund, or the purchase and repurchase  prices may be the same, with interest at a
stated rate due to a Fund together with the repurchase price upon repurchase. In
either  case,  the income to a Fund is  unrelated  to the  interest  rate on the
Obligation  itself.  Obligations will be held by the custodian or in the Federal
Reserve Book Entry System.

         For  purposes of the  Investment  Company Act of 1940,  as amended (the
"1940 Act"),  a  repurchase  agreement is deemed to be a loan from a Fund to the
seller of the Obligation  subject to the  repurchase  agreement and is therefore
subject to each Fund's  investment  restriction  applicable to loans.  It is not
clear whether a court would consider the Obligation  purchased by a Fund subject
to a repurchase agreement as being owned by that Fund or as being collateral for
a loan  by  that  Fund  to the  seller.  In the  event  of the  commencement  of
bankruptcy  or  insolvency  proceedings  with  respect  to  the  seller  of  the
Obligation before repurchase of the Obligation under a repurchase  agreement,  a
Fund may encounter delay and incur costs before being able to sell the security.
Delays may involve  loss of interest or decline in price of the  Obligation.  If
the court characterizes the transaction as a loan and a Fund has not perfected a
security  interest  in the  Obligation,  that Fund may be required to return the
Obligation to the seller's estate and be treated as an unsecured creditor of the
seller. As an unsecured creditor,  a Fund would be at risk of losing some or all
of the principal and income involved in the  transaction.  As with any unsecured
debt Obligation  purchased for a Fund, the Adviser seeks to minimize the risk of
loss through  repurchase  agreements  by analyzing the  creditworthiness  of the
obligor,  in this case the  seller  of the  Obligation.  Apart  from the risk of
bankruptcy or insolvency proceedings, there is also the risk that the seller may
fail to repurchase the Obligation,  in which case a Fund may incur a loss if the
proceeds to that Fund of the sale to a third party are less than the  repurchase
price.  However,  if the market value  (including  interest)  of the  Obligation
subject to the  repurchase  agreement  becomes  less than the  repurchase  price
(including interest), a Fund will direct the seller of the Obligation to deliver
additional  securities  so that the market  value  (including  interest)  of all
securities  subject  to the  repurchase  agreement  will  equal  or  exceed  the
repurchase price.

                                       5
<PAGE>

   
         Illiquid and Restricted Securities. Each Fund may occasionally purchase
securities  other than in the open market.  While such purchases may often offer
attractive  opportunities  for  investment  not otherwise  available on the open
market,  the securities so purchased are often  "restricted  securities",  i.e.,
securities  which cannot be sold to the public  without  registration  under the
Securities Act of 1933 or the  availability  of an exemption  from  registration
(such as Rules 144 or 144A), or which are "not readily  marketable" because they
are subject to other legal or contractual delays in or restrictions on resale.

         Generally speaking, restricted securities may be sold only to qualified
institutional  buyers,  or in a privately  negotiated  transaction  to a limited
number of purchasers,  or in limited  quantities after they have been held for a
specified  period of time and other  conditions are met pursuant to an exemption
from registration, or in a public offering for which a registration statement is
in effect  under the  Securities  Act of 1933.  Each Fund may be deemed to be an
"underwriter" for purposes of the Securities Act of 1933 when selling restricted
securities  to the  public,  and in  such  event  each  Fund  may be  liable  to
purchasers of such  securities  if the  registration  statement  prepared by the
issuer,  or the  prospectus  forming a part of it, is  materially  inaccurate or
misleading.

         The Adviser will monitor the  liquidity of such  restricted  securities
subject  to the  supervision  of each  Fund's  Board of  Trustees.  In  reaching
liquidity  decisions,  the Adviser will consider the following factors:  (1) the
frequency  of trades  and  quotes  for the  security,  (2) the number of dealers
wishing to  purchase  or sell the  security  and the  number of their  potential
purchasers,  (3) dealer  undertakings to make a market in the security;  and (4)
the nature of the security and the nature of the  marketplace  trades (i.e.  the
time needed to dispose of the security,  the method of soliciting offers and the
mechanics of the transfer).
    

         The conclusions and investment decisions of the Adviser with respect to
each Fund are based  primarily on the analyses of its own research  specialists.
While these specialists have the major responsibility for doing research on debt
securities,  they  receive  the  support  of  the  Adviser's  general  economics
department  for  studies on  interest  rate  trends and of the  Adviser's  stock
research analysts for consultation on the qualitative aspects of credit analysis
which  enable the  Adviser to  establish  its own credit  ratings for issuers of
senior securities. The Adviser believes it is important to have this combination
of specialized skills available for developing the proper investment  strategies
for the Funds. The Adviser  subscribes to leading bond information  services and
receives directly published reports and statistical  compilations of the issuers
themselves,  as well as  analyses  from  brokers  and  dealers  who may  execute
portfolio  transactions for the Adviser's clients.  However, the Adviser regards
this information and material as an adjunct to its own research activities.

Investment Restrictions

         Unless specified to the contrary, the following restrictions may not be
changed without the approval of a majority of the outstanding  voting securities
of the Fund involved which,  under the 1940 Act and the rules  thereunder and as
used in this Statement of Additional Information, means the lesser of (1) 67% or
more of the voting securities present at a meeting,  if the holders of more than
50% of the outstanding  voting securities of the Fund are present or represented
by proxy; or (2) more than 50% of the outstanding  voting  securities of a Fund.
Any  investment  restrictions  herein  which  involve  a maximum  percentage  of
securities  or assets shall not be  considered  to be violated  unless an excess
over the percentage occurs  immediately  after, and is caused by, an acquisition
or encumbrance of securities or assets of, or borrowings by, a Fund.

         As a matter of fundamental policy, SCIT may not:

         1.       borrow money,  except as a temporary measure for extraordinary
                  or  emergency  purposes or except in  connection  with reverse
                  repurchase agreements;  provided that the Fund maintains asset
                  coverage of 300% for all borrowings;

         2.       act as an underwriter of securities  issued by others,  except
                  to the  extent  that  it  may  be  deemed  an  underwriter  in
                  connection with the disposition of portfolio securities of the
                  Fund;

                                       6
<PAGE>

         3.       make  loans  to  other  persons,  except  loans  of  portfolio
                  securities  and except to the extent that the purchase of debt
                  obligations in accordance  with its  investment  objective and
                  policies  and the  entry  into  repurchase  agreements  may be
                  deemed to be loans;

         4.       Issue senior  securities,  except as  appropriate  to evidence
                  indebtedness  which it is permitted  to incur,  and except for
                  shares  of the  separate  classes  or  series  of  the  Trust,
                  provided  that   collateral   arrangements   with  respect  to
                  currency-related  contracts,  futures  contracts,  options  or
                  other permitted investments, including deposits of initial and
                  variation  margin,  are not  considered  to be the issuance of
                  senior securities for purposes of this restriction;

         5.       with respect to 75% of the Fund's total assets,  purchase more
                  than 10% of the voting  securities of any one issuer or invest
                  more than 5% of the  value of the total  assets of the Fund in
                  the  securities of any one issuer  (except for  investments in
                  obligations issued or guaranteed by the U.S. Government or its
                  agencies or  instrumentalities,  cash and cash equivalents and
                  securities of other investment  companies),  provided that the
                  amount of the total assets of the Fund that may be invested in
                  the securities of any one issuer will,  instead, be limited in
                  accordance   with  federal  law,   regulation  and  regulatory
                  interpretation  applicable to money market  funds,  as amended
                  from time to time;

         6.       purchase or sell real estate  (except that the Fund may invest
                  in (i)  securities  of companies  which deal in real estate or
                  mortgages,  and (ii)  securities  secured  by real  estate  or
                  interests therein);

         7.       purchase any securities which would cause more than 25% of the
                  market value of its total assets at the time of such  purchase
                  to be invested in the securities of one or more issuers having
                  their  principal  business  activities  in the same  industry,
                  provided  that  there  is  no   limitation   with  respect  to
                  investments  in  obligations  issued or guaranteed by the U.S.
                  Government,   its   agencies  or   instrumentalities,   or  in
                  certificates of deposit or bankers' acceptances.

         In addition, although not a matter of fundamental policy, SCIT may not:

         (a)      borrow  money in excess of 5% of its  total  assets  (taken at
                  market  value)  except for  temporary or  emergency  purposes,
                  borrow  other than from banks or in  connection  with  reverse
                  repurchase agreements;

         (b)      purchase  or sell  interests  in  oil,  gas or  other  mineral
                  leases, or exploration or development  programs (although they
                  may invest in  securities  of  issuers  which own or invest in
                  such interests);

         (c)      pledge,  mortgage or hypothecate  its assets,  except that, to
                  secure borrowings permitted by Investment  Restriction (1), it
                  may  pledge  securities  having a market  value at the time of
                  pledge  not  exceeding  15% of the  cost of the  Fund's  total
                  assets;

         (d)      purchase  or sell any put or call  options or any  combination
                  thereof, not including warrants;

         (e)      purchase restricted  securities (for these purposes restricted
                  security   means  a  security  with  a  legal  or  contractual
                  restriction  on  resale in the  principal  market in which the
                  security is traded),  including repurchase agreements maturing
                  in more than seven days and  securities  which are not readily
                  marketable  if as a result  more than 10% of SCIT's net assets
                  (valued  at  market at  purchase)  would be  invested  in such
                  securities;

         (f)      purchase  securities if, as a result thereof,  more than 5% of
                  the value of SCIT's net assets would be invested in restricted
                  securities;

         (g)      invest in the securities of other investment companies, except
                  by purchase in the open market when no commission or profit to
                  a sponsor or dealer  results from such purchase other than the
                  customary broker's  commission,  or except when such purchase,
                  though  not  made  on the  open  market,  is part of a plan of
                  merger or consolidation;

                                       7
<PAGE>

         (h)      purchase or sell real estate limited partnership interests;

         (i)      invest more than 5% of its total assets in the  securities  of
                  any one issuer or subject to puts from any one issuer,  except
                  U.S. Government securities,  provided that the Fund may invest
                  more than 5% of its total assets in first tier  securities  of
                  any one issuer for a period of up to three  business  days or,
                  in  unrated  securities  that  have been  determined  to be of
                  comparable quality by the Fund's Adviser;

         (j)      invest  more  than  5% of its  total  assets  in  second  tier
                  securities, or in unrated securities determined by the Adviser
                  to be of comparable quality;

         (k)      invest  more than the  greater  of  $1,000,000  or 1% of total
                  assets in second tier securities of any one issuer;

         (l)      invest more than 10% of its total assets in securities subject
                  to an unconditional put issued by any one institution;

         (m)      borrow money,  including  reverse  repurchase  agreements,  in
                  excess of 5% of its  total  assets  (taken  at  market  value)
                  except for  temporary or emergency  purposes,  or borrow other
                  than from banks;

         (n)      make loans unless all loans of portfolio  securities are fully
                  collateralized and marked to market daily;

         (o)      purchase securities on margin or make short sales,  unless, by
                  virtue of its ownership of other securities,  it has the right
                  to  obtain  securities  equivalent  in kind and  amount to the
                  securities sold and, if the right is conditional,  the sale is
                  made  upon the same  conditions,  except  in  connection  with
                  arbitrage  transactions  and  except  that the Fund may obtain
                  such short-term  credits as may be necessary for the clearance
                  of purchases and sales of securities;

         (p)      purchase  or  retain  securities  of an  issuer  any of  whose
                  officers,  directors,  trustees  or  security  holders  is  an
                  officer  or  director  of  the  Trust  or a  member,  officer,
                  director or trustee of the  investment  adviser of the Fund if
                  one or more of such  individuals owns  beneficially  more than
                  one-half of one percent  (1/2%) of the  outstanding  shares or
                  securities  or both (taken at market value) of such issuer and
                  such  individuals  owning  more than  one-half  of one percent
                  (1/2%) of such shares or securities  together own beneficially
                  more than 5% of such shares or securities or both;

         (q)      invest more than 10% of its total assets in  securities  which
                  are not  readily  marketable,  the  disposition  of  which  is
                  restricted  under  Federal  securities  laws or in  repurchase
                  agreements not terminable within 7 days provided that the fund
                  will not invest more than 5% of its total assets in restricted
                  securities;

         (r)      purchase  securities  of any issuer with a record of less than
                  three  years  continuous  operation,  including  predecessors,
                  except obligations issued or guaranteed by the U.S. Government
                  or its  agencies,  if such  purchase  would  cause the  Fund's
                  investments  in all such  issuers  to exceed 5% of the  Fund's
                  total assets taken at market value.

         As a matter of fundamental  policy,  unless and to the extent permitted
by an exemptive order of the SEC, Treasury Fund may not:

         1.       borrow money,  except as a temporary measure for extraordinary
                  or  emergency  purposes or except in  connection  with reverse
                  repurchase agreements,  provided that the Fund maintains asset
                  coverage of 300% for all borrowings;

         2.       purchase or sell real estate  (except that the Fund may invest
                  in (i)  securities  of companies  which deal in real estate or
                  mortgages,  and (ii)  securities  secured  by real  estate  or
                  interests  therein,  and  that the Fund  reserves  freedom  of
                  action to hold and to sell real estate acquired as a result of
                  the Fund's  ownership  of  securities);  or  purchase  or sell
                  physical   commodities  or  contracts   relating  to  physical
                  commodities;

                                       8
<PAGE>

         3.       act as an underwriter of securities  issued by others,  except
                  to the  extent  that  it  may  be  deemed  an  underwriter  in
                  connection with the disposition of portfolio securities of the
                  Fund;

         4.       make loans to other  persons,  except  (a) loans of  portfolio
                  securities,  and (b) to the extent  the entry into  repurchase
                  agreements  and the purchase of debt  securities in accordance
                  with its investment  objective and investment  policies may be
                  deemed to be loans; or

         5.       issue senior  securities,  except as  appropriate  to evidence
                  indebtedness  which it is permitted  to incur,  and except for
                  shares  of the  separate  classes  or  series  of  the  Trust,
                  provided  that   collateral   arrangements   with  respect  to
                  currency-related  contracts,  futures  contracts,  options  or
                  other permitted investments, including deposits of initial and
                  variation  margin,  are not  considered  to be the issuance of
                  senior securities for purposes of this restriction.

         Treasury  Fund has  undertaken  that if the Fund  obtains an  exemptive
order of the SEC which would permit the taking of action in contravention of any
policy which may not be changed  without a shareholder  vote,  the Fund will not
take such action unless either (i) the  applicable  exemptive  order permits the
taking of such action  without a  shareholder  vote or (ii) the staff of the SEC
has issued to the Fund a "no action" or  interpretive  letter to the effect that
the Fund may proceed without a shareholder vote.

         Although not a matter of fundamental policy Treasury Fund may not:

         (a)      purchase  or  retain  securities  of any  open-end  investment
                  company,  or  securities of  closed-end  investment  companies
                  except by purchase in the open market where no  commission  or
                  profit to a sponsor or dealer results from such purchases,  or
                  except when such purchase, though not made in the open market,
                  is part of a plan of merger, consolidation,  reorganization or
                  acquisition of assets;  in any event the Fund may not purchase
                  more than 3% of the outstanding  voting  securities of another
                  investment company,  may not invest more than 5% of its assets
                  in another  investment  company,  and may not invest more than
                  10% of its assets in other investment companies;

         (b)      pledge, mortgage or hypothecate its assets in excess, together
                  with permitted borrowings, of 1/3 of its total assets;

         (c)      purchase  or  retain  securities  of an  issuer  any of  whose
                  officers,  directors,  trustees  or  security  holders  is  an
                  officer, director or trustee of the Fund or a member, officer,
                  director or trustee of the  investment  adviser of the Fund if
                  one or more of such  individuals owns  beneficially  more than
                  one-half of one percent  (1/2%) of the  outstanding  shares or
                  securities  or both (taken at market value) of such issuer and
                  such  individuals  owning  more than  one-half  of one percent
                  (1/2%) of such shares or securities  together own beneficially
                  more than 5% of such shares or securities or both;

         (d)      purchase securities on margin or make short sales,  unless, by
                  virtue of its ownership of other securities,  it has the right
                  to  obtain  securities  equivalent  in kind and  amount to the
                  securities sold and, if the right is conditional,  the sale is
                  made upon the same conditions, except that the Fund may obtain
                  such short-term  credits as may be necessary for the clearance
                  of purchases and sales of securities;

         (e)      invest more than 10% of its net assets in securities which are
                  not readily marketable, the disposition of which is restricted
                  under Federal securities laws, or in repurchase agreements not
                  terminable  within 7 days,  and the Fund will not invest  more
                  than 10% of its total assets in restricted securities;

         (f)      purchase  securities  of any issuer with a record of less than
                  three years  continuous  operations,  including  predecessors,
                  except U.S.  Government  securities and obligations  issued or
                  guaranteed  by  any  foreign  government  or its  agencies  or
                  instrumentalities,   if  such   purchase   would   cause   the
                  investments  of the Fund in all such  issuers  to exceed 5% of
                  the total assets of the Fund taken at market value;

         (g)      purchase  more than 10% of the  voting  securities  of any one
                  issuer,  except securities issued by the U.S. Government,  its
                  agencies or instrumentalities;

                                       9
<PAGE>

         (h)      invest in oil, gas or other mineral leases,  or exploration or
                  development  programs (although it may invest in issuers which
                  own or invest in such interests);

         (i)      borrow money,  including  reverse  repurchase  agreements,  in
                  excess of 5% of its  total  assets  (taken  at  market  value)
                  except for  temporary or emergency  purposes,  or borrow other
                  than from banks;

         (j)      purchase  or sell any put or call  options or any  combination
                  thereof;

         (k)      purchase or sell real estate limited partnership interests;

         (l)      invest more than 5% of its total assets in the  securities  of
                  any one issuer or subject to puts from any one issuer,  except
                  U.S. Government securities,  provided that the Fund may invest
                  more than 5% of its total assets in first tier  securities  of
                  any one issuer for a period of up to three  business  days or,
                  in  unrated  securities  that  have been  determined  to be of
                  comparable quality by the Fund's Adviser;

         (m)      invest  more  than  5% of its  total  assets  in  second  tier
                  securities, or in unrated securities determined by the Adviser
                  to be of comparable quality;

         (n)      invest  more than the  greater  of  $1,000,000  or 1% of total
                  assets in second tier securities of any one issuer;

         (o)      invest more than 10% of its total assets in securities subject
                  to an unconditional put issued by any one institution; or

         (p)      make loans unless all loans of portfolio  securities are fully
                  collateralized and marked to market daily.

                                    PURCHASES

   (See "Purchases" and "Transaction information" in each Fund's prospectus.)

Additional Information About Opening an Account

         Clients having a regular investment counsel account with the Adviser or
its affiliates and members of their immediate  families,  officers and employees
of the Adviser or of any affiliated  organization and their immediate  families,
members of the National  Association of Securities  Dealers,  Inc.  ("NASD") and
banks may,  if they  prefer,  subscribe  initially  for at least  $2,500 of Fund
shares through Scudder Investor  Services,  Inc. (the  "Distributor") by letter,
fax, TWX or telephone.

         Shareholders  of other  Scudder  funds who have  submitted  an  account
application  and have a certified tax  identification  number,  clients having a
regular investment counsel account with Scudder or its affiliates and members of
their  immediate  families,  officers  and  employees  of the  Adviser or of any
affiliated  organization and their immediate  families,  members of the NASD and
banks may open an account by wire. These investors must call  1-800-225-5163  to
get an account  number.  During the call the investor  will be asked to indicate
the Fund  name,  amount  to be  wired  ($2,500  minimum),  name of bank or trust
company  from  which the wire will be sent,  the exact  registration  of the new
account,  the tax identification  number or Social Security number,  address and
telephone  number.  The  investor  must  then  call the bank to  arrange  a wire
transfer to The Scudder Funds,  Boston, MA 02110, ABA Number 011000028,  Account
Number:  9903-5552.  The investor must give the Scudder fund name,  account name
and the new account  number.  Finally,  the investor must send the completed and
signed application to the Fund promptly.

Checks

         A  certified  check is not  necessary,  but  checks  are only  accepted
subject to collection  at full face value in U.S.  funds and must be drawn on or
payable through a United States bank.

         If  shares  of a Fund are  purchased  with a check  which  proves to be
uncollectible,  that Fund reserves the right to cancel the purchase  immediately
and the purchaser will be responsible  for any loss incurred by that Fund or the
principal  underwriter  by reason of such  cancellation.  If the  purchaser is a

                                       10
<PAGE>

shareholder,  such Fund will have the authority, as agent of the shareholder, to
redeem  shares in the account in order to  reimburse  the Fund or the  principal
underwriter for the loss incurred. Investors whose orders have been canceled may
be prohibited  from or restricted in placing future orders in any of the Scudder
funds.

Wire Transfer of Federal Funds

   
         To  purchase  shares of a Fund and obtain the same day's  dividend  you
must have your bank  forward  federal  funds by wire  transfer  and  provide the
required  account  information  so as to be  available to a Fund prior to twelve
o'clock  noon  eastern  time on that  day.  If you  wish to make a  purchase  of
$500,000 or more, you should notify the Fund's transfer  agent,  Scudder Service
Corporation (the "Transfer Agent") of such a purchase by calling 1-800-225-5163.
If either the federal funds or the account  information is received after twelve
o'clock  noon  eastern  time,  but both the funds and the  information  are made
available  before  the close of regular  trading on the New York Stock  Exchange
(the "Exchange") (normally 4 p.m. eastern time) on any business day, shares will
be purchased at net asset value  determined on that day but will not receive the
dividend; in such cases, dividends commence on the next business day.
    

         The bank sending an  investor's  federal  funds by bank wire may charge
for the  service.  Presently,  each Fund pays a fee for receipt by State  Street
Bank and Trust  Company  (the  "Custodian")  of "wired  funds," but the right to
charge investors for this service is reserved.

         Boston banks are closed on certain  holidays  although the Exchange may
be open.  These holidays  include Martin Luther King Jr., Day (the 3rd Monday in
January),  Columbus Day (the 2nd Monday in October) and  Veterans' Day (November
11).  Investors are not able to purchase  shares by wiring federal funds on such
holidays  because the  Custodian is not open to receive  such  federal  funds on
behalf of either Fund.

   
Additional Information About Making Subsequent Investments by QuickBuy
    

   
         Shareholders, whose predesignated bank account of record is a member of
the Automated  Clearing  House Network (ACH) and who have elected to participate
in the QuickBuy program,  may purchase shares of the Fund by telephone.  Through
this service  shareholders  may purchase up to $250,000.  To purchase  shares by
QuickBuy,  shareholders  should call before 4 p.m. eastern time. Proceeds in the
amount of your purchase will be transferred  from your bank checking account two
or three business days  following your call. For requests  received by the close
of regular  trading on the  Exchange,  shares will be purchased at the net asset
value per share  calculated  at the close of  trading  on the day of your  call.
QuickBuy  requests  received after the close of regular  trading on the Exchange
will begin their  processing and be purchased at the net asset value  calculated
the following  business day. If you purchase  shares by QuickBuy and redeem them
within seven days of the purchase, the Fund may hold the redemption proceeds for
a period of up to seven  business  days.  If you  purchase  shares and there are
insufficient  funds in your bank account the  purchase  will be canceled and you
will be subject  to any losses or fees  incurred  in the  transaction.  QuickBuy
transactions  are not  available for most  retirement  plan  accounts.  However,
QuickBuy transactions are available for Scudder IRA accounts.

         In order to  request  purchases  by  QuickBuy,  shareholders  must have
completed  and returned to the Transfer  Agent the  application,  including  the
designation  of a bank account from which the purchase  payment will be debited.
New investors wishing to establish  QuickBuy may so indicate on the application.
Existing  shareholders  who wish to add  QuickBuy to their  account may do so by
completing an QuickBuy  Enrollment  Form.  After  sending in an enrollment  form
shareholders should allow for 15 days for this service to be available.

         The Funds  employ  procedures,  including  recording  telephone  calls,
testing a caller's  identity,  and sending  written  confirmation  of  telephone
transactions,   designed  to  give   reasonable   assurance  that   instructions
communicated  by telephone are genuine,  and to discourage  fraud. To the extent
that a Fund does not follow such procedures,  it may be liable for losses due to
unauthorized or fraudulent telephone instructions.  The Funds will not be liable
for acting  upon  instructions  communicated  by  telephone  that it  reasonably
believes to be genuine.
    

Share Price

         Purchases  made by check  will be filled  without  sales  charge at the
close of regular trading on the Exchange on the day the check is received by the
Transfer Agent in good order.  Net asset value of each Fund normally is computed

                                       11
<PAGE>

twice a day, as of twelve  o'clock noon and the close of regular  trading on the
Exchange on each day when the Exchange is open for trading.

Share Certificates

         Due to  the  desire  of  each  Fund's  management  to  afford  ease  of
redemption,  certificates  will not be issued to  indicate  ownership  in either
Fund. Share  certificates  now in a shareholder's  possession may be sent to the
Transfer  Agent  for  cancellation  and  credit to such  shareholder's  account.
Shareholders who prefer may hold the certificates in their possession until they
wish to exchange or redeem such shares.

Other Information

   
         If purchases and  redemptions of shares of either Fund are arranged and
settlement  is made at the  investor's  election  through  a member of the NASD,
other than Scudder Investor Services,  Inc., that member may, at its discretion,
charge a fee for that  service.  The Trustees of each Fund and Scudder  Investor
Services,  Inc., the Funds' principal underwriter,  each has the right to limit,
for any reason, the amount of purchases and to refuse to sell to any person. The
Board of Trustees of each Fund and Scudder Investor  Services,  Inc. may suspend
or terminate the offering of shares of their respective Fund at any time for any
reason.
    

         The "Tax  Identification  Number"  section of the  application  must be
completed when opening an account.  Applications  and purchase  orders without a
correct  certified  tax  identification   number  and  certain  other  certified
information  (e.g. from exempt  investors a certification of exempt status) will
be returned to the investor.

         The minimum  initial  purchase amount is less than $2,500 under certain
special plan accounts.

         The Funds may issue  shares at net asset value in  connection  with any
merger or  consolidation  with, or  acquisition of the assets of, any investment
company  (or  series  thereof)  or  personal  holding  company,  subject  to the
requirements of the 1940 Act.

                            EXCHANGES AND REDEMPTIONS

                      (See "Exchanges and redemptions" and
              "Transaction information" in each Fund's prospectus.)

Exchanges

         Exchanges  are  comprised of a  redemption  from one Scudder fund and a
purchase into another Scudder fund. The purchase side of the exchange either may
be an additional  investment  into an existing  account or may involve opening a
new account in the other fund. When an exchange involves a new account,  the new
account  will be  established  with the same  registration,  tax  identification
number,  address,  telephone redemption option,  "Scudder Automated  Information
Line" (SAIL(TM))  transaction  authorization and dividend option as the existing
account.  Other features will not carry over  automatically  to the new account.
Exchanges  into a new fund  account  must be for a minimum  of  $2,500.  When an
exchange  represents  an additional  investment  into an existing  account,  the
account  receiving the exchange proceeds must have identical  registration,  tax
identification number,  address, and account  options/features as the account of
origin.  Exchanges  into an existing  account  must be for $100 or more.  If the
account receiving the exchange  proceeds is to be different in any respect,  the
exchange  request  must be in writing  and must  contain an  original  signature
guarantee    as    described    under    "Transaction     information--Redeeming
shares--Signature guarantees" in each Fund's prospectus.

         Exchange  orders  received  before the close of regular  trading on the
Exchange on any business day  ordinarily  will be executed at the respective net
asset values determined on that day. Exchange orders received after the close of
regular trading on the Exchange will be executed on the following business day.

         Investors  may also  request,  at no extra  charge,  to have  exchanges
automatically  executed on a predetermined  schedule from one Scudder fund to an
existing  account in another  Scudder fund, at current net asset value,  through
Scudder's  Automatic  Exchange Program.  Exchanges must be for a minimum of $50.
Shareholders  may add this  free  feature  over  the  telephone  or in  writing.

                                       12
<PAGE>

Automatic Exchanges will continue until the shareholder requests by telephone or
in writing to have the  feature  removed,  or until the  originating  account is
depleted. The Trusts and the Transfer Agent each reserve the right to suspend or
terminate the privilege of the Automatic Exchange Program at any time.

         There is no charge to the shareholder for any exchange described above.
An exchange into another  Scudder fund is a redemption of shares,  and therefore
may  result  in tax  consequences  (gain or loss)  to the  shareholder,  and the
proceeds  of such  an  exchange  may be  subject  to  backup  withholding.  (See
"TAXES.")

         Investors currently receive the exchange privilege,  including exchange
by  telephone,  automatically  without  having to elect it.  The  Trusts  employ
procedures,  including recording  telephone calls,  testing a caller's identity,
and sending  written  confirmation of telephone  transactions,  designed to give
reasonable  assurance that  instructions  communicated by telephone are genuine,
and to  discourage  fraud.  To the extent  that the  Trusts do not  follow  such
procedures,  they may be liable  for losses due to  unauthorized  or  fraudulent
telephone  instructions.   The  Trusts  will  not  be  liable  for  acting  upon
instructions  communicated  by  telephone  that they  reasonably  believe  to be
genuine.  The Trusts and the Transfer Agent each reserve the right to suspend or
terminate the privilege of exchanging by telephone or fax at any time.

   
         The Scudder funds into which  investors may make an exchange are listed
under  "THE  SCUDDER  FAMILY  OF  FUNDS"  herein.  Before  making  an  exchange,
shareholders should obtain from the Distributor a prospectus of the Scudder fund
into which the exchange is being contemplated. The exchange privilege may not be
available  for  certain  Scudder  funds.  For  more  information,   please  call
1-800-225-5163.
    

         Scudder  retirement  plans may have  different  exchange  requirements.
Please refer to appropriate plan literature.

Redemption by Telephone

         In order to request  redemptions by telephone,  shareholders  must have
completed  and returned to the Transfer  Agent the  application,  including  the
designation of a bank account to which the  redemption  proceeds are to be sent.
Shareholders  currently  receive  the right to redeem  up to  $100,000  to their
address of record  automatically,  without having to elect it.  Shareholders may
also request to have the proceeds mailed or wired to their  pre-designated  bank
account.

         (a)      NEW INVESTORS wishing to establish  telephone  redemption to a
                  pre-designated  bank  account must  complete  the  appropriate
                  section on the application.

         (b)      EXISTING  SHAREHOLDERS  (except  those  who are  Scudder  IRA,
                  Scudder Pension and Profit-Sharing, Scudder 401(k) and Scudder
                  403(b) Planholders) who wish to establish telephone redemption
                  to a  pre-designated  bank  account  or who want to change the
                  bank  account  previously  designated  to  receive  redemption
                  payments  should either return a Telephone  Redemption  Option
                  Form (available upon request) or send a letter identifying the
                  account and  specifying  the exact  information to be changed.
                  The letter must be signed exactly as the shareholder's name(s)
                  appears on the account. A signature and a signature  guarantee
                  are  required  for each  person in whose  name the  account is
                  registered.

         Telephone   redemption  is  not   available   with  respect  to  shares
represented by share certificates or shares held in certain retirement accounts.

         If a request for redemption to a shareholder's  bank account is made by
telephone  or fax,  payment  will be by  Federal  Reserve  bank wire to the bank
account  designated  on the  application,  unless  a  request  is made  that the
redemption  check be mailed to the designated  bank account.  There will be a $5
charge for all wire redemptions.

         Note:  Investors  designating a savings bank to receive their telephone
redemption proceeds are advised that if the savings bank is not a participant in
the  Federal  Reserve  System,  redemption  proceeds  must be  wired  through  a
commercial bank which is a correspondent  of the savings bank. As this may delay
receipt by the shareholder's  account, it is suggested that investors wishing to
use a savings  bank  discuss  wire  procedures  with  their  bank and submit any

                                       13
<PAGE>

special wire transfer information with the telephone  redemption  authorization.
If appropriate  wire  information is not supplied,  redemption  proceeds will be
mailed to the designated bank.

         The Funds  employ  procedures,  including  recording  telephone  calls,
testing a caller's  identity,  and sending  written  confirmation  of  telephone
transactions,   designed  to  give   reasonable   assurance  that   instructions
communicated  by telephone are genuine,  and to discourage  fraud. To the extent
that the Funds do not follow such procedures,  they may be liable for losses due
to  unauthorized  or fraudulent  telephone  instructions.  The Funds will not be
liable  for  acting  upon  instructions  communicated  by  telephone  that  they
reasonably believe to be genuine.

         Redemption requests by telephone (technically a repurchase by agreement
between the Fund and the  shareholder) of shares  purchased by check will not be
accepted  until  the  purchase  check  has  cleared  which  may take up to seven
business days.

   
Redemption By QuickSell

         Shareholders, whose predesignated bank account of record is a member of
the Automated  Clearing  House Network (ACH) and have elected to  participate in
the QuickSell program may sell shares of a Fund by telephone.  To sell shares by
QuickSell, shareholders should call before 4 p.m. eastern time. Redemptions must
be for at  least  $250.  Proceeds  in the  amount  of  your  redemption  will be
transferred  to  your  bank  checking  account  in two or  three  business  days
following  your call. For requests  received by the close of regular  trading on
the  Exchange,  shares  will  be  redeemed  at the net  asset  value  per  share
calculated at the close of trading on the day of your call.  QuickSell  requests
received  after the close of regular  trading on the  Exchange  will begin their
processing  and be  redeemed  at the net asset value  calculated  the  following
business day. QuickSell  transactions are not available for Scudder IRA accounts
and most other retirement plan accounts.

         In order to request  redemptions by QuickSell,  shareholders  must have
completed  and returned to the Transfer  Agent the  application,  including  the
designation of a bank account to which the redemption proceeds will be credited.
New investors wishing to establish QuickSell may so indicate on the application.
Existing  shareholders  who wish to add  QuickSell to their account may do so by
completing a QuickSell  Enrollment  Form.  After sending in an enrollment  form,
shareholders should allow for 15 days for this service to be available.
    

         The Funds  employ  procedures,  including  recording  telephone  calls,
testing a caller's  identity,  and sending  written  confirmation  of  telephone
transactions,   designed  to  give   reasonable   assurance  that   instructions
communicated  by telephone are genuine,  and to discourage  fraud. To the extent
that a Fund does not follow such procedures,  it may be liable for losses due to
unauthorized or fraudulent telephone instructions.  The Funds will not be liable
for acting upon  instructions  communicated  by telephone  that they  reasonably
believe to be genuine.

Redemption by Mail or Fax

         Any existing share certificates representing shares being redeemed must
accompany a request for  redemption  and be duly  endorsed or  accompanied  by a
proper stock  assignment  form with  signatures  guaranteed as explained in each
Fund's prospectus.

         In order to ensure proper  authorization  before redeeming shares,  the
Transfer Agent may request additional  documents such as, but not restricted to,
stock  powers,  trust  instruments,   certificates  of  death,  appointments  as
executor,  certificates  of corporate  authority and waivers of tax (required in
some states when settling estates).

   
         It is suggested that shareholders  holding share certificates or shares
registered in other than  individual  names contact the Transfer  Agent prior to
any  redemptions to ensure that all necessary  documents  accompany the request.
When  shares are held in the name of a  corporation,  trust,  fiduciary,  agent,
attorney or partnership,  the Transfer Agent requires,  in addition to the stock
power,  certified  evidence of authority to sign.  These  procedures are for the
protection  of  shareholders  and should be followed to ensure  prompt  payment.
Redemption  requests  must  not  be  conditional  as to  date  or  price  of the
redemption. Proceeds of a redemption will be sent within five days after receipt
by the Transfer Agent of a request for  redemption  that complies with the above
requirements.  Delays of more than seven  business  days of  payment  for shares
tendered for  repurchase or redemption  may result,  but only until the purchase
check has cleared.
    

                                       14
<PAGE>

         The  requirements  for IRA  redemptions  are  different  from those for
regular accounts. For more information call 1-800-225-5163.

Redemption by Write-a-Check

         All new investors and existing  shareholders  who apply to State Street
Bank and Trust Company for checks may use them to pay any person,  provided that
each  check is for at least  $100 and not more  than $5  million.  By using  the
checks,  the shareholder will receive daily dividend credit on his or her shares
until the check has cleared the banking system.  Investors who purchased  shares
by check may write  checks  against  those shares only after they have been on a
Fund's book for seven business days.  Shareholders who use this service may also
use  other  redemption  procedures.  No  shareholder  may write  checks  against
certificated  shares. The Funds pay the bank charges for this service.  However,
each Fund will review the cost of operation  periodically  and reserve the right
to  determine  if direct  charges to the  persons who avail  themselves  of this
service would be appropriate.  Each Fund, Scudder Service  Corporation and State
Street  Bank and  Trust  Company  reserve  the right at any time to  suspend  or
terminate the "Write-a-Check" procedure.

Other Information

         If a  shareholder  redeems all shares in the account,  the  shareholder
will  receive,  in addition to the net asset value  thereof,  all  declared  but
unpaid  dividends  thereon.  Neither  Fund imposes a  redemption  or  repurchase
charge,  although a wire charge may be applicable for redemption  proceeds wired
to an investor's  bank account.  Redemptions  of shares,  including  redemptions
undertaken  to  effect  an  exchange  for  shares  of  another  Scudder  fund or
portfolio, and including exchanges and redemptions by Write-a-Check,  may result
in tax  consequences  (gain or loss) to the shareholder and the proceeds of such
redemptions may be subject to backup withholding (see "TAXES").

         Shareholders  who wish to redeem  shares  from  Special  Plan  Accounts
should  contact  the  employer,  trustee  or  custodian  of  the  Plan  for  the
requirements.

         The  determination  of net asset value may be  suspended at times and a
shareholder's  right to redeem shares and to receive payment may be suspended at
times during which (a) during which the Exchange is closed, other than customary
weekend  and  holiday  closings,  (b) during  which  trading on the  Exchange is
restricted for any reason,  (c) during which an emergency  exists as a result of
which disposal by a Fund of securities owned by it is not reasonably practicable
or it is not reasonably  practicable for a Fund fairly to determine the value of
its net assets,  or (d) during which the SEC by order permits  suspension of the
right of redemption or a  postponement  of the date of payment or of redemption;
provided that  applicable  rules and  regulations  of the SEC (or any succeeding
governmental  authority) shall govern as to whether the conditions prescribed in
(b), (c) or (d) exist.

         Shareholders  should  maintain a share  balance  worth at least  $2,500
($1,000 for IRAs,  Uniform  Gift to Minor Act,  and  Uniform  Trust to Minor Act
accounts), which amount may be changed by each Fund's Board of Trustees. Scudder
retirement  plans  have  similar  or  lower  minimum  balance  requirements.   A
shareholder  may open an account with at least  $1,000 ($500 for an UGMA,  UTMA,
IRA and other  retirement  accounts),  if an automatic  investment plan (AIP) of
$100/month  ($50/month for an UGMA, UTMA, IRA and other retirement  accounts) is
established.

   
         SCIT reserves the right,  with regard to those investors who maintain a
non-fiduciary  account  balance  of  less  than  $2,500  in  the  Fund,  without
establishing an AIP, to assess an annual $10.00 per fund account charge with the
fee to be  reinvested  in the Fund.  SCIT also  reserves the right to waive this
fee.  The  $10.00  charge  will not apply to  accounts  of  shareholders  with a
combined  household  account  balance in any of the Scudder  Funds of $25,000 or
more.  The Fund also reserves the right,  following 60 days'  written  notice to
shareholders,  to  redeem  all  shares  in  accounts  with a value  below  $250,
including accounts of new investors, where a reduction in value has occurred due
to a redemption or exchange out of the account.  The Fund will mail the proceeds
of the redeemed account to the shareholder at the address of record.  Reductions
in value that result solely from market activity will not trigger an involuntary
redemption.  UGMA, UTMA, IRA and other retirement  accounts will not be assessed
the $10.00 charge or be subject to automatic liquidation.

         Treasury Fund shareholders who maintain a non-fiduciary account balance
of less than $2,500 in the Fund,  without  establishing an AIP, will be assessed
an annual $10.00 per fund charge with the fee to be reinvested in the Fund.  The
$10.00 charge will not apply to shareholders  with a combined  household account
balance in any of the Scudder  Funds of $25,000 or more.  The Fund  reserves the
    

                                       15
<PAGE>

   
right,  following 60 days' written notice to shareholders,  to redeem all shares
in accounts below $250,  including accounts of new investors,  where a reduction
in value has occurred due to a  redemption  or exchange out of the account.  The
Fund will mail the proceeds of the redeemed  account to the  shareholder  at the
address of record.  Reductions in value that result solely from market  activity
will not trigger an involuntary redemption. UGMA, UTMA, IRA and other retirement
accounts  will not be  assessed  the $10.00  charge or be  subject to  automatic
liquidation.
    

                   FEATURES AND SERVICES OFFERED BY THE FUNDS

             (See "Shareholder benefits" in each Fund's prospectus.)

The Pure No-Load(TM) Concept

         Investors  are  encouraged  to be aware of the  full  ramifications  of
mutual fund fee structures,  and of how Scudder distinguishes its funds from the
vast  majority of mutual  funds  available  today.  The primary  distinction  is
between load and no-load funds.

         Load funds  generally are defined as mutual funds that charge a fee for
the sale and  distribution  of fund  shares.  There  are  three  types of loads:
front-end  loads,  back-end loads,  and asset-based  12b-1 fees.  12b-1 fees are
distribution-related  fees charged  against  fund assets and are  distinct  from
service fees,  which are charged for personal  services  and/or  maintenance  of
shareholder  accounts.  Asset-based sales charges and service fees are typically
paid pursuant to distribution plans adopted under 12b-1 under the 1940 Act.

         A front-end  load is a sales  charge,  which can be as high as 8.50% of
the amount  invested.  A back-end  load is a contingent  deferred  sales charge,
which can be as high as 8.50% of either the amount  invested  or  redeemed.  The
maximum  front-end or back-end  load  varies,  and depends upon whether or not a
fund also charges a 12b-1 fee and/or a service fee or offers  investors  various
sales-related services such as dividend  reinvestment.  The maximum charge for a
12b-1 fee is 0.75% of a fund's average annual net assets, and the maximum charge
for a service fee is 0.25% of a fund's average annual net assets.

         A no-load  fund does not charge a front-end or back-end  load,  but can
charge a small 12b-1 fee and/or service fee against fund assets.  Under the NASD
Rules of Fair  Practice,  a mutual fund can call itself a "no-load" fund only if
the 12b-1 fee  and/or  service  fee does not  exceed  0.25% of a fund's  average
annual net assets.

         Because  Scudder  funds do not pay any  asset-based  sales  charges  or
service fees,  Scudder  developed and trademarked the phrase pure no-load(TM) to
distinguish Scudder funds from other no-load mutual funds. Scudder pioneered the
no-load  concept when it created the nation's  first  no-load fund in 1928,  and
later developed the nation's first family of no-load mutual funds.

         The  following  chart  shows  the  potential   long-term  advantage  of
investing  $10,000 in a Scudder pure no-load fund over investing the same amount
in a load fund that collects an 8.50%  front-end load, a load fund that collects
only a 0.75% 12b-1 and/or  service fee, and a no-load fund charging only a 0.25%
12b-1 and/or service fee. The  hypothetical  figures in the chart show the value
of an  account  assuming  a constant  10% rate of return  over the time  periods
indicated and reinvestment of dividends and distributions.
<TABLE>
<CAPTION>

- -------------------------------------------------------------------------------------------------------------------
                              Scudder                                                         No-Load Fund with
                          Pure No-Load(TM)                              Load Fund with            0.25% 12b-1 
         YEARS                Fund                 8.50% Load Fund      0.75% 12b-1 Fee               Fee
- -------------------------------------------------------------------------------------------------------------------

<S>       <C>                  <C>                    <C>                    <C>                    <C>     
          10                   $ 25,937               $ 23,733               $ 24,222               $ 25,354
- -------------------------------------------------------------------------------------------------------------------

          15                    41,772                 38,222                 37,698                 40,371
- -------------------------------------------------------------------------------------------------------------------

          20                    67,275                 61,557                 58,672                 64,282
- -------------------------------------------------------------------------------------------------------------------
</TABLE>

                                       16
<PAGE>


         Investors  are  encouraged  to review  the fee tables on page 2 of each
Fund's  prospectus  for  more  specific  information  about  the  rates at which
management fees and other expenses are assessed.

Internet Access

   
World   Wide  Web  Site  --  The   address   of  the   Scudder   Funds  site  is
http://funds.scudder.com.  The site  offers  guidance  on global  investing  and
developing  strategies to help meet financial  goals and provides  access to the
Scudder investor relations department via e-mail. The site also enables users to
access or view  fund  prospectuses  and  profiles  with  links  between  summary
information  in Profiles and details in the  Prospectus.  Users can fill out new
account forms on-line, order free software, and request literature on funds.

         The site is designed for interactivity, simplicity and maneuverability.
A  section  entitled  "Planning   Resources"   provides   information  on  asset
allocation,  tuition,  and retirement planning to users who fill out interactive
"worksheets."  Investors can easily  establish a "Personal  Page," that presents
price information,  updated daily, on funds they're interested in following. The
"Personal  Page" also offers easy  navigation  to other parts of the site.  Fund
performance  data from both  Scudder and Lipper  Analytical  Services,  Inc. are
available  on the  site.  Also  offered  on the  site is a news  feature,  which
provides timely and topical material on the Scudder Funds.

         Scudder has communicated with shareholders and other interested parties
on  Prodigy  since  1988 and has  participated  since  1994 in  GALT's  Networth
"financial  marketplace"  site on the  Internet.  The firm  made  Scudder  Funds
information available on America Online in early 1996.

Account  Access --  Scudder is among the first  mutual  fund  families  to allow
shareholders to manage their fund accounts  through the World Wide Web.  Scudder
Fund  shareholders  can view a snapshot  of  current  holdings,  review  account
activity and move assets between Scudder Fund accounts.

         Scudder's  personal  portfolio  capabilities  -- known as SEAS (Scudder
Electronic  Account  Services) -- are  accessible  only by current  Scudder Fund
shareholders  who have set up a Personal  Page on  Scudder's  Web site.  Using a
secure Web  browser,  shareholders  sign on to their  account  with their Social
Security  number and their SAIL  password.  As an additional  security  measure,
users can change their  current  password or disable  access to their  portfolio
through the World Wide Web.

         An Account Activity option reveals a financial  history of transactions
for an account,  with trade dates,  type and amount of transaction,  share price
and number of shares traded.  For users who wish to trade shares between Scudder
Funds,  the Fund Exchange option  provides a step-by-step  procedure to exchange
shares among existing fund accounts or to new Scudder Fund accounts.

         A Call MeTM  feature  enables  users to speak  with a Scudder  Investor
Relations telephone  representative while viewing their account on the Web site.
In order to use the Call MeTM feature,  an individual  must have two phone lines
and enter on the  screen the phone  number  that is not being used to connect to
the  Internet.  They  are  connected  to the  next  available  Scudder  Investor
Relations representative from 8 a.m. to 8 p.m. eastern time.
    

Dividend and Capital Gain Distribution Options

         Investors have freedom to choose whether to receive cash or to reinvest
any dividends from net investment income or distributions  from realized capital
gains in additional shares of a Fund. A change of instructions for the method of
payment  must be given to the  Transfer  Agent at  least  five  days  prior to a
dividend  record date.  Shareholders  may change their dividend option either by
calling 1-800-225-5163 or by sending written instructions to the Transfer Agent.
See "How to contact Scudder" in each Fund's  prospectus for the address.  Please
include your account number with your written request.

         Reinvestment  is usually  made on the day  following  the record  date.
Investors may leave standing  instructions  with the Transfer Agent  designating
their  option  for  either  reinvestment  or  cash  distribution  of any  income
dividends or capital gains distributions.  If no election is made, dividends and
distributions will be invested in additional shares of the relevant Fund.

                                       17
<PAGE>

         Investors  may also  have  dividends  and  distributions  automatically
deposited   to   their    predesignated    bank   account   through    Scudder's
DistributionsDirect  Program.  Shareholders  who  elect  to  participate  in the
DistributionsDirect  Program, and whose predesignated checking account of record
is with a member bank of the  Automated  Clearing  House  Network (ACH) can have
income and capital gain distributions  automatically deposited to their personal
bank  account  usually  within  three  business  days  after  a  Fund  pays  its
distribution.  A  DistributionsDirect  request  form can be  obtained by calling
1-800-225-5163.  Confirmation  statements  will be  mailed  to  shareholders  as
notification that distributions have been deposited.

   
Scudder Investor Centers
    

         Investors may visit any of the Centers  maintained by Scudder  Investor
Services,  Inc. The Centers are designed to provide  individuals  with  services
during any business day.  Investors may pick up literature or obtain  assistance
with opening an account,  adding monies or special options to existing accounts,
making exchanges within the Scudder Family of Funds, redeeming shares or opening
retirement  plans.  Checks  should  not be mailed to the  Centers  but should be
mailed to "The  Scudder  Funds" at the  address  listed  under  "How to  contact
Scudder" in the Funds' prospectuses.

Diversification

         Your  investment  represents  an  interest  in  a  large,   diversified
portfolio of carefully selected  securities.  Diversification  helps protect you
against the risks  associated  with  concentrating  in fewer  securities or in a
specific market sector.

Reports to Shareholders

         Each Fund issues to their respective  shareholders semiannual financial
statements  (audited annually by independent  accountants),  including a list of
investments held and statements of assets and liabilities,  operations,  changes
in net assets, and financial highlights for each Fund.

Transaction Summaries

         Annual summaries of all transactions in each Fund account are available
to shareholders. The summaries may be obtained by calling 1-800-225-5163.

                           THE SCUDDER FAMILY OF FUNDS

   
      (See "Investment products and services" in the Funds' prospectuses.)
    

         The Scudder  Family of Funds is America's  first family of mutual funds
and the nation's oldest family of no-load mutual funds.  To assist  investors in
choosing a Scudder fund, descriptions of the Scudder funds' objectives follow.

MONEY MARKET

   
         Scudder U.S. Treasury Money Fund seeks to provide safety, liquidity and
         stability  of capital and,  consistent  therewith,  to provide  current
         income.  The Fund seeks to maintain a constant net asset value of $1.00
         per share,  although in certain circumstances this may not be possible,
         and declares dividends daily.

         Scudder Cash Investment  Trust ("SCIT") seeks to maintain the stability
         of capital and,  consistent  therewith,  to maintain  the  liquidity of
         capital  and to  provide  current  income.  SCIT  seeks to  maintain  a
         constant  net  asset  value of $1.00 per  share,  although  in  certain
         circumstances this may not be possible, and declares dividends daily.

         Scudder Money Market Series seeks to provide  investors  with as high a
         level of current income as is consistent  with its  investment  polices
         and with  preservation  of  capital  and  liquidity.  The Fund seeks to
         maintain a constant net asset value of $1.00 per share, but there is no
         assurance  that it will be able to do so.  The  institutional  class of
         shares of this Fund is not within the Scudder Family of Funds.

    
                                       18
<PAGE>

   
         Scudder  Government Money Market Series seeks to provide investors with
         as high a level of current income as is consistent  with its investment
         polices and with preservation of capital and liquidity.  The Fund seeks
         to maintain a constant net asset value of $1.00 per share, but there is
         no assurance that it will be able to do so. The institutional  class of
         shares of this Fund is not within the Scudder Family of Funds.
    

TAX FREE MONEY MARKET

   
         Scudder Tax Free Money Fund  ("STFMF")  seeks to provide  income exempt
         from regular  federal  income tax and  stability  of principal  through
         investments primarily in municipal securities.  STFMF seeks to maintain
         a  constant  net asset  value of $1.00 per share,  although  in extreme
         circumstances this may not be possible.

         Scudder Tax Free Money Market Series seeks to provide investors with as
         high a level of current  income  that  cannot be  subjected  to federal
         income  tax  by  reason  of  federal  law  as is  consistent  with  its
         investment policies and with preservation of capital and liquidity. The
         Fund seeks to  maintain a constant  net asset value of $1.00 per share,
         but  there  is no  assurance  that  it  will  be  able  to do  so.  The
         institutional  class of shares of this Fund is not within  the  Scudder
         Family of Funds.

         Scudder  California Tax Free Money Fund* seeks stability of capital and
         the  maintenance of a constant net asset value of $1.00 per share while
         providing California taxpayers income exempt from both California State
         personal and regular federal income taxes. The Fund is a professionally
         managed  portfolio of high  quality,  short-term  California  municipal
         securities.  There can be no assurance  that the stable net asset value
         will be maintained.

         Scudder New York Tax Free Money Fund*  seeks  stability  of capital and
         the  maintenance  of a constant net while  providing New York taxpayers
         income  exempt  from New York State and New York City  personal  income
         taxes and regular  federal  income tax.  There can be no assurance that
         the stable net asset value will be maintained.

    

TAX FREE

         Scudder  Limited Term Tax Free Fund seeks to provide as high a level of
         income exempt from regular  federal income tax as is consistent  with a
         high degree of principal stability.

       

   
         Scudder  Medium  Term Tax Free Fund  seeks to  provide a high  level of
         income free from regular  federal  income taxes and to limit  principal
         fluctuation.   The  Fund   will   invest   primarily   in   high-grade,
         intermediate-term bonds.

         Scudder  Managed  Municipal  Bonds seeks to provide  income exempt from
         regular federal income tax primarily through investments in high-grade,
         long-term municipal securities.

         Scudder  High  Yield Tax Free  Fund  seeks to  provide a high  level of
         interest  income,  exempt from  regular  federal  income  tax,  from an
         actively managed  portfolio  consisting  primarily of  investment-grade
         municipal securities.

         Scudder California Tax Free Fund* seeks to provide California taxpayers
         with  income  exempt from both  California  State  personal  income and
         regular  federal  income  tax.  The  Fund is a  professionally  managed
         portfolio consisting primarily of California municipal securities.

         Scudder  Massachusetts  Limited  Term Tax Free  Fund*  seeks to provide
         Massachusetts  taxpayers  with as high a level of  income  exempt  from
         Massachusetts personal income tax and regular federal income tax, as is
         consistent   with  a  high  degree  of  price   stability,   through  a
         professionally    managed    portfolio    consisting    primarily    of
         investment-grade municipal securities.
    


- ----------------
*        These funds are not available for sale in all states.  For information,
         contact Scudder Investor Services, Inc.



                                       19
<PAGE>
   

         Scudder  Massachusetts  Tax Free Fund*  seeks to provide  Massachusetts
         taxpayers with income exempt from both  Massachusetts  personal  income
         tax and  regular  federal  income  tax.  The  Fund is a  professionally
         managed portfolio  consisting  primarily of investment-grade  municipal
         securities.

         Scudder  New York Tax Free Fund*  seeks to provide  New York  taxpayers
         with  income  exempt  from New York  State and New York  City  personal
         income   taxes  and  regular   federal   income  tax.  The  Fund  is  a
         professionally  managed  portfolio  consisting  primarily  of New  York
         municipal securities.

         Scudder Ohio Tax Free Fund* seeks to provide Ohio taxpayers with income
         exempt from both Ohio personal  income tax and regular  federal  income
         tax.  The  Fund  is  a  professionally   managed  portfolio  consisting
         primarily of investment-grade municipal securities.

         Scudder  Pennsylvania  Tax Free  Fund*  seeks to  provide  Pennsylvania
         taxpayers with income exempt from both Pennsylvania personal income tax
         and regular  federal income tax. The Fund is a  professionally  managed
         portfolio   consisting   primarily   of   investment-grade    municipal
         securities.
    

U.S. INCOME

   
         Scudder  Short  Term Bond Fund  seeks to provide a high level of income
         consistent  with a high  degree of  principal  stability  by  investing
         primarily in high quality short-term bonds.

         Scudder  Zero Coupon  2000 Fund seeks to provide as high an  investment
         return over a selected  period as is consistent with investment in U.S.
         Government securities and the minimization of reinvestment risk.

         Scudder GNMA Fund seeks to provide high current  income  primarily from
         U.S. Government guaranteed mortgage-backed (Ginnie Mae) securities.

         Scudder Income Fund seeks a high level of income,  consistent  with the
         prudent  investment of capital,  through a flexible  investment program
         emphasizing high-grade bonds.

         Scudder High Yield Bond Fund seeks a high level of current  income and,
         secondarily, capital appreciation through investment primarily in below
         investment-grade domestic debt securities.
    

GLOBAL INCOME

   
         Scudder Global Bond Fund seeks to provide total return with an emphasis
         on  current   income  by  investing   primarily  in  high-grade   bonds
         denominated in foreign  currencies and the U.S. dollar.  As a secondary
         objective, the Fund will seek capital appreciation.

         Scudder  International  Bond Fund seeks to provide income  primarily by
         investing in a managed portfolio of high-grade  international bonds. As
         a  secondary   objective,   the  Fund  seeks  protection  and  possible
         enhancement  of principal  value by actively  managing  currency,  bond
         market and maturity exposure and by security selection.

         Scudder  Emerging  Markets  Income Fund seeks to provide  high  current
         income  and,   secondarily,   long-term  capital  appreciation  through
         investments  primarily  in  high-yielding  debt  securities  issued  by
         governments and corporations in emerging markets.
    

ASSET ALLOCATION

   
         Scudder Pathway Series:  Conservative Portfolio seeks primarily current
         income and secondarily  long-term growth of capital.  In pursuing these
         objectives, the Portfolio, under normal market conditions,  will invest
         substantially  in a select mix of Scudder bond mutual  funds,  but will
         have some exposure to Scudder equity mutual funds.
    


- ----------------
*        These funds are not available for sale in all states.  For information,
         contact Scudder Investor Services, Inc.


                                       20
<PAGE>


   
         Scudder Pathway Series:  Balanced  Portfolio seeks to provide investors
         with a balance  of growth and  income by  investing  in a select mix of
         Scudder money market, bond and equity mutual funds.

         Scudder Pathway  Series:  Growth  Portfolio seeks to provide  investors
         with  long-term  growth of capital.  In pursuing  this  objective,  the
         Portfolio will, under normal market conditions, invest predominantly in
         a select  mix of  Scudder  equity  mutual  funds  designed  to  provide
         long-term growth.

         Scudder  Pathway  Series:  International  Portfolio seeks maximum total
         return for investors. Total return consists of any capital appreciation
         plus  dividend  income and  interest.  To achieve this  objective,  the
         Portfolio  invests in a select  mix of  established  international  and
         global Scudder funds.

U.S. GROWTH AND INCOME
         Scudder  Balanced  Fund seeks a balance  of growth  and  income  from a
         diversified portfolio of equity and fixed-income  securities.  The Fund
         also seeks long-term preservation of capital through a quality-oriented
         approach that is designed to reduce risk.

         Scudder  Growth and  Income  Fund seeks  long-term  growth of  capital,
         current income, and growth of income.

         Scudder S&P 500 Index Fund seeks to provide  investment  results  that,
         before  expenses,  correspond  to the total  return  of  common  stocks
         publicly traded in the United States,  as represented by the Standard &
         Poor's 500 Composite Stock Price Index.

U.S. GROWTH

     Value

         Scudder Large Company  Value Fund seeks to maximize  long-term  capital
         appreciation through a value-driven investment program.

         Scudder Value Fund seeks long-term growth of capital through investment
         in undervalued equity securities.

         Scudder  Small  Company  Value Fund  invests  for  long-term  growth of
         capital by seeking out undervalued stocks of small U.S. companies.

         Scudder Micro Cap Fund seeks  long-term  growth of capital by investing
         primarily  in a  diversified  portfolio  of  U.S.  micro-capitalization
         ("micro-cap") common stocks.

     Growth

         Scudder  Classic  Growth  Fund  seeks to  provide  long-term  growth of
         capital  and to keep the value of its  shares  more  stable  than other
         growth mutual funds.

         Scudder Large Company Growth Fund seeks to provide  long-term growth of
         capital  through  investment  primarily  in the  equity  securities  of
         seasoned, financially strong U.S. growth companies.

         Scudder Development Fund seeks long-term growth of capital by investing
         primarily in securities of small and medium-size growth companies.

         Scudder 21st Century Growth Fund seeks  long-term  growth of capital by
         investing  primarily in the  securities  of emerging  growth  companies
         poised to be leaders in the 21st century.
    

                                       21
<PAGE>

   
GLOBAL GROWTH

     Worldwide

         Scudder  Global  Fund  seeks  long-term  growth  of  capital  through a
         diversified  portfolio  of  marketable  securities,   primarily  equity
         securities,   including  common  stocks,   preferred  stocks  and  debt
         securities convertible into common stocks.

         Scudder  International Growth and Income Fund seeks long-term growth of
         capital and current income primarily from foreign equity securities.

         Scudder  International Fund seeks long-term growth of capital primarily
         through  a   diversified   portfolio  of  marketable   foreign   equity
         securities.

         Scudder Global Discovery Fund seeks above-average  capital appreciation
         over the long term by investing  primarily in the equity  securities of
         small companies located throughout the world.

         Scudder  Emerging Markets Growth Fund seeks long-term growth of capital
         primarily  through  equity  investment in emerging  markets  around the
         globe.
    
         Scudder Gold Fund seeks maximum  return  (principal  change and income)
         consistent  with  investing  in  a  portfolio  of  gold-related  equity
         securities and gold.

     Regional

         Scudder  Greater Europe Growth Fund seeks  long-term  growth of capital
         through  investments  primarily  in the equity  securities  of European
         companies.

   
         Scudder Pacific  Opportunities  Fund seeks long-term  growth of capital
         through investment  primarily in the equity securities of Pacific Basin
         companies, excluding Japan.
    

         Scudder  Latin  America  Fund  seeks  to  provide   long-term   capital
         appreciation  through  investment  primarily in the securities of Latin
         American issuers.

       

   
         The Japan Fund, Inc. seeks long-term capital  appreciation by investing
         primarily in equity securities (including American Depository Receipts)
         of Japanese companies.

         The net asset  values of most  Scudder  funds can be found daily in the
"Mutual Funds" section of The Wall Street Journal under "Scudder  Funds," and in
other leading newspapers  throughout the country.  Investors will notice the net
asset value and offering  price are the same,  reflecting the fact that no sales
commission or "load" is charged on the sale of shares of the Scudder funds.  The
latest seven-day yields for the money-market funds can be found every Monday and
Thursday in the  "Money-Market  Funds" section of The Wall Street Journal.  This
information  also may be obtained by calling the Scudder  Automated  Information
Line (SAIL) at 1-800-343-2890.

         The Scudder  Family of Funds  offers many  conveniences  and  services,
including:  active  professional  investment  management;  broad and diversified
investment  portfolios;  pure no-load funds with no  commissions  to purchase or
redeem  shares or Rule 12b-1  distribution  fees;  individual  attention  from a
service  representative  of  Scudder  Investor  Relations;  and  easy  telephone
exchanges into other Scudder funds.  Certain  Scudder funds may not be available
for purchase or exchange. For more information, please call 1-800-225-5163.
    

                                       22
<PAGE>

   
                              SPECIAL PLAN ACCOUNTS

         (See "Scudder tax-advantaged retirement plans," "Purchases--By
          Automatic Investment Plan" and "Exchanges and redemptions--By
             Automatic Withdrawal Plan" in each Fund's prospectus.)
    

         Detailed  information  on any Scudder  investment  plan,  including the
applicable  charges,   minimum  investment  requirements  and  disclosures  made
pursuant to Internal Revenue Service (the "IRS")  requirements,  may be obtained
by contacting Scudder Investor Services,  Inc., Two International Place, Boston,
Massachusetts  02110-4103  or  by  calling  toll  free,  1-800-225-2470.  It  is
advisable  for an  investor  considering  the  funding of the  investment  plans
described  below to consult with an attorney or other  investment or tax adviser
with respect to the suitability requirements and tax aspects thereof.

   
         Shares of the Funds may also be a  permitted  investment  under  profit
sharing  and  pension  plans and IRA's  other than  those  offered by the Funds'
distributor depending on the provisions of the relevant plan or IRA.
    

         None of the plans  assures a profit or  guarantees  protection  against
depreciation, especially in declining markets.

   
Scudder Retirement Plans:  Profit-Sharing and Money Purchase
Pension Plans for Corporations and Self-Employed Individuals

         Shares of the Funds may be purchased as the  investment  medium under a
plan in the form of a Scudder  Profit-Sharing  Plan  (including a version of the
Plan which  includes a  cash-or-deferred  feature) or a Scudder  Money  Purchase
Pension Plan (jointly referred to as the Scudder  Retirement Plans) adopted by a
corporation,  a self-employed individual or a group of self-employed individuals
(including  sole   proprietorships   and  partnerships),   or  other  qualifying
organization.  Each of these forms was approved by the IRS as a  prototype.  The
IRS's  approval  of an  employer's  plan under  Section  401(a) of the  Internal
Revenue Code will be greatly  facilitated if it is in such approved form.  Under
certain  circumstances,  the IRS will assume that a plan,  adopted in this form,
after special notice to any employees,  meets the requirements of Section 401(a)
of the Internal Revenue Code.

Scudder 401(k): Cash or Deferred Profit-Sharing Plan
for Corporations and Self-Employed Individuals

         Shares of the Funds may be purchased as the  investment  medium under a
plan  in  the  form  of a  Scudder  401(k)  Plan  adopted  by a  corporation,  a
self-employed individual or a group of self-employed individuals (including sole
proprietors and partnerships),  or other qualifying organization.  This plan has
been approved as a prototype by the IRS.

Scudder IRA:  Individual Retirement Account

         Shares of the Funds may be purchased as the  underlying  investment for
an Individual  Retirement Account which meets the requirements of Section 408(a)
of the Internal Revenue Code.
    

         A  single   individual   who  is  not  an  active   participant  in  an
employer-maintained  retirement  plan, a simplified  employee pension plan, or a
tax-deferred  annuity program (a "qualified plan"), and a married individual who
is not an active participant in a qualified plan and whose spouse is also not an
active  participant  in a qualified  plan,  are eligible to make tax  deductible
contributions  of up to  $2,000  to an IRA  prior  to the year  such  individual
attains age 70 1/2. In addition, certain individuals who are active participants
in qualified  plans (or who have spouses who are active  participants)  are also
eligible to make  tax-deductible  contributions to an IRA; the annual amount, if
any, of the  contribution  which such an  individual  will be eligible to deduct
will be determined by the amount of his, her, or their adjusted gross income for
the year. Whenever the adjusted gross income limitation  prohibits an individual
from   contributing   what  would   otherwise  be  the  maximum   tax-deductible
contribution he or she could make, the individual will be eligible to contribute
the difference to an IRA in the form of nondeductible contributions.

         An eligible  individual  may  contribute as much as $2,000 of qualified
income (earned income or, under certain  circumstances,  alimony) to an IRA each
year (up to $2,000 per  individual  for  married  couples if only one spouse has

                                       23
<PAGE>

earned  income).  All income and capital gains derived from IRA  investments are
reinvested  and  compound  tax-deferred  until  distributed.  Such  tax-deferred
compounding can lead to substantial retirement savings.

         The table below shows how much individuals  would accumulate in a fully
tax-deductible  IRA by age 65  (before  any  distributions)  if they  contribute
$2,000 at the beginning of each year,  assuming average annual returns of 5, 10,
and 15%. (At withdrawal, accumulations in this table will be taxable.)

   
<TABLE>
<CAPTION>

                             Value of IRA at Age 65
                 Assuming $2,000 Deductible Annual Contribution

- -----------------------------------------------------------------------------------------------------------
         Starting                                           Annual Rate of Return
          Age of             ------------------------------------------------------------------------------
       Contributions                    5%                        10%                       15%
- -----------------------------------------------------------------------------------------------------------
<S>         <C>                     <C>                        <C>                     <C>       
            25                      $253,680                   $973,704                $4,091,908
            35                       139,522                    361,887                   999,914
            45                        69,439                    126,005                   235,620
            55                        26,414                     35,062                    46,699
</TABLE>
    

         This next table shows how much individuals  would accumulate in non-IRA
accounts  by age 65 if they start  with  $2,000 in pretax  earned  income at the
beginning of each year (which is $1,380 after taxes are paid),  assuming average
annual returns of 5, 10 and 15%. (At withdrawal,  a portion of the  accumulation
in this table will be taxable.)

   
<TABLE>
<CAPTION>

                          Value of a Non-IRA Account at
                   Age 65 Assuming $1,380 Annual Contributions
                 (post tax, $2,000 pretax) and a 31% Tax Bracket

- -----------------------------------------------------------------------------------------------------------
         Starting                                           Annual Rate of Return
          Age of             ------------------------------------------------------------------------------
       Contributions                    5%                        10%                       15%
- -----------------------------------------------------------------------------------------------------------
<S>         <C>                     <C>                        <C>                     <C>       
            25                      $119,318                   $287,021                  $741,431
            35                        73,094                    136,868                   267,697
            45                        40,166                     59,821                    90,764
            55                        16,709                     20,286                    24,681
</TABLE>

Scudder 403(b) Plan

         Shares of the Funds may also be purchased as the underlying  investment
for tax sheltered annuity plans under the provisions of Section 403(b)(7) of the
Internal  Revenue  Code.  In  general,  employees  of  tax-exempt  organizations
described in Section  501(c)(3) of the Internal Revenue Code (such as hospitals,
churches,  religious,  scientific,  or literary  organizations  and  educational
institutions)  or a public school system are eligible to participate in a 403(b)
plan.

Automatic Withdrawal Plan

         Non-retirement plan shareholders may establish an Automatic  Withdrawal
Plan to receive  monthly,  quarterly  or  periodic  redemptions  from his or her
account for any designated amount of $50 or more.  Shareholders may designate on
which day they want the automatic withdrawal to be processed.  The check amounts
may be based on the  redemption  of a fixed dollar  amount,  fixed share amount,
percent of account  value or  declining  balance.  The Plan  provides for income
dividends  and  capital  gains  distributions,  if  any,  to  be  reinvested  in
additional  shares.  Shares are then  liquidated  as  necessary  to provide  for
withdrawal  payments.  Since the  withdrawals  are in  amounts  selected  by the
investor and have no relationship to yield or income,  payments  received cannot
be  considered  as  yield  or  income  on  the   investment  and  the  resulting
liquidations may deplete or possibly  extinguish the initial  investment and any
reinvested dividends and capital gains distributions.  Requests for increases in
withdrawal  amounts or to change the payee must be submitted in writing,  signed
exactly as the account is  registered,  and contain  signature  guarantee(s)  as
described   under    "Transaction    information--Redeeming    shares--Signature
guarantees" in each Fund's prospectus. Any such requests must be received by the
Funds'  transfer  agent  ten  days  prior  to the  date of the  first  automatic
withdrawal.  An Automatic  Withdrawal  Plan may be terminated at any time by the
    

                                       24
<PAGE>

   
shareholder,  the respective Trust, or its agent on written notice,  and will be
terminated when all shares of a Fund under the Plan have been liquidated or upon
receipt by the respective Trust of notice of death of the shareholder.
    

         An  Automatic  Withdrawal  Plan request form can be obtained by calling
1-800-225-5163.

Group or Salary Deduction Plan

   
         An  investor  may  join  a  Group  or  Salary   Deduction   Plan  where
satisfactory  arrangements have been made with Scudder Investor  Services,  Inc.
for forwarding regular  investments  through a single source. The minimum annual
investment  is $240  per  investor  which  may be made  in  monthly,  quarterly,
semiannual or annual payments.  The minimum monthly deposit per investor is $20.
Except for trustees or custodian fees for certain  retirement  plans, at present
there is no separate charge for  maintaining  group or salary  deduction  plans;
however,  each Trust and its agents reserve the right to establish a maintenance
charge in the future depending on the services required by the investor.

         Each  Trust  reserves  the  right,  after  notice has been given to the
shareholder,  to redeem and close a shareholder's  account in the event that the
shareholder ceases participating in the group plan prior to investment of $1,000
per  individual  or in the  event  of a  redemption  which  occurs  prior to the
accumulation  of that amount or which  reduces  the  account  value to less than
$1,000 and the account value is not increased to $1,000 within a reasonable time
after  notification.  An investor in a plan who has not purchased shares for six
months shall be presumed to have stopped making payments under the plan.

Automatic Investment Plan
    

         Shareholders may arrange to make periodic investments through automatic
deductions  from  checking  accounts  by  completing  the  appropriate  form and
providing the necessary  documentation  to establish  this service.  The minimum
investment is $50.

         The Automatic  Investment  Plan involves an investment  strategy called
dollar cost averaging.  Dollar cost averaging is a method of investing whereby a
specific dollar amount is invested at regular  intervals.  By investing the same
dollar amount each period, when shares are priced low the investor will purchase
more  shares  than when the share  price is  higher.  Over a period of time this
investment  approach may allow the  investor to reduce the average  price of the
shares purchased.  However, this investment approach does not assure a profit or
protect  against loss. This type of regular  investment  program may be suitable
for various  investment  goals such as, but not limited to, college  planning or
saving for a home.

Uniform Transfers/Gifts to Minors Act

         Grandparents, parents or other donors may set up custodian accounts for
minors.  The minimum  initial  investment  is $1,000  unless the donor agrees to
continue to make  regular  share  purchases  for the account  through  Scudder's
Automatic Investment Plan (AIP). In this case, the minimum initial investment is
$500.

   
         Each  Trust  reserves  the  right,  after  notice has been given to the
shareholder and custodian,  to redeem and close a  shareholder's  account in the
event that regular investments to the account cease before the $1,000 minimum is
reached.
    

                                    DIVIDENDS

                       (See "Distribution and performance
                    information--Dividends and capital gains
                   distributions" in each Fund's prospectus.)

         The net  income of each Fund is  determined  as of the close of regular
trading on the Exchange, usually 4 p.m. eastern time on each day the Exchange is
open for trading.

   
         All the net investment income and all net realized  short-term  capital
gains and net realized short and long-term  capital losses of SCIT so determined
normally  will be  declared  as a  dividend  to  shareholders  of  record  as of
determination  of the net  asset  value at 12:00  noon  after the  purchase  and
redemption of shares.  Any losses may be included in the daily dividend for such
    

                                       25
<PAGE>

   
number of days as is  deemed  appropriate  in order to avoid a  disproportionate
impact on holders of shares of beneficial interest of the Fund on any one day on
which a dividend is  declared.  All the net  investment  income and all realized
capital  gains and losses on  securities  held for one year or less  (short-term
capital gain/loss) of Treasury Fund so determined normally will be declared as a
dividend to shareholders of record as of determination of the net asset value at
twelve  o'clock  noon  after the  purchase  and  redemption  of  shares.  Shares
purchased  as of the  determination  of net asset  value made as of the  regular
close of the Exchange will not participate in that day's dividend; in such cases
dividends  commence  on  the  next  business  day.  Checks  will  be  mailed  to
shareholders  electing to take  dividends  in cash,  and  confirmations  will be
mailed to shareholders electing to invest dividends in additional shares for the
month's  dividends  within four business days after the dividend is  calculated.
Dividends  will be invested at the net asset  value per share,  normally  $l.00,
determined  as of the  close of  regular  trading  on the  Exchange  on the last
business day of each month.
    

         Dividends are declared  daily on each day on which the Exchange is open
for business.  The dividends for a business day immediately  preceding a weekend
or  holiday  will  normally  include  an amount  equal to the net income for the
subsequent days on which dividends are not declared.  However, no daily dividend
will  include  any amount of net  investment  income in respect of a  subsequent
semiannual accounting period.

         Net  investment  income  (from  the time of the  immediately  preceding
determination  thereof) consists of all interest income accrued on the portfolio
assets of a Fund, less all actual and accrued expenses. Interest income included
in the daily computation of net investment income is comprised of original issue
discount  earned on  discount  paper  accrued to the date of maturity as well as
accrued interest. Expenses of each Fund, including the management fee payable to
the Adviser, are accrued each day.

         Normally,  each Fund will have a positive net investment  income at the
time of each determination  thereof. Net investment income may be negative if an
unexpected  liability must be accrued or a loss realized.  If the net investment
income of a Fund  determined  at any time is a  negative  amount,  the net asset
value per share will be reduced  below $l.00 unless one or more of the following
steps are taken:  the Trustees  have the  authority  (1) to reduce the number of
shares in each shareholder's  account, (2) to offset each shareholder's pro rata
portion  of  negative  net  investment  income  from the  shareholder's  accrued
dividend  account or from future  dividends,  or (3) to combine these methods in
order to seek to maintain the net asset value per share at $1.00.  Each Fund may
endeavor  to  restore  the net asset  value per share to $l.00 by not  declaring
dividends from net investment income on subsequent days until restoration,  with
the result  that the net asset  value per share will  increase  to the extent of
positive net investment income which is not declared as a dividend.

         Because  the net  investment  income  of each  Fund  is  declared  as a
dividend each time the net investment income of the Fund is determined,  the net
asset  value per share of each Fund  (i.e.,  the fair value of the net assets of
the Fund divided by the number of shares of the Fund outstanding) will remain at
$l.00  per  share  immediately  after  each  such   determination  and  dividend
declaration, unless (i) there are unusual or extended fluctuations in short-term
interest   rates  or  other  factors,   such  as  unfavorable   changes  in  the
creditworthiness  of issuers  affecting  the value of  securities  in the Fund's
portfolio, or (ii) net income is a negative amount.

         Should a Fund incur or anticipate any unusual or unexpected significant
expense or loss which would affect  disproportionately  that Fund's income for a
particular period, the Trustees would at that time consider whether to adhere to
the  dividend  policy  described  above or to revise it in the light of the then
prevailing  circumstances  in order to  ameliorate  to the extent  possible  the
disproportionate  effect of such expense,  loss or depreciation on then existing
shareholders. Such expenses or losses may nevertheless result in a shareholder's
receiving  no dividends  for the period  during which the shares are held and in
receiving upon redemption a price per share lower than that which was paid.

         Neither Fund anticipates realizing any long-term capital gains.

                             PERFORMANCE INFORMATION

           (See "Distribution and performance information--Performance
                    information" in each Fund's prospectus.)

         From  time to  time,  quotations  of  each  Fund's  performance  may be
included in  advertisements,  sales  literature  or reports to  shareholders  or
prospective  investors.  These  performance  figures  may be  calculated  in the
following manner:

                                       26
<PAGE>


Yield

   
         Yield is the net annualized  yield based on a specified 7 calendar days
calculated at simple interest rates.  Yield is calculated by determining the net
change,   exclusive  of  capital  changes,   in  the  value  of  a  hypothetical
pre-existing  account  having a  balance  of one share at the  beginning  of the
period, and dividing the difference by the value of the account at the beginning
of the base period to obtain the base period return.  The yield is annualized by
multiplying  the base period return by 365/7.  The yield figure is stated to the
nearest hundredth of one percent.  The yield for the seven-day period ended June
30, 1997 was 4.75% for SCIT and 4.50% for  Treasury  Fund.  If  Treasury  Fund's
Adviser had not absorbed a portion of the Fund's expenses and had imposed a full
management  fee, the Fund's yield for the  seven-day  period ended June 30, 1997
would have been 4.15%.
    

Effective Yield

         Effective yield is the net annualized  yield for a specified 7 calendar
days assuming a reinvestment  of the income or  compounding.  Effective yield is
calculated  by the same method as yield  except the  effective  yield  figure is
compounded  by adding 1,  raising  the sum to a power equal to 365 divided by 7,
and subtracting 1 from the result, according to the following formula:

             Effective yield = [(Base Period Return + 1)^365/7] - 1.

   
         The effective  yield for the  seven-day  period ended June 30, 1997 was
4.86% for SCIT and 4.60% for Treasury Fund. If SCIT's Adviser had not absorbed a
portion of the Fund's expenses and had imposed a full management fee, the Fund's
yield for the  seven-day  period  ended June 30, 1997 would have been 4.60%.  If
Treasury  Fund's  Adviser had not absorbed a portion of the Fund's  expenses and
had imposed a full  management  fee, the Fund's yield for the  seven-day  period
ended June 30, 1997 would have been 4.25%.
    

         Quotations of each Fund's performance are based on historical  earnings
and are not intended to indicate future  performance.  An investor's shares when
redeemed may be worth more or less than their original cost.  Performance of the
Fund will vary  based on  changes  in  market  conditions  and the level of each
Fund's expenses.

Average Annual Total Return

         Average  annual total  return is the average  annual  compound  rate of
return for the periods of one year,  five years and ten years,  all ended on the
last day of a recent calendar  quarter.  Average annual total return  quotations
reflect  changes in the price of a Fund's  shares,  if any,  and assume that all
dividends and capital gains  distributions  during the  respective  periods were
reinvested in Fund shares.  Average annual total return is calculated by finding
the average annual  compound rates of return of a hypothetical  investment  over
such periods, according to the following formula (average annual total return is
then expressed as a percentage):

                               T = (ERV/P)1/n - 1
         Where:

                  P        =        a hypothetical initial investment of $1,000
                  T        =        Average Annual Total Return
                  n        =        number of years
                  ERV      =        ending  redeemable  value: ERV is the value,
                                    at the end of the  applicable  period,  of a
                                    hypothetical  $1,000  investment made at the
                                    beginning of the applicable period. 
                        

                                       27
<PAGE>


   
           Average Annual Total Return for periods ended June 30, 1997
    

                        One         Five         Ten
                        Year        Years       Years
                        ----        -----       -----

   
SCIT*                4.73%          4.00%       5.51%
Treasury Fund**      4.58%          3.93%       5.18%
    

         *        If the Adviser had not absorbed a portion of SCIT expenses and
                  had imposed a full  management  fee, the average  annual total
                  return for the one year,  five year and ten year periods ended
                  June 30, 1997, would have been lower.

   
         **       If the  Adviser had not  absorbed a portion of  Treasury  Fund
                  expenses  and had imposed a full  management  fee, the average
                  annual total  return for the one year,  five year and ten year
                  periods  ended June 30,  1997,  would have been  approximately
                  4.29%, 3.68% and 5.02%.
    

Cumulative Total Return

         Cumulative  Total  Return  is  the  cumulative  rate  of  return  on  a
hypothetical  initial  investment of $1,000 for a specified  period.  Cumulative
total return  quotations  reflect the change in the price of a Fund's shares and
assume that all dividends and capital gains distributions during the period were
reinvested in Fund shares.  Cumulative total return is calculated by finding the
cumulative  rates of  return of a  hypothetical  investment  over such  periods,
according to the following formula (cumulative total return is then expressed as
a percentage):

                                  C = (ERV/P)-1
         Where:

                  C        =        Cumulative Total Return
                  P        =        a hypothetical initial investment of $1,000
                  ERV      =        ending  redeemable  value: ERV is the value,
                                    at the end of the  applicable  period,  of a
                                    hypothetical  $1,000  investment made at the
                                    beginning of the applicable period. 
   
             Cumulative Total Return for periods ended June 30, 1997
    

                        One         Five         Ten
                        Year        Years       Years
                        ----        -----       -----

   
SCIT*                  4.73%       21.69%       70.94%
Treasury Fund**        4.58%       21.25%       65.73%
    

         *        If the Adviser had not  absorbed a portion of SCIT's  expenses
                  and had imposed a full  management  fee, the cumulative  total
                  return for the one year,  five year and ten year periods ended
                  June 30, 1997, would have been lower.

   
         **       If the Adviser had not  absorbed a portion of Treasury  Fund's
                  expenses and had imposed a full management fee, the cumulative
                  total return for the one year,  five year and ten year periods
                  ended  June 30,  1997,  would have been  approximately  4.23%,
                  20.90% and 65.08%.
    

Total Return

         Total  return is the rate of return on an  investment  for a  specified
period of time calculated in the manner as cumulative total return.

                                       28
<PAGE>

         Quotations  of  the  Funds'   performance  are  historical,   show  the
performance of a hypothetical investment and are not intended to indicate future
performance.  Average annual total return, cumulative total return and yield for
a Fund will vary  based on changes  in market  conditions  and the level of each
Fund's  expenses.  An investor's  shares when redeemed may be worth more or less
than their original cost.

         Investors  should  be aware  that  the  principal  of each  Fund is not
insured.

Comparison of Fund Performance

         A comparison of the quoted non-standard performance offered for various
investments is valid only if performance is calculated in the same manner. Since
there  are  different  methods  of  calculating  performance,  investors  should
consider the effects of the methods used to calculate performance when comparing
performance of a Fund with  performance  quoted with respect to other investment
companies or types of investments.

   
         In  connection  with   communicating  its  performance  to  current  or
prospective  shareholders,  a  Fund  also  may  compare  these  figures  to  the
performance of unmanaged  indices which may assume  reinvestment of dividends or
interest  but  generally  do  not  reflect  deductions  for  administrative  and
management  costs.  Examples  include,  but are  not  limited  to the Dow  Jones
Industrial  Average,  the Consumer Price Index,  Standard & Poor's 500 Composite
Stock  Price  Index  (S&P  500),  the Nasdaq  OTC  Composite  Index,  the Nasdaq
Industrials Index, the Russell 2000 Index, and statistics published by the Small
Business Administration.
    

         From time to time, in advertising  and marketing  literature,  a Fund's
performance  may be compared to the  performance of broad groups of mutual funds
with similar investment goals, as tracked by independent  organizations such as,
Investment  Company  Data,  Inc.  ("ICD"),   Lipper  Analytical  Services,  Inc.
("Lipper"), CDA Investment Technologies,  Inc. ("CDA"), Morningstar, Inc., Value
Line  Mutual  Fund  Survey  and  other  independent  organizations.  When  these
organizations'  tracking  results  are  used,  a Fund  will be  compared  to the
appropriate fund category, that is, by fund objective and portfolio holdings, or
to the  appropriate  volatility  grouping,  where  volatility  is a measure of a
fund's risk.  For instance,  a Scudder  growth fund will be compared to funds in
the growth fund category; a Scudder income fund will be compared to funds in the
income fund  category;  and so on. Scudder funds (except for money market funds)
may also be compared to funds with similar volatility, as measured statistically
by independent organizations.

   
         From time to time, in marketing and other Fund literature, Trustees and
officers  of the  Funds,  the  Funds'  portfolio  managers,  or  members  of the
portfolio  management  team may be depicted and quoted to give  prospective  and
current  shareholders  a better  sense of the outlook and  approach of those who
manage the Funds.  In addition,  the amount of assets that the Adviser has under
management  in  various  geographical  areas may be quoted  in  advertising  and
marketing materials.
    

         The Funds  may be  advertised  as an  investment  choice  in  Scudder's
college planning program. The description may contain illustrations of projected
future  college  costs  based on assumed  rates of  inflation  and  examples  of
hypothetical fund performance, calculated as described above.

         Statistical and other  information,  as provided by the Social Security
Administration,  may be used in marketing  materials  pertaining  to  retirement
planning  in order to  estimate  future  payouts  of social  security  benefits.
Estimates may be used on demographic and economic data.

         Marketing and other Fund  literature  may include a description  of the
potential  risks and rewards  associated  with an investment  in the Funds.  The
description  may include a  "risk/return  spectrum"  which compares the Funds to
other Scudder funds or broad categories of funds, such as money market,  bond or
equity funds,  in terms of potential  risks and returns.  Money market funds are
designed to maintain a constant $1.00 share price and have a fluctuating  yield.
Share  price,  yield and total return of a bond fund will  fluctuate.  The share
price and return of an equity fund also will fluctuate. The description may also
compare the Funds to bank  products,  such as  certificates  of deposit.  Unlike
mutual  funds,  certificates  of deposit  are insured up to $100,000 by the U.S.
government and offer a fixed rate of return.

         Because bank products  guarantee  the principal  value of an investment
and money  market funds seek  stability  of  principal,  these  investments  are
considered  to be less risky than  investments  in either bond or equity  funds,
which may involve the loss of principal.  However,  all  long-term  investments,
including investments in bank products,  may be subject to inflation risk, which
is the risk of erosion of the value of an investment  as prices  increase over a

                                       29
<PAGE>

long time period.  The  risks/returns  associated  with an investment in bond or
equity funds depend upon many factors. For bond funds these factors include, but
are not limited to, a fund's overall investment objective, the average portfolio
maturity,  credit quality of the securities  held, and interest rate  movements.
For equity funds,  factors include a fund's overall  investment  objective,  the
types of equity securities held and the financial position of the issuers of the
securities.  The  risks/returns  associated with an investment in  international
bond or equity funds also will depend upon currency exchange rate fluctuation.

         A risk/return  spectrum  generally will position the various investment
categories in the following order: bank products, money market funds, bond funds
and equity funds.  Shorter-term  bond funds  generally are considered less risky
and offer the potential for less return than longer-term bond funds. The same is
true of domestic bond funds relative to international bond funds, and bond funds
that purchase  higher  quality  securities  relative to bond funds that purchase
lower  quality  securities.   Growth  and  income  equity  funds  are  generally
considered  to be less risky and offer the potential for less return than growth
funds. In addition, international equity funds usually are considered more risky
than domestic equity funds but generally offer the potential for greater return.

         Risk/return  spectrums  also  may  depict  funds  that  invest  in both
domestic and foreign securities or a combination of bond and equity securities.
       

         Evaluation  of  Fund   performance   or  other   relevant   statistical
information  made by  independent  sources  may  also be used in  advertisements
concerning the Funds,  including reprints of, or selections from,  editorials or
articles  about  these  Funds.  Sources  for Fund  performance  information  and
articles about the Funds include the following:

American Association of Individual  Investors' Journal, a monthly publication of
the AAII that includes articles on investment analysis techniques.

Asian Wall Street  Journal,  a weekly Asian  newspaper  that often  reviews U.S.
mutual funds investing internationally.

Banxquote,  an on-line source of national  averages for leading money market and
bank CD interest  rates,  published  on a weekly  basis by  Masterfund,  Inc. of
Wilmington, Delaware.

Barron's,  a Dow Jones and  Company,  Inc.  business and  financial  weekly that
periodically reviews mutual fund performance data.

Business  Week,  a  national  business  weekly  that  periodically  reports  the
performance rankings and ratings of a variety of mutual funds investing abroad.

CDA Investment  Technologies,  Inc., an organization which provides  performance
and ranking  information  through  examining the dollar results of  hypothetical
mutual fund investments and comparing these results against  appropriate  market
indices.

Consumer  Digest, a monthly  business/financial  magazine that includes a "Money
Watch" section featuring financial news.

Financial Times,  Europe's business newspaper,  which features from time to time
articles on international or country-specific funds.

Financial World, a general  business/financial  magazine that includes a "Market
Watch" department reporting on activities in the mutual fund industry.

Forbes,  a national  business  publication  that from time to time  reports  the
performance of specific investment companies in the mutual fund industry.

Fortune, a national business publication that periodically rates the performance
of a variety of mutual funds.

                                       30
<PAGE>

The  Frank  Russell  Company,  a  West-Coast  investment  management  firm  that
periodically  evaluates  international stock markets and compares foreign equity
market performance to U.S. stock market performance.

Global  Investor,   a  European   publication  that  periodically   reviews  the
performance of U.S. mutual funds investing internationally.

IBC Money  Fund  Report,  a weekly  publication  of IBC  Financial  Data,  Inc.,
reporting on the  performance  of the nation's  money market funds,  summarizing
money  market fund  activity  and  including  certain  averages  as  performance
benchmarks, specifically "IBC's Money Fund Average," and "IBC's Government Money
Fund Average."

Ibbotson  Associates,  Inc., a company  specializing in investment  research and
data.

Investment  Company  Data,  Inc., an  independent  organization  which  provides
performance ranking information for broad classes of mutual funds.

Investor's Business Daily, a daily newspaper that features financial,  economic,
and business news.

Kiplinger's Personal Finance Magazine, a monthly investment advisory publication
that periodically features the performance of a variety of securities.

Lipper Analytical  Services,  Inc.'s Mutual Fund Performance  Analysis, a weekly
publication of industry-wide mutual fund averages by type of fund.

Money,  a monthly  magazine that from time to time features both specific  funds
and the mutual fund industry as a whole.

Morgan  Stanley  International,  an  integrated  investment  banking  firm  that
compiles statistical information.

Mutual Fund Values,  a biweekly  Morningstar,  Inc.  publication  that  provides
ratings  of  mutual  funds  based  on  fund  performance,   risk  and  portfolio
characteristics.

The New York Times, a nationally  distributed  newspaper which regularly  covers
financial news.

The No-Load Fund Investor,  a monthly  newsletter,  published by Sheldon Jacobs,
that includes mutual fund  performance data and  recommendations  for the mutual
fund investor.

No-Load Fund*X, a monthly newsletter, published by DAL Investment Company, Inc.,
that reports on mutual fund  performance,  rates funds and discusses  investment
strategies for the mutual fund investor.

Personal  Investing  News,  a monthly  news  publication  that often  reports on
investment opportunities and market conditions.

Personal  Investor,  a monthly investment  advisory  publication that includes a
"Mutual Funds Outlook" section  reporting on mutual fund  performance  measures,
yields, indices and portfolio holdings.

   
SmartMoney,  a national personal finance magazine published monthly by Dow Jones
and  Company,  Inc.  and The  Hearst  Corporation.  Focus is placed on ideas for
investing, spending and saving.
    

Success,  a monthly magazine  targeted to the world of entrepreneurs and growing
business, often featuring mutual fund performance data.

United Mutual Fund Selector, a semi-monthly investment newsletter,  published by
Babson United  Investment  Advisors,  that includes mutual fund performance data
and reviews of mutual fund portfolios and investment strategies.

USA Today, a leading national daily newspaper.

U.S. News and World Report,  a national  news weekly that  periodically  reports
mutual fund performance data.

                                       31
<PAGE>

Value Line  Mutual  Fund  Survey,  an  independent  organization  that  provides
biweekly performance and other information on mutual funds.

The Wall Street Journal, a Dow Jones and Company, Inc. newspaper which regularly
covers financial news.

Wiesenberger  Investment Companies Services, an annual compendium of information
about mutual funds and other investment companies, including comparative data on
funds' backgrounds,  management policies, salient features,  management results,
income and dividend records and price ranges.

Working  Woman,  a monthly  publication  that  features a  "Financial  Workshop"
section reporting on the mutual fund/financial industry.

   
Worth,  a national  publication  issued 10 times per year by Capital  Publishing
Company,  a  subsidiary  of  Fidelity  Investments.  Focus is placed on personal
financial journalism.
    

                            ORGANIZATION OF THE FUNDS

              (See "Fund organization" in each Fund's prospectus.)

         Scudder  Cash  Investment  Trust  is  a  Massachusetts  business  trust
established under a Declaration of Trust dated December 12, 1975.  Treasury Fund
is a Massachusetts business trust established under a Declaration of Trust dated
April 4, 1980.  On February  12,  1991,  the Board of Trustees of Treasury  Fund
approved the change in name from Scudder  Government  Money Fund to Scudder U.S.
Treasury Money Fund.  Each Fund's  authorized  capital  consists of an unlimited
number of shares of beneficial interest,  par value $.01 per share, all of which
are one class and have equal  rights as to voting,  dividends  and  liquidation.
Shareholders  have  one  vote  for  each  share  held.  All  shares  issued  and
outstanding will be fully paid and  non-assessable  by the Funds, and redeemable
as described in this combined  Statement of Additional  Information  and in each
Fund's  prospectus.  The Trustees of both Funds have the authority to issue more
than one series of shares, but have no present intention to do so.

         The Trustees of Treasury Fund, in their  discretion,  may authorize the
division of shares of the Fund (or shares of a series) into  different  classes,
permitting shares of different  classes to be distributed by different  methods.
Although  shareholders  of different  classes would have an interest in the same
portfolio  of assets,  shareholders  of  different  classes  may bear  different
expenses in connection with different methods of distribution. The Trustees have
no present  intention  of taking the action  necessary to effect the division of
shares into  separate  classes,  nor of changing the method of  distribution  of
shares of Treasury Fund.

         Each Fund has a Declaration of Trust which provides that obligations of
the Fund involved are not binding upon the Trustees  individually  but only upon
the property of that Fund, that the Trustees and officers will not be liable for
errors of judgment or mistakes of fact or law, and that the Fund  involved  will
indemnify its Trustees and officers against liabilities and expenses incurred in
connection  with  litigation  in which  they may be  involved  because  of their
offices with the Fund involved except if it is determined in the manner provided
in the  Declarations  of Trust  that they  have not  acted in good  faith in the
reasonable  belief that their  actions  were in the best  interests  of the Fund
involved.  However, nothing in the Declarations of Trust protects or indemnifies
a Trustee or officer against any liability to which he or she would otherwise be
subject  by reason of  willful  misfeasance,  bad faith,  gross  negligence,  or
reckless disregard of the duties involved in the conduct of his or her office.

                               INVESTMENT ADVISER

    (See "Fund organization--Investment adviser" in each Fund's prospectus.)

         Scudder,  Stevens & Clark,  Inc., an investment  counsel firm,  acts as
investment  adviser  to  the  Funds.  This  organization  is  one  of  the  most
experienced investment management firms in the United States. It was established
as a  partnership  in 1919 and  pioneered  the practice of providing  investment
counsel to individual  clients on a fee basis.  In 1928, it introduced the first
no-load  mutual fund to the public.  In 1953,  the  Adviser  introduced  Scudder
International  Fund,  Inc., the first mutual fund registered with the SEC in the

                                       32
<PAGE>

United States investing  internationally in several foreign countries.  The firm
reorganized from a partnership to a corporation on June 28, 1985.

   
         The  principal  source of the  Adviser's  income is  professional  fees
received from providing  continuous  investment  advice, and the firm derives no
income  from  brokerage  or  underwriting  of  securities.  Today,  it  provides
investment  counsel for many individuals and institutions,  including  insurance
companies,   colleges,  industrial  corporations,   and  financial  and  banking
organizations.  In addition,  it manages  Montgomery  Street Income  Securities,
Inc., Scudder California Tax Free Trust,  Scudder Cash Investment Trust, Scudder
Equity Trust,  Scudder Fund,  Inc.,  Scudder Funds Trust,  Scudder  Global Fund,
Inc., Scudder GNMA Fund, Scudder Portfolio Trust,  Scudder  Institutional  Fund,
Inc.,  Scudder  International  Fund, Inc.,  Scudder  Investment  Trust,  Scudder
Municipal  Trust,  Scudder  Mutual  Funds,  Inc.,  Scudder New Asia Fund,  Inc.,
Scudder New Europe Fund, Inc., Scudder Pathway Series, Scudder Securities Trust,
Scudder  State Tax Free Trust,  Scudder  Tax Free Money  Fund,  Scudder Tax Free
Trust,  Scudder U.S. Treasury Money Fund, Scudder Variable Life Investment Fund,
Scudder World Income  Opportunities  Fund,  Inc., The Argentina Fund,  Inc., The
Brazil Fund, Inc., The Korea Fund, Inc., The Japan Fund, Inc., The Latin America
Dollar Income Fund,  Inc. and Scudder Spain and Portugal Fund,  Inc. Some of the
foregoing companies or trusts have two or more series.

         The Adviser also provides  investment  advisory  services to the mutual
funds  which  comprise  the  AARP  Investment  Program  from  Scudder.  The AARP
Investment  Program  from  Scudder has assets over $13 billion and  includes the
AARP Growth Trust,  AARP Income Trust,  AARP Tax Free Income Trust, AARP Managed
Investment Portfolios Trust and AARP Cash Investment Funds.

          Pursuant to an Agreement  between Scudder,  Stevens & Clark,  Inc. and
AMA  Solutions,  Inc., a subsidiary  of the American  Medical  Association  (the
"AMA"),  dated May 9, 1997,  Scudder has  agreed,  subject to  applicable  state
regulations,  to pay AMA Solutions,  Inc.  royalties in an amount equal to 5% of
the  management  fee received by Scudder with respect to assets  invested by AMA
members in Scudder funds in connection  with the AMA  InvestmentLinkSM  Program.
Scudder will also pay AMA Solutions,  Inc. a general  monthly fee,  currently in
the  amount of $833.  The AMA and AMA  Solutions,  Inc.  are not  engaged in the
business  of  providing  investment  advice  and  neither  is  registered  as an
investment  adviser or broker/dealer  under federal  securities laws. Any person
who  participates  in the AMA  InvestmentLinkSM  Program  will be a customer  of
Scudder (or of a subsidiary thereof) and not the AMA or AMA Solutions,  Inc. AMA
InvestmentLinkSM is a service mark of AMA Solutions, Inc.
    

         The  Adviser  maintains a large  research  department,  which  conducts
continuous   studies  of  the  factors  that  affect  the  position  of  various
industries,  companies and individual securities. The Adviser receives published
reports and statistical  compilations from issuers and other sources, as well as
analyses from brokers and dealers who may execute portfolio transactions for the
Adviser's clients. However, the Adviser regards this information and material as
an adjunct to its own research activities.  In selecting the securities in which
the Fund may invest,  the  conclusions  and investment  decisions of the Adviser
with respect to the Fund are based primarily on the analyses of its own research
department.

         Certain  investments may be appropriate for both SCIT and Treasury Fund
as well as other clients  advised by the Adviser.  Investment  decisions for the
Funds  and other  clients  are made with a view to  achieving  their  respective
investment  objectives and after  consideration of such factors as their current
holdings,  availability of cash for investment and the size of their investments
generally.  Frequently, a particular security may be bought or sold for only one
client or in different amounts and at different times for more than one but less
than all clients.  Likewise, a particular security may be bought for one or more
clients when one or more other  clients are selling the  security.  In addition,
purchases  or sales of the same  security may be made for two or more clients on
the same day. In such  event,  such  transactions  will be  allocated  among the
clients in a manner  believed by the Adviser to be  equitable  to each.  In some
cases, this procedure could have an adverse effect on the price or amount of the
securities  purchased  or sold by the Funds.  Purchase and sales orders for each
Fund may be combined  with those of other clients of the Adviser in the interest
of achieving the most favorable net results to the Funds.

   
         Scudder has entered into an  agreement  with Zurich  Insurance  Company
("Zurich"),  an  international  insurance and financial  services  organization,
pursuant to which  Scudder  will form a new global  investment  organization  by
combining with Zurich's subsidiary, Zurich Kemper Investments,  Inc., and change
its name to Scudder Kemper Investments, Inc. After the transaction is completed,
Zurich will own approximately 70% of the new organization with the balance owned
by the new organization's officers and employees.
    

                                       33
<PAGE>

   
         Consummation   of  the   transaction   is   subject   to  a  number  of
contingencies,  including regulatory  approvals.  The transaction is expected to
close in the fourth quarter of 1997.  Upon  consummation  of the transaction the
investment  management  agreement  with  Scudder,  Stevens & Clark,  Inc.,  will
terminate.  The Trustees have approved an investment  management  agreement with
Scudder Kemper Investments, Inc. which is substantially identical to the current
investment  management agreement to become effective upon the termination of the
current investment management agreement.
    

Scudder Cash Investment Trust

   
         The  Investment  Advisory  Agreement  between SCIT and the Adviser (the
"Agreement"), dated November 12, 1985, will remain in effect until September 30,
1998 and will  continue  in  effect  from  year to year  thereafter  only if its
continuance is approved annually by the vote of a majority of those Trustees who
are not parties to such Agreement or "interested persons" of the Adviser or SCIT
cast in person at a meeting  called for the  purpose of voting on such  approval
and  either  by  vote  of a  majority  of  the  Trustees  or a  majority  of the
outstanding  voting  securities of SCIT.  The Agreement was last approved by the
Trustees  (including  a majority of the  Trustees  who are not such  "interested
persons") on August 12, 1997 and by the  shareholders of the Fund on November 3,
1987. The Agreement may be terminated at any time without  payment of penalty by
either party on sixty days' written notice, and automatically  terminates in the
event of its assignment.

         Under the Agreement,  the Adviser  regularly  provides SCIT  investment
management  of  the  assets  of the  Fund  in  accordance  with  the  investment
objectives,  policies and restrictions set forth, and determines what securities
shall be purchased for SCIT, what securities  shall be held or sold by SCIT, and
what portion of SCIT's assets shall be held  uninvested,  subject  always to the
provisions of SCIT's  Declaration of Trust and By-Laws,  and of the 1940 Act and
to SCIT's investment objectives,  policies and restrictions, and subject further
to such policies and  instructions as the Trustees of SCIT may from time to time
establish.  The Adviser  also advises and assists the officers of SCIT in taking
such steps as are  necessary or  appropriate  to carry out the  decisions of its
Trustees and the appropriate committees of the Trustees regarding the conduct of
the business of SCIT.

         The Adviser furnishes the Trust's Board of Trustees periodic reports on
the investment performance of the Fund and on the performance of its obligations
regarding  this agreement as well as additional  reports and  information as the
Trust's officers or Board of Trustees shall reasonably request.

         The  Adviser  furnishes  for  the  use of the  Fund  office  space  and
facilities  in the  United  States as the Fund may  require  for its  reasonable
needs,  and also renders  significant  administrative  services  (not  otherwise
provided by third  parties)  necessary for the Fund's  operations as an open-end
investment company including,  but not limited to, preparing reports and notices
to  the  Trustees  and  shareholders;   supervising,   negotiating   contractual
arrangements with, to the extent appropriate, and monitoring various third-party
service  providers  to the Fund  (such as the  Fund's  transfer  agent,  pricing
agents,  custodian,  accountants and others);  preparing and making filings with
the SEC and other regulatory  agencies;  assisting in the preparation and filing
of the Fund's  federal,  state and local tax returns;  preparing  and filing the
Fund's federal excise tax returns;  assisting with investor and public relations
matters; monitoring the valuation of securities and the calculation of net asset
value;  monitoring  the  registration  of  shares of the Fund  under  applicable
federal and state securities  laws;  maintaining or causing to be maintained for
the Fund all books, record and reports to the extent not otherwise maintained by
a third  party;  assisting  in  establishing  accounting  policies  of the Fund;
assisting in the  resolution of accounting  and legal issues;  establishing  and
monitoring  the Fund's  operating  budget;  processing the payment of the Fund's
bills;  assisting  the Fund in, and  otherwise  arranging  for,  the  payment of
distributions and dividends,  and otherwise assisting the Fund in the conduct of
its business, subject to the direction and control of the Trustees.

         The Agreement  also  provides  that the Fund is granted a  nonexclusive
right and  sublicense to use the "Scudder"  name and mark as part of the Trust's
name,  and the Scudder Marks in  connection  with the  Corporation's  investment
product and services.
    

         The  Adviser  pays the  compensation  and  expenses  of all  affiliated
Trustees and executive employees of SCIT and makes available, without expense to
the Fund, the services of such  Trustees,  officers and employees as may duly be
elected Trustees, officers or employees of the Fund, subject to their individual
consent  to serve and to any  limitations  imposed  by law,  and pays the Fund's
office  rent  and  provides  investment   advisory,   research  and  statistical
facilities  and all  clerical  services  relating to research,  statistical  and

                                       34
<PAGE>

investment work. For these services SCIT pays a monthly fee at an annual rate of
0.50 of 1% of the first $250  million of the Fund's  average  daily net  assets,
0.45 of 1% on the next $250  million of such net assets,  0.40 of 1% of the next
$500  million  of such net assets and 0.35 of 1% on such net assets in excess of
$1 billion.

   
         Until  October 31,  1998,  the Adviser and certain of its  subsidiaries
have agreed to waive all or  portions  of their fees  payable by the Fund to the
extent necessary so that the total annualized expenses of the Fund do not exceed
0.85% of average daily net assets of the Fund.

         For the fiscal years ended June 30, 1995,  1996 and 1997 the investment
advisory fee was $6,372,462, $5,898,959 and $5,944,464, respectively.

         The  Agreement  also  provides that the Adviser shall not be liable for
any error of judgment or mistake of law or for any loss  suffered by the Fund in
connection with matters to which the Agreement relates, provided that nothing in
the  agreement  shall be deemed to protect or  purport  to protect  against  any
liability to the Trust, the Fund or its shareholders to which it would otherwise
be subject by reason of willful  misfeasance,  bad faith or gross  negligence in
the  performance  of the  duties,  or by reason  of  reckless  disregard  of the
obligations and duties hereunder.

         Any person, even though also employed by Scudder,  who may be or become
an  employee  of and paid by the Fund shall be deemed,  when  acting  within the
scope of his or her  employment  by the Fund,  to be  acting in such  employment
solely for the Fund and not as an agent of Scudder.
    

Scudder U.S. Treasury Money Fund

   
         The  Investment  Management  Agreement  between  Treasury  Fund and the
Adviser (the  "Agreement")  was last approved by the Trustees on August 12, 1997
and by the  shareholders  on November 13, 1990.  The Agreement is dated November
14, 1990 and will  continue in effect until  September 30, 1998 and from year to
year thereafter  only if its  continuance is approved  annually by the vote of a
majority of those  Trustees who are not parties to such  Agreement or interested
persons of the Adviser or the Fund,  cast in person at a meeting  called for the
purpose of voting on such  approval,  and  either by vote of a  majority  of the
Trustees or of the outstanding  voting securities of the Fund. The Agreement may
be  terminated  at any time without  payment of penalty by either party on sixty
days'  written  notice,  and  automatically  terminates  in  the  event  of  its
assignment.
    

         Under the Agreement,  the Adviser regularly provides Treasury Fund with
continuing  investment  management for the Fund's portfolio  consistent with the
Fund's  investment  objectives,  policies and  restrictions  and determines what
securities  shall be purchased  for the  portfolio of the Fund,  what  portfolio
securities  shall be held or sold by the Fund,  and what  portion  of the Fund's
assets shall be held uninvested,  subject always to the provisions of the Fund's
Declaration of Trust and By-Laws, of the 1940 Act and the Code and to the Fund's
investment objectives,  policies and restrictions, and subject, further, to such
policies  and  instructions  as the  Trustees  of the Fund may from time to time
establish.  The Adviser  also  advises  and assists the  officers of the Fund in
taking such steps as are necessary or  appropriate to carry out the decisions of
its Trustees  and the  appropriate  committees  of the  Trustees  regarding  the
conduct of the business of the Fund.

         Under   the   Agreement,   the   Adviser   also   renders   significant
administrative  services (not otherwise provided by third parties) necessary for
Treasury Fund's operations as an open-end investment company including,  but not
limited to,  preparing  reports and notices to the  Trustees  and  shareholders;
supervising,  negotiating contractual  arrangements with, and monitoring various
third-party  service  providers to the Fund (such as the Fund's  transfer agent,
pricing agents, custodian, accountants and others); preparing and making filings
with the SEC and other  regulatory  agencies;  assisting in the  preparation and
filing the Fund's federal, state and local tax returns; preparing and filing the
Fund's federal excise tax returns;  assisting with investor and public relations
matters; monitoring the valuation of securities and the calculation of net asset
value;  monitoring  the  registration  of  shares of the Fund  under  applicable
federal and state securities  laws;  maintaining the Fund's books and records to
the extent not otherwise maintained by a third party;  assisting in establishing
accounting  policies of the Fund;  assisting in the resolution of accounting and
legal  issues;   establishing  and  monitoring  the  Fund's  operating   budget;
processing the payment of the Fund's bills; assisting the Fund in, and otherwise
arranging  for,  the  payment  of  distributions  and  dividends  and  otherwise
assisting the Fund in the conduct of its business,  subject to the direction and
control of the Trustees.

                                       35
<PAGE>

         The  Adviser  pays  the  compensation  and  expenses  of all  Trustees,
officers and  executive  employees of Treasury  Fund (except  those of attending
Board  and   committee   meetings   outside  New  York,   New  York  or  Boston,
Massachusetts)  who are affiliated  persons of the Adviser and makes  available,
without  expense to Treasury Fund,  the services of the directors,  officers and
employees  of the  Adviser as may duly be elected  officers  of  Treasury  Fund,
subject to their individual  consent to serve and to any limitations  imposed by
law and provides the Fund's office space and facilities.

   
         For these services,  Treasury Fund pays the Adviser a fee equal to 0.50
of 1% of the  Fund's  average  daily net  assets.  The fee is  payable  monthly,
provided  the Fund will make such  interim  payments as may be  requested by the
Adviser not to exceed 75% of the amount of the fee then  accrued on the books of
the Fund and unpaid. For the fiscal years ended June 30, 1995, 1996 and 1997 the
investment   advisory  fee  imposed  was   $939,421,   $890,672  and   $893,667,
respectively  and the fees not imposed  amounted  to  $967,383,  $1,077,479  and
$1,202,181, respectively.

         The  Adviser has agreed  until  October 31, 1998 not to impose all or a
portion of its investment  management  fee and take other action,  to the extent
necessary, to maintain the annualized expenses of Treasury Fund at not more than
0.65% of average daily net assets.  The Adviser retains the ability to be repaid
by the Treasury Fund if expenses fall below the specified limit prior to the end
of the fiscal  year.  These  expense  limitation  arrangements  can decrease the
Treasury Fund's expenses and improve its performance.
    

         Under the  Agreement,  Treasury Fund is  responsible  for all its other
expenses,  including fees and expenses incurred in connection with membership in
investment company organizations;  brokers' commissions;  payments for portfolio
pricing  services to a pricing  agent,  if any;  legal,  auditing and accounting
expenses;  taxes and  governmental  fees;  the fees and expenses of the Transfer
Agent; the cost of preparing share certificates or any other expenses, including
expenses of issuance,  sale,  redemption  or  repurchase of shares of beneficial
interest;  the expenses of and fees for registering or qualifying securities for
sale; the fees and expenses of Trustees,  officers and employees of the Fund who
are not  affiliated  with the  Adviser;  the cost of printing  and  distributing
reports  and  notices  to  shareholders;  and  the  fees  and  disbursements  of
custodians.  Treasury Fund may arrange to have third parties  assume all or part
of the expense of sale,  underwriting  and  distribution  of shares of the Fund.
(See  "DISTRIBUTOR"  for  expenses  paid by  Scudder  Investor  Services,  Inc.)
Treasury  Fund is also  responsible  for  expenses of  shareholder  meetings and
expenses incurred in connection with litigation,  proceedings and claims and the
legal obligation it may have to indemnify its officers and Trustees with respect
thereto.

SCIT and Treasury Fund

   
         The expense  ratios for SCIT for the fiscal  years ended June 30, 1995,
1996, and 1997 were 0.78%, 0.83% and 0.86%, respectively. The ratios of expenses
to annual investment income for SCIT for the same years were 13.89%, 14.75%, and
15.63%, respectively.  The expense ratios for Treasury Fund for the fiscal years
ended June 30, 1995,  1996 and 1997 were 0.65%,  0.65% and 0.65%,  respectively.
The ratios of expenses to annual  investment  income for the same  periods  were
12.36%, 11.94% and 12.65%,  respectively.  If reimbursement is required, it will
be made as  promptly  as  practicable  after  the end of a Fund's  fiscal  year.
However, no fee payment will be made to the Adviser during any fiscal year which
will cause  year-to-date  expenses  to exceed the  cumulative  pro rata  expense
limitation at the time of such payment.
    

         Each  Agreement  also provides a Fund may use any name derived from the
name "Scudder,  Stevens & Clark" only as long as the Agreement or any extension,
renewal or amendment thereof remains in effect.

         In reviewing the terms of the Agreements  and in  discussions  with the
Adviser concerning the Agreements, Trustees of each Fund who are not "interested
persons" of the Fund or the Adviser are  represented by  independent  counsel at
that Fund's  expense.  Dechert  Price & Rhoads acts as general  counsel for each
Fund.

         Each  Agreement  provides  that the Adviser shall not be liable for any
error  of  judgment  or  mistake  of law or for any loss  suffered  by a Fund in
connection with matters to which the Agreements relate,  except a loss resulting
from  willful  misfeasance,  bad  faith or gross  negligence  on the part of the
Adviser in the  performance  of its  duties or from  reckless  disregard  by the
Adviser of its obligations and duties under the Agreement.

                                       36
<PAGE>

         Officers  and  employees  of the  Adviser  from  time to time  may have
transactions with various banks,  including the Funds' custodian bank. It is the
Adviser's  opinion that the terms and conditions of those  transactions were not
influenced by existing or potential custodial or other Fund relationships.

         None of the Trustees or officers of a Fund may have  dealings with that
Fund as principals in the purchase or sale of  securities,  except as individual
subscribers to or holders of shares of the Fund.

Personal Investments by Employees of the Adviser

     Employees  of  the  Adviser  are  permitted  to  make  personal  securities
transactions,  subject  to  requirements  and  restrictions  set  forth  in  the
Adviser's  Code  of  Ethics.   The  Code  of  Ethics  contains   provisions  and
requirements  designed to identify  and address  certain  conflicts  of interest
between personal investment  activities and the interests of investment advisory
clients  such as the  Funds.  Among  other  things,  the Code of  Ethics,  which
generally  complies  with  standards   recommended  by  the  Investment  Company
Institute's  Advisory Group on Personal  Investing,  prohibits  certain types of
transactions  absent prior approval,  imposes time periods during which personal
transactions may not be made in certain securities,  and requires the submission
of  duplicate  broker   confirmations   and  monthly   reporting  of  securities
transactions.  Additional  restrictions  apply to portfolio  managers,  traders,
research  analysts  and others  involved  in the  investment  advisory  process.
Exceptions to these and other provisions of the Code of Ethics may be granted in
particular circumstances after review by appropriate personnel.

                              TRUSTEES AND OFFICERS

Scudder Cash Investment Trust

<TABLE>
   
<CAPTION>
                                                             Principal Occupation**      Position with Underwriter,
Name, Age and Address               Position with Fund       and Affiliations            Scudder Investor Services, Inc.
- ---------------------               ------------------       ------------------------    -------------------------------
<S>                                 <C>                      <C>                         <C>   
Daniel Pierce (63)*@                President and Trustee    Chairman of the Board and   Vice President, Director and
                                                             Managing Director of        Assistant Treasurer
                                                             Scudder, Stevens & Clark,
                                                             Inc.

Henry P. Becton, Jr. (53)#          Trustee                  President and General           --
WGBH                                                         Manager, WGBH Educational
125 Western Avenue                                           Foundation
Allston, MA  02134

Dawn-Marie Driscoll (50)            Trustee                  Executive Fellow, Center        --
5760 Flamingo Drive                                          for Business Ethics;
Cape Coral, FL  33904                                        President, Driscoll
                                                             Associates

Peter B. Freeman (65)               Trustee                  Corporate Director and          --
100 Alumni Avenue                                            Trustee
Providence, RI  02906

George M. Lovejoy, Jr. (67)#        Trustee                  President and Director,         --
160 Federal Street                                           Fifty Associates
Boston, MA  02110

Dr. Wesley W. Marple, Jr. (65)      Trustee                  Professor of Business          --
Northeastern University                                      Administration,
360 Huntington Avenue                                        Northeastern University
Boston, MA  02115
    



                                       37
<PAGE>

     
                                                             Principal Occupation**      Position with Underwriter,
Name, Age and Address               Position with Fund       and Affiliations            Scudder Investor Services, Inc.
- ---------------------               ------------------       ------------------------    -------------------------------

Jean C. Tempel (54)                 Trustee                  Managing Partner,              --
                                                             Technology Equity Partners

Jerard K. Hartman (64)+             Vice President           Managing Director of           --
                                                             Scudder, Stevens & Clark,
                                                             Inc.

Thomas W. Joseph (58)@              Vice President           Principal of Scudder,       Vice President, Director,
                                                             Stevens & Clark, Inc.       Treasurer & Assistant Clerk

Thomas F. McDonough (50)@           Vice President and       Principal of Scudder,       Clerk
                                    Secretary                Stevens & Clark, Inc.

Pamela A. McGrath (43)@             Vice President and       Managing Director of            --
                                    Treasurer                Scudder, Stevens & Clark,
                                                             Inc.

Edward J. O'Connell (52)+           Vice President and       Principal of Scudder,       Assistant Treasurer
                                    Assistant Treasurer      Stevens and Clark, Inc.

David Wines (41)++                  Vice President           Principal of Scudder,          --
                                                             Stevens & Clark, Inc.
</TABLE>

*        Messrs.  Findlay and Pierce are  considered by the Fund and its counsel
         to be Trustees who are "interested persons" of the Adviser of the Fund,
         within the meaning of the 1940 Act, as amended.
**       Unless otherwise stated, all officers and Trustees have been associated
         with  their  respective  companies  for more than five  years,  but not
         necessarily in the same capacity.
#        Messrs. Becton, Lee and Lovejoy are members of the Executive Committee,
         which has the power to  declare  dividends  from  ordinary  income  and
         distributions of realized capital gains to the same extent as the Board
         is so empowered.
@        Address:  Two International Place, Boston, Massachusetts  02110
+        Address:  345 Park Avenue, New York, New York  10154
++       Address:  333 South Hope Street, 37th floor, Los Angeles, CA  90071

         As of  September  30, 1997 all Trustees and officers of SCIT as a group
owned  beneficially  (as  that  term  is  defined  under  Section  13(d)  of the
Securities  Exchange  Act of  1934)  less  than  1% of the  shares  of the  Fund
outstanding on such date.

         To the best of SCIT's  knowledge  as of  September  30,  1997 no person
owned beneficially more than 5% of SCIT's outstanding shares.
    

         The Trustees and officers of the Fund also serve in similar  capacities
with other Scudder Funds.

Scudder U.S. Treasury Money Fund
   

<TABLE>
<CAPTION>
                                                             Principal Occupation**      Position with Underwriter,
Name, Age and Address               Position with Fund       and Affiliations            Scudder Investor Services, Inc.
- ---------------------               ------------------       ------------------------    -------------------------------
<S>                                 <C>                      <C>                         <C>           
David S. Lee (63)*#@                President and Trustee    Managing Director of        President, Assistant Treasurer
                                                             Scudder, Stevens & Clark,   and Director
                                                             Inc.

E. Michael Brown (57)*@             Trustee                  Managing Director of        Assistant Treasurer
                                                             Scudder, Stevens & Clark,
                                                             Inc.
    

                                       38
<PAGE>
    
    
                                                             Principal Occupation**      Position with Underwriter,
Name, Age and Address               Position with Fund       and Affiliations            Scudder Investor Services, Inc.
- ---------------------               ------------------       ------------------------    -------------------------------

Dawn-Marie Driscoll (50)#           Trustee                  Executive Fellow, Center       --
Driscoll Associates                                          for Business Ethics;
4909 SW 9th Place                                            President, Driscoll
Cape Coral, FL  33914                                        Associates

Peter B. Freeman (65)               Trustee                  Corporate Director and          --
100 Alumni Avenue                                            Trustee
Providence, RI  02906

George M. Lovejoy, Jr. (67)#        Trustee                  President and Director,         --
50 Congress Street, Suite 543                                Fifty Associates
Boston, MA 02110

Jean C. Tempel (54)                 Trustee                  General Partner, TL             --
Ten Post Office Square                                       Ventures
Suite 1325
Boston, MA 02109-4603

Jerard K. Hartman (64)+             Vice President           Managing Director of           --
                                                             Scudder, Stevens & Clark,
                                                             Inc.

Thomas W. Joseph (58)@              Vice President           Principal of Scudder,       Vice President, Director,
                                                             Stevens & Clark, Inc.       Treasurer & Assistant Clerk

David B. Wines (41)++               Vice President           Principal of Scudder,          --
                                                             Stevens & Clark, Inc.

Thomas F. McDonough (50)@           Vice President and       Principal of Scudder,       Clerk
                                    Secretary                Stevens & Clark, Inc.

Pamela A. McGrath (44)@             Vice President and       Managing Director of            --
                                    Treasurer                Scudder, Stevens & Clark,
                                                             Inc.

Edward J. O'Connell (52)+           Vice President and       Principal of Scudder,       Assistant Treasurer
                                    Assistant Treasurer      Stevens & Clark, Inc.
    
</TABLE>


   
*        Messrs.  Brown and Lee are considered by the Fund and its counsel to be
         Trustees  who are  "interested  persons"  of the  Adviser  of the Fund,
         within the meaning of the 1940 Act.
**       Unless otherwise stated, all officers and Trustees have been associated
         with  their  respective  companies  for more  than  five  years but not
         necessarily in the same capacity.
#        Messrs.  Lee and Lovejoy and Ms.  Driscoll are members of the Executive
         Committee,  which  has the power to  declare  dividends  from  ordinary
         income and  distributions  of realized capital gains to the same extent
         as the Board is so empowered.
@        Address:  Two International Place, Boston, Massachusetts  02110
+        Address:  345 Park Avenue, New York, New York  10154
++       Address:  333 South Hope Street, 37th floor, Los Angeles, CA  90071

         To the best of the Trust's  knowledge,  as of September  30, 1997,  all
Trustees  and officers of the Treasury  Fund as a group owned  beneficially  (as
that term is defined under Section 13(d) of the Securities Exchange Act of 1934)
less than 1% of the shares of the Fund outstanding on such date.
    

                                       39
<PAGE>

   
         To the best of the Trust's  knowledge,  as of September  30,  1997,  no
person owned beneficially more than 5% of the Fund's outstanding shares.
    

         The  Trustees  and  officers  of  Treasury  Fund also  serve in similar
capacities with other Scudder Funds.

                                  REMUNERATION

   
Responsibilities of the Board--Board and Committee Meetings

         Each Fund's Board of Trustees is responsible for the general  oversight
of each Fund's  business.  A majority of each Board's members are not affiliated
with the Adviser.  These "Independent  Trustees" have primary responsibility for
assuring that each Fund is managed in the best interests of its shareholders.

         The Board of Trustees for each Fund meets at least  quarterly to review
the investment performance of each Fund and other operational matters, including
policies and procedures  designated to assure compliance with various regulatory
requirements.  At least annually,  the Independent Trustees review the fees paid
to the Adviser and its  affiliates for  investment  advisory  services and other
administrative and shareholder  services.  In this regard, they evaluate,  among
other things, each Fund's investment performance,  the quality and efficiency of
the  various  other  services  provided,  costs  incurred by the Adviser and its
affiliates,   and  comparative   information  regarding  fees  and  expenses  of
competitive  funds. They are assisted in this process by each Fund's independent
public  accountants and by independent legal counsel selected by the Independent
Trustees.

         All of the  Independent  Trustees serve on the Committee on Independent
Trustees,  which  nominates  Independent  Trustees and  considers  other related
matters,  and the Audit Committee,  which selects each Fund's independent public
accountants  and  reviews  accounting   policies  and  controls.   In  addition,
Independent  Trustees  from time to time  have  established  and  served on task
forces and  subcommittees  focusing on  particular  matters such as  investment,
accounting and shareholder service issues.

         The  Independent  Trustees  for SCIT met  nineteen  times  during 1996,
including  Board and  Committee  meetings  and  meetings  to review  the  Fund's
contractual arrangements as described above.

         The  Independent  Trustees for Treasury Fund met nineteen  times during
1996,  including Board and Committee  meetings and meetings to review the Fund's
contractual arrangements as described above.

Compensation of Officers and Trustees

         The Independent  Trustees receive the following  compensation from each
Fund: as of July 1, 1997 a revised annual trustee's fee of $4,800; a revised fee
of $200 for attendance at each Board meeting,  audit committee meeting, or other
meeting held for the purposes of considering  arrangements between each Fund and
the  Adviser  or any  affiliate  of the  Adviser;  $100 for any other  committee
meeting  (although in some cases the Independent  Trustees have waived committee
meeting fees);  and  reimbursement  of expenses  incurred for travel to and from
Board Meetings.  No additional  compensation is paid to any Independent  Trustee
for travel time to meetings,  attendance  at trustees'  educational  seminars or
conferences,  service on industry or association  committees,  participation  as
speakers at  trustees'  conferences,  service on special  trustee task forces or
subcommittees or service as lead or liaison trustee. Independent Trustees do not
receive any employee  benefits such as pension,  retirement or health insurance.
For the year ended June 30,  1997,  such fees  aggregated  $38,301  for SCIT and
$31,125 for Treasury Fund.

         The  Independent  Trustees  also serve in the same  capacity  for other
funds managed by the Adviser.  These funds differ  broadly in type an complexity
and in some  cases have  substantially  different  Trustee  fee  schedules.  The
following table shows the aggregate  compensation  received by each  Independent
Trustee during 1996 from each Trust and from all of Scudder funds as a group.
    

                                       40
<PAGE>
   

<TABLE>
<CAPTION>

                                           Scudder Cash       Scudder U.S. Treasury
                    Name                 Investment Trust          Money Fund                  All Scudder Funds
                    ----                 ----------------          ----------                  -----------------

<S>                                          <C>                       <C>                      <C>  
       Henry P. Becton, Jr.,**               $8,900                    --                       $91,012 (16 funds)
       Trustee

       Dawn-Marie Driscoll,                  $9,500                     $9,500                 $103,000 (16 funds)
       Trustee

       Peter B. Freeman,*                    $9,500                    --                      $131,734 (33 funds)
       Trustee

       George M. Lovejoy, Jr.,               $9,500                     $9,500                 $124,512 (13 funds)
       Trustee

       Dr. Wesley W. Marple, Jr.#**            --                      --                      $106,812 (16 funds)

       Jean C. Tempel,#                        --                       $9,200                 $102,895 (16 funds)
       Trustee
</TABLE>

*        Mr. Freeman became a Trustee of Treasury Fund on July 1, 1997.
#        Ms. Tempel and Dr. Marple became  Trustees of the  Investment  Trust on
         October 24, 1997.
**       Mr.  Becton and Dr.  Marple  become  Trustees of the  Treasury  Fund on
         October 24, 1997.

         Members of the Board of Trustees  who are  employees  of Scudder or its
affiliates  receive no direct  compensation  from the Trust,  although  they are
compensated  as employees of Scudder,  or its  affiliates,  as a result of which
they may be deemed to participate in fees paid by each Fund.
    

                                   DISTRIBUTOR

         Both  Funds  have  an  underwriting  agreement  with  Scudder  Investor
Services,  Inc. (the  "Distributor"),  a Massachusetts  corporation,  which is a
wholly-owned subsidiary of the Adviser, a Delaware corporation.

         As agent,  the Distributor  currently  offers shares of both Funds on a
continual  basis to  investors in all states in which the Funds may from time to
time be  registered  or where  permitted by  applicable  law.  The  underwriting
agreement  provides that the  Distributor  accept orders for shares at net asset
value as no sales  commission or load is charged the investor.  The  Distributor
has made no firm commitment to acquire shares of either Fund.

Scudder Cash Investment Trust

   
         SCIT's underwriting agreement dated July 20, 1976 will remain in effect
until  September  30,  1998 and from  year to year  only if its  continuance  is
approved  annually by a majority of the Board of Trustees who are not parties to
such agreement or "interested persons" of any such party and either by vote of a
majority of the Trustees or a majority of the outstanding  voting  securities of
the Fund. SCIT has agreed to pay all expenses in connection with registration of
its  shares  with  the SEC and  auditing  and  filing  fees in  connection  with
registration of its shares under the various state "blue-sky" laws and to assume
the cost of preparation of prospectuses and other expenses. The Distributor pays
all  expenses  of printing  prospectuses  used in  offering  shares  (other than
prospectuses  used by SCIT for transmission to shareholders,  for which the Fund
pays printing expenses),  expenses,  other than filing fees, of qualification of
SCIT's shares in various states, including registering SCIT as a dealer, and all
other  expenses in  connection  with the offer and sale of shares  which are not
specifically  allocated  to the  Funds.  The  underwriting  agreement  was  last
approved by the Trustees on August 12, 1997.
    

Scudder U.S. Treasury Money Fund

   
         Treasury  Fund's  underwriting  agreement dated September 10, 1985 will
remain in effect until  September 30, 1998 and from year to year thereafter only
if its  continuance  is  approved  annually  by a majority of the members of the
    

                                       41
<PAGE>

   
Board of Trustees who are not parties to such agreement or "interested  persons"
of any such party and either by vote of a majority of the Board of Trustees or a
majority of the outstanding voting securities of Treasury Fund. The underwriting
agreement was last approved by the Trustees on August 12, 1997.
    

         Under  the   principal   underwriting   agreement,   Treasury  Fund  is
responsible  for:  the payment of all fees and expenses in  connection  with the
preparation and filing with the SEC of its registration statement and prospectus
and any amendments and supplements  thereto;  the registration and qualification
of shares for sale in the various states, including registering Treasury Fund as
a broker or dealer;  the fees and  expenses of  preparing,  printing and mailing
prospectuses,   notices,  proxy  statements,  reports  or  other  communications
(including  newsletters)  to shareholders of Treasury Fund; the cost of printing
and  mailing   confirmations   of  purchases  of  shares  and  the  prospectuses
accompanying  such  confirmations;  any issuance  taxes or any initial  transfer
taxes;  a portion of  shareholder  toll-free  telephone  charges and expenses of
customer service  representatives;  the cost of wiring funds for share purchases
and redemptions  (unless paid by the shareholder who initiates the transaction);
the cost of printing and postage of business reply  envelopes;  and a portion of
the cost of computer  terminals used by both Treasury Fund and the  Distributor.
Although  Treasury  Fund does not  currently  have a 12b-1 Plan and  shareholder
approval  would be required in order to adopt one,  Treasury  Fund will also pay
those  fees and  expenses  permitted  to be paid or  assumed  by  Treasury  Fund
pursuant to a 12b-1 Plan, if any, adopted by Treasury Fund,  notwithstanding any
other provision to the contrary in the underwriting  agreement and Treasury Fund
or a third party will pay those fees and expenses not specifically  allocated to
the Distributor in the underwriting agreement.

         The Distributor will pay for printing and distributing  prospectuses or
reports  prepared for its use in  connection  with the offering of the shares to
the  public  and  preparing,  printing  and  mailing  any  other  literature  or
advertising  in  connection  with the offering of shares of Treasury Fund to the
public.  The  Distributor  will pay all fees and expenses in connection with its
qualification  and  registration  as a broker or dealer under  federal and state
laws,  a portion of the cost of  toll-free  telephone  service  and  expenses of
customer service  representatives,  a portion of the cost of computer terminals,
and of any activity which is primarily  intended to result in the sale of shares
issued by the Fund,  unless a 12b-1 Plan is in effect  which  provides  that the
Fund shall bear some or all of such expenses.

                                      TAXES

                (See "Transaction information--Tax identification
        number" and "Distribution and performance information--Dividends
          and capital gains distributions" in each Fund's prospectus.)

         Each Fund has elected to be treated as a regulated  investment  company
under  Subchapter M of the Code, or a  predecessor  statute and has qualified as
such since its  inception.  Each Fund  intends to  continue  to qualify for such
treatment.  Such  qualification  does not involve  governmental  supervision  or
management of investment practices or policy.

         A regulated  investment  company  qualifying  under Subchapter M of the
Code  is  required  to  distribute  to  its  shareholders  at  least  90% of its
investment  company taxable income  (including net short-term  capital gain) and
generally is not subject to federal income tax to the extent that it distributes
annually its investment company taxable income and net realized capital gains in
the manner  required under the Code.  Each Fund intends to distribute,  at least
annually,  all of its investment company taxable income and net realized capital
gains.

         The Funds are  subject  to a 4%  nondeductible  excise  tax on  amounts
required  to be but not  distributed  under a  prescribed  formula.  The formula
requires  payment  to  shareholders  during  a  calendar  year of  distributions
representing  at least 98% of a Fund's ordinary income for the calendar year, at
least 98% of the excess of its capital gains over capital  losses  (adjusted for
certain  ordinary  losses) realized during the one-year period ending October 31
during such year  (although  investment  companies  with taxable years ending on
November  30 or  December  31 may make an  irrevocable  election  to measure the
required  capital gain  distribution  using their actual taxable year),  and all
ordinary  income and  capital  gains for prior  years  that were not  previously
distributed.

         Investment  company taxable income generally  includes interest and net
short-term  capital  gains in  excess  of net  long-term  capital  losses,  less
expenses.  Net realized  capital  gains for a fiscal year are computed by taking
into account any capital loss carryforward of the Funds.

                                       42
<PAGE>

         Distributions  of  investment  company  taxable  income are  taxable to
shareholders as ordinary income.

         Since no portion of the Funds'  income is comprised  of dividends  from
domestic corporations, none of the income distributions of the Funds is eligible
for the deduction for dividends received by corporations.

   
         Properly  designated  distributions  of the  excess  of  net  long-term
capital gain over net  short-term  capital loss that are  designated  as capital
gain dividends are taxable to shareholders as long-term capital gain, regardless
of the  length of time the  shares of the Fund  involved  have been held by such
shareholders.  Such  distributions  are not eligible for the  dividends-received
deduction.  Any loss realized upon the  redemption of shares held at the time of
redemption for six months or less will be treated as a long-term capital loss to
the extent of any amounts treated as  distributions  of long-term  capital gains
during such six-month period.
    

         Distributions  of investment  company  taxable  income and net realized
capital gains will be taxable as described above,  whether received in shares or
in  cash.  Shareholders  electing  to  receive  distributions  in  the  form  of
additional shares will have a cost basis for federal income tax purposes in each
share so received  equal to the net asset  value of a share on the  reinvestment
date.

         All distributions of investment company taxable income and net realized
capital gain,  whether  received in shares or in cash,  must be reported by each
shareholder  on his or her  federal  income tax  return.  Dividends  declared in
October,  November or December  with a record date in such a month are deemed to
have been  received  by  shareholders  on  December 31 if paid in January of the
following year. Redemptions of shares, including exchanges for shares of another
Scudder fund, may result in tax  consequences  (gain or loss) to the shareholder
and are also subject to these reporting requirements.

         A portion of the  difference  between  the issue  price of zero  coupon
securities and their face value  ("original issue discount") is considered to be
income to a Fund each year,  even though a Fund will not receive  cash  interest
payments from these securities. This original issue discount imputed income will
comprise a part of the investment company taxable income of the Funds which must
be distributed to  shareholders  in order to maintain the  qualification  of the
Funds as regulated  investment  companies and to avoid federal income tax at the
level of the Funds.  In the event that a Fund  acquires a debt  instrument  at a
market  discount,  it is possible  that a portion of any gain  recognized on the
disposition of such instrument may be treated as ordinary income.

   
         A qualifying individual may make a deductible IRA contribution of up to
$2,000 or, if less, the amount of the  individual's  earned income (up to $2,000
per individual for married couples if only one spouse has earned income) for any
taxable  year only if (i) neither the  individual  nor a spouse  (unless  filing
separate returns) is an active participant in an employer's  retirement plan, or
(ii) the individual  (and a spouse,  if applicable) has an adjusted gross income
below a certain level  ($40,050 for married  individuals  filing a joint return,
with a phase-out of the deduction for adjusted gross income between  $40,050 and
$50,000;  $25,050 for a single  individual,  with a phase-out for adjusted gross
income  between  $25,050 and $35,000).  However,  an individual not permitted to
make  a  deductible  contribution  to an IRA  for  any  such  taxable  year  may
nonetheless  make  nondeductible  contributions  up to $2,000 to an IRA for that
year. There are special rules for determining how withdrawals are to be taxed if
an IRA  contains  both  deductible  and  nondeductible  amounts.  In general,  a
proportionate  amount  of  each  withdrawal  will  be  deemed  to be  made  from
nondeductible  contributions;  amounts  treated  as a  return  of  nondeductible
contributions will not be taxable.  Also, annual  contributions may be made to a
spousal IRA even if the spouse has earnings in a given year if the spouse elects
to be treated as having no  earnings  (for IRA  contribution  purposes)  for the
year.
    

         The Funds will be  required to report to the IRS all  distributions  of
taxable  income and capital gains as well as gross  proceeds from the redemption
or exchange of Fund shares,  except in the case of certain exempt  shareholders.
Under  the  backup   withholding   provisions  of  Section  3406  of  the  Code,
distributions  of  taxable  income and  capital  gains  (and  proceeds  from the
redemption  or exchange of the shares of a regulated  investment  company if the
funds  fail to  maintain  a  constant  $1.00 NAV per  share)  may be  subject to
withholding  of federal  income tax at the rate of 31% in the case of non-exempt
shareholders  who fail to furnish the  investment  company  with their  taxpayer
identification numbers and with required  certifications  regarding their status
under the federal income tax law.  Withholding may also be required if a Fund is
notified  by  the  IRS or a  broker  that  the  taxpayer  identification  number
furnished by the shareholder is incorrect or that the shareholder has previously
failed to report interest or dividend income. If the withholding  provisions are

                                       43
<PAGE>

applicable,  any  such  distributions  and  proceeds,  whether  taken in cash or
reinvested in additional  shares,  will be reduced by the amounts required to be
withheld.

         Shareholders  of the Funds may be subject  to state and local  taxes on
distributions  received from the Funds and on  redemptions of the Funds' shares.
Under the laws of certain states,  distributions  of investment  company taxable
income are taxable to shareholders  as dividends,  even though a portion of such
distributions may be derived from interest on U.S. Government obligations which,
if received  directly by such  shareholders,  would be exempt from state  income
tax.

         Each distribution is accompanied by a brief explanation of the form and
character of the distribution.  In January of each year, the Funds issue to each
shareholder a statement of the federal income tax status of all distributions.

         Each Fund is organized as a Massachusetts  business trust and, provided
that it  qualifies  as a regulated  investment  company  for federal  income tax
purposes,  is not liable for any income or franchise tax in the  Commonwealth of
Massachusetts.

         The foregoing  discussion of U.S. federal income tax law relates solely
to the  application  of that  law to  U.S.  persons,  i.e.,  U.S.  citizens  and
residents  and  U.S.  corporations,   partnerships,  trusts  and  estates.  Each
shareholder  who is not a U.S.  person should  consider the U.S. and foreign tax
consequences of ownership of shares of a Fund,  including the  possibility  that
such a shareholder may be subject to a U.S. withholding tax at a rate of 30% (or
at a lower rate under an applicable  income tax treaty) on amounts  constituting
ordinary income received by the  shareholder,  where such amounts are treated as
income from U.S. sources under the Code.

         Shareholders should consult their tax advisers about the application of
the  provisions of tax law  described in this  combined  Statement of Additional
Information in light of their particular tax situations.

                             PORTFOLIO TRANSACTIONS

         To the maximum extent feasible, the Adviser places orders for portfolio
transactions for the Funds through the Distributor,  which in turn places orders
on behalf of the Funds with other  brokers and  dealers.  The  Distributor  will
receive no commissions,  fees or other remuneration for this service. Allocation
of brokerage is supervised by the Adviser.

         A Fund's  purchases  and sales of portfolio  securities  are  generally
placed  by the  Adviser  with the  issuer or a  primary  market  maker for these
securities on a net basis,  without any brokerage  commission  being paid by the
Funds.  Trading does,  however,  involve  transaction  costs.  Transactions with
dealers  serving as primary market makers reflect the spread between the bid and
asked prices.  Transaction costs may also include fees paid to third parties for
information  as to potential  purchasers or sellers of securities  but only if a
Fund would  obtain the most  favorable  net  results,  including  such fee, on a
particular transaction.  Purchases of underwritten issues may be made which will
include an  underwriting  fee paid to the  underwriter.  To date,  no  brokerage
commissions have been paid.

         The primary objective of the Adviser in placing orders for the purchase
and sale of securities for the Funds' portfolios is to obtain the most favorable
net results taking into account such factors as price, commission (negotiable in
the case of national securities exchange  transactions),  if any, size of order,
difficulty of execution and skill required of the executing  broker/dealer.  The
Adviser seeks to evaluate the overall  reasonableness  of brokerage  commissions
paid (to the extent applicable)  through the familiarity of the Distributor with
commissions  charged  on  comparable  transactions,  as  well  as  by  comparing
commissions  paid by the  Funds to  reported  commissions  paid by  others.  The
Adviser reviews on a routine basis  commission  rates,  execution and settlement
services performed, making internal and external comparisons.

   
         When it can be done  consistently with the policy of obtaining the most
favorable net results,  it is the  Adviser's  practice to place such orders with
brokers and dealers, who supply research,  market and statistical information to
the Adviser. The term "research,  market and statistical  information"  includes
advice  as to the  value  of  securities,  the  advisability  of  investing  in,
purchasing  or  selling  securities;  and  the  availability  of  securities  or
purchasers  or  sellers of  securities;  and  furnishing  analyses  and  reports
concerning  issuers,  industries,   securities,  economic  factors  and  trends,
portfolio  strategy and the  performance of accounts.  The Adviser is authorized
when placing portfolio  transactions for the Funds to pay a brokerage commission
    

                                       44
<PAGE>

   
(to the extent  applicable)  in excess of that which  another  broker might have
charged for effecting the same  transaction  solely on account of the receipt of
research,  market or statistical information.  The Adviser does not place orders
with brokers or dealers on the basis that a broker or dealer has or has not sold
shares of the Funds. In effecting  transactions in over-the-counter  securities,
orders are placed with the principal market-makers for the security being traded
unless,  after  exercising  care,  it appears  that more  favorable  results are
available otherwise.
    

         Although  certain  research,  market and statistical  information  from
brokers  and dealers  can be useful to the Funds and to the  Adviser,  it is the
opinion  of  the  management  of  the  Funds  that  such   information  is  only
supplementary to the Adviser's own research  effort,  since the information must
still  be  analyzed,   weighed,  and  reviewed  by  the  Adviser's  staff.  Such
information may be useful to the Adviser in providing  services to clients other
than  the  Funds,  and not all  such  information  is  used  by the  Adviser  in
connection with the Funds. Conversely,  such information provided to the Adviser
by brokers  and  dealers  through  whom  other  clients  of the  Adviser  effect
securities  transactions  may be useful to the Adviser in providing  services to
the Funds.

         The  Trustees  of each  Fund  review  from  time to  time  whether  the
recapture  for the  benefit  of  each  Fund of  some  portion  of the  brokerage
commissions  or  similar  fees paid by each Fund on  portfolio  transactions  is
legally permissible and advisable. To date, no such recapture has been effected.

                                 NET ASSET VALUE

   
         The net asset value per share of each Fund is  computed  twice daily as
of  twelve  o'clock  noon and the  close of  regular  trading  on the  Exchange,
normally 4 p.m. eastern time, on each day when the Exchange is open for trading.
The Exchange is normally closed on the following national  holidays:  New Year's
Day,  Presidents' Day, Good Friday,  Memorial Day,  Independence Day, Labor Day,
Thanksgiving, and Christmas. Net asset value is determined by dividing the total
assets of a Fund, less all of its liabilities,  by the total number of shares of
that  Fund  outstanding.  The Funds use the  penny-rounding  method of  security
valuation  as permitted  under Rule 2a-7 under the 1940 Act.  Under this method,
portfolio securities for which market quotations are readily available and which
have  remaining  maturities  of more than 60 days from the date of valuation are
valued at market.  Short-term  securities purchased with remaining maturities of
60 days or less shall be valued by the amortized  cost method;  if acquired with
remaining  maturities  of 61 days or more,  the cost  thereof  for  purposes  of
valuation  is deemed to be the  value on the 61st day prior to  maturity.  Other
securities  are  appraised  at fair value as  determined  in good faith by or on
behalf of the Trustees of each Fund.  For  example,  securities  with  remaining
maturities  of more than 60 days for which  market  quotations  are not  readily
available  are  valued on the  basis of  market  quotations  for  securities  of
comparable  maturity,  quality and type.  Determinations  of net asset value per
share for each Fund made other than as of the close of the  Exchange  may employ
adjustments for changes in interest rates and other market factors.
    

                             ADDITIONAL INFORMATION

Experts

         The  financial   highlights  of  each  Fund  included  in  each  Fund's
prospectus  and the  Financial  Statements  incorporated  by  reference  in this
Statement of Additional  Information  have been so included or  incorporated  by
reference in reliance on the report of Coopers & Lybrand L.L.P., One Post Office
Square, Boston,  Massachusetts 02109, independent accountants,  and given on the
authority of that firm as experts in accounting and auditing.

Shareholder Indemnification

         The  Funds  are   organizations   of  the  type  commonly  known  as  a
"Massachusetts  business trust." Under Massachusetts law, shareholders of such a
trust may, under certain  circumstances,  be held personally  liable as partners
for the  obligations  of that  trust.  The  Declarations  of Trust of each  Fund
contain an express  disclaimer of shareholder  liability in connection  with the
Funds'  property  or  the  acts,  obligations  or  affairs  of  the  Funds.  The
Declarations  of  Trust  also  provide  for  indemnification  out of the  Funds'
property  of  any  shareholder  held  personally   liable  for  the  claims  and
liabilities  to which a  shareholder  may  become  subject by reason of being or
having been a shareholder.  Thus, the risk of a shareholder  incurring financial
loss on account of shareholder  liability is limited to circumstances in which a
Fund itself would be unable to meet its obligations.

                                       45
<PAGE>

Other Information

         Both Funds have a fiscal year ending on June 30.

         Portfolio  securities  of each Fund are held  separately,  pursuant  to
separate  custodian  agreements,  by State  Street Bank and Trust  Company,  225
Franklin Street, Boston, Massachusetts 02101 as custodian.

         The CUSIP number of Scudder Cash Investment Trust is 811118-10-8.

         The CUSIP number of Scudder U.S. Treasury Money Fund is 81123P-10-6.

         "Scudder Cash Investment  Trust" is the designation of the Trustees for
the time being under a  Declaration  of Trust dated  December 12, 1975,  and the
name "Scudder U.S.  Treasury Money Fund" is the  designation of the Trustees for
the time being under a Declaration of Trust dated April 4, 1980, each as amended
from time to time,  and all persons  dealing with a Fund must look solely to the
property of that Fund for the  enforcement  of any claims  against  that Fund as
neither the  Trustees,  officers,  agents or  shareholders  assume any  personal
liability  for  obligations  entered into on behalf of a Fund.  Upon the initial
purchase of shares,  the shareholder  agrees to be bound by a Fund's Declaration
of Trust,  as amended from time to time. No series is liable for the obligations
of any other  series.  The  Declaration  of Trust of each Fund is on file at the
Massachusetts Secretary of State's Office in Boston, Massachusetts.

   
         Scudder Fund Accounting  Corporation  (SFAC), Two International  Place,
Boston,  Massachusetts,  02110-4103,  a subsidiary of the Adviser,  computes the
Funds' net asset value.  Each Fund pays SFAC an annual fee equal to 0.02% of the
first $150 million of average daily net assets,  0.006% of such assets in excess
of $150  million,  0.0035% of such assets in excess of $1 billion,  plus holding
and  transaction  charges for this service.  For the fiscal years ended June 30,
1997,  1996 and 1995,  SFAC charged SCIT  aggregate  fees of $105,874,  of which
$8,818 was unpaid on June 30, 1997,  $104,207 and $99,328.  For the fiscal years
ended June 30, 1997, 1996 and 1995, SFAC charged Treasury Fund aggregate fees of
$ 50,134, $ 49,647 and $45,175.

         Scudder Service  Corporation  ("Service  Corporation"),  P.O. Box 2291,
Boston,  Massachusetts  02107-2291, a subsidiary of the Adviser, is the transfer
and dividend disbursing agent for both funds. Service Corporation also serves as
shareholder  service  agent  for  the  Funds  and  provides   subaccounting  and
recordkeeping  services  for  shareholder  accounts  in certain  retirement  and
employee benefit plans. The Funds each pay Service  Corporation an annual fee of
$31.50  for  each  regular  account  and  $34.50  for  each  retirement  account
maintained for a participant. For the fiscal years ended June 30, 1997, 1996 and
1995, Service  Corporation  charged SCIT aggregate fees of $2,907,025,  of which
$225,977 was unpaid on June 30, 1997, $2,884,988, and $4,218,266. For the fiscal
years ended June 30, 1997, 1996 and 1995, Service  Corporation  charged Treasury
Fund aggregate fees of $710,792, $682,565 and $988,611.

         Scudder Trust Company,  Two International Place, Boston, MA 02110-4103,
an  affiliate  of the Adviser  provides  services  for certain  retirement  plan
accounts.  The Funds each pay Scudder  Trust Company an annual fee of $34.50 for
each account  maintained for a participant.  For the fiscal years ended June 30,
1997 and 1996,  Scudder  Trust  Company's  fees  amounted to $1,699,834 of which
$155,350  was unpaid  June 30, 1997 and  $1,431,726  for SCIT and  $525,821  and
$447,05 for Treasury Fund.
    

         This Statement of Additional  Information  contains the  information of
both Scudder Cash  Investment  Trust and Scudder U.S.  Treasury Money Fund. Each
Fund, through its individual  prospectus,  offers only its own shares, yet it is
possible  that one Fund might become  liable for a  misstatement  regarding  the
other Fund.  The Trustees of each Fund have  considered  this, and have approved
the use of this Statement of Additional Information.

         Each  Fund's  prospectus  and this  combined  Statement  of  Additional
Information omit certain  information  contained in the Registration  Statements
which the Funds  have filed  with the SEC under the  Securities  Act of 1933 and
reference is hereby made to the Registration  Statements for further information
with respect to the Funds and the securities offered hereby.  These Registration
Statements  are available for inspection by the public at the offices of the SEC
in Washington, D.C.

                                       46
<PAGE>

                              FINANCIAL STATEMENTS

Scudder Cash Investment Trust

   
         The  financial  statements,  including  the  investment  portfolio,  of
Scudder  Cash  Investment  Trust,   together  with  the  Report  of  Independent
Accountants,   Financial  Highlights  and  notes  to  financial  statements  are
incorporated by reference and attached hereto on pages 6 through 17,  inclusive,
in the Annual Report to the  Shareholders  of the Fund dated June 30, 1997,  and
are  hereby  deemed  to be a part  of  this  combined  Statement  of  Additional
Information.
    

Scudder U.S. Treasury Money Fund

   
         The  financial  statements,  including  the  investment  portfolio,  of
Scudder  U.S.  Treasury  Money  Fund,  together  with the Report of  Independent
Accountants,   Financial  Highlights  and  notes  to  financial  statements  are
incorporated by reference and attached hereto on pages 8 through 17,  inclusive,
in the Annual Report to the  Shareholders  of the Fund dated June 30, 1997,  and
are  hereby  deemed  to be a part  of  this  combined  Statement  of  Additional
Information.
    


                                       47
<PAGE>

                                    APPENDIX

                     DESCRIPTION OF COMMERCIAL PAPER RATINGS

Ratings of Municipal Obligations

         The six highest  ratings of Moody's for municipal bonds are Aaa, Aa, A,
Baa, Ba and B. Bonds rated Aaa are judged by Moody's to be of the best  quality.
Bonds rated Aa are judged to be of high quality by all standards.  Together with
the Aaa group,  they comprise what are generally  known as  high-quality  bonds.
Moody's states that Aa bonds are rated lower than the best bonds because margins
of protection or other elements make long-term risks appear somewhat larger than
for Aaa municipal  bonds.  Municipal  bonds which are rated A by Moody's possess
many favorable  investment  attributes  and are  considered  "upper medium grade
obligations."  Factors  giving  security to  principal  and  interest of A rated
municipal  bonds are  considered  adequate,  but elements  may be present  which
suggest a susceptibility to impairment sometime in the future.  Securities rated
Baa are considered  medium grade,  with factors giving security to principal and
interest adequate at present but may be unreliable over any period of time. Such
bonds have  speculative  elements as well as  investment-grade  characteristics.
Securities rated Ba or below by Moody's are considered  below investment  grade,
with  factors  giving   security  to  principal  and  interest   inadequate  and
potentially  unreliable  over any period of time.  Such  securities are commonly
referred to as "junk" bonds and as such they carry a high margin of risk.

         Moody's  ratings for  municipal  notes and other  short-term  loans are
designated Moody's Investment Grade (MIG). This distinction is in recognition of
the differences  between short-term and long-term credit risk. Loans bearing the
designation  MIG1  are  of the  best  quality,  enjoying  strong  protection  by
establishing  cash  flows of funds for their  servicing  or by  established  and
broad-based  access to the market for  refinancing,  or both.  Loans bearing the
designation MIG2 are of high quality,  with margins of protection ample although
not as large as in the preceding group.

         The six highest ratings of S&P for municipal bonds are AAA (Prime),  AA
(High-grade),  A  (Good-grade),  BBB  (Investment-grade)  and  BB  and B  (Below
investment-grade).  Bonds rated AAA have the highest rating assigned by S&P to a
municipal obligation.  Capacity to pay interest and repay principal is extremely
strong.  Bonds rated AA have a very strong  capacity to pay  interest  and repay
principal and differ from the highest rated issues only in a small degree. Bonds
rated A have a strong capacity to pay principal and interest,  although they are
somewhat more susceptible to the adverse effects of changes in circumstances and
economic conditions.  Bonds rated BBB have an adequate capacity to pay principal
and interest.  Adverse economic conditions or changing  circumstances are likely
to lead to a weakened  capacity to pay interest and repay principal for bonds of
this category than for bonds of higher rated categories.  Securities rated BB or
below by S&P are considered below investment grade, with factors giving security
to principal and interest inadequate and potentially  unreliable over any period
of time.  Such  securities are commonly  referred to as "junk" bonds and as such
they carry a high margin of risk.

         S&P's top ratings for  municipal  notes  issued after July 29, 1984 are
SP-1 and SP-2.  The  designation  SP-1  indicates a very strong  capacity to pay
principal  and interest.  A "+" is added for those issues  determined to possess
overwhelming  safety   characteristics.   An  "SP-2"  designation   indicates  a
satisfactory capacity to pay principal and interest.

         The six highest  ratings of Fitch for  municipal  bonds are AAA, AA, A,
BBB, BB and B. Bonds rated AAA are considered to be investment-grade  and of the
highest credit quality.  The obligor has an exceptionally  strong ability to pay
interest  and repay  principal,  which is unlikely to be affected by  reasonably
foreseeable events.  Bonds rated AA are considered to be investment grade and of
very high  credit  quality.  The  obligor's  ability to pay  interest  and repay
principal  is very  strong,  although  not quite as strong as bonds rated 'AAA.'
Because  bonds  rated in the 'AAA'  and 'AA'  categories  are not  significantly
vulnerable to foreseeable future developments,  short-term debt of these issuers
is generally  rated 'f-1+.' Bonds rated A are considered to be investment  grade
and of high credit  quality.  The  obligor's  ability to pay  interest and repay
principal is  considered  to be strong,  but may be more  vulnerable  to adverse
changes in economic  conditions and circumstances  than bonds with higher rates.
Bonds rated BBB are considered to be investment grade and of satisfactory credit
quality. The obligor's ability to pay interest and repay principal is considered
to be  adequate.  Adverse  changes in  economic  conditions  and  circumstances,
however,  are more likely to have adverse effects on these bonds,  and therefore
impair timely payment.  The likelihood that the ratings of these bonds will fall
below investment grade is higher than for bonds with greater ratings. Securities
rated BB or below by Fitch are considered below investment  grade,  with factors

                                       48
<PAGE>

giving security to principal and interest inadequate and potentially  unreliable
over any period of time.  Such  securities  are  commonly  referred to as "junk"
bonds and as such they carry a high margin of risk.

Commercial Paper Ratings

         Commercial  paper  rated  A-1  or  better  by  S&P  has  the  following
characteristics:  liquidity  ratios  are  adequate  to meet  cash  requirements;
long-term  senior  debt is rated "A" or better,  although  in some  cases  "BBB"
credits  may be  allowed;  the  issuer  has  access to at least  two  additional
channels of  borrowing;  and basic  earnings  and cash flow have an upward trend
with allowance made for unusual circumstances.  Typically, the issuer's industry
is well  established  and the issuer has a strong  position within the industry.
The reliability and quality of management are unquestioned.

         The rating Prime-1 is the highest  commercial  paper rating assigned by
Moody's.  Among the factors  considered by Moody's in assigning  ratings are the
following:  (1)  evaluation  of the  management  of  the  issuer;  (2)  economic
evaluation  of  the  issuer's   industry  or  industries  and  an  appraisal  of
speculative-type risks which may be inherent in certain areas; (3) evaluation of
the issuer's  products in relation to competition and customer  acceptance;  (4)
liquidity;  (5) amount and quality of long-term debt; (6) trend of earnings over
a period of ten  years;  (7)  financial  strength  of a parent  company  and the
relationship which exists with the issuer; and (8) recognition by the management
of obligations  which may be present or may arise as a result of public interest
questions and preparations to meet such obligations.

         The rating F-1+ is the  highest  rating  assigned  by Fitch.  Among the
factors  considered  by Fitch in  assigning  this rating are:  (1) the  issuer's
liquidity;  (2) its standing in the industry;  (3) the size of its debt; (4) its
ability to service its debt;  (5) its  profitability;  (6) its return on equity;
(7) its  alternative  sources of  financing;  and (8) its  ability to access the
capital markets.  Analysis of the relative strength or weakness of these factors
and others determines whether an issuer's commercial paper is rated F-1+.

         Relative  strength or weakness of the above  factors  determine how the
issuer's commercial paper is rated within the above categories.


                                       49
<PAGE>


Scudder
Cash Investment Trust

Annual Report
June 30, 1997

Pure No-Load(TM) Funds

A money market fund for investors seeking stability and liquidity of capital and
current income.

A pure no-load(TM) fund with no commissions to buy, sell, or exchange shares.

SCUDDER [LOGO]

<PAGE>

                                Table of Contents

 2  In Brief
 3  Letter from the Fund's President
 4  Portfolio Management Discussion
 7  Investment Portfolio
11  Financial Statements
14  Financial Highlights
15  Notes to Financial Statements
17  Report of Independent Accountants
20  Officers and Trustees
21  Investment Products and Services
22  Scudder Solutions
                                    In Brief

o Your Fund's investments in ultra short-term, high-quality securities
contributed to a total return of 4.73% for the fiscal year ended June 30, 1997.
The Fund's 30-day net annualized yield at the end of June was 4.73%.


o The Fund has recently adopted more flexible guidelines, and can now average
out to 90 days in maturity to take advantage of the slightly higher yields on
longer-maturity investments in the money-market universe.

o As rates edged higher on evidence of stronger economic growth late last year,
we began to extend the Fund's average maturity. At the end of June, the Fund's
average maturity stood at 73 days.

                     Page 2 -- Scudder Cash Investment Trust
<PAGE>
                        Letter From the Fund's President

Dear Shareholders,

     Throughout Scudder Cash Investment Trust's 1997 fiscal year, inflation
remained dormant, yet investors responded to strong economic growth as if higher
prices were just around the corner. At the end of March, the Federal Reserve
Board engineered a small increase in short-term interest rates, taking aim at
inflation before many economists were aware it was a serious threat. The
anticipation of this event in the financial markets affected all types of
fixed-income investments. However, those most sensitive to changes in the level
of interest rates -- longer-maturity bonds -- were the hardest hit.

     In contrast, your Fund's focus on the shortest-maturity and highest-quality
money market securities permitted the Fund's share price to remain impervious to
market volatility in keeping with its objective of maintaining a stable $1.00
share price. As the Fund's portfolio managers explain in the following letter,
steps were also taken during the period to improve the Fund's yield.

     We would like to take this opportunity to introduce a newcomer to Scudder's
mutual fund lineup: Scudder International Growth and Income Fund. The Fund
employs a yield-oriented approach to international investing and seeks to
provide long-term growth of capital plus current income. Investors who desire
international exposure but who wish to take a relatively conservative approach
may appreciate the Fund's emphasis on the dividend paying stocks of
well-established companies outside the United States. For a complete listing of
Scudder's mutual fund offerings, see page 21.

     Despite near-term uncertainty, we believe the global economic landscape
provides an excellent long-term backdrop for fixed-income investors. In the
report that follows, your Fund's managers discuss the events of the past 12
months as well as their outlook for fiscal year 1998. Thank you for choosing
Scudder Cash Investment Trust to help meet your investment needs. Please do not
hesitate to call Investor Relations at 1-800-225-2470 with any questions, or
visit our Web site at http://funds.scudder.com.

     Sincerely,


     /s/ David S. Lee
     David S. Lee
     President,
     Scudder Cash Investment Trust

                     Page 3 -- Scudder Cash Investment Trust
<PAGE>

                         Portfolio Management Discussion

Dear Shareholders,

Over the course of your Fund's 1997 fiscal year, investors continued to grapple
with an interesting paradox: growth without inflation. As the economy began its
sixth year of uninterrupted growth, economists and other market pundits strained
to see rising prices behind each new release of positive economic data. But
inflation was nowhere in sight. The economy heated up in earnest in late 1996
and went on to deliver 5.9% GDP growth in the first quarter of 1997.
Unemployment dropped to its lowest level since 1973, and investors widely
anticipated March's increase in the federal funds rate. After much interim
volatility, fixed-income investments rallied in the remaining weeks through June
30, as data began to suggest that growth in the second quarter would be slower.

Your Fund's investments in ultra short-term, high-quality securities helped it
successfully navigate the changing tides of investor sentiment that proved
detrimental to longer-maturity bonds during the period. Scudder Cash Investment
Trust maintained its $1.00 share price throughout the period and, as interest
rates edged higher, was able to provide a high level of income, contributing to
a total return of 4.73% for the fiscal year. The Fund's 30-day net annualized
yield at the end of June was 4.73%.

                             Fund Loosens Investment
                               Restrictions, Seeks
                                  Higher Yield

During the fiscal year, Scudder elected to discontinue having the Fund rated by
independent agencies such as Standard & Poor's. In the past, the Fund sought and
achieved the highest rating (AAA) in part by restricting the average maturity of
the portfolio and by investing only in the highest-rated securities.

By eliminating these stringent agency guidelines, the Fund has greater
flexibility to pursue a higher level of income. However, we intend to take a
conservative approach when adding credit risk to the Fund, in accordance with
the strict credit limitations mandate we have established with our credit
research group.

In order to achieve a AAA rating by Standard & Poor's, the Fund had to limit the
average maturity of its holdings to 60 days. The Fund can now extend to an
average maturity of 90 days and take advantage of the slightly higher yields on
longer-maturity investments in the money-market universe. Previously, the Fund
was also unable to own A2/P2 commercial paper if it wished to achieve its AAA
rating. A2/P2 commercial paper is generally issued by companies that pose a
slightly greater credit risk than those of the highest quality. Utilizing
Scudder's extensive corporate bond research talents, we believe we are able to
identify A2/P2 issuers that offer higher yielding paper with what we believe is
minimal added risk. That said, portfolio concentration in A2/P2 paper during the
year was below 5% at any given time.


                     Page 4 -- Scudder Cash Investment Trust
<PAGE>

                               Maturity Management
                                   Adds Value

Few tools are as important to the management of a money-market portfolio as its
average maturity. From the start of the fiscal year, the Fund's average maturity
remained below 50 days through the end of October. During this time, we
anticipated interest rates would rise and sought to avoid any potential price
volatility, confident that higher reinvestment rates were on the horizon. As
rates edged higher on evidence of stronger economic growth late last year, we
began to extend the Fund's average maturity. It wasn't until after the Federal
Reserve raised short-term rates in March, however, that the average maturity was
extended beyond 60 days. At the end of June, the Fund's average maturity stood
at 73 days.

                              A Cautionary Outlook

By the end of June, longer-maturity bonds had recovered from their late-March
selloff, and a host of crucial economic reports suggested that inflation is less
of a threat than many predicted. The six-year-old expansion may very well wind
down, paving the way for lower interest rates and a sustained bond market rally.
Importantly, profit expectations may be overly optimistic, given that many
companies are unable to raise prices. Also, at 5.5% the current federal funds
rate does not constitute "easy money" in our view.

But the timing of an economic downturn is difficult to predict. For now, growth
is strong and reported profits continue to exceed expectations. Although the Fed
left interest rates unchanged at its May 20 



                     Page 5 -- Scudder Cash Investment Trust
<PAGE>


and July 2 meetings, it may find sufficient reason to raise rates later this
year. Given this uncertain outlook for investors in longer-dated fixed-income
instruments, we believe Scudder Cash Investment Trust will likely have another
chance to demonstrate the value of owning a short-term investment vehicle as
part of a well-diversified portfolio. Plus, with our newly broadened average
maturity guidelines, we intend to take advantage of any future rate increases to
boost the Fund's yield.

Sincerely,

Your Portfolio Management Team

/s/David B. Wines             /s/Stephen L. Akers
David B. Wines                Stephen L. Akers


/s/Debra A. Hanson            /s/K. Sue Cote
Debra A. Hanson               K. Sue Cote


                         Scudder Cash Investment Trust:
                          A Team Approach to Investing

Scudder Cash Investment Trust is managed by a team of investment professionals
who each play an important role in the Fund's management process. Team members
work together to develop investment strategies and select securities for the
Fund's portfolio. They are supported by Scudder's large staff of economists,
research analysts, traders, and other investment specialists who work in
Scudder's offices across the United States and abroad. We believe our team
approach benefits Fund investors by bringing together many disciplines and
leveraging Scudder's extensive resources.

Lead Portfolio Manager David B. Wines assumed responsibility for the Fund's
day-to-day management in 1996. Mr. Wines focuses on overall investment strategy
and has eight years of investment industry experience. Stephen L. Akers,
Portfolio Manager, joined the Fund's team in 1994 and has managed several
fixed-income portfolios since joining Scudder in 1984. Debra A. Hanson,
Portfolio Manager, assists with the development and execution of investment
strategy and has been with Scudder since 1983. K. Sue Cote, Portfolio Manager,
joined Scudder in 1983 and has 13 years experience working with short-term
fixed-income investments.

                     Page 6 -- Scudder Cash Investment Trust
<PAGE>
                                 Investment Portfolio as of June 30, 1997

<TABLE>
<CAPTION>
                                                                                             Principal              Value ($)
                                                                                             Amount ($)              (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
Repurchase Agreements 3.6%
- ------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                           <C>                   <C>   
Repurchase Agreement with Donaldson, Lufkin & Jenrette dated 6/30/97 at 5.9%, to be
  repurchased at $46,534,625 on 7/1/97, collateralized by a $40,843,000 U.S. Treasury
  Note, 9.125%, 5/15/09 ....................................................................  46,527,000            46,527,000
Repurchase Agreement with State Street Bank and Trust Company dated 6/30/97 at 5.6%, to be
  repurchased at $5,034,783 on 7/1/97, collateralized by a $5,100,000 U.S. Treasury
  Bond, 6%, 5/31/98 ........................................................................   5,034,000             5,034,000
- ------------------------------------------------------------------------------------------------------------------------------
Total Repurchase Agreements (Cost $51,561,000)                                                                      51,561,000
- ------------------------------------------------------------------------------------------------------------------------------
Commercial Paper 56.9%
- ------------------------------------------------------------------------------------------------------------------------------
Health 1.7%
Pharmaceuticals
Schering Corp., 5.56%, 7/8/97* .............................................................  24,625,000            24,594,692
                                                                                                                   -----------
Communications 5.2%
Telephone/Communications
Ameritech Corp., 5.62%, 10/28/97* ..........................................................  20,000,000            19,628,000
Ameritech Corp., 5.535%, 12/22/97* .........................................................  35,000,000            34,050,625
BellSouth Telecommunications Inc., 5.525%, 9/15/97* ........................................  20,000,000            19,761,728
                                                                                                                   -----------
                                                                                                                    73,440,353
                                                                                                                   -----------
Financial 41.7%
Banks 10.0%
Abbey National North America, 5.295%, 8/11/97* .............................................  20,000,000            19,871,246
Abbey National North America, 5.5%, 11/26/97 ...............................................  40,000,000            39,957,262
Chase Bank USA, 5.55%, 11/13/97* ...........................................................  10,000,000             9,982,806
Chase Manhattan Bank, 5.53%, 7/31/97 .......................................................  10,000,000             9,997,622
Private Export Funding Corp., 5.39%, 8/25/97* ..............................................  24,990,000            24,775,499
Private Export Funding Corp., 5.53%, 12/23/97* .............................................  40,000,000            38,937,777
                                                                                                                   -----------
                                                                                                                   143,522,212
                                                                                                                   -----------
Insurance 5.2%
Prudential Funding Corp., 5.33%, 7/15/97* ..................................................  10,000,000             9,976,948
Prudential Funding Corp., 5.28%, 8/29/97* ..................................................  20,000,000            19,816,396
Prudential Funding Corp., 5.73%, 10/14/97* .................................................  45,000,000            44,260,650
                                                                                                                   -----------
                                                                                                                    74,053,994
                                                                                                                   -----------
Business Finance 3.5%
CIT Group Holdings Inc., 5.63%, 7/30/97* ...................................................  20,000,000            19,908,005
Corporate Asset Funding Corp., 5.52% 7/15/97* ..............................................  30,000,000            29,935,600
                                                                                                                   -----------
                                                                                                                    49,843,605
                                                                                                                   -----------
</TABLE>

    The accompanying notes are an integral part of the financial statements.


                       7 -- Scudder Cash Investment Trust
<PAGE>

<TABLE>
<CAPTION>
                                                                                             Principal              Value ($)
                                                                                             Amount ($)              (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                           <C>                   <C>       
Consumer Finance 5.2%
FCar Owner Trust I, 5.58%, 9/8/97* .........................................................  25,300,000            25,025,987
Ford Motor Credit Co., 5.66%, 10/9/97* .....................................................  30,000,000            29,537,589
Household Finance Corp., 5.65%, 7/29/97* ...................................................  20,000,000            19,911,057
                                                                                                                   -----------
                                                                                                                    74,474,633
                                                                                                                   -----------
Other Financial Companies 17.8%
American General Finance Corp., 5.34%, 7/2/97* .............................................  20,000,000            19,993,840
American General Finance Corp., 5.61%, 7/8/97* .............................................  40,000,000            39,950,486
Associates Corp. of North America, 5.65%, 8/5/97* ..........................................  40,000,000            39,778,888
Avco Financial Services Inc., 5.57%, 7/15/97* ..............................................  25,000,000            24,942,370
Avco Financial Services, Inc., 5.53%, 9/11/97* .............................................  30,000,000            29,661,158
Credit Suisse First Boston Corp., 5.527%, 4/15/98 ..........................................   9,617,941             9,617,941
General Electric Capital Corp., 5.55%, 8/12/97* ............................................  40,000,000            39,734,828
General Electric Capital Corp., 5.42%, 8/13/97* ............................................  20,000,000            19,865,356
Rincon Securities Inc., 5.57%, 9/9/97* .....................................................   6,000,000             5,934,088
Transamerica Finance Corp., 5.275%, 8/14/97* ...............................................  24,000,000            23,834,756
                                                                                                                   -----------
                                                                                                                   253,313,711
                                                                                                                   -----------
Manufacturing 5.1%
Office Equipment/Supplies
Pitney Bowes Credit Corp., 5.52%, 7/28/97* .................................................  25,000,000            24,896,500
Pitney Bowes Credit Corp., 5.64%, 10/7/97* .................................................  10,000,000             9,848,869
Pitney Bowes Credit Corp., 5.64%, 10/8/97* .................................................  22,000,000            21,664,205
Pitney Bowes Credit Corp., 5.63%, 11/17/97* ................................................  16,000,000            15,652,800
                                                                                                                   -----------
                                                                                                                    72,062,374
                                                                                                                   -----------
Energy 1.7%
Oil & Gas Production
Atlantic Richfield Co., 5.65%, 10/7/97* ....................................................  25,000,000            24,622,173
                                                                                                                   -----------
Utilities 1.5%
Electric Utilities
Pacific Gas & Electric Co., 5.51%, 7/22/97* ................................................  22,000,000            21,929,288
- ------------------------------------------------------------------------------------------------------------------------------
Total Commercial Paper (Cost $811,949,892)                                                                         811,857,035
- ------------------------------------------------------------------------------------------------------------------------------
Certificates Of Deposit 9.6%
- ------------------------------------------------------------------------------------------------------------------------------
Chase Bank Delaware, 5.81%, 12/5/97 ........................................................  15,000,000            14,998,495
Federal Farm Credit Bank, 5.6%, 11/3/97 ....................................................  10,000,000            10,001,600
LaSalle National Bank, 5.81%, 12/2/97 ......................................................  10,000,000             9,999,015
Mellon Bank Corp., 6.13%, 9/9/97 ...........................................................  15,000,000            15,004,846
</TABLE>

    The accompanying notes are an integral part of the financial statements.


                       8 -- Scudder Cash Investment Trust
<PAGE>

<TABLE>
<CAPTION>
                                                                                              Principal             Value ($)
                                                                                              Amount ($)             (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                           <C>                   <C>       
Morgan Guaranty Trust Company, 5.955%, 6/22/98 .............................................  36,500,000            36,488,094
Morgan Guaranty Trust Company, 5.71%, 1/6/98 ...............................................  10,000,000             9,986,621
National Bank of Detroit, 5.76%, 2/3/98 ....................................................  10,000,000             9,989,081
NationsBank of South Carolina, N.A., 5.55%, 7/24/97 ........................................  30,000,000            30,000,000
- ------------------------------------------------------------------------------------------------------------------------------
Total Certificates of Deposit (Cost $136,484,761)                                                                  136,467,752
- ------------------------------------------------------------------------------------------------------------------------------
U. S. Government Agency Obligations 10.7%
- ------------------------------------------------------------------------------------------------------------------------------
Federal National Mortgage Association, 5.25%, 7/14/99** ....................................  56,000,000            55,921,600
Student Loan Marketing Association, 5.42%, 10/30/97** ......................................  50,000,000            50,070,500
Student Loan Marketing Association, 5.25%, 7/12/99** .......................................  46,500,000            46,379,100
- ------------------------------------------------------------------------------------------------------------------------------
Total U.S. Government Agency Obligations (Cost $152,500,000)                                                       152,371,200
- ------------------------------------------------------------------------------------------------------------------------------
Medium-Term and Short-Term Notes 18.5%
- ------------------------------------------------------------------------------------------------------------------------------
Consumer Discretionary 0.5%
Department & Chain Stores
Wal-Mart Stores Inc. Note, 5.5%, 3/1/98 ....................................................   8,200,000             8,178,352
                                                                                                                   -----------
Financial 18.0%
Banks 14.8%
Bank One, Columbus, N.A., Floating Rate Note, 5.69%, 6/10/98** .............................  30,000,000            29,978,100
Bank of America NT&SA, 5.87%, 1/5/98 .......................................................  35,000,000            35,006,476
Bankers Trust Co., Medium Term Note, 5.71%, 4/14/98** ......................................  30,000,000            30,000,000
FCC National Bank Note, 5.725%, 1/7/98 .....................................................  10,000,000             9,987,351
FCC National Bank Note, 5.73%, 8/21/97 .....................................................  10,000,000             9,997,083
FCC National Bank Note, 5.59%, 11/7/97 .....................................................  31,000,000            30,952,633
Fifth Third Bank, 5.45%, 7/11/97 ...........................................................  25,000,000            24,998,563
Huntington National Bank, 6.2%, 7/8/97 .....................................................   5,000,000             5,000,196
Huntington National Bank, 5.85%, 9/30/97 ...................................................  15,000,000            14,991,775
Pittsburgh National Bank, 5.591%, 7/1/97** .................................................  20,000,000            19,999,973
                                                                                                                   -----------
                                                                                                                   210,912,150
                                                                                                                   -----------
Other Financial Companies 3.2%
American Express Centurion, Floating Rate Bank Note, 5.658%, 4/24/98** .....................  20,000,000            20,000,000
First Bank Minnesota Corp., Floating Rate Bank Note, 5.648%, 11/19/97** ....................  25,000,000            24,997,500
                                                                                                                    ----------
                                                                                                                    44,997,500
- ------------------------------------------------------------------------------------------------------------------------------
Total Medium-Term and Short-Term Notes (Cost $264,162,501)                                                         264,088,002
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.


                       9 -- Scudder Cash Investment Trust
<PAGE>

<TABLE>
<CAPTION>
                                                                                             Principal              Value ($)
                                                                                             Amount ($)             (Note A)
- ------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                           <C>                <C>       
Fixed Time Deposits 0.7%
- ------------------------------------------------------------------------------------------------------------------------------
Financial                                                                                                        -------------
National Bank of Detroit, 5.74%, 1/22/98 (Cost $10,000,000) ................................  10,000,000             9,987,966
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
Total Investment Portfolio-- 100.0% (Cost $1,426,658,154) (a)                                                    1,426,332,955
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

  (a) The cost for federal income tax purposes was $1,426,658,154. At June 30,
      1997, net unrealized depreciation for all securities based on tax cost was
      $325,199. This consisted of aggregate gross unrealized appreciation for
      all securities in which there was an excess of market value over tax cost
      of $135,052 and aggregate gross unrealized depreciation for all securities
      in which there was an excess of tax cost over market value of $460,251.

    * Bond equivalent yield to maturity; not a coupon rate. (Unaudited)

   ** Floating rate notes are securities whose yields vary with a designated
      market index or market rate, such as the coupon-equivalent of the Treasury
      bill rate. These securities are shown at their rate as of June 30, 1997.

    The accompanying notes are an integral part of the financial statements.


                       10 -- Scudder Cash Investment Trust
<PAGE>

<TABLE>
<CAPTION>
                              Financial Statements
                       Statement of Assets and Liabilities
                               as of June 30, 1997

 Assets
 ----------------------------------------------------------------------------------------------------------------------------
<S>                                                                                          <C>           
                  Investments, at value (identified cost $1,426,658,154) .............      $1,426,332,955
                  Cash ...............................................................                 370
                  Receivable for Fund shares sold ....................................          10,244,030
                  Interest receivable ................................................          11,058,021
                  Other assets .......................................................              48,232
                                                                                           ----------------
                  Total assets .......................................................       1,447,683,608

 Liabilities
 ----------------------------------------------------------------------------------------------------------------------------
                  Payable for Fund shares redeemed ...................................          15,636,071
                  Dividends payable ..................................................             253,951
                  Accrued management fee .............................................             492,255
                  Other payables and accrued expenses ................................             677,814
                                                                                           ----------------
                  Total liabilities ..................................................          17,060,091
                  -----------------------------------------------------------------------------------------
                  Net assets, at value                                                      $1,430,623,517
                  -----------------------------------------------------------------------------------------
 Net Assets
 ----------------------------------------------------------------------------------------------------------------------------
                  Net assets consist of:
                  Unrealized depreciation on investments .............................            (325,199)
                  Accumulated net realized loss ......................................            (459,101)
                  Paid-in capital ....................................................       1,431,407,817
                  -----------------------------------------------------------------------------------------
                  Net assets, at value                                                      $1,430,623,517
                  -----------------------------------------------------------------------------------------
 Net Asset Value
 ----------------------------------------------------------------------------------------------------------------------------
                  Net Asset Value, offering and redemption price per share
                  ($1,430,623,517/1,430,702,947 outstanding shares of 
                  beneficial interest, $.01 par value, unlimited number                    ----------------
                     of shares authorized) ...........................................               $1.00
                                                                                           ----------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.


                       11 -- Scudder Cash Investment Trust
<PAGE>

<TABLE>
<CAPTION>
                             Statement of Operations
                            year ended June 30, 1997

 Investment Income
 ------------------------------------------------------------------------------------------------------------------------------
 <S>                                                                                         <C>          
                  Interest ...........................................................       $  79,522,543
                                                                                           ----------------
                  Expenses:
                  Management fee .....................................................           5,944,464
                  Services to shareholders ...........................................           5,587,530
                  Custodian and accounting fees ......................................             253,722
                  Trustees' fees and expenses ........................................              38,301
                  Reports to shareholders ............................................             395,021
                  Registration fees ..................................................              70,388
                  Legal ..............................................................              33,783
                  Auditing ...........................................................              39,710
                  Other ..............................................................              66,989
                                                                                           ----------------
                  Total expenses before reductions ...................................          12,429,908
                  Expense reductions .................................................              (2,420)
                                                                                           ----------------
                  Expenses, net ......................................................          12,427,488
                  -----------------------------------------------------------------------------------------
                  Net investment income                                                         67,095,055
                  -----------------------------------------------------------------------------------------
 
 Unrealized gain on investment transactions
 ------------------------------------------------------------------------------------------------------------------------------
                  Net unrealized appreciation during the period on investments .......             911,613
                  -----------------------------------------------------------------------------------------
                  Net gain on investments                                                          911,613
                  -----------------------------------------------------------------------------------------
                  -----------------------------------------------------------------------------------------
                  Net increase in net assets resulting from operations                       $  68,006,668
                  -----------------------------------------------------------------------------------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.


                       12 -- Scudder Cash Investment Trust
<PAGE>

<TABLE>
<CAPTION>
                       Statements of Changes in Net Assets
                                                                                   Years Ended June 30,
 Increase (Decrease) in Net Assets                                                 1997             1996
 ---------------------------------------------------------------------------------------------------------------------
 <S>                                                                           <C>              <C>         
                  Operations:
                  Net investment income ...................................    $ 67,095,055     $ 68,809,419
                  Net unrealized appreciation on investment transactions
                     during the period ....................................         911,613          268,338
                                                                            ---------------   --------------
                  Net increase in net assets resulting from operations ....      68,006,668       69,077,757
                                                                            ---------------   --------------
                  Distributions to shareholders:
                  From net investment income ..............................     (67,095,055)     (68,809,419)
                                                                            ---------------   --------------
                  Fund share transactions in net asset value of 
                  $1.00 per share: Shares sold ............................   2,146,433,255    1,734,972,406
                  Net asset value of shares issued to shareholders in
                  reinvestment of distributions............................      62,538,989       64,180,974
                  Shares redeemed .........................................  (2,166,626,217)  (1,932,327,819)
                                                                            ---------------   --------------
                  Net increase (decrease) in net assets from Fund share
                  transactions ............................................      42,346,027     (133,174,439)
                                                                            ---------------   --------------
                  Increase (decrease) in net assets .......................      43,257,640     (132,906,101)
                  Net assets at beginning of period .......................   1,387,365,877    1,520,271,978
                                                                            ---------------   --------------
                  Net assets at end of period .............................  $1,430,623,517   $1,387,365,877
                                                                            ---------------   --------------
</TABLE>

    The accompanying notes are an integral part of the financial statements.


                       13 -- Scudder Cash Investment Trust
<PAGE>

                              Financial Highlights

The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the financial
statements.

<TABLE>
<CAPTION>
                                                                                Years Ended June 30,

                                            1997    1996    1995    1994     1993    1992    1991    1990     1989    1988
 ----------------------------------------------------------------------------------------------------------------------------
 <S>                                      <C>      <C>     <C>     <C>     <C>      <C>     <C>     <C>     <C>      <C>   
 Net asset value, beginning of           ------------------------------------------------------------------------------------
    period .............................  $1.000   $1.000  $1.000  $1.000  $1.000   $1.000  $1.000  $1.000  $1.000   $1.000
                                         ------------------------------------------------------------------------------------
 Net investment income .................    .046     .048    .048    .027    .027     .047    .069    .080    .082     .064
 Distributions from net investment
    income and net realized capital     
    gains ..............................   (.046)   (.048)  (.048)  (.027)  (.027)   (.047)  (.069)  (.080)  (.082)   (.064)
                                          -----------------------------------------------------------------------------------
 Net asset value, end of period ........  $1.000   $1.000  $1.000  $1.000  $1.000   $1.000  $1.000  $1.000  $1.000   $1.000
 ----------------------------------------------------------------------------------------------------------------------------
 Total Return (%) ......................    4.73     4.89    4.90    2.77    2.75     4.76    7.13    8.23    8.49     6.59
 Ratios and Supplemental Data           
 Net assets, end of period ($ millions).   1,431    1,387   1,520   1,430   1,119    1,361   1,736   1,644   1,563    1,370
 Ratio of operating expenses, net to
    average daily net assets (%)........     .86      .83     .78     .82     .78      .70     .66     .67     .66      .68
 Ratio of operating expenses before
    expense reduction, to average
    daily net assets (%)................     .86      .83     .78     .82     .78      .70     .66     .67     .66      .68 
 Ratio of net investment income
    to average daily net assets (%).....    4.63     4.79    4.84    2.78    2.72     4.58    6.91    7.93    8.21     6.44     
</TABLE>


                       14 -- Scudder Cash Investment Trust
<PAGE>

                          Notes to Financial Statements

                       A. Significant Accounting Policies

Scudder Cash Investment Trust (the "Fund") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940, as
amended, as a diversified, open-end management investment company.

The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which require the use of management estimates.
The policies described below are followed consistently by the Fund in the
preparation of its financial statements.

Security Valuation. Portfolio securities which have remaining maturities of
sixty days or less are valued by the amortized cost method permitted in
accordance with Rule 2a-7 under the Investment Company Act of 1940. Portfolio
securities for which market quotations are readily available and which have
remaining maturities of sixty-one days or more from the date of valuation are
valued at market. On the sixtieth day prior to maturity and thereafter until
maturity, securities originally purchased with more than sixty days remaining to
maturity are valued at amortized cost calculated daily, based upon the market
valuation of the securities on the sixty-first day prior to maturity. Other
securities are appraised at fair value as determined in good faith by or on
behalf of the Trustees of the Fund. Repurchase agreements are valued at cost
which, when combined with accrued interest receivable, approximates market.

Repurchase Agreements. The Fund may enter into repurchase agreements with
certain banks and broker/dealers whereby the Fund, through its custodian,
receives delivery of the underlying securities, the amount of which at the time
of purchase and each subsequent business day is required to be maintained at
such a level that the market value, depending on the maturity of the repurchase
agreement, is equal to at least 100.5% of the repurchase price.

Federal Income Taxes. The Fund's policy is to comply with the requirements of
the Internal Revenue Code which are applicable to regulated investment companies
and to distribute all of its taxable income to its shareholders. The Fund
accordingly paid no federal income taxes and no provision for federal income
taxes was required. At June 30, 1997, the Fund had a net tax basis capital loss
carryforward of approximately $459,000, which may be applied against any
realized net taxable capital gains of each succeeding year until fully utilized
or until June 30, 2004, ($279,000) and June 30, 2005 ($180,000), the respective
expiration dates, whichever occurs first.

Distribution of Income and Gains. All of the net investment income of the Fund
is declared as a dividend to shareholders of record as of twelve o'clock noon on
each business day and is paid to shareholders monthly. During any particular
year, net realized gains from investment transactions, in excess of available
capital loss carryforwards, would be taxable to the Fund if not distributed and,
therefore, will be distributed to the shareholders. An additional distribution
may be made to the extent necessary to avoid the payment of a four percent
federal excise tax.

The Fund uses the specific identification method for determining realized gain
or loss on investments for both financial and federal income tax reporting
purposes.

Other. Investment transactions are accounted for on a trade-date basis (which in
most instances is the same as the settlement date). Interest income is accrued
pro rata to maturity. All premiums and discounts are amortized/accreted for both
tax and financial reporting purposes.


                       15 -- Scudder Cash Investment Trust
<PAGE>

                               B. Related Parties

Under the Fund's Investment Advisory Agreement (the "Agreement") with Scudder
Stevens & Clark, Inc. (the "Adviser"), the Fund agrees to pay the Adviser a fee
equal to an annual rate of 0.50% of the first $250,000,000 of the Fund's average
daily net assets, 0.45% of the next $250,000,000 of such net assets, 0.40% of
the next $500,000,000 of such net assets and 0.35% of such net assets in excess
of $1,000,000,000, computed and accrued daily and payable monthly. As manager of
the assets of the Fund, the Adviser directs the investments of the Fund in
accordance with its investment objectives, policies, and restrictions. The
Adviser determines the securities, instruments, and other contracts relating to
investments to be purchased, sold or entered into by the Fund. In addition to
portfolio management services, the Adviser provides certain administrative
services in accordance with the Management Agreement. The Agreement also
provides that if the Fund's expenses, exclusive of taxes, interest and
extraordinary expenses, exceed specified limits, such excess, up to the amount
of the management fee, will be paid by the Adviser. In addition, effective June
30, 1997, the Adviser has agreed to maintain the annualized expenses of the Fund
at not more than .85% of average daily net assets until October 31, 1998. For
the year ended June 30, 1997, the fee pursuant to the Agreement amounted to
$5,944,464 which was equivalent to an annual effective rate of .41% of the
Fund's average daily net assets.

On June 26, 1997, the Adviser entered into an agreement with The Zurich
Insurance Company ("Zurich"), an international insurance and financial services
organization, pursuant to which Zurich will acquire a majority interest in the
Adviser, and the Adviser will form a new global investment organization by
combining with Zurich's subsidiary, Zurich Kemper Investments, Inc. and change
its name to Scudder Kemper Investments, Inc. Subject to the receipt of the
required regulatory and shareholder approvals, the transaction is expected to
close in the fourth quarter of 1997.

Scudder Service Corporation ("SSC"), a subsidiary of the Adviser, is the
transfer, dividend paying and shareholder service agent for the Fund. For the
year ended June 30, 1997, the amount charged to the Fund by SSC aggregated
$2,907,025, of which $225,977 is unpaid at June 30, 1997.

Scudder Trust Company ("STC"), a subsidiary of the Adviser, provides
recordkeeping and other services in connection with certain retirement and
employee benefit plans invested in the Fund. For the year ended June 30, 1997,
the amount charged to the Fund by STC aggregated $1,699,834, of which $155,350
is unpaid at June 30, 1997.

Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of the Adviser, is
responsible for determining the daily net asset value per share and maintaining
the portfolio and general accounting records of the Fund. For the year ended
June 30, 1997, the amount charged to the Fund by SFAC aggregated $105,874, of
which $8,818 is unpaid at June 30, 1997.

The Fund is one of several Scudder Funds (the "Underlying Funds") in which the
Scudder Pathway Series Portfolios (the "Portfolios") invest. In accordance with
the Special Servicing Agreement entered into by the Adviser, the Portfolios, the
Underlying Funds, SSC, SFAC, STC, and Scudder Investor Services, Inc., expenses
from the operation of the Portfolios are borne by the Underlying Funds based on
each Underlying Fund's proportionate share of assets owned by the Portfolios. No
Underlying Funds will be charged expenses that exceed the estimated savings to
each respective Underlying Fund. These estimated savings result from the
elimination of separate shareholder accounts which either currently are or have
potential to be invested in the Underlying Funds. At June 30, 1997, the Special
Servicing Agreement expense charged to the Fund amounted to $67,107.

The Fund pays each Trustee not affiliated with the Adviser $4,000 annually plus
specified amounts for attended board and committee meetings. For the year ended
June 30, 1997, Trustees' fees and expenses aggregated $38,301.


                       16 -- Scudder Cash Investment Trust
<PAGE>

                        Report of Independent Accountants

To the Board of Trustees and the Shareholders of Scudder Cash Investment Trust:

We have audited the accompanying statement of assets and liabilities of Scudder
Cash Investment Trust, including the investment portfolio, as of June 30, 1997,
and the related statement of operations for the year then ended, the statements
of changes in net assets for each of the two years in the period then ended, and
the financial highlights for each of the ten years in the period then ended.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of June
30, 1997, by correspondence with the custodian. An audit also includes assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Scudder Cash Investment Trust as of June 30, 1997, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for each of the ten years
in the period then ended, in conformity with generally accepted accounting
principles.

Boston, Massachusetts                                   COOPERS & LYBRAND L.L.P.
August 5, 1997

                       17 -- Scudder Cash Investment Trust
<PAGE>



                                    This Page
                                  intentionally
                                   left blank.




                    Page 18 -- Scudder Cash Investment Trust
<PAGE>


                                    This Page
                                  intentionally
                                   left blank.




                    Page 19 -- Scudder Cash Investment Trust
<PAGE>
                              Officers and Trustees


David S. Lee*
President and Trustee

Dudley H. Ladd*
Vice President and Trustee

E. Michael Brown*
Trustee

Henry P. Becton, Jr.
Trustee; President and 
General Manager, WGBH
Educational Foundation

Dawn-Marie Driscoll
Trustee;  Executive Fellow, 
Center for Business Ethics; 
President, Driscoll Associates

Peter B. Freeman
Trustee; Corporate
Director and Trustee

George M. Lovejoy, Jr.
Trustee; President and
Director, Fifty Associates

Stephen L. Akers*
Vice President

Jerard K. Hartman*
Vice President

Thomas W. Joseph*
Vice President

Thomas F. McDonough*
Vice President and Secretary

Pamela A. McGrath*
Vice President and Treasurer

Edward J. O'Connell*
Vice President and Assistant Treasurer

David Wines*
Vice President

* Scudder, Stevens & Clark, Inc.

                    Page 20 -- Scudder Cash Investment Trust
<PAGE>

                        Investment Products and Services

The Scudder Family of Funds+++
- --------------------------------------------------------------------------------
Money Market
- ------------
  Scudder U.S. Treasury Money Fund
  Scudder Cash Investment Trust
  Scudder Money Market Series -- 
     Premium Shares*
     Managed Shares*
  Scudder Government Money Market Series -- 
     Managed Shares*

Tax Free Money Market+
- ----------------------
  Scudder Tax Free Money Fund
  Scudder Tax Free Money Market Series--
     Managed Shares*
  Scudder California Tax Free Money Fund**
  Scudder New York Tax Free Money Fund**

Tax Free+
- ---------
  Scudder Limited Term Tax Free Fund
  Scudder Medium Term Tax Free Fund
  Scudder Managed Municipal Bonds
  Scudder High Yield Tax Free Fund
  Scudder California Tax Free Fund**
  Scudder Massachusetts Limited Term Tax Free Fund**
  Scudder Massachusetts Tax Free Fund**
  Scudder New York Tax Free Fund**
  Scudder Ohio Tax Free Fund**
  Scudder Pennsylvania Tax Free Fund**

U.S. Income
- -----------
  Scudder Short Term Bond Fund
  Scudder Zero Coupon 2000 Fund
  Scudder GNMA Fund
  Scudder Income Fund
  Scudder High Yield Bond Fund

Global Income
- -------------
  Scudder Global Bond Fund
  Scudder International Bond Fund
  Scudder Emerging Markets Income Fund

Asset Allocation
- ----------------
  Scudder Pathway Conservative Portfolio
  Scudder Pathway Balanced Portfolio
  Scudder Pathway Growth Portfolio
  Scudder Pathway International Portfolio

U.S. Growth and Income
- ----------------------
  Scudder Balanced Fund
  Scudder Growth and Income Fund

U.S. Growth
- -----------
  Value
    Scudder Large Company Value Fund
    Scudder Value Fund
    Scudder Small Company Value Fund
    Scudder Micro Cap Fund

  Growth
    Scudder Classic Growth Fund
    Scudder Large Company Growth Fund
    Scudder Development Fund
    Scudder 21st Century Growth Fund

Global Growth
- -------------
  Worldwide
    Scudder Global Fund
    Scudder International Growth and Income Fund
    Scudder International Fund
    Scudder Global Discovery Fund
    Scudder Emerging Markets Growth Fund
    Scudder Gold Fund

  Regional
    Scudder Greater Europe Growth Fund
    Scudder Pacific Opportunities Fund
    Scudder Latin America Fund
    The Japan Fund, Inc.

Retirement Programs
- -------------------
  IRA
  SEP IRA
  Keogh Plan
  401(k), 403(b) Plans
  Scudder Horizon Plan**+++ +++
    (a variable annuity)

Closed-End Funds#
- --------------------------------------------------------------------------------
  The Argentina Fund, Inc.
  The Brazil Fund, Inc.
  The Korea Fund, Inc.
  The Latin America Dollar Income Fund, Inc.
  Montgomery Street Income Securities, Inc.
  Scudder New Asia Fund, Inc.
  Scudder New Europe Fund, Inc.
  Scudder Spain and Portugal Fund, Inc.
  Scudder World Income Opportunities
    Fund, Inc.

For complete information on any of the above Scudder funds, including management
fees and expenses, call or write for a free prospectus. Read it carefully before
you invest or send money. +++Funds within categories are listed in order from
expected least risk to most risk. +A portion of the income from the tax-free
funds may be subject to federal, state, and local taxes. *A class of shares of
the Fund. **Not available in all states. +++ +++A no-load variable annuity
contract provided by Charter National Life Insurance Company and its affiliate,
offered by Scudder's insurance agencies, 1-800-225-2470. #These funds, advised
by Scudder, Stevens & Clark, Inc., are traded on various stock exchanges.


                    Page 21 -- Scudder Cash Investment Trust
<PAGE>

                                Scudder Solutions
<TABLE>
<CAPTION>


Convenient ways to invest, quickly and reliably:
- ------------------------------------------------------------------------------------------------------------------------------
<S>       <C>                                                          <C>
          Automatic Investment Plan                                    QuickBuy

          A convenient investment program in which you designate       Lets you purchase Scudder fund shares
          the purchase details and the bank account, and money is      electronically, avoiding potential mailing delays;
          electronically debited from that account monthly to          designate a bank account and the transaction
          regularly purchase fund shares and "dollar cost average"     details, and money for each of your transactions is
          -- buy more shares when the fund's price is lower and        electronically debited from that account.
          fewer when it's higher, which can reduce your average
          purchase price over time.

          Automatic Dividend Transfer                                  Payroll Deduction and Direct Deposit

          The most timely, reliable, and convenient way to             Have all or part of your paycheck -- even government
          purchase shares -- use distributions from one Scudder        checks -- invested in up to four Scudder funds at
          fund to purchase shares in another, automatically            one time.
          (accounts with identical registrations or the same
          social security or tax identification number).

          Dollar cost averaging involves continuous investment in securities regardless of price
          fluctuations and does not assure a profit or protect against loss in declining markets.
          Investors should consider their ability to continue such a plan through periods of low price
          levels.

Around-the-clock electronic account service and information, including some transactions:
- ------------------------------------------------------------------------------------------------------------------------------
          Scudder Automated Information Line: SAIL(TM) --              Scudder's Web Site -- http://funds.scudder.com
          1-800-343-2890
                                                                       Scudder Electronic Account Services: Offering
          Personalized account information, the ability to             account information and transactions, interactive
          exchange or redeem shares, and information on other          worksheets, prospectuses and applications for all
          Scudder funds and services via touchtone telephone.          Scudder funds, plus your current asset allocation,
                                                                       whenever you need them. Scudder's Site also
                                                                       provides news about Scudder funds, retirement
                                                                       planning information, and more.

Retirees and those who depend on investment proceeds for living expenses can enjoy these convenient,
timely, and reliable automated withdrawal programs:
- ------------------------------------------------------------------------------------------------------------------------------
          Automatic Withdrawal Plan                                    QuickSell

          You designate the bank account, determine the schedule       Provides speedy access to your money by
          (as frequently as once a month) and amount of the            electronically crediting your redemption proceeds
          redemptions, and Scudder does the rest.                      to the bank account you designate.

          DistributionsDirect

          Automatically deposits your fund distributions into the
          bank account you designate within three business days
          after each distribution is paid.

For more information about these services, call a Scudder representative at 1-800-225-5163
- ------------------------------------------------------------------------------------------------------------------------------


                    Page 22 -- Scudder Cash Investment Trust
<PAGE>


Mutual Funds and More -- Brokerage and Guidance Services:
- ------------------------------------------------------------------------------------------------------------------------------
          Scudder Brokerage Services                             Scudder Portfolio Builder

          Offers you access to a world of investments,           A free service designed to help suggest ways investors like
          including stocks, corporate bonds, Treasuries, plus    you can diversify your portfolio among domestic and global,
          over 6,000 mutual funds from at least 150 mutual       as well as equity, fixed-income, and money market funds,
          fund companies. And Scudder Fund Folio(SM) provides    using Scudder funds.
          investors with access to a marketplace of more than
          500 no-load funds from well-known companies--with no   Personal Counsel from Scudder(SM)
          transaction fees or commissions. Scudder
          shareholders can take advantage of a Scudder           Developed for investors who prefer the benefits of no-load
          Brokerage account already reserved for them, with      Scudder funds but want ongoing professional assistance in
          no minimum investment. For information about           managing a portfolio. Personal Counsel(SM) is a highly
          Scudder Brokerage Services, call 1-800-700-0820.       customized, fee-based asset management service for
                                                                 individuals investing $100,000 or more.


          Fund Folio funds held less than six months will be charged a fee for redemptions. You can buy
          shares directly from the fund itself or its principal underwriter or distributor without
          paying this fee. Scudder Brokerage Services, Inc., 42 Longwater Drive, Norwell, MA 02061.
          Member SIPC.

          Personal Counsel From Scudder(SM) and Personal Counsel(SM) are service marks of and represent a
          program offered by Scudder Investor Services, Inc., Adviser.

For more information about these services, call a Scudder representative at 1-800-225-5163
- ------------------------------------------------------------------------------------------------------------------------------
Additional Information on How to Contact Scudder:
- ------------------------------------------------------------------------------------------------------------------------------
          For existing account services and transactions         Please address all written correspondence to
          Scudder Investor Relations -- 1-800-225-5163           The Scudder Funds
                                                                 P.O. Box 2291
          For establishing 401(k) and 403(b) plans               Boston, Massachusetts
          Scudder Defined Contribution Services --               02107-2291
          1-800-323-6105
                                                                 Or Stop by a Scudder Investor Center

          For information about The Scudder Funds, including     Many shareholders enjoy the personal, one-on-one service of
          additional applications and prospectuses, or for       the Scudder Investor Centers. Check for an Investor Center near
          answers to investment questions                        you -- they can be found in the following cities:

          Scudder Investor Relations -- 1-800-225-2470           Boca Raton            Chicago           San Francisco
                   [email protected]                Boston                New York

- ------------------------------------------------------------------------------------------------------------------------------
          New From Scudder: Scudder International Growth and Income Fund

          Scudder International Growth and Income Fund takes a yield-oriented approach to investing in international equities. The
          Fund seeks to provide long-term growth of capital plus current income. Investors who desire international exposure but
          who wish to take a more conservative approach may appreciate the Fund's emphasis on the dividend paying stocks of
          well-established companies outside the United States.
- ------------------------------------------------------------------------------------------------------------------------------
          The share price of Scudder International Growth and Income Fund will fluctuate. International investing involves special
          risks including currency fluctuation and political instability. Contact Scudder Investor Services, Inc., Distributor,
          for a prospectus which contains more complete information, including management fees and other expenses. Please read it
          carefully before you invest or send money.

</TABLE>



                    Page 23 -- Scudder Cash Investment Trust
<PAGE>

Celebrating Over 75 Years of Serving Investors

Established in 1919 by Theodore Scudder, Sidney Stevens, and F. Haven Clark,
Scudder, Stevens & Clark was the first independent investment counsel firm in
the United States. Since its birth, Scudder's pioneering spirit and commitment
to professional long-term investment management have helped shape the investment
industry. In 1928, we introduced the nation's first no-load mutual fund. Today
we offer over 40 pure no load(TM) funds, including the first international
mutual fund offered to U.S. investors.

Over the years, Scudder's global investment perspective and dedication to
research and fundamental investment disciplines have helped us become one of the
largest and most respected investment managers in the world. Though times have
changed since our beginnings, we remain committed to our long-standing
principles: managing money with integrity and distinction; keeping the interests
of our clients first; providing access to investments and markets that may not
be easily available to individuals; and making investing as simple and
convenient as possible through friendly, comprehensive service.


This information must be preceded or accompanied by a
current prospectus.

Portfolio changes should not be considered recommendations
for action by individual investors.

SCUDDER

[LOGO]
<PAGE>

                          SCUDDER CASH INVESTMENT TRUST
                                
                            PART C. OTHER INFORMATION

Item 24.       Financial Statements and Exhibits

          a.   Financial Statements:

               Included in Part A of this Registration Statement:

                    Financial Highlights for the ten fiscal years
                    ended June 30, 1996

               Included in Part B of this Registration Statement:

                    Investment Portfolio as of June 30, 1996
                    Statement of Assets and Liabilities as of
                    June 30, 1996
                    Statement of Operations for the fiscal year
                    ended June 30, 1996
                    Statements of Changes in Net Assets for the
                    two fiscal years ended June 30, 1996
                    Financial Highlights for the ten fiscal years
                    ended June 30, 1996
                    Notes to Financial Statements
                    Report of Independent Accountants

               Statements, schedules and historical information
               other than those listed above have been omitted
               since they are either not applicable or are not
               required.

          b.   Exhibits:
                         
               All references are to the Registrant's
               Registration Statement on Form N-1A filed with
               the Securities and Exchange Commission on
               December 12, 1975.  File Nos. 2-5516 & 811-2613
               (the "Registration Statement").
                         
               1.   Amended and Restated Declaration of Trust
                    dated November 3, 1987 is filed herein.
                         
               2.   (a)(1) By-Laws amended as of June 30, 1979 is
                           filed herein.
                         
                    (a)(2) Amendment to the By-Laws dated August
                           13, 1991 is filed herein.
                         
                    (a)(3) Amendment to the By-Laws dated
                           November 12, 1991 is filed herein.
                         
               3.   Inapplicable.
                    
               4.   Specimen certificate representing shares of
                    beneficial interest of $.01 par value.
                    (Incorporated by reference to Exhibit 4 to
                    Post-Effective Amendment No. 21 to the
                    Registration Statement.)
                    
               5.   Investment Advisory Agreement with Scudder,
                    Stevens & Clark Ltd. dated November 12,
                    1985 filed herein.
                    
               6.   Underwriting Agreement with Scudder
                    Investor Services, Inc. (formerly Scudder
                    Fund Distributors, Inc.) dated July 20,
                    1976 filed herein.
                    
               7.   Inapplicable.

                                Part C - Page 1
<PAGE>
                        
               8. (a)(1) Custodian Contract with State Street
                         Bank and Trust Company dated March 19,
                         1980 is filed herein.
                         
                  (a)(2) Amendment to the Custodian Contract
                         with State Street Bank and Trust
                         Company dated August 11, 1987 is filed
                         herein.
                         
                  (a)(3) Amendment to the Custodian Contract
                         with State Street Bank and Trust
                         Company dated August 9, 1988 is filed
                         herein.
                         
                  (a)(4) Fee schedule for Exhibit 8(a)(l) is
                         filed herein.
                         
                  (a)(5) Amendment to the Custodian Contract
                         with State Street Bank and Trust
                         Company dated November 13, 1990 is
                         filed herein.
                         
                  (a)(6) Fee schedule for Exhibit 8(a)(1).
                         (Incorporated by reference to Exhibit
                         8(a)(6) to Post-Effective Amendment
                         No. 29 to the Registration Statement.)
                         
                  (b)(1) Subcustodian Agreement between State
                         Street Bank and Trust Company and The
                         Bank of New York, London office, dated
                         March 27, 1979 and Fee Schedule is
                         filed herein.
                         
               9.(a)(1)  Transfer Agency and Service Agreement with
                         Scudder Service Corporation dated
                         October 2, 1989 is filed herein.
                         
                 (a)(2)  Fee schedule for Exhibit 9(a)(1) is
                         filed herein.
                         
                 (a)(3)  Fee schedule for exhibit 9(a)(1) is
                         filed herein.
                         
                 (a)(4)  Form of revised fee schedule dated
                         October 1, 1996 for exhibit 9(a)(1) is
                         filed herein.
                         
                 (b)(1)  COMPASS Service Agreement with Scudder
                         Trust Company dated January 1, 1990 is
                         filed herein.
                         
                 (b)(2)  Fee schedule for Exhibit 9(b)(1) is
                         filed herein.
                         
                 (b)(3)  Shareholder Services Agreement with
                         Charles Schwab & Co., Inc. dated June
                         1, 1990 is filed herein.
                         
                 (b)(4)  COMPASS Service Agreement with Scudder
                         Trust Company dated October 1, 1995 is
                         filed herein.
                         
                 (b)(5)  Form of revised fee schedule dated
                         October 1, 1996 for exhibit 9(b)(4) is
                         filed herein.
                         
                    (c)  Inapplicable.
                         
                    (d)  Fund Accounting Services Agreement
                         between the Registrant and Scudder
                         Financial Accounting Corporation dated
                         August 1, 1994.
                         (Incorporated by reference to Exhibit
                         9(d) to Post-Effective Amendment No.
                         29 to the Registration Statement.)
                         
               10.  Opinion of Counsel is filed herein.

                                Part C - Page 2
<PAGE>
                   
               11.  Consent of Independent Accountants is filed
                    herein.
                    
               12.  Inapplicable.
                    
               13.  Inapplicable.
                         
               14.  (a)  Scudder Flexi-Plan for Corporations
                         and Self-Employed Individuals is filed
                         herein.
                         
                    (b)  Scudder Individual Retirement Plan is
                         filed herein.
                         
                    (c)  Scudder Funds 403(b) Plan is filed
                         herein.
                         
                    (d)  Scudder Employer-Select 403(b) Plan is
                         filed herein.
                         
                    (e)  Scudder Cash or Deferred Profit
                         Sharing Plan under Section 401(k) is
                         filed herein.
                         
               15.  Inapplicable.
                    
               16.  Schedule for Computation of Performance
                    Quotation is filed herein.
                    
               17.  Financial Data Schedule is filed herein.
                    
               18.  Inapplicable.
                    
               19.  Power of Attorney filed as part of Post-
                    Effective Amendment No. 25 to the
                    Registration Statement filed on August 28,
                    1991 is filed herein and Post-Effective
                    Amendment No. 31 to this Registration
                    Statement.

Item 25.  Persons Controlled by or under Common Control with Registrant

          None

Item 26.  Number of Holders of Securities (as of October 15, 1997).

                (1)                      (2)
          Title of Class           Number of Record
                                     Shareholders
                                
          Shares of             
          beneficial
          interest
          par value $.01                81,295
          per share

Item 27.  Indemnification.

          A policy of insurance  covering  Scudder,  Stevens & Clark,  Inc., its
          affiliates  including Scudder Investor Services,  Inc., and all of the
          registered  investment companies advised by Scudder,  Stevens & Clark,
          Inc.,  insures the  Registrant's  directors  and  officers  and others
          against  liability  arising  by  reason of an  alleged  breach of duty
          caused by any negligent act, error or accidental omission in the scope
          of their duties.
          
          Article IV of Registrant's Declaration of Trust states as follows:
          
          Section 4.1. No Personal Liability of Shareholders, Trustees, Etc.
          
          No Shareholder shall be subject to any personal  liability  whatsoever
          to  any  Person  in  connection  with  Trust  Property  or  the  acts,
          obligations or affairs of the Trust. No Trustee,  officer, employee or
          agent of the Trust shall be subject to any personal liability
          


                                Part C - Page 3
<PAGE>

          whatsoever to any Person, other than to the Trust or its Shareholders,
          in connection  with Trust  Property or the affairs of the Trust,  save
          only  that  arising  from  bad  faith,  willful   misfeasance,   gross
          negligence  or reckless  disregard  of his duties with respect to such
          Person;  and all such Persons shall look solely to the Trust  Property
          for  satisfaction  of claims of any nature arising in connection  with
          the  affairs  of the  Trust.  If any  Shareholder,  Trustee,  officer,
          employee, or agent, as such, of the Trust, is made a party to any suit
          or  proceeding  to enforce any such  liability of the Trust,  he shall
          not, on account thereof, be held to any personal liability.  The Trust
          shall  indemnify and hold each  Shareholder  harmless from and against
          all  claims and  liabilities,  to which  such  Shareholder  may become
          subject by reason of his being or having been a Shareholder, and shall
          reimburse such Shareholder for all legal and other expenses reasonably
          incurred by him in connection  with any such claim or  liability.  The
          indemnification  and reimbursement  required by the preceding sentence
          shall be made  only out of the  assets  of the one or more  Series  of
          which  the   Shareholder  who  is  entitled  to   indemnification   or
          reimbursement  was a Shareholder at the time the act or event occurred
          which gave rise to the claim against or liability of said Shareholder.
          The rights accruing to a Shareholder  under this Section 4.1 shall not
          impair  any other  right to which  such  Shareholder  may be  lawfully
          entitled,  nor shall anything herein  contained  restrict the right of
          the Trust to indemnify or reimburse a Shareholder  in any  appropriate
          situation even though not specifically provided herein.
          
          Section 4.2.  Non-Liability of Trustees, Etc.
          
          No Trustee, officer, employee or agent of the Trust shall be liable to
          the Trust, its Shareholders, or to any Shareholder,  Trustee, officer,
          employee, or agent thereof for any action or failure to act (including
          without  limitation  the  failure  to compel in any way any  former or
          acting  Trustee to redress any breach of trust) except for his own bad
          faith, willful misfeasance,  gross negligence or reckless disregard of
          the duties involved in the conduct of his office.

          Section 4.3.  Mandatory Indemnification.

          (a)  Subject to the exceptions and limitations  contained in paragraph
               (b) below:
               
               (i)  every  person  who is, or has been,  a Trustee or officer of
                    the Trust shall be  indemnified  by the Trust to the fullest
                    extent  permitted by law against all  liability  and against
                    all  expenses   reasonably   incurred  or  paid  by  him  in
                    connection  with any claim,  action,  suit or  proceeding in
                    which he becomes  involved as a party or otherwise by virtue
                    of his being or having been a Trustee or officer and against
                    amounts paid or incurred by him in the settlement thereof;
                    
               (ii) the words "claim,"  "action," "suit," or "proceeding"  shall
                    apply to all claims,  actions,  suits or proceedings (civil,
                    criminal,  administrative,  or  other,  including  appeals),
                    actual  or  threatened;   and  the  words   "liability"  and
                    "expenses"  shall include,  without  limitation,  attorneys'
                    fees, costs, judgments,  amounts paid in settlement,  fines,
                    penalties and other liabilities.

          (b)  No  indemnification  shall be provided  hereunder to a Trustee or
               officer:

               (i)  against any liability to the Trust, a Series thereof, or the
                    Shareholders by reason of a final adjudication by a court or
                    any other body before which a proceeding was brought that he
                    engaged in willful misfeasance,  bad faith, gross negligence
                    or reckless  disregard of the duties involved in the conduct
                    of his office;
               
               (ii) with  respect  to any  matter as to which he shall have been
                    finally  adjudicated  not to have acted in good faith in the
                    reasonable  belief that his action was in the best  interest
                    of the Trust;

                                Part C - Page 4
<PAGE>
               
               (iii)in the  event  of a  settlement  or  other  disposition  not
                    involving a final  adjudication  as  provided  in  paragraph
                    (b)(i) or  (b)(ii)  resulting  in a payment  by a Trustee or
                    officer,  unless  there has been a  determination  that such
                    Trustee  or officer  did not engage in willful  misfeasance,
                    bad faith,  gross  negligence  or reckless  disregard of the
                    duties involved in the conduct of his office:

                    (A)  by the court or other body  approving the settlement or
                         other disposition; or
                 
                    (B)  based  upon a review  of  readily  available  facts (as
                         opposed to a full trial-type  inquiry) by (x) vote of a
                         majority of the  Disinterested  Trustees  acting on the
                         matter  (provided that a majority of the  Disinterested
                         Trustees  then  in  office  act on the  matter)  or (y)
                         written opinion of independent legal counsel.

     (c)  The rights of  indemnification  herein provided may be insured against
          by policies  maintained by the Trust,  shall be  severable,  shall not
          affect any other  rights to which any  Trustee  or officer  may now or
          hereafter be entitled, shall continue as to a person who has ceased to
          be such  Trustee  or  officer  and shall  inure to the  benefit of the
          heirs, executors, administrators and assigns of such a person. Nothing
          contained herein shall affect any rights to  indemnification  to which
          personnel  of the  Trust  other  than  Trustees  and  officers  may be
          entitled by contract or otherwise under law.
          
     (d)  Expenses of preparation  and  presentation  of a defense to any claim,
          action, suit or proceeding of the character described in paragraph (a)
          of this  Section  4.3 may be  advanced  by the  Trust  prior  to final
          disposition  thereof upon receipt of an undertaking by or on behalf of
          the  recipient,  to repay such amount if it is  ultimately  determined
          that he is not  entitled to  indemnification  under this  Section 4.3,
          provided that either:

          (i)  such  undertaking  is  secured  by a  surety  bond or some  other
               appropriate  security  provided  by the  recipient,  or the Trust
               shall be insured against losses arising out of any such advances;
               or
                 
          (ii) a majority  of the  Disinterested  Trustees  acting on the matter
               (providing that a majority of the  Disinterested  Trustees act on
               the matter) or an independent  legal counsel in a written opinion
               shall determine,  based upon a review of readily  available facts
               (as opposed to a full trial-type  inquiry),  that there is reason
               to believe that the recipient  ultimately  will be found entitled
               to indemnification.

          As used in this Section 4.3, a  "Disinterested  Trustee" is one who is
          not (i) an Interested  Person of the Trust  (including  anyone who has
          been exempted from being an Interested Person by any rule,  regulation
          or order of the  Commission,  or (ii)  involved in the claim,  action,
          suit or proceeding.

Item 28.  Business or Other Connections of Investment Adviser

          The  Adviser  has  stockholders  and  employees  who  are  denominated
          officers  but do not as such have  corporation-wide  responsibilities.
          Such persons are not considered  officers for the purpose of this Item
          28.

                        Business and Other Connections of Board        
     Name               of Directors of Registrant's Adviser           
                                                                       
Stephen R Beckwith      Director, Vice President, Treasurer, Chief     
                           Operating Officer & Chief Financial Officer,
                           Scudder, Stevens & Clark, Inc. (investment  
                           adviser)**                                  
                                                                       
Lynn S. Birdsong       Director, Scudder, Stevens & Clark, Inc.       
                          (investment adviser)**                      
                        President & Director, The Latin America Dollar 
                           Income Fund, Inc.  (investment company)**   
                        President & Director, Scudder World Income     
                           Opportunities Fund, Inc.  (investment       
                           company)**                                  
                        
                                Part C - Page 5
<PAGE>

               
               
                      President, The Japan Fund, Inc. (investment      
                         company)**                                    
                      Supervisory Director, The Latin America Income   
                         and Appreciation Fund N.V. (investment        
                         company) +                                    
                      Supervisory Director, The Venezuela High Income  
                         Fund N.V. (investment company) xx             
                      Supervisory Director, Scudder Mortgage Fund      
                         (investment company)+                         
                      Supervisory Director, Scudder Floating Rate      
                         Funds for Fannie Mae Mortgage Securities I &  
                         II (investment company) +                     
                      Director, Canadian High Income Fund (investment  
                         company)#                                     
                      Director, Hot Growth Companies Fund (investment  
                         company)#                                     
                      Director, Sovereign High Yield Investment        
                         Company (investment company)+                 
                      Director, Scudder, Stevens & Clark (Luxembourg)  
                         S.A. (investment manager) #                   
                                                                       
Nicholas Bratt        Director, Scudder, Stevens & Clark, Inc.         
                         (investment adviser)**                        
                      President & Director, Scudder New Europe Fund,   
                         Inc. (investment company)**                   
                      President & Director, The Brazil Fund, Inc.      
                         (investment company)**                        
                      President & Director, The First Iberian Fund,    
                         Inc. (investment company)**                   
                      President & Director, Scudder International      
                         Fund, Inc.  (investment company)**            
                      President & Director, Scudder Global Fund, Inc.  
                         (President on all series except Scudder       
                         Global Fund) (investment company)**           
                      President & Director, The Korea Fund, Inc.       
                         (investment company)**                        
                      President & Director, Scudder New Asia Fund,     
                         Inc. (investment company)**                   
                      President, The Argentina Fund, Inc. (investment  
                         company)**                                    
                      Vice President, Scudder, Stevens & Clark         
                         Corporation (Delaware) (investment adviser)** 
                      Vice President, Scudder, Stevens & Clark Japan,  
                         Inc. (investment adviser)###                  
                      Vice President, Scudder, Stevens & Clark of      
                         Canada Ltd. (Canadian investment adviser)     
                         Toronto, Ontario, Canada                      
                      Vice President, Scudder, Stevens & Clark         
                         Overseas Corporationoo                        
                                                                 
E. Michael Brown      Director, Chief Administrative Officer, Scudder, 
                         Stevens & Clark, Inc. (investment adviser)**  
                      Trustee, Scudder GNMA Fund (investment company)* 
                      Trustee, Scudder Portfolio Trust (investment     
                         company)*                                     
                      Trustee, Scudder U.S. Treasury Fund (investment  
                         company)*                                     
                      Trustee, Scudder Tax Free Money Fund (investment 
                         company)*                                     
                      Trustee, Scudder State Tax Free Trust            
                         (investment company)*                         
                      Trustee, Scudder Cash Investment Trust           
                         (investment company)*                         
                      Assistant Treasurer, Scudder Investor Services,  
                         Inc. (broker/dealer)*                         
                      Director & President, Scudder Realty Holding     
                         Corporation (a real estate holding company)*  
                      Director & President, Scudder Trust Company (a   
                         trust company)+++                             
                      Director, Scudder Trust (Cayman) Ltd.            
                                                                       
Mark S. Casady        Director, Scudder, Stevens & Clark, Inc.         
                         (investment adviser)**                        
                      Director & Vice President, Scudder Investor      
                         Services, Inc. (broker/dealer)*               
                      Director & Vice President, Scudder Service       
                         Corporation (in-house transfer agent)*        
                      Director, SFA, Inc. (advertising agency)*        
                                                              
Linda C. Coughlin     Director, Scudder, Stevens & Clark, Inc.         
                        (investment adviser)**                           
                      Chairman & Trustee, AARP Cash Investment Funds   
                         (investment company)**                        
                      Chairman & Trustee, AARP Growth Trust            
                         (investment company)**                        
                      Chairman & Trustee, AARP Income Trust            
                         (investment company)**                        
                      Chairman & Trustee, AARP Tax Free Income Trust   
                         (investment company)** 

                                 Part C - Page 6
<PAGE>                
                      Chairman & Trustee, AARP Managed Investment 
                         Portfolios Trust  (investment company)**     
                      Director & Senior Vice President, Scudder       
                         Investor Services, Inc. (broker/dealer)*     
                      Director, SFA, Inc. (advertising agency)*       
                                                                      
Margaret D. Hadzima   Director, Scudder, Stevens & Clark, Inc.        
                        (investment adviser)**                          
                      Assistant Treasurer, Scudder Investor Services, 
                         Inc. (broker/dealer)*                        
                                                                      
Jerard K. Hartman     Director, Scudder, Stevens & Clark, Inc.        
                         (investment adviser)**                       
                      Vice President, Scudder California Tax Free     
                         Trust (investment company)*                  
                      Vice President, Scudder Equity Trust (investment
                         company)**                                   
                      Vice President, Scudder Cash Investment Trust   
                         (investment company)*                        
                      Vice President, Scudder Fund, Inc. (investment  
                         company)**                                   
                      Vice President, Scudder Global Fund, Inc.       
                         (investment company)**                       
                      Vice President, Scudder GNMA Fund (investment   
                         company)*                                    
                      Vice President, Scudder Portfolio Trust         
                         (investment company)*                        
                      Vice President, Scudder Institutional Fund, Inc.
                         (investment company)**                       
                      Vice President, Scudder International Fund, Inc.
                         (investment company)**                       
                      Vice President, Scudder Investment Trust        
                         (investment company)*                        
                      Vice President, Scudder Municipal Trust         
                         (investment company)*                        
                      Vice President, Scudder Mutual Funds, Inc.      
                         (investment company)**                       
                      Vice President, Scudder New Asia Fund, Inc.     
                         (investment company)**                       
                      Vice President, Scudder New Europe Fund, Inc.   
                         (investment company)**                       
                      Vice President, Scudder Securities Trust        
                         (investment company)*                        
                      Vice President, Scudder State Tax Free Trust    
                         (investment company)*                        
                      Vice President, Scudder Funds Trust (investment 
                         company)**                                   
                      Vice President, Scudder Tax Free Money Fund     
                         (investment company)*                        
                      Vice President, Scudder Tax Free Trust          
                         (investment company)*                        
                      Vice President, Scudder U.S. Treasury Money Fund
                         (investment company)*                        
                      Vice President, Scudder Pathway Series          
                         (investment company)*                        
                      Vice President, Scudder Variable Life Investment
                         Fund (investment company)*                   
                      Vice President, The Brazil Fund, Inc.           
                         (investment company)**                       
                      Vice President, The Korea Fund, Inc. (investment
                         company)**                                   
                      Vice President, The Argentina Fund, Inc.        
                         (investment company)**                       
                      Vice President & Director, Scudder, Stevens &   
                         Clark of Canada, Ltd. (Canadian investment   
                         adviser) Toronto, Ontario, Canada            
                      Vice President, Scudder Spain & Portugal Fund,  
                         Inc. (investment company)**                  
                      Vice President, The Latin America Dollar Income 
                         Fund, Inc. (investment company)**            
                      Vice President, Scudder World Income            
                         Opportunities Fund, Inc. (investment         
                         company)**                                   
                                                                      
Richard A.Holt        Director, Scudder, Stevens & Clark, Inc.        
                       (investment adviser)**                     
                      Vice President, Scudder Variable Life Investment
                         Fund (investment company)*                   
                                                                      
John T. Packard       Director, Scudder, Stevens & Clark, Inc.        
                        (investment adviser)**                       
                      President, Montgomery Street Income Securities, 
                         Inc. (investment company) o                  
                      Chairman, Scudder Realty Advisors, Inc. (realty 
                         investment adviser) x                        
                                                                      
Daniel Pierce         Chairman & Director, Scudder, Stevens & Clark,  
                         Inc. (investment adviser)**                  
                      Chairman, Vice President & Director, Scudder    
                         Global Fund, Inc.  (investment company)**    
                      Chairman & Director, Scudder New Europe Fund,   
                         Inc. (investment company)**                  
                      Chairman & Director, Scudder Spain & Portugal   
                         Fund, Inc. (investment company)**            
                      Chairman & Director, Scudder International Fund,
                         Inc. (investment company)**                  
                      Chairman & Director, Scudder New Asia Fund, Inc.
                         (investment company)**                       
                      President & Trustee, Scudder Equity Trust       
                         (investment company)**                       
                      
                                Part C - Page 7
<PAGE>


                      President & Trustee, Scudder GNMA Fund          
                         (investment company)*                        
                      President & Trustee, Scudder Portfolio Trust    
                         (investment company)*                        
                      President & Trustee, Scudder Funds Trust        
                         (investment company)**                       
                      President & Trustee, Scudder Securities Trust   
                         (investment company)*                        
                      President & Trustee, Scudder Investment Trust   
                         (investment company)*                        
                      President & Director, Scudder Institutional     
                         Fund, Inc. (investment company)**            
                      President & Director, Scudder Fund, Inc.        
                         (investment company)**                       
                      President & Director, Scudder Mutual Funds, Inc.
                         (investment company)**                       
                      Vice President & Trustee, Scudder Municipal     
                         Trust (investment company)*                  
                      Vice President & Trustee, Scudder Variable Life 
                         Investment Fund (investment company)*        
                      Vice President & Trustee, Scudder Pathway Series
                         (investment company)*                        
                      Trustee, Scudder California Tax Free Trust      
                         (investment company)*                        
                      Trustee, Scudder State Tax Free Trust           
                         (investment company)*                        
                      Vice President, Montgomery Street Income        
                         Securities, Inc. (investment company)o       
                      Chairman & President, Scudder, Stevens & Clark  
                         of Canada, Ltd. (Canadian investment         
                         adviser), Toronto, Ontario, Canada           
                      Chairman & Director, Scudder Global             
                         Opportunities Funds (investment company)     
                         Luxembourg                                   
                      Chairman, Scudder, Stevens & Clark, Ltd.        
                         (investment adviser) London, England         
                      President & Director, Scudder Precious Metals,  
                         Inc. xxx                                     
                      Vice President, Director & Assistant Secretary, 
                         Scudder Realty Holdings Corporation          
                         (a real estate holding company)*             
                      Vice President, Director & Assistant Treasurer, 
                         Scudder Investor Services, Inc.              
                         (broker/dealer)*                             
                      Director, Scudder Latin America Investment Trust
                         PLC (investment company)@                    
                      Director, Fiduciary Trust Company (banking &    
                         trust company) Boston, MA                    
                      Director, Fiduciary Company Incorporated        
                         (banking & trust company) Boston, MA         
                      Trustee, New England Aquarium, Boston, MA       
                      Incorporator, Scudder Trust Company (a trust    
                         company)+++                                  
                                                                      
Kathryn L. Quirk      Director, Chief Legal Officer, Chief Compliance 
                         Officer and Secretary, Scudder, Stevens &    
                         Clark, Inc. (investment adviser)**           
                      Director, Vice President & Assistant Secretary, 
                         The Argentina Fund, Inc. (investment         
                         company)**                                   
                      Director, Vice President & Assistant Secretary, 
                         Scudder International Fund, Inc. (investment 
                         company)**                                   
                      Director, Vice President & Assistant Secretary, 
                         Scudder New Asia Fund (investment company)** 
                      Director, Vice President & Assistant Secretary, 
                         Scudder Global Fund, Inc. (investment        
                         company)**                                   
                      Trustee, Vice President & Assistant Secretary,  
                         Scudder Equity Trust (investment company)**  
                      Trustee, Vice President & Assistant Secretary,  
                         Scudder Securities Trust (investment         
                         company)*                                    
                      Trustee, Vice President & Assistant Secretary,  
                         Scudder Funds Trust (investment company)**   
                      Trustee, Scudder Investment Trust (investment   
                         company)*                                    
                      Trustee, Scudder Municipal Trust (investment    
                         company)*                                    
                      Vice President & Trustee, Scudder Cash          
                         Investment Trust (investment company)*       
                      Vice President & Trustee, Scudder Tax Free Money
                         Fund (investment company)*                   
                      Vice President & Trustee, Scudder Tax Free Trust
                         (investment company)*                        
                      Vice President & Secretary, AARP Growth Trust   
                         (investment company)**                       
                      Vice President & Secretary, AARP Income Trust   
                         (investment company)**                       
                      Vice President & Secretary, AARP Tax Free Income
                         Trust (investment company)**                 
                      Vice President & Secretary, AARP Cash Investment
                         Funds (investment company)**                 
                      
                                Part C - Page 8
<PAGE>


                      Vice President & Secretary, AARP Managed        
                         Investment Portfolios Trust (investment      
                         company)**                                   
                      Vice President & Secretary, The Japan Fund, Inc.
                         (investment company)**                       
                      Vice President & Assistant Secretary, Scudder   
                         World Income Opportunities Fund, Inc.        
                         (investment company)**                       
                      Vice President & Assistant Secretary, The Korea 
                         Fund, Inc. (investment company)**            
                      Vice President & Assistant Secretary, The Brazil
                         Fund, Inc. (investment company)**            
                      Vice President & Assistant Secretary, Montgomery
                         Street Income Securities, Inc. (investment   
                         company)o                                    
                      Vice President & Assistant Secretary, Scudder   
                         Mutual Funds, Inc. (investment company)**    
                      Vice President & Assistant Secretary, Scudder   
                         Pathway Series (investment company)*         
                      Vice President & Assistant Secretary, Scudder   
                         New Europe Fund, Inc. (investment company)** 
                      Vice President & Assistant Secretary, Scudder   
                         Variable Life Investment Fund (investment    
                         company)*                                    
                      Vice President & Assistant Secretary, The First 
                         Iberian Fund, Inc. (investment company)**    
                      Vice President & Assistant Secretary, The Latin 
                         America Dollar Income Fund, Inc. (investment 
                         company)**                                   
                      Vice President, Scudder Fund, Inc. (investment  
                         company)**                                   
                      Vice President, Scudder Institutional Fund, Inc.
                         (investment company)**                       
                      Vice President, Scudder GNMA Fund (investment   
                         company)*                                    
                      Director, Senior Vice President & Clerk, Scudder
                         Investor Services, Inc. (broker/dealer)*     
                      Director, Vice President & Secretary, Scudder   
                         Fund Accounting Corporation (in-house fund   
                         accounting agent)*                           
                      Director, Vice President & Secretary, Scudder   
                         Realty Holdings Corporation (a real estate   
                         holding company)*                            
                      Director & Clerk, Scudder Service Corporation   
                         (in-house transfer agent)*                   
                      Director, SFA, Inc. (advertising agency)*       
                      Vice President, Director & Assistant Secretary, 
                         Scudder Precious Metals, Inc. xxx            
                                                                      
Cornelia M. Small     Director, Scudder, Stevens & Clark, Inc.        
                         (investment adviser)**                       
                      President, AARP Cash Investment Funds           
                         (investment company)**                       
                      President, AARP Growth Trust (investment        
                         company)**                                   
                      President, AARP Income Trust (investment        
                         company)**                                   
                      President, AARP Tax Free Income Trust           
                         (investment company)**                       
                      President, AARP Managed Investment Portfolio    
                         Trust (investment company)**                 
                                                                      
Edmond D. Villani    Director, President & Chief Executive Officer,  
                         Scudder, Stevens & Clark, Inc. (investment   
                         adviser)**                                   
                      Chairman & Director, The Argentina Fund, Inc.   
                         (investment company)**                       
                      Chairman & Director, The Latin America Dollar   
                         Income Fund, Inc. (investment company)**     
                      Chairman & Director, Scudder World Income       
                         Opportunities Fund, Inc.  (investment        
                         company)**                                   
                      Supervisory Director, Scudder Mortgage Fund     
                         (investment company) +                       
                      Supervisory Director, Scudder Floating Rate     
                         Funds for Fannie Mae Mortgage Securities I & 
                         II (investment company)+                     
                      Director, Scudder, Stevens & Clark Japan, Inc.  
                         (investment adviser)###                      
                      Director, The Brazil Fund, Inc. (investment     
                         company)**                                   
                      Director, Indosuez High Yield Bond Fund         
                         (investment company) Luxembourg              
                      President & Director, Scudder, Stevens & Clark  
                         Overseas Corporationoo                       
                      President & Director, Scudder, Stevens & Clark  
                         Corporation (Delaware) (investment adviser)**
                      Director, Scudder Realty Advisors, Inc. (realty 
                         investment adviser) x                        
                      
                                Part C - Page 9
<PAGE>


                        Director, IBJ Global Investment Management S.A.,  
                           (Luxembourg investment management company)     
                           Luxembourg, Grand-Duchy of Luxembourg          
                                                                          
Stephen A. Wohler       Director, Scudder, Stevens & Clark, Inc.          
                          (investment adviser)**                         
                        Vice President, Montgomery Street Income          
                           Securities, Inc. (investment company)o         
                        
     *    Two International Place, Boston, MA
     x    333 South Hope Street, Los Angeles, CA
     **   345 Park Avenue, New York, NY
     ++   Two Prudential Plaza, 180 N. Stetson Avenue,
          Chicago, IL
     +++  5 Industrial Way, Salem, NH
     o    101 California Street, San Francisco, CA
     #    Socit Anonyme, 47, Boulevard Royal, L-2449
          Luxembourg, R.C. Luxembourg B 34.564
     +    John B. Gorsiraweg 6, Willemstad Curacao,
          Netherlands Antilles
     xx   De Ruyterkade 62, P.O. Box 812, Willemstad
          Curacao, Netherlands Antilles
     ##   2 Boulevard Royal, Luxembourg
     ***  B1 2F3F 248 Section 3, Nan King East Road, Taipei,
          Taiwan
     xxx  Grand Cayman, Cayman Islands, British West Indies
     oo   20-5, Ichibancho, Chiyoda-ku, Tokyo, Japan
     ###  1-7, Kojimachi, Chiyoda-ku, Tokyo, Japan
     @    c/o Sinclair Hendersen Limited, 23 Cathedral Yard,
          Exeter, Devon, U.K.

Item 29.  Principal Underwriters.

     (a)  Scudder California Tax Free Trust
          Scudder Cash Investment Trust
          Scudder Equity Trust
          Scudder Fund, Inc.
          Scudder Funds Trust
          Scudder Global Fund, Inc.
          Scudder GNMA Fund
          Scudder Institutional Fund, Inc.
          Scudder International Fund, Inc.
          Scudder Investment Trust
          Scudder Municipal Trust
          Scudder Mutual Funds, Inc.
          Scudder Pathway Series
          Scudder Portfolio Trust
          Scudder Securities Trust
          Scudder State Tax Free Trust
          Scudder Tax Free Money Fund
          Scudder Tax Free Trust
          Scudder U.S. Treasury Money Fund
          Scudder Variable Life Investment
          Fund
          AARP Cash Investment Funds
          AARP Growth Trust
          AARP Income Trust
          AARP Tax Free Income Trust
          AARP Managed Investment Portfolios
          Trust
          The Japan Fund, Inc.

                                Part C - Page 10
<PAGE>

     (b)

     (1)                (2)                    (3)

     Name and           Position and Offices   Positions and
     Principal          with                   Offices with
     Business           Scudder Investor       Registrant
     Address            Services, Inc.
                                               
     Lynn S. Birdsong   Senior Vice President  None
     345 Park Avenue
     New York, NY
     10154
                                               
     E. Michael Brown   Assistant Treasurer    Trustee
     Two International
     Place
     Boston, MA  02110
                                               
     Mark S. Casady     Director and Vice      None
     Two International  President
     Place
     Boston, MA  02110
                                               
     Linda Coughlin     Director and Senior    None
     Two International  Vice President
     Place
     Boston, MA  02110
                                               
     Richard W.         Vice President         None
     Desmond
     345 Park Avenue
     New York, NY
     10154
                                               
     Paul J. Elmlinger  Senior Vice President  None
     345 Park Avenue    and Assistant Clerk
     New York, NY
     10154
                                               
     Margaret D.        Assistant Treasurer    None
     Hadzima
     Two International
     Place
     Boston, MA  02110
                                               
     Thomas W. Joseph   Director, Vice         Vice
     Two International  President,             President
     Place              Treasurer and
     Boston, MA 02110   Assistant Clerk
                                               
     David S. Lee       Director, President    President and
     Two International  and Assistant          Trustee
     Place              Treasurer
     Boston, MA 02110
                                               
     Thomas F.          Clerk                  Vice
     McDonough                                 President and
     Two International                         Secretary
     Place
     Boston, MA 02110
                                               
     Thomas H. O'Brien  Assistant Treasurer    None
     345 Park Avenue
     New York, NY
     10154
                                               
     Edward J.          Assistant Treasurer    Vice
     O'Connell                                 President and
     345 Park Avenue                           Assistant
     New York, NY                              Treasurer
     10154

                                Part C - Page 11
<PAGE>
                                               
     Daniel Pierce      Director, Vice         None
     Two International  President
     Place              and Assistant
     Boston, MA 02110   Treasurer
                                               
     Kathryn L. Quirk   Director, Senior Vice  Vice
     345 Park Avenue    President and          President and
     New York, NY       Assistant Clerk        Trustee
     10154
                                               
     Robert A. Rudell   Vice President         None
     Two International
     Place
     Boston, MA 02110
                                               
     Edmund J. Thimme   Vice President         None
     345 Park Avenue
     New York, NY
     10154
                                               
     Benjamin           Vice President         None
     Thorndike
     Two International
     Place
     Boston, MA 02110
                                               
     Sydney S. Tucker   Vice President         None
     Two International
     Place
     Boston, MA 02110
                                               
     David B. Watts     Assistant Treasurer    None
     Two International
     Place
     Boston, MA 02110
                                               
     Linda J. Wondrack  Vice President         None
     Two International
     Place
     Boston, MA 02110

     The Underwriter has employees who are denominated officers
     of an operational area.  Such persons do not have
     corporation-wide responsibilities and are not considered
     officers for the purpose of this Item 29.

     (c)

           (1)          (2)                  (3)            (4)        (5)    
                        Net              Compensation                       
         Name of     Underwriting             on        Brokerage     Other   
        Principal    Discounts and       Redemptions  Commissions  Compensation 
       Underwriter   and Commissions     and Purchases 
                                                                        
         Scudder        None                 None              None      None
        Investor                        
     Services, Inc.

                                Part C - Page 12
<PAGE>

Item 30.  Location of Accounts and Records.

          Certain accounts, books and other documents required to
          be maintained by Section 31(a) of the 1940 Act and the
          Rules promulgated thereunder are maintained by Scudder,
          Stevens & Clark, Inc., Two International Place, Boston,
          MA 02110.  Records relating to the duties of the
          Registrant's custodian are maintained by State Street
          Bank and Trust Company, Heritage Drive, North Quincy,
          Massachusetts.

Item 31.  Management Services.

          Inapplicable.

Item 32.  Undertakings.

          Inapplicable.


                                Part C - Page 13
<PAGE>

                                   SIGNATURES

     Pursuant  to  the  requirements  of the  Securities  Act of  1933  and  the
Investment  Company Act of 1940, the  Registrant  certifies that it meets all of
the  requirements  for  effectiveness  of  this  amendment  to its  Registration
Statement  pursuant to Rule 485(b) under the Securities Act of 1933 and has duly
caused this amendment to its  Registration  Statement to be signed on its behalf
by the undersigned,  thereunto duly authorized,  in the City of Boston,  and the
Commonwealth of Massachusetts, on the __ day of October, 1996.



                                   SCUDDER CASH INVESTMENT TRUST

                                   By/s/Thomas F. McDonough
                                     --------------------------------
                                     Thomas F. McDonough
                                     Vice President and Secretary


     Pursuant to the  requirements of the Securities Act of 1933, this amendment
to its Registration  Statement has been signed below by the following persons in
the capacities and on the dates indicated.


<TABLE>
<CAPTION>
<S>                               <C>                       <C>

SIGNATURE                          TITLE                     DATE 
                            
/s/David S. Lee
- -------------------------                                                                                          
David S. Lee*                      President (Principal      October   , 1997             
                                   Executive Officer)                                     
                                   and Trustee                                            
                                                                                          
/s/Henry P. Becton, Jr.
- -------------------------                                                                                                 
Henry P. Becton, Jr.*              Trustee                   October   , 1997             
                                                                                     
                                                                                          
/s/E. Michael Brown
- -------------------------                                                                                              
E. Michael Brown*                  Trustee                   October   , 1997                
                                                                                          
                                                                                          
/s/Dawn-Marie Driscoll
- -------------------------                                                                                              
Dawn-Marie Driscoll*               Trustee                   October   , 1997             
                                                                                          
                                                                                          
/s/Peter B. Freeman
- -------------------------                                                                                              
Peter B. Freeman*                  Trustee                   October   , 1997             
                                                                                          
                                                                                          
/s/George M. Lovejoy,  Jr.
- -------------------------                                                                                              
George M. Lovejoy,  Jr.*           Trustee                   October   , 1997             
                                                                                    
                                                                                          
                                                                                          
/s/Kathryn L. Quirk
- -------------------------                                                                                          
Kathryn L. Quirk*                  Vice President and        October   , 1997             
                                   Trustee                                                
<PAGE>
                                                                                          
SIGNATURE                          TITLE                     DATE                         
                                                                                          
                                                                                          
/s/Pamela A. McGrath
- -------------------------                                                                                          
Pamela A. McGrath                  Vice President and        October   , 1997             
                                   Treasurer (Principal                                   
                                   Financial and                                          
                                   Accounting Officer)                                    
                                                                                          
                                                                                          
                                                                                          
</TABLE>

*By:/s/Thomas F. McDonough
    -------------------------                               
     Thomas F. McDonough
     Attorney-in-fact pursuant to a
     power of attorney included
     with the signature page of
     Post-Effective Amendment No.
     25 to the Registration
     Statement filed August 28,
     1991, Post-Effective Amendment
     No. 31 to the Registration
     Statement filed October ____,
     1997.

                                       2
<PAGE>                                       


                                
                                   SIGNATURES

     Pursuant  to  the  requirements  of the  Securities  Act of  1933  and  the
Investment  Company Act of 1940, the  Registrant  certifies that it meets all of
the  requirements  for  effectiveness  of  this  amendment  to its  Registration
Statement  pursuant to Rule 485(b) under the Securities Act of 1933 and has duly
caused this amendment to its  Registration  Statement to be signed on its behalf
by the  undersigned,  thereunto  duly  authorized  in the  City of  Boston,  and
Commonwealth of Massachusetts on the 30th day of September, 1997.

                                   SCUDDER CASH INVESTMENT TRUST


                                   By/s/Thomas F. McDonough
                                     --------------------------------
                                     Thomas F. McDonough, Vice President and
                                     Secretary

     Pursuant to the  requirements of the Securities Act of 1933, this amendment
to its Registration  Statement has been signed below by the following persons in
the capacities and on the dates indicated. By so signing, the undersigned in her
capacity as trustee or officer,  or both, as the case may be of the  Registrant,
does hereby appoint  Thomas F. McDonough her true and lawful  attorney and agent
to  execute  in her  name,  place  and  stead  (in  such  capacity)  any and all
amendments  to the  Registration  Statement  and any  post-effective  amendments
thereto and all instruments necessary or desirable in connection  therewith,  to
attest  the  seal of the  Registrant  thereon  and to file  the  same  with  the
Securities and Exchange Commission. Each of said attorneys and agents shall have
power to act with or without the other and have full power and  authority  to do
and  perform  in the  name  and on  behalf  of the  undersigned,  in any and all
capacities,  every  act  whatsoever  necessary  or  advisable  to be done in the
premises as fully and to all intents and  purposes as the  undersigned  might or
could do in person, hereby ratifying and approving the act of said attorneys and
agents and each of them.

SIGNATURE               TITLE                     DATE
                                                  
                                                  
/s/Kathryn L. Quirk
- -------------------                                                  
Kathryn L. Quirk        Trustee                   September 30, 1997
                                                  
                        




<PAGE>


                                
                                   SIGNATURES

     Pursuant  to  the  requirements  of the  Securities  Act of  1933  and  the
Investment  Company Act of 1940, the  Registrant  certifies that it meets all of
the  requirements  for  effectiveness  of  this  amendment  to its  Registration
Statement  pursuant to Rule 485(b) under the Securities Act of 1933 and has duly
caused this amendment to its  Registration  Statement to be signed on its behalf
by the  undersigned,  thereunto  duly  authorized  in the  City of  Boston,  and
Commonwealth of Massachusetts on the 30th day of September, 1997.

                                   SCUDDER CASH INVESTMENT TRUST


                                   By/s/Thomas F. McDonough
                                     --------------------------------
                                     Thomas F. McDonough, Vice President and
                                     Secretary

     Pursuant to the  requirements of the Securities Act of 1933, this amendment
to its Registration  Statement has been signed below by the following persons in
the capacities and on the dates indicated. By so signing, the undersigned in his
capacity as trustee or officer,  or both, as the case may be of the  Registrant,
does hereby appoint  Thomas F. McDonough his true and lawful  attorney and agent
to  execute  in his  name,  place  and  stead  (in  such  capacity)  any and all
amendments  to the  Registration  Statement  and any  post-effective  amendments
thereto and all instruments necessary or desirable in connection  therewith,  to
attest  the  seal of the  Registrant  thereon  and to file  the  same  with  the
Securities and Exchange Commission. Each of said attorneys and agents shall have
power to act with or without the other and have full power and  authority  to do
and  perform  in the  name  and on  behalf  of the  undersigned,  in any and all
capacities,  every  act  whatsoever  necessary  or  advisable  to be done in the
premises as fully and to all intents and  purposes as the  undersigned  might or
could do in person, hereby ratifying and approving the act of said attorneys and
agents and each of them.

SIGNATURE               TITLE                     DATE
                                                  
                                                  
/s/E. Michael Brown
- -------------------                                                  
E. Michael Brown        Trustee                   September 30, 1997
                                                  
                        

<PAGE>

                                   SIGNATURES
                                   ----------

     Pursuant to Rule 438 of the Securities Act, the undersigned,  a nominee for
Trustee of the Trust,  hereby  consents to being named in this  amendment to the
Registration  Statement  of Scudder  Cash  Investment  Trust  which will  become
effective November 1, 1997.

SIGNATURE                               DATE
- ---------                               ----

/s/Daniel Pierce                        October 7, 1997
- ----------------                       
Daniel Pierce

/s/Wesley W. Marple, Jr.                October 7, 1997
- ------------------------            
Wesley W. Marple, Jr.


/s/Jean C. Tempel                       October 7, 19997
- -----------------                      
Jean C. Tempel
<PAGE>


                                                  File No. 2-55166
                                                  File No. 811-2613



               SECURITIES AND EXCHANGE COMMISSION
                                
                     WASHINGTON, D.C. 20549
                                
                                
                                
                            EXHIBITS
                                
                               TO
                                
                            FORM N-1A
                                
                                
                                
                 POST-EFFECTIVE AMENDMENT NO. 31
                                
                    TO REGISTRATION STATEMENT
                                
                              UNDER
                                
                   THE SECURITIES ACT OF 1933
                                
                               AND
                                
                        AMENDMENT NO. 21
                                
                    TO REGISTRATION STATEMENT
                                
                              UNDER
                                
               THE INVESTMENT COMPANY ACT OF 1940
                                
                                
                  SCUDDER CASH INVESTMENT TRUST

<PAGE>

                  SCUDDER CASH INVESTMENT TRUST
                                
                          EXHIBIT INDEX
                                
                                
                                
                            Exhibit 1
                                
                        Exhibit 2 (a)(1)
                                
                        Exhibit 2 (a)(2)
                                
                        Exhibit 2 (a)(3)
                                
                            Exhibit 5
                                
                            Exhibit 6
                                
                        Exhibit 8 (a)(1)
                                
                        Exhibit 8 (a)(2)
                                
                        Exhibit 8 (a)(3)
                                
                        Exhibit 8 (a)(4)
                                
                        Exhibit 8 (a)(5)
                                
                        Exhibit 8 (b)(1)
                                
                        Exhibit 9 (a)(1)
                                
                        Exhibit 9 (a)(2)
                                
                        Exhibit 9 (b)(1)
                                
                        Exhibit 9 (b)(2)
                                
                        Exhibit 9 (b)(3)
                                
                           Exhibit 11
                                
                         Exhibit 14 (a)
                                
                         Exhibit 14 (b)
                                
                         Exhibit 14 (c)
                                
                         Exhibit 14 (d)
                                
                         Exhibit 14 (e)
                                
                           Exhibit 16
                                
                           Exhibit 17
                                
                           Exhibit 19
 






<TABLE> <S> <C>


<ARTICLE>6                                            
<LEGEND>                                             
This schedule contains summary financial information extracted from the Scudder
Cash Inv Trust Annual Report for the fiscal year ended 6/30/97 and is qualified
in its entirety by reference to such financial statements.
</LEGEND>                                            
<SERIES>                                             
<NUMBER>0
<NAME>SCUDDER CASH INV TRUST
                                                     
<S>                              <C>
<PERIOD-TYPE>                    YEAR
<FISCAL-YEAR-END>                         JUN-30-1997
<PERIOD-START>                            JUL-01-1996
<PERIOD-END>                              JUN-30-1997
<INVESTMENTS-AT-COST>                   1,426,658,155
<INVESTMENTS-AT-VALUE>                  1,426,332,955
<RECEIVABLES>                              21,302,051
<ASSETS-OTHER>                                 48,602
<OTHER-ITEMS-ASSETS>                                0
<TOTAL-ASSETS>                          1,447,683,608
<PAYABLE-FOR-SECURITIES>                            0
<SENIOR-LONG-TERM-DEBT>                             0
<OTHER-ITEMS-LIABILITIES>                  17,060,091
<TOTAL-LIABILITIES>                        17,060,091
<SENIOR-EQUITY>                                     0
<PAID-IN-CAPITAL-COMMON>                1,431,407,817
<SHARES-COMMON-STOCK>                   1,430,702,947
<SHARES-COMMON-PRIOR>                   1,388,356,869
<ACCUMULATED-NII-CURRENT>                           0
<OVERDISTRIBUTION-NII>                              0 
<ACCUMULATED-NET-GAINS>                     (459,101)
<OVERDISTRIBUTION-GAINS>                            0  
<ACCUM-APPREC-OR-DEPREC>                    (325,199)
<NET-ASSETS>                            1,430,623,517
<DIVIDEND-INCOME>                                   0
<INTEREST-INCOME>                          79,522,543
<OTHER-INCOME>                                      0
<EXPENSES-NET>                             12,427,488
<NET-INVESTMENT-INCOME>                    67,095,055
<REALIZED-GAINS-CURRENT>                            0
<APPREC-INCREASE-CURRENT>                     911,613
<NET-CHANGE-FROM-OPS>                      68,006,668
<EQUALIZATION>                                      0
<DISTRIBUTIONS-OF-INCOME>                (67,095,055)
<DISTRIBUTIONS-OF-GAINS>                            0
<DISTRIBUTIONS-OTHER>                               0
<NUMBER-OF-SHARES-SOLD>                 2,146,433,255
<NUMBER-OF-SHARES-REDEEMED>           (2,166,626,217)
<SHARES-REINVESTED>                        62,538,989
<NET-CHANGE-IN-ASSETS>                     43,257,640
<ACCUMULATED-NII-PRIOR>                             0
<ACCUMULATED-GAINS-PRIOR>                           0
<OVERDISTRIB-NII-PRIOR>                             0
<OVERDIST-NET-GAINS-PRIOR>                          0
<GROSS-ADVISORY-FEES>                       5,944,464
<INTEREST-EXPENSE>                                  0
<GROSS-EXPENSE>                                     0
<AVERAGE-NET-ASSETS>                    1,448,150,101
<PER-SHARE-NAV-BEGIN>                            1.00
<PER-SHARE-NII>                                  0.05
<PER-SHARE-GAIN-APPREC>                          0.00
<PER-SHARE-DIVIDEND>                           (0.05)
<PER-SHARE-DISTRIBUTIONS>                        0.00
<RETURNS-OF-CAPITAL>                             0.00
<PER-SHARE-NAV-END>                              1.00
<EXPENSE-RATIO>                                  0.86
<AVG-DEBT-OUTSTANDING>                              0
<AVG-DEBT-PER-SHARE>                                0
                 


</TABLE>


                                                                       Exhibit 1

                                                    CITY CLERK'S OFFICE

                                                        NOV 4 1987

                                                      CITY OF BOSTON

                         SCUDDER CASH INVESTMENT TRUST

                                                   [STAMP OF SECRETARY OF STATE]

                              AMENDED AND RESTATED

                              DECLARATION OF TRUST

                             DATED November 3, 1987

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

ARTICLE I -- Name and Definitions

     Section   1.1    Name
     Section   1.2    Definitions

ARTICLE II -- Trustees

     Section   2.1    General Powers
     Section   2.2    Investments
     Section   2.3    Legal Title
     Section   2.4    Issuance and Repurchase of
                        Shares
     Section   2.5    Delegation; Committees
     Section   2.6    Collection and Payment
     Section   2.7    Expenses
     Section   2.8    Manner of Acting; By-laws
     Section   2.9    Miscellaneous Powers
     Section   2.10   Principal Transactions
     Section   2.11   Number of Trustees
     Section   2.12   Election and Term
     Section   2.13   Resignation and Removal
     Section   2.14   Vacancies
     Section   2.15   Delegation of Power to Other
                        Trustees

ARTICLE III -- Contracts

     Section   3.1    Distribution Contract
     Section   3.2    Advisory or Management Contract
     Section   3.3    Affiliations of Trustees or
                            Officers, Etc.
     Section   3.4    Compliance with 1940 Act

ARTICLE IV -- Limitations of Liability of Shareholders,
              Trustees and Others

     Section   4.1    No Personal Liability of Share-
                        holders, Trustees, Etc.
     Section   4.2    Non-Liability of Trustees, Etc.
     Section   4.3    Mandatory Indemnification
     Section   4.4    No Bond Required of Trustees
     Section   4.5    No Duty of Investigation; Notice in
                        Trust Instruments, Etc.
     Section   4.6    Reliance on Experts, Etc.


                                      -ii-
<PAGE>

                                                                            Page
                                                                            ----

ARTICLE V -- Shares of Beneficial Interest

     Section   5.1    Beneficial Interest
     Section   5.2    Rights of Shareholders
     Section   5.3    Trust Only
     Section   5.4    Issuance of Shares
     Section   5.5    Register of Shares
     Section   5.6    Transfer of Shares
     Section   5.7    Notices, Reports
     Section   5.8    Treasury Shares
     Section   5.9    Voting Powers
     Section   5.10   Meetings of Shareholders
     Section   5.11   Series Designation
     Section   5.12   Assent to Declaration of Trust

ARTICLE VI -- Redemption and Repurchase of Shares

     Section   6.1    Redemption of Shares
     Section   6.2    Price
     Section   6.3    Payment
     Section   6.4    Effect of Suspension of
                        Determination of Net
                        Asset Value
     Section   6.5    Repurchase by Agreement
     Section   6.6    Redemption of Shareholder's
                        Interest
     Section   6.7    Redemption of Shares in Order
                        to Qualify as Regulated
                        Investment Company
                        Disclosure of Holding
     Section   6.8    Reductions in Number of Outstanding
                        Shares Pursuant to Net Asset
                        Value Formula
     Section   6.9    Suspension of Right of Redemption

ARTICLE VII -- Determination of Net Asset Value, Net
               Income and Distributions

     Section   7.1    Net Asset Value
     Section   7.2    Distributions to Shareholders
     Section   7.3    Determination of Net Income: Constant
                       Net Asset Value; Reduction of
                         Outstanding Shares


                                     -iii- 
<PAGE>

                                                                            Page
                                                                            ----

     Section   7.4    Allocation Between Principal and
                          Income
     Section   7.5    Power to Modify Foregoing
                          Procedures

ARTICLE VIII -- Duration; Termination of Trust;
                Amendment; Mergers, Etc.

     Section   8.1    Duration
     Section   8.2    Termination of Trust
     Section   8.3    Amendment Procedure
     Section   8.4    Merger, Consolidation and Sale
                        of Assets
     Section   8.5    Incorporation

ARTICLE IX -- Reports to Shareholders

ARTICLE X --  Miscellaneous

     Section  10.1    Filing
     Section  10.2    Governing Law
     Section  10.3    Counterparts
     Section  10.4    Reliance by Third Parties
     Section  10.5    Provisions in Conflict with Law
                          or Regulations


                                      -iv-
<PAGE>

                              AMENDED AND RESTATED
                              DECLARATION OF TRUST
                                       OF
                           SCUDDER CASH INVESTMENT TRUST

                             DATED November 3, 1987

      AMENDED AND RESTATED DECLARATION OF TRUST made November 3, 1987, by the
undersigned Trustees;

      WHEREAS, pursuant to a Declaration of Trust dated December 12, 1975 the
Trustees, established a Massachusetts business trust for the investment and
reinvestment of funds contributed thereto;

      WHEREAS, said Declaration of Trust has been amended from time to time;

      WHEREAS, the Trustees desire to restate said Declaration of Trust in its
entirety;

      NOW, THEREFORE, the Trustees restate the Declaration of Trust as follows:

                                     ARTICLE I

                              NAME AND DEFINITIONS

      Section 1.1. Name. The name of the trust created hereby is the "Scudder
Cash Investment Trust".

      Section 1.2. Definitions. Wherever they are used herein, the following
terms have the following respective meanings:

      (a) "By-laws" means the By-laws referred to in Section 2.8 hereof, as from
time to time amended.

      (b) The term "Commission" has the meaning given it in the 1940 Act. The
term "Interested Person" has the meaning given it in the 1940 Act, as modified
by any applicable order or orders of the Commission. Except as otherwise defined
by the Trustees in conjunction with the establishment of any series of Shares,
the term "vote of a majority of the Shares outstanding and entitled to vote"
shall have the same meaning as the term "vote of a majority of the outstanding
voting securities" given it in the 1940 Act.

      (c) "Custodian" means any Person other than the Trust who has custody of
any Trust Property as required by Section 17(f)

<PAGE>

of the 1940 Act, but does not include a system for the central handling of
securities described in said Section 17(f).

      (d) "Declaration" means this Declaration of Trust as further amended from
time to time. Reference in this Declaration of Trust to "Declaration," "hereof,"
"herein," and "hereunder" shall be deemed to refer to this Declaration rather
than exclusively to the article or section in which such words appear.

      (e) "Distributor" means the party, other than the Trust, to the contract
described in Section 3.1 hereof.

      (f) "His" shall include the feminine and neuter, as well as the masculine,
genders.

      (g) "Investment Adviser" means the party, other than the Trust, to the
contract described in Section 3.2 hereof.

      (h) "Municipal Bonds" means obligations issued by or on behalf of states,
territories of the United States and the District of Columbia and their
political subdivisions, agencies and instrumentalities, the interest from which
is exempt from regular Federal income tax.

      (i) The "1940 Act" means the Investment Company Act of 1940, as amended
from time to time.

      (j) "Person" means and includes individuals, corporations, partnerships,
trusts, associations, joint ventures and other entities, whether or not legal
entities, and governments and agencies and political subdivisions thereof.

      (k) "Series" individually or collectively means the two or more Series as
may be established and designated from time to time by the Trustees pursuant to
Section 5.11 hereof.

      (l) "Shareholder" means a record owner of Outstanding Shares.

      (m) "Shares" means the equal proportionate units of interest into which
the beneficial interest in the Trust shall be divided from time to time,
including the Shares of any and all series which may be established by the
Trustees, and includes fractions of Shares as well as whole Shares. "Outstanding
Shares" means those Shares shown from time to time on the books of the Trust or
its Transfer Agent as then issued and outstanding, but shall not include Shares
which have been redeemed or repurchased by the Trust and which are at the time
held in the treasury of the Trust.

      (n) "Transfer Agent" means any one or more Persons other than the Trust
who maintains the Shareholder records of the


                                      -2-                                  
<PAGE>

Trust, such as the list of Shareholders, the number of Shares credited to each
account, and the like.

      (o) The "Trust" means the Scudder Cash Investment Trust.

      (p) The "Trust Property" means any and all property, real or personal,
tangible or intangible, which is owned or held by or for the account of the
Trust or the Trustees.

      (q) The "Trustees" means the person or persons who has or have signed this
Declaration, so long as he or they shall continue in office in accordance with
the terms hereof, and all other persons who may from time to time be duly
qualified and serving as Trustees in accordance with the provisions of Article
II hereof, and reference herein to a Trustee or the Trustees shall refer to such
person or persons in this capacity or their capacities as trustees hereunder.

                                   ARTICLE II

                                    TRUSTEES

      Section 2.1. General Powers. The Trustees shall have exclusive and
absolute control over the Trust Property and over the business of the Trust to
the same extent as if the Trustees were the sole owners of the Trust Property
and business in their own right, but with such powers of delegation as may be
permitted by this Declaration. The Trustees shall have power to conduct the
business of the Trust and carry on its operations in any and all of its branches
and maintain offices both within and without the Commonwealth of Massachusetts,
in any and all states of the United States of America, in the District of
Columbia, and in any and all commonwealths, territories, dependencies, colonies,
possessions, agencies or instrumentalities of the United States of America and
of foreign governments, and to do all such other things and execute all such
instruments as they deem necessary, proper or desirable in order to promote the
interests of the Trust although such things are not herein specifically
mentioned. Any determination as to what is in the interests of the Trust made by
the Trustees in good faith shall be conclusive. In construing the provisions of
this Declaration, the presumption shall be in favor of a grant of power to the
Trustees.

      The enumeration of any specific power herein shall not be construed as
limiting the aforesaid power. Such powers of the Trustees may be exercised
without order of or resort to any court.


                                      -3-                             
<PAGE>

      Section 2.2. Investments. The Trustees shall have the power:

      (a) To operate as and carry on the business of an investment company, and
exercise all the powers necessary and appropriate to the conduct of such
operations.

      (b) To invest in, hold for investment, or reinvest in, securities,
including common and preferred stocks; warrants; bonds, debentures, bills, time
notes and all other evidences of indebtedness; negotiable or non-negotiable
instruments; government securities, including securities of any state,
municipality or other political subdivision thereof, or any governmental or
quasi-governmental agency or instrumentality; and money market instruments
including bank certificates of deposit, finance paper, commercial paper, bankers
acceptances and all kinds of repurchase agreements, of any corporation, company,
trust, association, firm or other business organization however established, and
of any country, state, municipality or other political subdivision, or any
governmental or quasi-governmental agency or instrumentality.

      (c) To acquire (by purchase, subscription or otherwise), to hold, to trade
in and deal in, to acquire any rights or options to purchase or sell, to sell or
otherwise dispose of, to lend, and to pledge any such securities and to enter
into repurchase agreements and forward foreign currency exchange contracts, to
purchase and sell futures contracts on securities, securities indices and
foreign currencies, to purchase or sell options on such contracts, and foreign
currency contracts foreign currencies and to engage in all types of hedging and
risk management transactions.

      (d) To exercise all rights, powers and privileges of ownership or interest
in all securities, repurchase agreements, futures contracts and options and
other assets included in the Trust Property, including the right to vote thereon
and otherwise act with respect thereto and to do all acts for the preservation,
protection, improvement and enhancement in value of all such assets.

      (e) To acquire (by purchase, lease or otherwise) and to hold, use,
maintain, develop and dispose of (by sale or otherwise) any property, real or
personal, including cash, and any interest therein.

      (f) To borrow money and in this connection issue notes or other evidences
of indebtedness; to secure borrowings by mortgaging, pledging or otherwise
subjecting as security the Trust Property; to endorse, guarantee, or undertake
the performance of any obligation or engagement of any other Person and to lend
Trust Property.


                                      -4- 
<PAGE>

      (g) To aid by further investment any corporation, company, trust,
association or firm, any obligation of or interest in which is included in the
Trust Property or in the affairs of which the Trustees have any direct or
indirect interest; to do all acts and things designed to protect, preserve,
improve or enhance the value of such obligation or interest, and to guarantee or
become surety on any or all of the contracts, stocks, bonds, notes, debentures
and other obligations of any such corporation, company, trust, association or
firm.

      (h) To enter into a plan of distribution and any related agreements
whereby the Trust may finance directly or indirectly any activity which is
primarily intended to result in the sale of Shares.

      (i) In general to carry on any other business in connection with or
incidental to any of the foregoing powers, to do everything necessary, suitable
or proper for the accomplishment of any purpose or the attainment of any object
or the furtherance of any power hereinbefore set forth, either alone or in
association with others, and to do every other act or thing incidental or
appurtenant to or growing out of or connected with the aforesaid business or
purposes, objects or powers.

      The foregoing clauses shall be construed both as objects and powers, and
the foregoing enumeration of specific powers shall not be held to limit or
restrict in any manner the general powers of the Trustees.

      The Trustees shall not be limited to investing in obligations maturing
before the possible termination of the Trust, nor shall the Trustees be limited
by any law limiting the investments which may be made by fiduciaries.

      Section 2.3. Legal Title. Legal title to all the Trust Property, including
the property of any Series of the Trust, shall be vested in the Trustees as
joint tenants except that the Trustees shall have power to cause legal title to
any Trust Property to be held by or in the name of one or more of the Trustees,
or in the name of the Trust, or in the name of any other Person as nominee, on
such terms as the Trustees may determine, provided that the interest of the
Trust therein is deemed appropriately protected. The right, title and interest
of the Trustees in the Trust Property and the property of each Series of the
Trust shall vest automatically in each Person who may hereafter become a
Trustee. Upon the termination of the term of office, resignation, removal or
death of a Trustee he shall automatically cease to have any right, title or
interest in any of the Trust Property or the property of any Series of the
Trust, and the right, title and interest of such Trustee in the Trust Property
shall vest automatically in the remaining Trustees. Such vesting and cessation
of title shall be


                                     -5-
<PAGE>

effective whether or not conveyancing documents have been executed and
delivered.

      Section 2.4. Issuance and Repurchase of Shares. The Trustees shall have
the power to issue, sell, repurchase, redeem, retire, cancel, acquire, hold,
resell, reissue, dispose of, transfer, and otherwise deal in Shares and, subject
to the provisions set forth in Articles VI and VII and Section 5.11 hereof, to
apply to any such repurchase, redemption, retirement, cancellation or
acquisition of Shares any funds or property of the particular series of the
Trust with respect to which such Shares are issued, whether capital or surplus
or otherwise, to the full extent now or hereafter permitted by the laws of the
Commonwealth of Massachusetts governing business corporations.

      Section 2.5. Delegation; Committees. The Trustees shall have power to
delegate from time to time to such of their number or to officers, employees or
agents of the Trust the doing of such things and the execution of such
instruments either in the name of the Trust or the names of the Trustees or
otherwise as the Trustees may deem expedient, to the same extent as such
delegation is permitted by the 1940 Act.

      Section 2.6. Collection and Payment. The Trustees shall have power to
collect all property due to the Trust; to pay all claims, including taxes,
against the Trust Property; to prosecute, defend, compromise or abandon any
claims relating to the Trust Property; to foreclose any security interest
securing any obligations, by virtue of which any property is owed to the Trust;
and to enter into releases, agreements and other instruments.

      Section 2.7. Expenses. The Trustees shall have the power to incur and pay
any expenses which in the opinion of the Trustees are necessary or incidental to
carry out any of the purposes of this Declaration, and to pay reasonable
compensation from the funds of the Trust to themselves as Trustees. The Trustees
shall fix the compensation of all officers, employees and Trustees.

      Section 2.8. Manner of Acting; By-laws. Except as otherwise provided
herein or in the By-laws, any action to be taken by the Trustees may be taken by
a majority of the Trustees present at a meeting of Trustees (a quorum being
present), including any meeting held by means of a conference telephone circuit
or similar communications equipment by means of which all persons participating
in the meeting can hear each other, or by written consents of the entire number
of Trustees then in office. The Trustees may adopt By-laws not inconsistent with
this Declaration to provide for the conduct of the business of the Trust and may
amend or repeal such By-laws to the extent such power is not reserved to the
Shareholders.


                                      -6-
<PAGE>

      Notwithstanding the foregoing provisions of this Section 2.8 and in
addition to such provisions or any other provision of this Declaration or of the
By-laws, the Trustees may by resolution appoint a committee consisting of less
than the whole number of Trustees then in office, which committee may be
empowered to act for and bind the Trustees and the Trust, as if the acts of such
committee were the acts of all the Trustees then in office, with respect to the
institution, prosecution, dismissal, settlement, review or investigation of any
action, suit or proceeding which shall be pending or threatened to be brought
before any court, administrative agency or other adjudicatory body.

      Section 2.9. Miscellaneous Powers. Subject to Section 5.11, hereof, the
Trustees shall have the power to: (a) employ or contract with such Persons as
the Trustees may deem desirable for the transaction of the business of the
Trust; (b) enter into joint ventures, partnerships and any other combinations or
associations; (c) remove Trustees or fill vacancies in or add to their number,
elect and remove such officers and appoint and terminate such agents or
employees as they consider appropriate, and appoint from their own number, and
terminate, any one or more committees which may exercise some or all of the
power and authority of the Trustees as the Trustees may determine; (d) purchase,
and pay for out of Trust Property, insurance policies insuring the Shareholders,
Trustees, officers, employees, agents, investment advisers, distributors,
selected dealers or independent contractors of the Trust against all claims
arising by reason of holding any such position or by reason of any action taken
or omitted by any such Person in such capacity, whether or not constituting
negligence, or whether or not the Trust would have the power to indemnify such
Person against such liability; (e) establish pension, profit-sharing, share
purchase, and other retirement, incentive and benefit plans for any Trustees,
officers, employees and agents of the Trust; (f) to the extent permitted by law,
indemnify any person with whom the Trust has dealings, including the Investment
Adviser, Distributor, Transfer Agent and selected dealers, to such extent as the
Trustees shall determine; (g) guarantee indebtedness or contractual obligations
of others; (h) determine and change the fiscal year of the Trust and the method
by which its accounts shall be kept; and (i) adopt a seal for the Trust, but the
absence of such seal shall not impair the validity of any instrument executed on
behalf of the Trust.

      Section 2.10. Principal Transactions. Except in transactions not permitted
by the 1940 Act or rules and regulations adopted by the Commission, the Trustees
may, on behalf of the Trust, buy any securities from or sell any securities to,
or lend any assets of the Trust to, any Trustee or officer of the Trust or any
firm of which any such Trustee or officer is a


                                      -7-
<PAGE>

member acting as principal, or have any such dealings with the Investment
Adviser, Distributor or Transfer Agent or with any Interested Person of such
Person; and the Trust may employ any such Person, or firm or company in which
such Person is an Interested Person, as broker, legal counsel, registrar,
Transfer Agent, dividend disbursing agent or custodian upon customary terms.

      Section 2.11. Number of Trustees. The number of Trustees shall initially
be one (1), and thereafter shall be such number as shall be fixed from time to
time by a written instrument signed by a majority of the Trustees, provided,
however, that the number of Trustees shall in no event be more than fifteen
(15).

      Section 2.12. Election and Term. Except for the Trustees named herein or
appointed to fill vacancies pursuant to Section 2.14 hereof, the Trustees shall
be elected by the Shareholders owning of record a plurality of the Shares voting
at a meeting of Shareholders. Such a meeting shall be held on a date fixed by
the Trustees. Except in the event of resignation or removals pursuant to Section
2.13 hereof, each Trustee shall hold office until such time as less than a
majority of the Trustees holding office have been elected by Shareholders. In
such event the Trustees then in office will call a Shareholders' meeting for the
election of Trustees. Except for the foregoing circumstances, the Trustees shall
continue to hold office and may appoint successor trustees.

      Section 2.13. Resignation and Removal. Any Trustee may resign his trust
(without the need for any prior or subsequent accounting) by an instrument in
writing signed by him and delivered to the other Trustees and such resignation
shall be effective upon such delivery, or at a later date according to the terms
of the instrument. Any of the Trustees may be removed (provided the aggregate
number of Trustees after such removal shall not be less than one) with cause, by
the action of two-thirds of the remaining Trustees. Any Trustee may be removed
at any meeting of Shareholders by vote of two-thirds of the Outstanding Shares.
The Trustees shall promptly call a meeting of the shareholders for the purpose
of voting upon the question of removal of any such Trustee or Trustees when
requested in writing so to do by the holders of not less than ten percent of the
Outstanding Shares, and in that connection, the Trustees will assist shareholder
communications to the extent provided for in Section 16(c) under the 1940 Act.
Upon the resignation or removal of a Trustee, or his otherwise ceasing to be a
Trustee, he shall execute and deliver such documents as the remaining Trustees
shall require for the purpose of conveying to the Trust or the remaining
Trustees any Trust Property or property of any series of the Trust held in the
name of the resigning or removed Trustee. Upon the incapacity


                                      -8-
<PAGE>

or death of any Trustee, his legal representative shall execute and deliver on
his behalf such documents as the remaining Trustees shall require as provided in
the preceding sentence.

      Section 2.14. Vacancies. The term of office of a Trustee shall terminate
and a vacancy shall occur in the event of the death, resignation, removal,
bankruptcy, adjudicated incompetence or other incapacity to perform the duties
of the office of a Trustee. No such vacancy shall operate to annul the
Declaration or to revoke any existing agency created pursuant to the terms of
the Declaration. In the case of an existing vacancy, including a vacancy
existing by reason of an increase in the number of Trustees, subject to the
provisions of Section 16(a) of the 1940 Act, the remaining Trustees shall fill
such vacancy by the appointment of such other person as they in their discretion
shall see fit, made by a written instrument signed by a majority of the Trustees
then in office. Any such appointment shall not become effective, however, until
the person named in the written instrument of appointment shall have accepted in
writing such appointment and agreed in writing to be bound by the terms of the
Declaration. An appointment of a Trustee may be made in anticipation of a
vacancy to occur at a later date by reason of retirement, resignation or
increase in the number of Trustees, provided that such appointment shall not
become effective prior to such retirement, resignation or increase in the number
of Trustees. Whenever a vacancy in the number of Trustees shall occur, until
such vacancy is filled as provided in this Section 2.14, the Trustees in office,
regardless of their number, shall have all the powers granted to the Trustees
and shall discharge all the duties imposed upon the Trustees by the Declaration.
A written instrument certifying the existence of such vacancy signed by a
majority of the Trustees in office shall be conclusive evidence of the existence
of such vacancy.

      Section 2.15. Delegation of Power to Other Trustees. Any Trustee may, by
power of attorney, delegate his power for a period not exceeding six (6) months
at any one time to any other Trustee or Trustees; provided that in no case shall
less than two (2) Trustees personally exercise the powers granted to the
Trustees under this Declaration except as herein otherwise expressly provided.

                                   ARTICLE III

                                    CONTRACTS

      Section 3.1. Distribution Contract. The Trustees may in their discretion
from time to time enter into an exclusive or non-exclusive underwriting contract
or contracts providing for the sale of the Shares at a price based on the net
asset value


                                      -9-                              
<PAGE>

of a Share, whereby the Trustees may either agree to sell the Shares to the
other party to the contract or appoint such other party their sales agent for
the Shares, and in either case on such terms and conditions, if any, as may be
prescribed in the By-laws, and such further terms and conditions as the Trustees
may in their discretion determine not inconsistent with the provisions of this
Article III or of the By-laws; and such contract may also provide for the
repurchase of the Shares by such other party as agent of the Trustees.

      Section 3.2. Advisory or Management Contract. The Trustees may in their
discretion from time to time enter into an investment advisory or management
contract or separate advisory contracts with respect to one or more Series
whereby the other party to such contract shall undertake to furnish to the Trust
such management, investment advisory, statistical and research facilities and
services and such other facilities and services, if any, and all upon such terms
and conditions as the Trustees may in their discretion determine, including the
grant of authority to such other party to determine what securities shall be
purchased or sold by the Trust and what portion of its assets shall be
uninvested, which authority shall include the power to make changes in the
investments of the Trust or any Series.

      The Trustees may also employ, or authorize the Investment Adviser to
employ, one or more sub-advisers from time to time to perform such of the acts
and services of the Investment Adviser and upon such terms and conditions as may
be agreed upon between the Investment Adviser and such sub-advisers and approved
by the Trustees. Any reference in this Declaration to the Investment Adviser
shall be deemed to include such sub-advisers unless the context otherwise
requires.

      Section 3.3. Affiliations of Trustees or Officers, Etc. The fact that:

            (i) any of the Shareholders, Trustees or officers of the Trust is a
      shareholder, director, officer, partner, trustee, employee, manager,
      adviser or distributor of or for any partnership, corporation, trust,
      association or other organization or of or for any parent or affiliate of
      any organization, with which a contract of the character described in
      Sections 3.1 or 3.2 above or for services as Custodian, Transfer Agent or
      disbursing agent or for related services may have been or may hereafter be
      made, or that any such organization, or any parent or affiliate thereof,
      is a Shareholder of or has an interest in the Trust, or that

            (ii)  any partnership, corporation, trust, association or other
      organization with which a contract of the


                                     -10-                                
<PAGE>

      character described in Sections 3.1 or 3.2 above or for services as
      Custodian, Transfer Agent or disbursing agent or for related services may
      have been or may hereafter be made also has any one or more of such
      contracts with one or more other partnerships, corporations, trusts,
      associations or other organizations, or has other business or interests,

shall not affect the validity of any such contract or disqualify any
Shareholder, Trustee or officer of the Trust from voting upon or executing the
same or create any liability or accountability to the Trust or its Shareholders.

      Section 3.4. Compliance with 1940 Act. Any contract entered into pursuant
to Sections 3.1 or 3.2 shall be consistent with and subject to the requirements
of Section 15 of the 1940 Act (including any amendment thereof or other
applicable act of Congress hereafter enacted), as modified by any applicable
order or orders of the Commission, with respect to its continuance in effect,
its termination and the method of authorization and approval of such contract or
renewal thereof.

                                   ARTICLE IV

                    LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
                               TRUSTEES AND OTHERS

      Section 4.1. No Personal Liability of Shareholders, Trustees, Etc. No
Shareholder shall be subject to any personal liability whatsoever to any Person
in connection with Trust Property or the acts, obligations or affairs of the
Trust. No Trustee, officer, employee or agent of the Trust shall be subject to
any personal liability whatsoever to any Person, other than to the Trust or its
Shareholders, in connection with Trust Property or the affairs of the Trust,
save only that arising from bad faith, willful misfeasance, gross negligence or
reckless disregard of his duties with respect to such Person; and all such
Persons shall look solely to the Trust Property for satisfaction of claims of
any nature arising in connection with the affairs of the Trust. If any
Shareholder, Trustee, officer, employee, or agent, as such, of the Trust, is
made a party to any suit or proceeding to enforce any such liability of the
Trust, he shall not, on account thereof, be held to any personal liability. The
Trust shall indemnify and hold each Shareholder harmless from and against all
claims and liabilities, to which such Shareholder may become subject by reason
of his being or having been a Shareholder, and shall reimburse such Shareholder
for all legal and other expenses reasonably incurred by him in connection with
any such claim or liability. The indemnification and reimbursement required by
the preceding sentence shall be made only out of the assets of


                                     -11-
<PAGE>

the one or more Series of which the Shareholder who is entitled to
indemnification or reimbursement was a Shareholder at the time the act or event
occurred which gave rise to the claim against or liability of said Shareholder.
The rights accruing to a Shareholder under this Section 4.1 shall not impair any
other right to which such Shareholder may be lawfully entitled, nor shall
anything herein contained restrict the right of the Trust to indemnify or
reimburse a Shareholder in any appropriate situation even though not
specifically provided herein.

      Section 4.2. Non-Liability of Trustees, Etc. No Trustee, officer, employee
or agent of the Trust shall be liable to the Trust, its Shareholders, or to any
Shareholder, Trustee, officer, employee, or agent thereof for any action or
failure to act (including without limitation the failure to compel in any way
any former or acting Trustee to redress any breach of trust) except for his own
bad faith, willful misfeasance, gross negligence or reckless disregard of the
duties involved in the conduct of his office.

      Section 4.3. Mandatory Indemnification. (a) Subject to the exceptions and
limitations contained in paragraph (b) below:

      (i) every person who is, or has been, a Trustee or officer of the Trust
shall be indemnified by the Trust to the fullest extent permitted by law against
all liability and against all expenses reasonably incurred or paid by him in
connection with any claim, action, suit or proceeding in which he becomes
involved as a party or otherwise by virtue of his being or having been a Trustee
or officer and against amounts paid or incurred by him in the settlement
thereof;

      (ii) the words "claim," "action," "suit," or "proceeding" shall apply to
all claims, actions, suits or proceedings (civil, criminal, administrative or
other, including appeals), actual or threatened; and the words "liability" and
"expenses" shall include, without limitation, attorneys' fees, costs, judgments,
amounts paid in settlement, fines, penalties and other liabilities.

      (b) No indemnification shall be provided hereunder to a Trustee or
officer:

            (i) against any liability to the Trust, a Series thereof, or the
      Shareholders by reason of a final adjudication by a court or other body
      before which a proceeding was brought that he engaged in willful
      misfeasance, bad faith, gross negligence or reckless disregard of the
      duties involved in the conduct of his office;


                                     -12-               
<PAGE>

            (ii) with respect to any matter as to which he shall have been
      finally adjudicated not to have acted in good faith in the reasonable
      belief that his action was in the best interest of the Trust;

            (iii) in the event of a settlement or other disposition not
      involving a final adjudication as provided in paragraph (b)(i) or (b)(ii)
      resulting in a payment by a Trustee or officer, unless there has been a
      determination that such Trustee or officer did not engage in willful
      misfeasance, bad faith, gross negligence or reckless disregard of the
      duties involved in the conduct of his office:

                  (A) by the court or other body approving the settlement or
            other disposition; or

                  (B) based upon a review of readily available facts (as opposed
            to a full trial-type inquiry) by (x) vote of a majority of the
            Disinterested Trustees acting on the matter (provided that a
            majority of the Disinterested Trustees then in office act on the
            matter) or (y) written opinion of independent legal counsel.

      (c) The rights of indemnification herein provided may be insured against
by policies maintained by the Trust, shall be severable, shall not affect any
other rights to which any Trustee or officer may now or hereafter be entitled,
shall continue as to a person who has ceased to be such Trustee or officer and
shall inure to the benefit of the heirs, executors, administrators and assigns
of such a person. Nothing contained herein shall affect any rights to
indemnification to which personnel of the Trust other than Trustees and officers
may be entitled by contract or otherwise under law.

      (d) Expenses of preparation and presentation of a defense to any claim,
action, suit or proceeding of the character described in paragraph (a) of this
Section 4.3 may be advanced by the Trust prior to final disposition thereof upon
receipt of an undertaking by or on behalf of the recipient to repay such amount
if it is ultimately determined that he is not entitled to indemnification under
this Section 4.3, provided that either:

            (i) such undertaking is secured by a surety bond or some other
      appropriate security provided by the recipient, or the Trust shall be
      insured against losses arising out of any such advances; or

            (ii) a majority of the Disinterested Trustees acting on the matter
      (provided that a majority of the Disinterested Trustees act on the matter)
      or an independent legal counsel


                                     -13-                               
<PAGE>

      in a written opinion shall determine, based upon a review of readily
      available facts (as opposed to a full trial-type inquiry), that there is
      reason to believe that the recipient ultimately will be found entitled to
      indemnification.

            As used in this Section 4.3, a "Disinterested Trustee" is one who is
      not (i) an Interested Person of the Trust (including anyone who has been
      exempted from being an Interested Person by any rule, regulation or order
      of the Commission), or (ii) involved in the claim, action, suit or
      proceeding.

      Section 4.4. No Bond Required of Trustees. No Trustee shall be obligated
to give any bond or other security for the performance of any of his duties
hereunder.

      Section 4.5. No Duty of Investigation; Notice in Trust Instruments, Etc.
No purchaser, lender, transfer agent or other Person dealing with the Trustees
or any officer, employee or agent of the Trust shall be bound to make any
inquiry concerning the validity of any transaction purporting to be made by the
Trustees or by said officer, employee or agent or be liable for the application
of money or property paid, loaned, or delivered to or on the order of the
Trustees or of said officer, employee or agent. Every obligation, contract,
instrument, certificate, Share, other security of the Trust or undertaking, and
every other act or thing whatsoever executed in connection with the Trust shall
be conclusively presumed to have been executed or done by the executors thereof
only in their capacity as Trustees under this Declaration or in their capacity
as officers, employees or agents of the Trust. Every written obligation,
contract, instrument, certificate, Share, other security of the Trust or
undertaking made or issued by the Trustees may recite that the same is executed
or made by them not individually, but as Trustees under the Declaration, and
that the obligations of the Trust under any such instrument are not binding upon
any of the Trustees or Shareholders individually, but bind only the trust
estate, and may contain any further recital which they or he may deem
appropriate, but the omission of such recital shall not operate to bind the
Trustees individually. The Trustees shall at all times maintain insurance for
the protection of the Trust Property, its Shareholders, Trustees, officers,
employees and agents in such amount as the Trustees shall deem adequate to cover
possible tort liability, and such other insurance as the Trustees in their sole
judgment shall deem advisable.

      Section 4.6. Reliance on Experts, Etc. Each Trustee and officer or
employee of the Trust shall, in the performance of his duties, be fully and
completely justified and protected with regard to any act or any failure to act
resulting from reliance in good faith upon the books of account or other


                                     -14-                               
<PAGE>

records of the Trust, upon an opinion of counsel, or upon reports made to the
Trust by any of its officers or employees or by the Investment Adviser, the
Distributor, Transfer Agent, selected dealers, accountants, appraisers or other
experts or consultants selected with reasonable care by the Trustees, officers
or employees of the Trust, regardless of whether such counsel or expert may also
be a Trustee.

                                    ARTICLE V

                          SHARES OF BENEFICIAL INTEREST

      Section 5.1. Beneficial Interest. The interest of the beneficiaries
hereunder shall be divided into transferable Shares of beneficial interest, all
of one class, except as provided in Section 5.11 hereof, par value $.01 per
share. The number of Shares of beneficial interest authorized hereunder is
unlimited. All Shares issued hereunder including, without limitation, Shares
issued in connection with a dividend in Shares or a split of Shares, shall be
fully paid and non-assessable.

      Section 5.2. Rights of Shareholders. The ownership of the Trust Property
and the property of each Series of the Trust of every description and the right
to conduct any business hereinbefore described are vested exclusively in the
Trustees, and the Shareholders shall have no interest therein other than the
beneficial interest conferred by their Shares, and they shall have no right to
call for any partition or division of any property, profits, rights or interests
of the Trust nor can they be called upon to share or assume any losses of the
Trust or suffer an assessment of any kind by virtue of their ownership of
Shares. The Shares shall be personal property giving only the rights
specifically set forth in this Declaration. The Shares shall not entitle the
holder to preference, preemptive, appraisal, conversion or exchange rights,
except as the Trustees may determine with respect to any Series of Shares.

      Section 5.3. Trust Only. It is the intention of the Trustees to create
only the relationship of Trustee and beneficiary between the Trustees and each
Shareholder from time to time. It is not the intention of the Trustees to create
a general partnership, limited partnership, joint stock association,
corporation, bailment or any form of legal relationship other than a trust.
Nothing in this Declaration of Trust shall be construed to make the
Shareholders, either by themselves or with the Trustees, partners or members of
a joint stock association.

      Section 5.4. Issuance of Shares. The Trustees in their discretion may,
from time to time without vote of the Shareholders, issue Shares, in addition to
the then issued and outstanding Shares and Shares held in the treasury, to such


                                     -15-
<PAGE>

party or parties and for such amount and type of consideration, including cash
or property, at such time or times and on such terms as the Trustees may deem
best, and may in such manner acquire other assets (including the acquisition of
assets subject to, and in connection with the assumption of liabilities) and
businesses. In connection with any issuance of Shares, the Trustees may issue
fractional Shares and Shares held in the treasury. The Trustees may from time to
time divide or combine the Shares into a greater or lesser number without
thereby changing the proportionate beneficial interests in the Trust.
Contributions to the Trust may be accepted for, and Shares shall be redeemed as,
whole Shares and/or 1/1,000ths of a Share or integral multiples thereof.

      Section 5.5. Register of Shares. A register shall be kept at the principal
office of the Trust or an office of the Transfer Agent which shall contain the
names and addresses of the Shareholders and the number of Shares held by them
respectively and a record of all transfers thereof. Such register shall be
conclusive as to who are the holders of the Shares and who shall be entitled to
receive dividends or distributions or otherwise to exercise or enjoy the rights
of Shareholders. No Shareholder shall be entitled to receive payment of any
dividend or distribution, nor to have notice given to him as herein or in the
By-laws provided, until he has given his address to the Transfer Agent or such
other officer or agent of the Trustees as shall keep the said register for entry
thereon. It is not contemplated that certificates will be issued for the Shares;
however, the Trustees, in their discretion, may authorize the issuance of share
certificates and promulgate appropriate rules and regulations as to their use.

      Section 5.6. Transfer of Shares. Except as otherwise provided by the
Trustees, Shares shall be transferable on the records of the Trust only by the
record holder thereof or by his agent thereunto duly authorized in writing, upon
delivery to the Trustees or the Transfer Agent of a duly executed instrument of
transfer, together with such evidence of the genuineness of each such execution
and authorization and of other matters as may reasonably be required. Upon such
delivery the transfer shall be recorded on the register of the Trust. Until such
record is made, the Shareholder of record shall be deemed to be the holder of
such Shares for all purposes hereunder and neither the Trustees nor any transfer
agent or registrar nor any officer, employee or agent of the Trust shall be
affected by any notice of the proposed transfer.

      Any person becoming entitled to any Shares in consequence of the death,
bankruptcy, or incompetence of any Shareholder, or otherwise by operation of
law, shall be recorded on the register of Shares as the holder of such Shares
upon production of the proper evidence thereof to the Trustees or the Transfer


                                     -16-
<PAGE>

Agent, but until such record is made, the Shareholder of record shall be deemed
to be the holder of such Shares for all purposes hereunder and neither the
Trustees nor any Transfer Agent or registrar nor any officer or agent of the
Trust shall be affected by any notice of such death, bankruptcy or incompetence,
or other operation of law.

      Section 5.7. Notices, Reports. Any and all notices to which any
Shareholder may be entitled and any and all communications shall be deemed duly
served or given if mailed, postage prepaid, addressed to any Shareholder of
record at his last known address as recorded on the register of the Trust. A
notice of a meeting, an annual report and any other communication to
Shareholders need not be sent to a Shareholder (i) if an annual report and a
proxy statement for two consecutive shareholder meetings have been mailed to
such Shareholder's address and have been returned as undeliverable, (ii) if all,
and at least two, checks (if sent by first class mail) in payment of dividends
on Shares during a twelve-month period have been mailed to such Shareholder's
address and have been returned as undeliverable or (iii) in any other case in
which a proxy statement concerning a meeting of security holders is not required
to be given pursuant to the Commission's proxy rules as from time to time in
effect under the Securities Exchange Act of 1934. However, delivery of such
proxy statements, annual reports and other communications shall resume if and
when such Shareholder delivers or causes to be delivered to the Trust written
notice setting forth such Shareholder's then current address.

      Section 5.8. Treasury Shares. Shares held in the treasury shall, until
reissued pursuant to Section 5.4, not confer any voting rights on the Trustees,
nor shall such Shares be entitled to any dividends or other distributions
declared with respect to the Shares.

      Section 5.9. Voting Powers. The Shareholders shall have power to vote only
(i) for the election of Trustees as provided in Section 2.12; (ii) for the
removal of Trustees as provided in Section 2.13; (iii) with respect to any
investment advisory or management contract entered into pursuant to Section 3.2;
(iv) with respect to termination of the Trust as provided in Section 8.2; (v)
with respect to any amendment of this Declaration to the extent and as provided
in Section 8.3; (vi) with respect to any merger, consolidation or sale of assets
as provided in Section 8.4; (vii) with respect to incorporation of the Trust or
any Series to the extent and as provided in Section 8.5; (viii) to the same
extent as the stockholders of Massachusetts business corporation as to whether
or not a court action, proceeding or claim should or should not be brought or
maintained derivatively or as a class action on behalf of the Trust or the
Shareholders; (ix) with respect to any plan


                                     -17-
<PAGE>

adopted pursuant to Rule 12b-1 (or any successor rule) under the 1940 Act; and
(x) with respect to such additional matters relating to the Trust as may be
required by this Declaration, the By-laws or any registration of the Trust as an
investment company under the 1940 Act with the Commission (or any successor
agency) or as the Trustees may consider necessary or desirable. Each whole Share
shall be entitled to one vote as to any matter on which it is entitled to vote
and each fractional Share shall be entitled to a proportionate fractional vote,
except that the Trustees may, in conjunction with the establishment of any
Series of Shares, establish or reserve the right to establish conditions under
which the several Series shall have separate voting rights or, if a Series would
not, in the sole judgment of the Trustees, be materially affected by a proposal,
no voting rights. There shall be no cumulative voting in the election of
Trustees. Until Shares are issued, the Trustees may exercise all rights of
Shareholders and may take any action required by law, this Declaration or the
By-laws to be taken by Shareholders. The By-laws may include further provisions
for Shareholders' votes and meetings and related matters.

      Section 5.10. Meetings of Shareholders. Meetings of Shareholders may be
called at any time by the President, and shall be called by the President and
Secretary at the request in writing or by resolution, of a majority of Trustees,
or at the written request of the holder or holders of ten percent (10%) or more
of the total number of Shares then issued and outstanding of the Trust entitled
to vote at such meeting. Any such request shall state the purpose of the
proposed meeting.

      Section 5.11. Series Designation. The Trustees, in their discretion, may
authorize the division of Shares into two or more Series, and the different
Series shall be established and designated, and the variations in the relative
rights and preferences as between the different Series shall be fixed and
determined, by the Trustees; provided, that all Shares shall be identical except
that there may be variations so fixed and determined between different Series as
to investment objective, purchase price, allocation of expenses, right of
redemption, special and relative rights as to dividends and on liquidation,
conversion rights, and conditions under which the several Series shall have
separate voting rights. All references to Shares in this Declaration shall be
deemed to be Shares of any or all series as the context may require.

     If the Trustees shall divide the Shares of the Trust into two or more
Series, the following provisions shall be applicable:

      (a) All provisions herein relating to the Trust shall apply equally to
each Series of the Trust except as the context requires otherwise.


                                     -18-     
<PAGE>

      (b) The number of authorized Shares and the number of Shares of each
Series that may be issued shall be unlimited. The Trustees may classify or
reclassify any unissued Shares or any Shares previously issued and reacquired of
any Series into one or more Series that may be established and designated from
time to time. The Trustees may hold as treasury Shares (of the same or some
other Series), reissue for such consideration and on such terms as they may
determine, or cancel any Shares of any Series reacquired by the Trust at their
discretion from time to time.

      (c) All consideration received by the Trust for the issue or sale of
Shares of a particular Series, together with all assets in which such
consideration is invested or reinvested, all income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall
irrevocably belong to that Series for all purposes, subject only to the rights
of creditors of such Series and except as may otherwise be required by
applicable laws, and shall be so recorded upon the books of account of the
Trust. In the event that there are any assets, income, earnings, profits, and
proceeds thereof, funds, or payments which are not readily identifiable as
belonging to any particular Series, the Trustees shall allocate them among any
one or more of the Series established and designated from time to time in such
manner and on such basis as they, in their sole discretion, deem fair and
equitable. Each such allocation by the Trustees shall be conclusive and binding
upon the shareholders of all Series for all purposes.

      (d) The assets belonging to each particular Series shall be charged with
the liabilities of the Trust in respect of that Series and all expenses, costs,
charges and reserves attributable to that Series, and any general liabilities,
expenses, costs, charges or reserves of the Trust which are not readily
identifiable as belonging to any particular Series shall be allocated and
charged by the Trustees to and among any one or more of the Series established
and designated from time to time in such manner and on such basis as the
Trustees in their sole discretion deem fair and equitable. Each allocation of
liabilities, expenses, costs, charges and reserves by the Trustees shall be
conclusive and binding upon the Shareholders of all Series for all purposes. The
Trustees shall have full discretion, to the extent not inconsistent with the
1940 Act, to determine which items are capital; and each such determination and
allocation shall be conclusive and binding upon the Shareholders. The assets of
a particular Series of the Trust shall, under no circumstances, be charged with
liabilities attributable to any other Series of the Trust. All persons extending
credit to, or contracting with or having any claim


                                     -19-                      
<PAGE>

against a particular Series of the Trust shall look only to the assets of that
particular Series for payment of such credit, contract or claim. No Shareholder
or former Shareholder of any Series shall have any claim on or right to any
assets allocated or belonging to any other series.

      (e) Each Share of a Series of the Trust shall represent a beneficial
interest in the net assets of such Series. Each holder of Shares of a Series
shall be entitled to receive his pro rata share of distributions of income and
capital gains made with respect to such Series. Upon redemption of his Shares or
indemnification for liabilities incurred by reason of his being or having been a
Shareholder of a Series, such shareholder shall be paid solely out of the funds
and property of such Series of the Trust. Upon liquidation or termination of a
Series of the Trust, Shareholders of such Series shall be entitled to receive a
pro rata share of the net assets of such Series. A Shareholder of a particular
Series of the Trust shall not be entitled to participate in a derivative or
class action on behalf of any other Series or the Shareholders of any other
Series of the Trust.

      (f) The establishment and designation of any Series of Shares shall be
effective upon the execution by a majority of the then Trustees of an instrument
setting forth such establishment and designation and the relative rights and
preferences of such Series, or as otherwise provided in such instrument. The
Trustees may by an instrument executed by a majority of their number abolish any
Series and the establishment and designation thereof. Except as otherwise
provided in this Article V, the Trustees shall have the power to determine the
designations, preferences, privileges, limitations and rights, of each class and
Series of Shares. Each instrument referred to in this paragraph shall have the
status of an amendment to this Declaration.

      Section 5.12. Assent to Declaration of Trust. Every Shareholder, by
virtue of having become a shareholder, shall be held to have expressly assented
and agreed to the terms hereof and to have become a party hereto.

                                   ARTICLE VI

                       REDEMPTION AND REPURCHASE OF SHARES

     Section 6.1.  Redemption of Shares.  All Shares of the Trust shall be
redeemable, at the redemption price determined in the manner set out in this
Declaration.  Redeemed or repurchased Shares may be resold by the Trust.


                                     -20-                                 
<PAGE>


[PAGE TO COME]


                                     -21-                                 
<PAGE>

owner thereof at a price not exceeding the net asset value per share determined
as of the time when the purchase or contract of purchase is made or the net
asset value as of any time which may be later determined pursuant to Section 7.1
hereof, provided payment is not made for the Shares prior to the time as of
which such net asset value is determined.

      Section 6.6. Redemption of Shareholder's Interest. The Trust shall have
the right at any time without prior notice to the shareholder to redeem Shares
of any shareholder for their then current net asset value per Share if at such
time the shareholder owns Shares having an aggregate net asset value of less
than $1,000 subject to such terms and conditions as the Trustees may approve,
and subject to the Trust's giving general notice to all shareholders of its
intention to avail itself of such right, either by publication in the Trust's
registration statement, if any, or by such other means as the Trustees may
determine.

      Section 6.7. Redemption of Shares in Order to Qualify as Regulated
Investment Company; Disclosure of Holding. If the Trustees shall, at any time
and in good faith, be of the opinion that direct or indirect ownership of Shares
or other securities of the Trust has or may become concentrated in any Person to
an extent which would disqualify any Series of the Trust as a regulated
investment company under the Internal Revenue Code, then the Trustees shall have
the power by lot or other means deemed equitable by them (i) to call for
redemption by any such Person a number, or principal amount, of Shares or other
securities of the Trust sufficient to maintain or bring the direct or indirect
ownership of Shares or other securities of the Trust into conformity with the
requirements for such qualification and (ii) to refuse to transfer or issue
Shares or other securities of the Trust to any Person whose acquisition of the
Shares or other securities of the Trust in question would result in such
disqualification. The redemption shall be effected at the redemption price and
in the manner provided in Section 6.1.

      The holders of Shares or other securities of the Trust shall upon demand
disclose to the Trustees in writing such information with respect to direct and
indirect ownership of Shares or other securities of the Trust as the Trustees
deem necessary to comply with the provisions of the Internal Revenue Code, or to
comply with the requirements of any other taxing authority.

      Section 6.8. Reductions in Number of Outstanding Shares Pursuant to Net
Asset Value Formula. The Trust may also reduce the number of Outstanding Shares
pursuant to the provisions of Section 7.3.


                                     -22-
<PAGE>

      Section 6.9. Suspension of Right of Redemption. The Trust may declare a
suspension of the right of redemption or postpone the date of payment or
redemption for the whole or any part of any period (i) during which the New York
Stock Exchange is closed other than customary week-end and holiday closings,
(ii) during which trading on the New York Stock Exchange is restricted, (iii)
during which an emergency exists as a result of which disposal by the Trust of
securities owned by it is not reasonably practicable or it is not reasonably
practicable for the Trust fairly to determine the value of its net assets, or
(iv) during any other period when the Commission may for the protection of
Shareholders of the Trust by order permit suspension of the right of redemption
or postponement of the date of payment or redemption; provided that applicable
rules and regulations of the Commission shall govern as to whether the
conditions prescribed in (ii), (iii), or (iv) exist. Such suspension shall take
effect at such time as the Trust shall specify but not later than the close of
business on the business day next following the declaration of suspension, and
thereafter there shall be no right of redemption or payment on redemption until
the Trust shall declare the suspension at an end, except that the suspension
shall terminate in any event on the first day on which said stock exchange shall
have reopened or the period specified in (ii) or (iii) shall have expired (as to
which in the absence of an official ruling by the Commission, the determination
of the Trust shall be conclusive). In the case of a suspension of the right of
redemption, a Shareholder may either withdraw his request for redemption or
receive payment based on the net asset value existing after the termination of
the suspension.

                                   ARTICLE VII

                        DETERMINATION OF NET ASSET VALUE,
                          NET INCOME AND DISTRIBUTIONS

      Section 7.1. Net Asset Value. The value of the assets of the Trust or any
Series of the Trust shall be determined by appraisal of the securities of the
Trust or allocated to such Series, such appraisal to be on the basis of the
amortized cost of such securities in the case of money market securities, market
value in the case of other securities, or by such other method as shall be
deemed to reflect the fair value thereof, determined in good faith by or under
the direction of the Trustees. From the total value of said assets, there shall
be deducted all indebtedness, interest, taxes, payable or accrued, including
estimated taxes on unrealized book profits, expenses and management charges
accrued to the appraisal date, net income determined and declared as a
distribution and all other items in the nature of liabilities attributable to
the Trust or such Series which shall be deemed appropriate. The resulting amount
which shall represent the total net assets of the Trust


                                     -23-                
<PAGE>

or the Series shall be divided by the number of Shares of the Trust or such
Series outstanding at the time and the quotient so obtained shall be deemed to
be the net asset value of the Shares. The net asset value of the Shares shall be
determined at least once on each business day, as of the close of trading on the
New York Stock Exchange or as of such other time or times as the Trustees shall
determine. The power and duty to make the daily calculations may be delegated by
the Trustees to the Investment Adviser, the custodian, the Transfer Agent or
such other Person as the Trustees may determine by resolution or by approving a
contract which delegates such duty to another Person. The Trustees may suspend
the daily determination of net asset value to the extent permitted by the 1940
Act.

      Section 7.2. Distributions to Shareholders. The Trustees shall from time
to time distribute ratably among the Shareholders of the Trust or a Series such
proportion of the net profits, surplus (including paid-in surplus), capital, or
assets of the Trust or such Series held by the Trustees as they may deem
proper. Such distributions may be made in cash or property (including without
limitation any type of obligations of the Trust or such Series or any assets
thereof), and the Trustees may distribute ratably among the Shareholders
additional Shares of the Trust or such Series issuable hereunder in such manner,
at such times, and on such terms as the Trustees may deem proper. Such
distributions may be among the Shareholders of record at the time of declaring a
distribution or among the Shareholders of record at such other date or time or
dates or times as the Trustees shall determine. The Trustees may in their
discretion determine that, solely for the purposes of such distributions,
Outstanding Shares shall exclude Shares for which orders have been placed
subsequent to a specified time on the date the distribution is declared or on
the next preceding day if the distribution is declared as of a day on which
Boston banks are not open for business, all as described in the registration
statement under the Securities Act of 1933. The Trustees may always retain from
the net profits such amount as they may deem necessary to pay the debts or
expenses of the Trust or the Series or to meet obligations of the Trust or the
Series, or as they may deem desirable to use in the conduct of its affairs or to
retain for future requirements or extensions of the business. The Trustees may
adopt and offer to Shareholders such dividend reinvestment plans, cash dividend
payout plans or related plans as the Trustees shall deem appropriate.

      Inasmuch as the computation of net income and gains for Federal income tax
purposes may vary from the computation thereof on the books, the above
provisions shall be interpreted to give the Trustees the power in their
discretion to distribute for any fiscal year as ordinary dividends and as
capital gains distributions, respectively, additional amounts sufficient to
enable the Trust or the Series to avoid or reduce liability for taxes.


                                     -24-   
<PAGE>

      Section 7.3. Determination of Net Income; Constant Net Asset Value;
Reduction of Outstanding Shares. Subject to Section 5.11 hereof, the net income
of the Trust or any Series shall be determined in such manner as the Trustees
shall provide by resolution. Expenses of the Trust or a Series, including the
advisory or management fee, shall be accrued each day. Such net income may be
determined by or under the direction of the Trustees as of the close of trading
on the New York Stock Exchange on each day on which such Exchange is open or as
of such other time or times as the Trustees shall determine, and, except as
provided herein, all the net income of the Trust or any Series, as so
determined, may be declared as a dividend on the Outstanding Shares of the
Trust or such Series. If, for any reason, the net income of the Trust or any
Series, determined at any time is a negative amount, the Trustees shall have the
power with respect to the Trust or such Series (i) to offset each Shareholder's
pro rata share of such negative amount from the accrued dividend account of such
Shareholder, or (ii) to reduce the number of Outstanding Shares of the Trust or
such Series by reducing the number of Shares in the account of such Shareholder
by that number of full and fractional Shares which represents the amount of
such excess negative net income, or (iii) to cause to be recorded on the books
of the Trust or such Series an asset account in the amount of such negative net
income, which account may be reduced by the amount, provided that the same shall
thereupon become the property of the Trust or such Series with respect to the
Trust or such Series and shall not be paid to any Shareholder, of dividends
declared thereafter upon the Outstanding Shares of the Trust or such Series on
the day such negative net income is experienced, until such asset account is
reduced to zero; or (iv) to combine the methods described in clauses (i) and
(ii) and (iii) of this sentence, in order to cause the net asset value per Share
of the Trust or such Series to remain at a constant amount per Outstanding Share
immediately after each such determination and declaration. The Trustees shall
also have the power to fail to declare a dividend out of net income for the
purpose of causing the net asset value per Share to be increased to a constant
amount. The Trustees shall not be required to adopt, but may at any time adopt,
discontinue or amend the practice of maintaining the net asset value per Share
of the Trust or a Series at a constant amount.

      Section 7.4. Allocation Between Principal and Income. The Trustees shall
have full discretion to determine whether any cash or property received shall be
treated as income or as principal and whether any item of expense shall be
charged to the income or the principal account, and their determination made in
good faith shall be conclusive upon the Shareholders. In the case of stock
dividends received, the Trustees shall have full discretion to determine, in the
light of the particular circumstances, how much if any of the value thereof
shall be treated as income, the balance, if any, to be treated as principal.


                                     -25-
<PAGE>

      Section 7.5. Power to Modify Foregoing Procedures. Notwithstanding any of
the foregoing provisions of this Article VII, the Trustees may prescribe, in
their absolute discretion, such other bases and times for determining the per
Share net asset value or net income, or the declaration and payment of dividends
and distributions as they may deem necessary or desirable.

                                  ARTICLE VIII

                         DURATION; TERMINATION OF TRUST;
                            AMENDMENT; MERGERS, ETC.

      Section 8.1. Duration. The Trust shall continue without limitation of time
but subject to the provisions of this Article VIII.

      Section 8.2. Termination of Trust. (a) The Trust or any Series of the
Trust may be terminated by an instrument in writing signed by a majority of the
Trustees, or by the affirmative vote of the holders of a majority of the Shares
of the Trust or Series outstanding and entitled to vote, at any meeting of
Shareholders. Upon the termination of the Trust or any Series,

            (i) the Trust or any Series shall carry on no business except for 
      the purpose of winding up its affairs;

            (ii) the Trustees shall proceed to wind up the affairs of the Trust
      or Series and all of the powers of the Trustees under this Declaration
      shall continue until the affairs of the Trust or Series shall have been
      wound up, including the power to fulfill or discharge the contracts of the
      Trust or Series, collect its assets, sell, convey, assign, exchange,
      transfer or otherwise dispose of all or any part of the remaining Trust
      Property or property of the Series to one or more persons at public or
      private sale for consideration which may consist in whole or in part of
      cash, securities or other property of any kind, discharge or pay its
      liabilities, and do all other acts appropriate to liquidate its business;

            (iii) after paying or adequately providing for the payment of all
      liabilities, and upon receipt of such releases, indemnities and refunding
      agreements as they deem necessary for their protection, the Trustees may
      distribute the remaining Trust Property or property of the Series, in cash
      or in kind or partly each, among the Shareholders of the Trust or Series
      according to their respective rights.

     (b) After termination of the Trust or any Series and distribution to the
Shareholders as herein provided, a majority of


                                     -26-
<PAGE>

the Trustees shall execute and lodge among the records of the Trust an
instrument in writing setting forth the fact of such termination, and the
Trustees shall thereupon be discharged from all further liabilities and duties
hereunder, and the rights and interests of all Shareholders of the Trust or
Series shall thereupon cease.

      Section 8.3. Amendment Procedure. (a) This Declaration may be amended by a
vote of the holders of a majority of the Shares outstanding and entitled to
vote. Amendments shall be effective upon the taking of action as provided in
this section or at such later time as shall be specified in the applicable vote
or instrument. The Trustees may also amend this Declaration without the vote or
consent of Shareholders if they deem it necessary to conform this Declaration to
the requirements of applicable federal or state laws or regulations or the
requirements of the regulated investment company provisions of the Internal
Revenue Code (including those provisions of such Code relating to the retention
of the exemption from federal income tax with respect to dividends paid by the
Trust out of interest income received on Municipal Bonds), but the Trustees
shall not be liable for failing so to do. The Trustees may also amend this
Declaration without the vote or consent of Shareholders if they deem it
necessary or desirable to change the name of the Trust or to make any other
changes in the Declaration which do not materially adversely affect the rights
of Shareholders hereunder.

      (b) No amendment may be made under this Section 8.3 which would change any
rights with respect to any Shares of the Trust or Series by reducing the amount
payable thereon upon liquidation of the Trust or Series or by diminishing or
eliminating any voting rights pertaining thereto, except with the vote or
consent of the holders of two-thirds of the Shares of the Trust or Series
outstanding and entitled to vote. Nothing contained in this Declaration shall
permit the amendment of this Declaration to impair the exemption from personal
liability of the Shareholders, Trustees, officers, employees and agents of the
Trust or to permit assessments upon Shareholders.

      (c) A certificate signed by a majority of the Trustees setting forth an
amendment and reciting that it was duly adopted by the Shareholders or by the
Trustees as aforesaid or a copy of the Declaration, as amended, and executed by
a majority of the Trustees, shall be conclusive evidence of such amendment when
lodged among the records of the Trust.

      Notwithstanding any other provision hereof, until such time as a
Registration Statement under the Securities Act of 1933, as amended, covering
the first public offering of securities of the Trust shall have become
effective, this Declaration may be terminated or amended in any respect by the
affirmative vote of


                                     -27-
<PAGE>

a majority of the Trustees or by an instrument signed by a majority of the
Trustees.

      Section 8.4. Merger, Consolidation and Sale of Assets. The Trust or any
Series thereof may merge or consolidate with any other corporation, association,
trust or other organization or may sell, lease or exchange all or substantially
all of the Trust Property or the property of any Series, including its good
will, upon such terms and conditions and for such consideration when and as
authorized at any meeting of Shareholders of the Trust or Series called for the
purpose by the affirmative vote of the holders of a majority of the Shares of
the Trust or Series.

      Section 8.5. Incorporation. With the approval of the holders of a majority
of the Shares of the Trust or any Series outstanding and entitled to vote, the
Trustees may cause to be organized or assist in organizing a corporation or
corporations under the laws of any jurisdiction or any other trust, partnership,
association or other organization to take over all of the Trust Property or the
property of any Series or to carry on any business in which the Trust or the
Series shall directly or indirectly have any interest, and to sell, convey and
transfer the Trust Property or the property of any Series to any such
corporation, trust, association or organization in exchange for the Shares or
securities thereof or otherwise, and to lend money to, subscribe for the Shares
or securities of, and enter into any contracts with any such corporation, trust,
partnership, association or organization, or any corporation, partnership,
trust, association or organization in which the Trust or the Series holds or is
about to acquire shares or any other interest. The Trustees may also cause a
merger or consolidation between the Trust or any Series or any successor thereto
and any such corporation, trust, partnership, association or other organization
if and to the extent permitted by law, as provided under the law then in effect.
Nothing contained herein shall be construed as requiring approval of
Shareholders for the Trustees to organize or assist in organizing one or more
corporations, trusts, partnerships, associations or other organizations and
selling, conveying or transferring a portion of the Trust Property to such
organization, or entities.

                                   ARTICLE IX

                             REPORTS TO SHAREHOLDERS

      The Trustees shall at least semi-annually submit to the Shareholders a
written financial report, which may be included in the Trust's prospectus or
statement of additional information, of the transactions of the Trust, including
financial statements which shall at least annually be certified by independent
public accountants.


                                     -28-               
<PAGE>

                                    ARTICLE X

                                  MISCELLANEOUS

      Section 10.1. Filing. This Declaration and any amendment hereto shall be
filed in the office of the Secretary of the Commonwealth of Massachusetts and in
such other places as may be required under the laws of Massachusetts and may
also be filed or recorded in such other places as the Trustees deem appropriate.
Unless the amendment is embodied in an instrument signed by a majority of the
Trustees, each amendment filed shall be accompanied by a certificate signed and
acknowledged by a Trustee stating that such action was duly taken in a manner
provided herein. A restated Declaration, integrating into a single instrument
all of the provisions of the Declaration which are then in effect and operative,
may be executed from time to time by a majority of the Trustees and shall, upon
filing with the Secretary of the Commonwealth of Massachusetts, be conclusive
evidence of all amendments contained therein and may hereafter be referred to in
lieu of the original Declaration and the various amendments thereto. The
restated Declaration may include any amendment which the Trustees are empowered
to adopt, whether or not such amendment has been adopted prior to the execution
of the restated Declaration.

      Section 10.2. Governing Law. This Declaration is executed by the Trustees
and delivered in the Commonwealth of Massachusetts and with reference to the
internal laws thereof, and the rights of all parties and the validity and
construction of every provision hereof shall be subject to and construed
according to the internal laws of said State without regard to the choice of law
rules thereof.

      Section 10.3. Counterparts. This Declaration may be simultaneously
executed in several counterparts, each of which shall be deemed to be an
original, and such counterparts, together, shall constitute one and the same
instrument, which shall be sufficiently evidenced by any such original
counterpart.

      Section 10.4. Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Trust appears to be a Trustee
hereunder, certifying to: (a) the number of identity of Trustees or
Shareholders, (b) the due authorization of the execution of any instrument or
writing, (c) the form of any vote passed at a meeting of Trustees or
Shareholders, (d) the fact that the number of Trustees or Shareholders present
at any meeting or executing any written instrument satisfies the requirements of
this Declaration, (e) the form of any By-laws adopted by or the identity of any
officers elected by the Trustees, or (f) the existence of any


                                     -29-                  
<PAGE>

fact or facts which in any manner relate to the affairs of the Trust, shall be
conclusive evidence as to the matters so certified in favor of any Person
dealing with the Trustees and their successors

      Section 10.5. Provisions in Conflict with Law or Regulations.

      (a) The provisions of this Declaration are severable, and if the Trustees
shall determine, with the advice of counsel, that any of such provisions is in
conflict with the 1940 Act, the regulated investment company provisions of the
Internal Revenue Code or with other applicable laws and regulations, the
conflicting provision shall be deemed never to have constituted a part of this
Declaration; provided, however, that such determination shall not affect any of
the remaining provisions of this Declaration or render invalid or improper any
action taken or omitted prior to such determination.

      (b) If any provision of this Declaration shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall
attach only to such provision in such jurisdiction and shall not in any manner
affect such provisions in any other jurisdiction or any other provision of this
Declaration in any jurisdiction.


                                     -30-                          
<PAGE>

      IN WITNESS WHEREOF, the undersigned has executed this instrument this 3rd
day of November, 1987.


                                            /s/ Dawn-Marie Driscoll
                                            -----------------------
                                            ------------------, as Trustee and
                                            not individually.

                        THE COMMONWEALTH OF MASSACHUSETTS

County of Suffolk                                               November 3, 1987

      Then personally appeared the above-named Dawn-Marie Driscoll, who
acknowledged the foregoing instrument to be her free act and deed.

                                                   Before me,


                                                   /s/ [ILLEGIBLE]
                                                   ----------------------
                                                   Notary Public

My commission expires:  [Stamp: My Commission Expires December 3, 1987]


                                      -31-

<PAGE>

      IN WITNESS WHEREOF, the undersigned has executed this instrument this 3rd
day of November, 1987.


                                            /s/ Cuyler W. Findlay
                                            -----------------------
                                            ----------------, as Trustee and
                                            not individually.

                        THE COMMONWEALTH OF MASSACHUSETTS

County of Suffolk                                               November 3, 1987

      Then personally appeared the above-named Cuyler W. Findlay, who
acknowledged the foregoing instrument to be his free act and deed.

                                                   Before me,


                                                   /s/ [ILLEGIBLE]
                                                   ----------------------
                                                   Notary Public

My commission expires:  [Stamp: My Commission Expires December 3, 1987]


                                      -31-

<PAGE>

      IN WITNESS WHEREOF, the undersigned has executed this instrument this 3rd
day of November, 1987.


                                            /s/ Peter B. Freeman
                                            -----------------------
                                            ---------------, as Trustee and
                                            not individually.

                        THE COMMONWEALTH OF MASSACHUSETTS

County of Suffolk                                               November 3, 1987

      Then personally appeared the above-named Peter B. Freeman, who
acknowledged the foregoing instrument to be his free act and deed.

                                                   Before me,


                                                   /s/ [ILLEGIBLE]
                                                   ----------------------
                                                   Notary Public

My commission expires:  [Stamp: My Commission Expires December 3, 1987]


                                      -31-

<PAGE>

      IN WITNESS WHEREOF, the undersigned has executed this instrument this 3rd
day of November, 1987.


                                            /s/ George S. Johnston
                                            -----------------------
                                            ---------------, as Trustee and
                                            not individually.

                        THE COMMONWEALTH OF MASSACHUSETTS

County of Suffolk                                               November 3, 1987

      Then personally appeared the above-named George S. Johnston, who
acknowledged the foregoing instrument to be his free act and deed.

                                                   Before me,


                                                   /s/ [ILLEGIBLE]
                                                   ----------------------
                                                   Notary Public

My commission expires:  [Stamp: My Commission Expires December 3, 1987]


                                      -31-

<PAGE>

      IN WITNESS WHEREOF, the undersigned has executed this instrument this 3rd
day of November, 1987.


                                            /s/ David S. Lee
                                            -----------------------
                                            ----------------, as Trustee and
                                            not individually.

                        THE COMMONWEALTH OF MASSACHUSETTS

County of Suffolk                                               November 3, 1987

      Then personally appeared the above-named David S. Lee, who acknowledged
the foregoing instrument to be his free act and deed.

                                                   Before me,


                                                   /s/ [ILLEGIBLE]
                                                   ----------------------
                                                   Notary Public

My commission expires:  [Stamp: My Commission Expires December 3, 1987]


                                      -31-

<PAGE>

      IN WITNESS WHEREOF, the undersigned has executed this instrument this 3rd
day of November, 1987.


                                            /s/ George M. Lovejoy, Jr.
                                            ---------------------------
                                            ---------------, as Trustee and
                                            not individually.

                        THE COMMONWEALTH OF MASSACHUSETTS

County of Suffolk                                               November 3, 1987

      Then personally appeared the above-named George M. Lovejoy, Jr., who
acknowledged the foregoing instrument to be his free act and deed.

                                                   Before me,


                                                   /s/ [ILLEGIBLE]
                                                   ----------------------
                                                   Notary Public

My commission expires:  [Stamp: My Commission Expires December 3, 1987]


                                      -31-

<PAGE>

      IN WITNESS WHEREOF, the undersigned has executed this instrument this 3rd
day of November, 1987.


                                            /s/ August R. Meyer
                                            ---------------------------
                                            ---------------, as Trustee and
                                            not individually.

                        THE COMMONWEALTH OF MASSACHUSETTS

County of Suffolk                                               November 3, 1987

      Then personally appeared the above-named August R. Meyer, who acknowledged
the foregoing instrument to be his free act and deed.

                                                   Before me,


                                                   /s/ [ILLEGIBLE]
                                                   ----------------------
                                                   Notary Public

My commission expires:  [Stamp: My Commission Expires December 3, 1987]


                                      -31-



                                                                       EXHIBIT 2

                                     BY-LAWS

                                       OF

                          SCUDDER CASH INVESTMENT TRUST
<PAGE>

                                TABLE OF CONTENTS

                                                                            Page

ARTICLE I - DEFINITIONS

ARTICLE II -  OFFICES
  Section 1.  Principal Office
  Section 2.  Other Offices

ARTICLE III - SHAREHOLDERS
  Section 1.  Meetings
  Section 2.  Notice of Meetings
  Section 3.  Record Date for Meetings
               and Other Purposes
  Section 4.  Proxies
  Section 5.  Inspection of Records
  Section 6.  Action without Meeting

ARTICLE IV - TRUSTEES
  Section 1.  Meetings of the Trustees
  Section 2.  Quorum and Manner of Acting

ARTICLE V - COMMITTEES
  Section 1.  Executive and Other Committees
  Section 2.  Meeting, Quorum and Manner of Acting

ARTICLE VI - OFFICERS
  Section 1.  General Provisions
  Section 2.  Term of Office and Qualifications
  Section 3.  Removal
  Section 4.  Powers and Duties of the President
  Section 5.  Powers and Duties of Vice Presidents
  Section 6.  Powers and Duties of the Treasurer
  Section 7.  Powers and Duties of the Secretary
  Section 8.  Powers and Duties of Assistant Treasurers
  Section 9.  Powers and Duties of Assistant Secretaries
  Section 10. Compensation of Officers and Trustees and
               Members of Advisory Board

ARTICLE VII - FISCAL YEAR

ARTICLE VIII - SEAL

ARTICLE IX - WAIVERS OF NOTICE
<PAGE>

                                       -2-


                          TABLE OF CONTENTS (continued)

                                                                            Page

ARTICLE X - CUSTODY OF SECURITIES
  Section 1.  Employment of a Custodian
  Section 2.  Action Upon Termination of Custodian
               Agreement
  Section 3.  Provisions of Custodian Contract
  Section 4.  Central Certificate System
  Section 5.  Acceptance of Receipts in Lieu of
               Certificate

ARTICLE XI - AMENDMENTS

ARTICLE XII - MISCELLANEOUS

ARTICLE XIII - INVESTMENTS; BORROWING AND PLEDGING
<PAGE>

                                     BY-LAWS

                                       OF

                          SCUDDER CASH INVESTMENT TRUST

                                    ARTICLE I

                                   DEFINITIONS

         The terms "Commission", "Custodian", "Declaration", "Distributor",
"Investment Adviser", "1940 Act", "Shareholder", "Shares", "Transfer Agent",
"Trust", "Trust Property", "Trustees", and "vote of a majority of the Shares
outstanding and entitled to vote", have the respective meanings given them in
the Declaration of Trust of Scudder Cash Investment Trust dated 1975, as amended
from time to time.

                                   ARTICLE II

                                     OFFICES

      Section 1. Principal Office. Until changed by the Trustees, the principal
office of the Trust in the Commonwealth of Massachusetts shall be in the City of
Boston, County of Suffolk.

      Section 2. Other Offices. The Trust may have offices in such other places
without as well as within the Commonwealth as the Trustees may from time to time
determine.
<PAGE>

                                       -2-


                                   ARTICLE III

                                  SHAREHOLDERS

      Section 1. Meetings. Meetings of the Shareholders shall be held as
provided in the Declaration at such place within or without the Commonwealth of
Massachusetts as the Trustees shall designate. The holders of a majority of
outstanding Shares present in person or by proxy shall constitute a quorum at
any meeting of the Shareholders.

      Section 2. Notice of Meetings. Notice of all meetings of the Shareholders,
stating the time, place and purposes of the meeting, shall be given by the
Trustees by mail to each Shareholder at his address as recorded on the register
of the Trust, mailed at least (10) days and not more than sixty (60) days before
the meeting. Only the business stated in the notice of the meeting shall be
considered at such meeting. Any adjourned meeting may be held as adjourned
without further notice. No notice need be given to any Shareholder who shall
have failed to inform the Trust of his current address or if a written waiver of
notice, executed before or after the meeting by the Shareholder or his attorney
thereunto authorized, is filed with the records of the meeting.

      Section 3. Record Date for Meetings and Other Purposes. For the purpose of
determining the Shareholders who are entitled to notice of and to vote at any
meeting, or to participate in any distribution, or for the purpose of any other
action, the Trustees may from time to time close the transfer books for
<PAGE>

                                       -3-


such period, not exceeding thirty (30) days, as the Trustees may determine; or
without closing the transfer books the Trustees may fix a date not more than
sixty (60) days prior to the date of any meeting of Shareholders or distribution
or other action as a record date for the determinations of the persons to be
treated as Shareholders of record for such purposes, except for dividend
payments which shall be governed by the Declaration.

      Section 4. Proxies. At any meeting of Shareholders, any holder of Shares
entitled to vote thereat may vote by proxy, provided that no proxy shall be
voted at any meeting unless it shall have been placed on file with the
Secretary, or with such other officer or agent of the Trust as the Secretary may
direct, for verification prior to the time at which such vote shall be taken.
Proxies may be solicited in the name of one or more Trustees or one or more of
the officers of the Trust. Only Shareholders of record shall be entitled to
vote. Each full Share shall be entitled to one vote and fractional Shares shall
be entitled to a vote of such fraction. When any Share is held jointly by
several persons, any one of them may vote at any meeting in person or by proxy
in respect of such Share, but if more than one of them shall be present at such
meeting in person or by proxy, and such joint owners or their proxies so present
disagree as to any vote to be cast, such vote shall not be received in respect
of such Share. A proxy purporting to be executed by or on behalf of a
Shareholder shall be deemed valid unless challenged at or prior to its exercise,
and the
<PAGE>

                                       -4-


burden of proving invalidity shall rest on the challenger. If the holder of any
such Share is a minor or a person of unsound mind, and subject to guardianship
or to the legal control of any other person as regards the charge or management
of such Share, he may vote by his guardian or such other person appointed or
having such control, and such vote may be given in person or by proxy.

      Section 5. Inspection of Records. The records of the Trust shall be open
to inspection by Shareholders to the same extent as is permitted shareholders of
a Massachusetts business corporation.

      Section 6. Action without Meeting. Any action which may be taken by
Shareholders may be taken without a meeting if a majority of Shareholders
entitled to vote on the matter (or such larger proportion thereof as shall be
required by law, the Declaration or these By-Laws for approval of such matter)
consent to the action in writing and the written consents are filed with the
records of the meetings of Shareholders. Such consents shall be treated for all
purposes as a vote taken at a meeting of Shareholders.

                                   ARTICLE IV

                                    TRUSTEES

      Section 1. Meetings of the Trustees. The Trustees may in their discretion
provide for regular or stated meetings of the Trustees. Notice of regular or
stated meetings need not be
<PAGE>

                                       -5-


given. Meetings of the Trustees other than regular or stated meetings shall be
held whenever called by the President, or by any one of the Trustees, at the
time being in office. Notice of the time and place of each meeting other than
regular or stated meetings shall be given by the Secretary or an Assistant
Secretary or by the officer or Trustee calling the meeting and shall be mailed
to each Trustee at least two days before the meeting, or shall be telegraphed,
cabled, or wirelessed to each Trustee at his business address, or personally
delivered to him at least one day before the meeting. Such notice may, however,
be waived by any Trustee. Notice of a meeting need not be given to any Trustee
if a written waiver of notice, executed by him before or after the meeting, is
filed with the records of the meeting, or to any Trustee who attends the meeting
without protesting prior thereto or at its commencement the lack of notice to
him. A notice or waiver of notice need not specify the purpose of any meeting.
The Trustees may meet by means of a telephone conference circuit or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, which telephone conference meeting shall be deemed
to have been held at a place designated by the Trustees at the meeting.
Participation in a telephone conference meeting shall constitute presence in
person at such meeting. Any action required or permitted to be taken at any
meeting of the Trustees may be taken by the Trustees without a meeting if all
the Trustees consent to the action in
<PAGE>

                                       -6-


writing and the written consents are filed with the records of the Trustees'
meetings. Such consents shall be treated as a vote for all purposes.

      Section 2. Quorum and Manner of Acting. A majority of the Trustees shall
be present in person at any regular or special meeting of the Trustees in order
to constitute a quorum for the transaction of business at such meeting and
(except as otherwise required by law, the Declaration or these By-Laws) the act
of a majority of the Trustees present at any such meeting, at which a quorum is
present, shall be the act of the Trustees. In the absence of a quorum, a
majority of the Trustees present may adjourn the meeting from time to time until
a quorum shall be present. Notice of an adjourned meeting need not be given.

                                    ARTICLE V

                                   COMMITTEES

      Section 1. Executive and Other Committees. The Trustees by vote of a
majority of all the Trustees may elect from their own number an Executive
Committee to consist of not less than three (3) to hold office at the pleasure
of the Trustees, which shall have the power to conduct the current and ordinary
business of the Trust while the Trustees are not in session, including the
purchase and sale of securities and the designation of securities to be
delivered upon redemption of Shares of the Trust, and such other powers of the
Trustees as the Trustees may, from time to time, delegate to them except those
powers
<PAGE>

                                       -7-


which by law, the Declaration or these By-Laws they are prohibited from
delegating. The Trustees may also elect from their own number other Committees
from time to time, the number composing such Committees, the powers conferred
upon the same (subject to the same limitations as with respect to the Executive
Committee) and the term of membership on such Committees to be determined by the
Trustees. The Trustees may designate a chairman of any such Committee. In the
absence of such designation the Committee may elect its own Chairman.

      Section 2. Meetings, Quorum and Manner of Acting. The Trustees may (1)
provide for stated meetings of any Committee, (2) specify the manner of calling
and notice required for special meetings of any Committee, (3) specify the
number of members of a Committee required to constitute a quorum and the number
of members of a Committee required to exercise specified powers delegated to
such Committee, (4) authorize the making of decisions to exercise specified
powers by written assent of the requisite number of members of a Committee
without a meeting, and (5) authorize the members of a Committee to meet by means
of a telephone conference circuit.

      The Executive Committee shall keep regular minutes of its meetings and
records of decisions taken without a meeting and cause them to be recorded in a
book designated for that purpose and kept in the office of the Trust.
<PAGE>

                                       -8-


                                   ARTICLE VI

                                    OFFICERS

      Section 1. General Provisions. The officers of the Trust shall be a
President, a Treasurer and a Secretary, who shall be elected by the Trustees.
The Trustees may elect or appoint such other officers or agents as the business
of the Trust may require, including one or more Vice Presidents, one or more
Assistant Secretaries, and one or more Assistant Treasurers. The Trustees may
delegate to any officer or committee the power to appoint any subordinate
officers or agents.

      Section 2. Term of Office and Qualifications. Except as otherwise provided
by law, the Declaration or these By-Laws, the President, the Treasurer and the
Secretary shall each hold office until his successor shall have been duly
elected and qualified, and all other officers shall hold office at the pleasure
of the Trustees. The Secretary and Treasurer may be the same person. A Vice
President and the Treasurer or a Vice President and the Secretary may be the
same person, but the offices of Vice President, Secretary and Treasurer shall
not be held by the same person. The President shall hold no other office. Except
as above provided, any two offices may be held by the same person. Any officer
may be but none need be a Trustee or Shareholder.

      Section 3. Removal. The Trustees, at any regular or special meeting of the
Trustees, may remove any officer without cause, by a vote of a majority of the
Trustees then in office. Any
<PAGE>

                                       -9-


officer or agent appointed by any officer or committee may be removed with or
without cause by such appointing officer or committee.

      Section 4. Powers and Duties of the President. The President may call
meetings of the Trustees and of any Committee thereof when he deems it necessary
and shall preside at all meetings of the Shareholders. Subject to the control of
the Trustees and to the control of any Committees of the Trustees, within their
respective spheres, as provided by the Trustees, he shall at all times exercise
a general supervision and direction over the affairs of the Trust. He shall have
the power to employ attorneys and counsel for the Trust and to employ such
subordinate officers, agents, clerks and employees as he may find necessary to
transact the business of the Trust. He shall also have the power to grant,
issue, execute or sign such powers of attorney, proxies or other documents as
may be deemed advisable or necessary in furtherance of the interests of the
Trust. The President shall have such other powers and duties as, from time to
time, may be conferred upon or assigned to him by the Trustees.

      Section 5. Powers and Duties of Vice Presidents. In the absence or
disability of the President, the Vice President or, if there be more than one
Vice President, any Vice President designated by the Trustees shall perform all
the duties and may exercise any of the powers of the President, subject to the
control of the Trustees. Each Vice President shall perform such other duties as
may be assigned to him from time to time by the Trustees and the President.
<PAGE>

                                      -10-


      Section 6. Powers and Duties of the Treasurer. The Treasurer shall be the
principal financial and accounting officer of the Trust. He shall deliver all
funds of the Trust which may come into his hands to such Custodian as the
Trustees may employ pursuant to Article X of these By-Laws. He shall render a
statement of condition of the finances of the Trust to the Trustees as often as
they shall require the same and he shall in general perform all the duties
incident to the office of Treasurer and such other duties as from time to time
may be assigned to him by the Trustees. The Treasurer shall give a bond for the
faithful discharge Of his duties, if required so to do by the Trustees, in such
sum and with such surety or sureties as the Trustees shall require.

      Section 7. Powers and Duties of the Secretary. The Secretary shall keep
the minutes of all meetings of the Trustees and of the Shareholders in proper
books provided for that purpose; he shall have custody of the seal of the Trust;
he shall have charge of the Share transfer books, lists and records unless the
same are in the charge of the Transfer Agent. He shall attend to the giving and
serving of all notices by the Trust in accordance with the provisions of these
By-Laws and as required by law; and subject to these By-Laws, he shall in
general perform all duties incident to the office of Secretary and such other
duties as from time to time may be assigned to him by the Trustees.

      Section 8. Powers and Duties of Assistant Treasurers. In the absence or
disability of the Treasurer, any Assistant Treasurer designated by the Trustees
shall perform all the duties, and may
<PAGE>

                                      -11-


exercise any of the powers, of the Treasurer. The Assistant Treasurers shall
perform such other duties as from time to time may be assigned to them by the
Trustees. Each Assistant Treasurer shall give a bond for the faithful discharge
of his duties, if required so to do by the Trustees, in such sum and with such
surety or sureties as the Trustees shall require.

      Section 9. Powers and Duties of Assistant Secretaries. In the absence or
disability of the Secretary, any Assistant Secretary designated by the Trustees
shall perform all the duties, and may exercise any of the powers, of the
Secretary. The Assistant Secretaries shall perform such other duties as from
time to time may be assigned to them by the Trustees.

      Section 10. Compensation of Officers and Trustees and Members of the
Advisory Board. Subject to any applicable provisions of the Declaration, the
compensation of the officers and Trustees and members of the Advisory Board
shall be fixed from time to time by the Trustees or, in the case of officers, by
any Committee or officer upon whom such power may be conferred by the Trustees.
No officer shall be prevented from receiving such compensation as such officer
by reason of the fact that he is also a Trustee.

                                   ARTICLE VII

                                   FISCAL YEAR

      The fiscal year of the Trust shall begin on the first day of January in
each year and shall end on the thirty-first day
<PAGE>

                                      -12-


of December in each year, provided, however, that the Trustees may from time to
time change the fiscal year.

                                  ARTICLE VIII

                                      SEAL

      The Trustees shall adopt a seal which shall be in such form and shall have
such inscription thereon as the Trustees may from time to time prescribe.

                                   ARTICLE IX

                                WAIVERS OF NOTICE

      Whenever any notice whatever is required to be given by law, the
Declaration or these By-Laws, a waiver thereof in writing, signed by the person
or persons entitled to said notice, whether before or after the time stated
therein, shall be deemed equivalent thereto. A notice shall be deemed to have
been telegraphed, cabled or wirelessed for the purposes of these By-Laws when it
has been delivered to a representative of any telegraph, cable or wireless
company with instructions that it be telegraphed, cabled or wirelessed. Any
notice shall be deemed to be given at the time when the same shall be mailed,
telegraphed, cabled or wirelessed.
<PAGE>

                                      -13-


                                    ARTICLE X

                              CUSTODY OF SECURITIES

      Section 1. Employment of a Custodian. The Trust shall place and at all
times maintain in the custody of a Custodian (including any sub-custodian for
the Custodian) all funds, securities and similar investments included in the
Trust Property. The Custodian (and any sub-custodian) shall be a bank having not
less than $2,000,000 aggregate capital, surplus and undivided profits and shall
be appointed from time to time by the Trustees, who shall fix its remuneration.

      Section 2. Action Upon Termination of Custodian Agreement.

      Upon termination of a Custodian Agreement or inability of the Custodian to
continue to serve, the Trustees shall promptly appoint a successor custodian,
but in the event that no successor custodian can be found who has the required
qualifications and is willing to serve, the Trustees shall call as promptly as
possible a special meeting of the Shareholders to determine whether the Trust
shall function without a custodian or shall be liquidated. If so directed by
vote of the holders of a majority of the outstanding voting securities, the
Custodian shall deliver and pay over all Trust Property held by it as specified
in such vote.

      Section 3. Provisions of Custodian Contract. The following provisions
shall apply to the employment of a Custodian and to any contract entered into
with the Custodian so employed:
<PAGE>

                                      -14-


         The Trustees shall cause to be delivered to the Custodian all
         Securities included in the Trust Property or to which the Trust may
         become entitled, and shall order the same to be delivered by the
         Custodian only in completion of a sale, exchange, transfer, pledge, or
         other disposition thereof, all as the Trustees may generally or from
         time to time require or approve or to a successor Custodian; and the
         Trustees shall cause all funds included in the Trust Property or to
         which it may become entitled to be paid to the Custodian, and shall
         order the same disbursed only for investment against delivery of the
         securities acquired, or in payment of expenses, including management
         compensation, and liabilities of the Trust, including distributions to
         shareholders, or to a successor Custodian.

      Section 4. Central Certificate System. Subject to such rules, regulations
and orders as the Commission may adopt, the Trustees may direct the Custodian
to deposit all or any part of the securities owned by the Trust in a system for
the central handling of securities established by a national securities exchange
or a national securities association registered with the Commission under the
Securities Exchange Act of 1934, or such other person as may be permitted by the
Commission, or otherwise in accordance with the 1940 Act, pursuant to which
system all securities of any particular class or series of any issuer deposited
within the system are treated as fungible and may be transferred or pledged by
bookkeeping entry without physical delivery of such securities, provided that
all such deposits shall be subject to withdrawal only upon the order of the
Trust.

      Section 5. Acceptance of Receipts in Lieu of Certificates. Subject to such
rules, regulations and orders as the Commission may adopt, the Trustees may
direct the Custodian to accept
<PAGE>

                                      -15-


written receipts or other written evidences indicating purchases of securities
held in book-entry form in the Federal Reserve System in accordance with
regulations promulgated by the Board of Governors of the Federal Reserve System
and the local Federal Reserve Banks in lieu of receipt of certificates
representing such securities.

                                   ARTICLE XI

                                   AMENDMENTS

      These By-Laws, or any of them, may be altered, amended or repealed, or new
By-Laws may be adopted by (a) vote of a majority of the outstanding voting
securities or (b) by the Trustees, provided, however, that no By-Law may be
amended, adopted or repealed by the Trustees if such amendment, adoption or
repeal requires, pursuant to law, the Declaration or these By-Laws, a vote of
the Shareholders or if such amendment, adoption or repeal changes or affects the
provisions of Sections 1, 2 and 3 of Article X or the provisions of this Article
XI, or of Article XII or Article XIII.

                                   ARTICLE XII

                                  MISCELLANEOUS

      (A) Except as hereinafter provided, no officer or Trustees of the Trust
and no partner, officer, director or shareholder of the Investment Adviser of
the Trust (as that term is defined in the Investment Company Act of 1940) or of
the underwriter of
<PAGE>

                                      -16-


the Trust, and no Investment Adviser or underwriter of the Trust, shall take
long or short positions in the securities issued by the Trust.

            (1) The foregoing provisions shall not prevent the underwriter from
      purchasing Shares from the Trust if such purchases are limited (except for
      reasonable allowances for clerical errors, delays and errors of
      transmission and cancellation of orders) to purchases for the purpose of
      filling orders for such Shares received by the underwriter, and provided
      that orders to purchase from the Trust are entered with the Trust or the
      Custodian promptly upon receipt by the underwriter of purchase orders for
      such Shares, unless the underwriter is otherwise instructed by its
      customer.

            (2) The foregoing provision shall not prevent the underwriter from
      purchasing Shares of the Trust as agent for the account of the Trust.

            (3) The foregoing provisions shall not prevent the purchase from the
      Trust or from the underwriter of Shares issued by the Trust, by any
      officer, or Trustee of the Trust or by any partner, officer, director or
      shareholder of the Investment Adviser of the Trust or of the underwriter
      of the Trust at the price available to the public generally at the moment
      of such purchase or, to the extent that any such person is a Shareholder,
      at the price available to Shareholders of the Trust generally at the
      moment of such
<PAGE>

                                      -17-


      purchase, or as described in the then currently effective Prospectus of
      the Trust.

            (4) The foregoing shall not prevent the Investment Adviser, or any
      affiliate thereof, of the Trust from purchasing Shares prior to the
      effectiveness of the first registration statement relating to the Shares
      under the Securities Act of 1933.

      (B) The Trust shall not lend assets of the Trust to any officer or Trustee
of the Trust, or to any partner, officer, director or shareholder of, or person
financially interested in, the Investment Adviser of the Trust, or the
underwriter of the Trust, or to the Investment Adviser of the Trust or to the
underwriter of the Trust.

      (C) The Trust shall not impose any restrictions upon the transfer of the
Shares of the Trust except as provided in the Declaration, but this requirement
shall not prevent the charging of customary transfer agent fees.

      (D) The Trust shall not permit any officer or Trustee of the Trust, or any
partner, officer or director of the Investment Adviser or underwriter of the
Trust to deal for or on behalf of the Trust with himself as principal or agent,
or with any partnership, association or corporation in which he has a financial
interest; provided that the foregoing provisions shall not prevent (a) officers
and Trustees of the Trust or partners, officers or directors of the Investment
Adviser or underwriter of the Trust from buying, holding or selling shares in
the
<PAGE>

                                      -18-


Trust, or from being partners, officers or directors of or otherwise financially
interested in the Investment Adviser or underwriter of the Trust; (b) purchases
or sales of securities or other property by the Trust from or to an affiliated
person or to the Investment Advisers or underwriter of the Trust if such
transaction is exempt from the applicable provisions of the 1940 Act; (c)
purchases of investments for the portfolio of the Trust or sales of investments
owned by the Trust through a security dealer who is, or one or more of whose
partners, shareholders, officers or directors is, an officer or Trustee of the
Trust, or a partner, officer or director of the Investment Adviser or
underwriter of the Trust, if such transactions are handled in the capacity of
broker only and commissions charged do not exceed customary brokerage charges
for such services; (d) employment of legal counsel, registrar, Transfer Agent,
dividend disbursing agent or Custodian who is, or has a partner, shareholder,
officer or director who is, an officer or Trustee of the Trust, or a partner,
officer or director of the Investment Adviser or underwriter of the Trust, if
only customary fees are charged for services to the Trust; (e) sharing
statistical, research, legal and management expenses and office hire and
expenses with any other investment company in which an officer or Trustee of the
Trust, or a partner, officer or director of the Investment Adviser or
underwriter of the Trust, is an officer or director or otherwise financially
interested.
<PAGE>

                                      -19-


                                  ARTICLE XIII

                       INVESTMENTS; BORROWING AND PLEDGING

      The Trust shall be subject to the following restrictions and limitations:

            (A) The Trust shall not purchase the securities of any issuer if
      such purchase at the time thereof would cause more than five percent (5%)
      of the total assets of the Trust (taken at market value) to be invested in
      the securities of such issuer. The foregoing limitation shall not apply to
      investments in Government securities as defined in the 1940 Act.

            (B) The Trust shall not purchase securities of any issuer if such
      purchase at the time thereof would cause more than ten percent (10%) of
      any class of securities of such issuer to be held by the Trust. For the
      purpose of this limitation, all indebtedness of an issuer shall be deemed
      a single class and all preferred stock of an issuer shall be deemed a
      single class.

            (C) The Trust shall not purchase securities issued by any other
      investment company or investment trust except by purchase in the open
      market where no commission or profit to a sponsor or dealer results from
      such purchase other than the customary broker's commission, or except when
      such purchase, though not made in the open market, is part of a plan of
      merger, consolidation, or acquisition of assets, provided, however, that
      the Trust shall not purchase the
<PAGE>

                                      -20-


      securities of any investment companies or investment trusts if such
      purchase at the time thereof would cause more than ten percent (10%) of
      the total assets of the Trust (taken at market value) to be invested in
      the securities of such issuers, and provided, further, that the Trust
      shall not purchase securities issued by any other open-end investment
      company.

            (D) The Trust shall not purchase securities of any issuer if such
      purchase at the time thereof would cause more than five percent (5%) of
      the total assets of the Trust (taken at market value) to be invested in
      securities of companies which have a record of less than three (3) years'
      continuous operation including, however, in such three (3) years the
      operation of any predecessor company or companies, partnership or
      individual enterprise if the issuer whose securities are proposed as an
      investment for funds of the Trust has come into existence as a result of a
      merger, consolidation, reorganization, or the purchase of substantially
      all the assets of such predecessor company or companies, partnership or
      individual enterprise. The foregoing limitation shall not apply to
      investments in Government securities as defined in the 1940 Act.

            (E) Notwithstanding the foregoing paragraphs (A), (B), (C) and (D),
      any investment company, whether organized as a trust, association or
      corporation, or a personal holding company, may be merged or consolidated
      with or acquired
<PAGE>

                                      -21-


      by the Trust, provided that if such merger, consolidation or acquisition
      results in an investment in the securities of any issuer prohibited by
      said paragraphs, the Trust shall within sixty (60) days after the
      consummation of such merger, consolidation or acquisition dispose of all
      of the securities of such issuer so acquired or such portion thereof as
      shall bring the total investment therein within the limitations imposed by
      said paragraphs above as of the date of consummation.

            (F) The Trust shall not purchase or retain in its portfolio any
      securities issued by an issuer any of whose officers, directors, partners,
      trustees, or security holders is an officer or Trustee of the Trust, or is
      a member, officer, director, partner or trustee of the Investment Adviser
      of the Trust, if after the purchase of the securities of such issuer by
      the Trust one or more of such persons owns beneficially more than one-half
      of one percent (1/2%) of the shares of securities, or both (all taken at
      market value), of such issuer, and such persons owning more than one-half
      of one percent (1/2%) of such shares or securities together own
      beneficially more than five percent (5%) of such shares or securities, or
      both (all taken at market value).

            (G) The Trust shall not borrow amounts in excess of five percent
      (5%) of the gross assets of the Trust taken at cost determined in
      accordance with good accounting practice, and no borrowing shall be
      undertaken except as
<PAGE>

                                      -22-


      a temporary measure for extraordinary or emergency purposes.

            (H) The Trust shall not pledge, mortgage or hypothecate the assets
      of the Trust taken at market value to an extent greater than fifteen
      percent (15%) of the gross assets of the Trust taken at cost.

            (I) The Trust shall not

                  (a) purchase any securities or evidences of interest therein
            on "margin", that is to say in a transaction in which it has
            borrowed all or a portion of the purchase price and pledged the
            purchased securities or evidences of interest therein as collateral
            for the amount so borrowed.

                  (b) sell or contract to sell any security which it does not
            own unless by virtue of its ownership of other securities it has at
            the time of sale a right to obtain securities equivalent in kind and
            amount to the securities sold and provided that if such right is
            conditional the sale is made upon the same conditions, and

                  (c) purchase or sell any put or call options or any
            combination thereof, provided, however, that nothing herein shall
            prevent the purchase, ownership, holding or sale of warrants where
            the grantor of the warrants is the issuer of the underlying
            securities.

                                 END OF BY-LAWS



                                                                 Exhibit 2(a)(2)

                          SCUDDER CASH INVESTMENT TRUST
                                SCUDDER GNMA FUND
                               SCUDDER INCOME FUND
                            SCUDDER INVESTMENT TRUST
                        SCUDDER U.S. TREASURY MONEY FUND

                        SCUDDER CALIFORNIA TAX FREE TRUST
                             SCUDDER MUNICIPAL TRUST
                          SCUDDER STATE TAX FREE TRUST
                           SCUDDER TAX FREE MONEY FUND
                          SCUDDER TAX FREE TARGET FUND

      On August 13, 1991, the Trustees of each of the aforementioned Funds
adopted the following resolution amending the By-Laws of each Fund:

                                   ARTICLE IV

                                    TRUSTEES

            Section 1. Meetings of the Trustees. The Trustees may in their
            discretion provide for regular or stated meetings of the Trustees.
            Notice of regular or stated meetings need not be given. Meetings of
            the Trustees other than regular or stated meetings shall be held
            whenever called by the President, or by any one of the Trustees, at
            the time being in office. Notice of the time and place of each
            meeting other than regular or stated meetings shall be given by the
            Secretary or an Assistant Secretary or by the officer or Trustee
            calling the meeting and shall be mailed to each Trustee at least two
            days before the meeting, or shall be telegraphed, cabled, or
            wirelessed to each Trustee at his business address, or personally
            delivered to him at least one day before the meeting. Such notice
            may, however, be waived by any Trustee. Notice of a meeting need not
            be given to any Trustee if a written waiver of notice, executed by
            him before or after the meeting, is filed with the records of the
            meeting, or to any Trustee who attends the meeting without
            protesting prior thereto or at its commencement the lack of notice
            to him. A notice or waiver of notice need not specify the purpose of
            any meeting. Meetings can be held in conjunction with investment
            companies having the same investment adviser or an affiliated
            investment adviser. The Trustees may meet by means of a telephone
            conference circuit or similar communications equipment;
            participation by such means shall constitute presence in person at
            such meeting and shall be deemed to have occurred at a place
            designated by the Trustees at the meeting. Any action required or
            permitted to be taken at any meeting of the Trustees may be taken by
            the Trustees without a meeting if all the Trustees consent to the
            action in writing and the written consents are filed with the
            records of the Trustees' meetings. Such consents shall be treated as
            a vote for all purposes.


                                       -1-



                                                                 EXHIBIT 2(a)(3)

                          SCUDDER CASH INVESTMENT TRUST
                                SCUDDER GNMA FUND
                               SCUDDER INCOME FUND
                            SCUDDER INVESTMENT TRUST
                        SCUDDER U.S. TREASURY MONEY FUND

      On November 12, 1991, the Trustees of each of the aforementioned Funds
adopted the following resolution amending the By-Laws of each Fund:

                                   ARTICLE IV

                                    TRUSTEES

            Section 1. Meetings of the Trustees. The Trustees may in their
            discretion provide for regular or stated meetings of the Trustees.
            Notice of regular or stated meetings need not be given. Meetings of
            the Trustees other than regular or stated meetings shall be held
            whenever called by the President, or by any one of the Trustees, at
            the time being in office. Notice of the time and place of each
            meeting other than regular or stated meetings shall be given by the
            Secretary or an Assistant Secretary or by the officer or Trustee
            calling the meeting and shall be mailed to each Trustee at least two
            days before the meeting, or delivered to him personally or
            transmitted by telegraph, cable or other communication leaving a
            visual record at least one day before the meeting. Such notice may,
            however, be waived by any Trustee, Notice of a meeting need not be
            given to any Trustee if a written waiver of notice, executed by him
            before or after the meeting, is filed with the records of the
            meeting, or to any Trustee who attends the meeting without
            protesting prior thereto or at its commencement the lack of notice
            to him. A notice or waiver of notice need not specify the purpose of
            any meeting. Meetings can be held in conjunction with investment
            companies having the same investment adviser or an affiliated
            investment adviser. The Trustees may meet by means of a telephone
            conference circuit or similar communications equipment;
            participation by such means shall constitute presence in person at
            such meeting and shall be deemed to have occurred at a place
            designated by the Trustees at the meeting. Any action required or
            permitted to be taken at any meeting of the Trustees may be taken by
            the Trustees without a meeting if all the Trustees consent to the
            action in writing and the written consents are filed with the
            records of the Trustees' meetings. Such consents shall be treated as
            a vote for all purposes.



                          SCUDDER CASH INVESTMENT TRUST
                               175 Federal Street
                           Boston, Massachusetts 02110

                                                     November 12, 1985

Scudder, Stevens & Clark Ltd.
175 Federal Street
Boston, Massachusetts  02110

                          Investment Advisory Agreement

Dear Sirs:

      This Trust (hereinafter called the "Trust") has been established as a
Massachusetts business trust to engage in the business of an investment company.
The Trust has selected you to act as the sole investment adviser of the Trust
and to provide certain other services, as more fully set forth below, and you
are willing to act as such investment adviser and to perform such services under
the terms and conditions hereinafter set forth. Accordingly, the Trust agrees
with you as follows:

      1. Delivery of Trust Documents. The Trust has furnished you with copies
properly certified or authenticated of each of the following:

      (a)   Declaration of Trust of the Trust, dated December 12, l975, as
            amended to date.

      (b)   By-Laws of the Trust as in effect on the date hereof.

      (c)   Resolutions of the Trustees selecting you as investment adviser and
            approving the form of this Agreement.

The Trust will furnish you from time to time with copies, properly certified or
authenticated, of all amendments of or supplements to the foregoing, if any.

      2. Name of Trust. The Trust may use the name "Scudder Cash Investment
Trust," or any name derived from the name "Scudder, Stevens & Clark" only for so
long as this Agreement or any extension, renewal or amendment hereof remains in
effect, including any similar agreement with any organization which shall have
succeeded to your business as investment
<PAGE>

adviser. At such time as such an agreement shall no longer be in effect, the
Trust will (to the extent that it lawfully can) cease to use such a name or any
other name indicating that it is advised by or otherwise connected with you or
any organization which shall have so succeeded to your business.

      3. Advisory Services. You will regularly provide the Trust with investment
research, advice and supervision and will furnish continuously an investment
program for the Trust's portfolio consistent with the Trust's investment
objectives and policies. You will determine what securities shall be purchased
for the portfolio of the Trust, what portfolio securities shall be held or sold
by the Trust, and what portion of the Trust's assets shall be held uninvested,
subject always to the provisions of the Trust's Declaration of Trust and By-Laws
and of the Investment Company Act of 1940, as amended, and to the Trust's
investment objectives, policies and restrictions, as each of the same shall be
from time to time in effect, and subject, further, to such policies and
instructions as the Trustees may from time to time establish. You shall advise
and assist the officers of the Trust in taking such steps as are necessary or
appropriate to carry out the decisions of the Trustees and the appropriate
committees of the Trustees regarding the conduct of the business of the Trust.

      4. Allocation of Charges and Expenses. You will pay the compensation and
expenses of all officers and executive employees of the Trust and will make
available, without expense to the Trust, the services of such of your officers,
directors and employees as may duly be elected officers or Trustees of the
Trust, subject to their individual consent to serve and to any limitations
imposed by law. You will pay the Trust's office rent and will provide investment
advisory, research and statistical facilities and all clerical services relating
to research, statistical and investment work. You will not be required to pay
any expenses of the Trust other than those above enumerated in this paragraph 4.
In particular, but without limiting the generality of the foregoing, you will
not be required to pay: organization expenses of the Trust; clerical salaries;
fees and expenses incurred by the Trust in connection with membership in
investment company organizations; brokers' commissions; legal, auditing or
accounting expenses; taxes or governmental fees and expenses of the transfer
agent of the Trust; the cost of preparing share certificates or any other
expenses, including clerical expenses, of issue, sale, underwriting,
distribution, redemption or repurchase of shares of the Trust; the expenses of
and fees for registering or qualifying securities for sale; the fees and
expenses of Trustees of the Trust who are not affiliated with you; the cost of
preparing and distributing reports and notices to shareholders; or the fees or
disbursements of custodians of the


                                   -2-                                        
<PAGE>

Trust's assets, including expenses incurred in the performance of any
obligations enumerated by the Declaration of Trust or By-Laws insofar as they
govern agreements with any such custodian.

      5. Compensation of the Adviser. (a) For all services to be rendered and
payments made as provided in paragraphs 3 and 4 hereof, the Trust will pay you
on the last day of each month a fee of 1/24 of 1% of the average of the values
placed on the net assets of the Trust as of the close of the New York Stock
Exchange, currently 4:00 P.M. (New York time), on each business day throughout
the month or, if the Trust lawfully determines the value of its net assets as of
some other time on each business day, as of such time provided that, for any
calendar month during which the average of such values exceeds $250,000,000, the
fee payable for that month based on the portion of the average of such values in
excess of $250,000,000 shall be 3/80 of 1% of such portion; and provided that
for any calendar month during which the average of such values exceeds
$500,000,000 the fee payable for that month based on the portion of the average
of such values in excess of $500,000,000 shall be 1/30 of 1% of such portion;
and provided that for any calendar month during which the average of such values
exceeds $1,000,000,000 the fee payable for that month based on the portion of
the average of such values in excess of $1,000,000,000 shall be 7/240 of 1% of
such portion. The value of net assets shall be determined pursuant to the
applicable provisions of the Declaration of Trust of the Trust. If, pursuant to
such provisions, the determination of net asset value is suspended for any
particular business day, then for the purposes of this paragraph 5, the value of
the net assets of the Trust as last determined shall be deemed to be the value
of the net assets as of the close of the New York Stock Exchange, or as of such
other time as the value of the Trust's net assets may lawfully be determined, on
that day. If the determination of the net asset value of the Trust's shares has
been suspended pursuant to the Declaration of Trust of the Trust for a period
including such month, your compensation payable at the end of such month shall
be computed on the basis of the value of the net assets of the Trust as last
determined (whether during or prior to such month). If the Trust determines the
value of its net assets more than once a day, the last such determination
thereof on that day shall be deemed to be the sole determination thereof on that
day for the purposes of this paragraph 5.

      (b) Pursuant to a Stipulation of Settlement effective as of August 18,
1983 by the parties to an action entitled Gloria Kamen v. Scudder, Stevens &
Clark and Scudder Cash Investment Trust (D. Mass. Civil Action No. 81-2356-MA),
you agree that, for a period of eight years beginning on September 1, 1983, you
will rebate to the Trust, on or before the tenth day of


                                   -3-                                         
<PAGE>

October, 1983 and each month thereafter, a portion of the compensation paid to
you as provided in paragraph (a) above with respect to the preceding month if
the average daily net asset value of the Trust during such preceding month was
at least $500,000,000. Such monthly rebates shall be computed as a percentage of
the compensation paid to you by the Trust with respect to such preceding month,
which percentage shall be determined in accordance with the following schedule:

                                                    Rebate as a Percentage
       Average Daily Net Asset                      of Compensation Paid
       Value of the Trust During                    to You With Respect to
          the Preceding Month                       the Preceding Month
          -------------------                       -------------------
$500 million to $750 million ..................            2.75%
$750 million to $1 billion ....................            3.25%
$1 billion to $2 billion ......................            3.75%
$2 billion to $3 billion ......................            4.00%
$3 billion to $5 billion ......................            4.25%
$5 billion and over ...........................            4.50%

except that in no event shall the rebate with respect to any month exceed the
sum of $68,906.25; provided, however, that for the twelve-month periods ended
August 31, 1984 and August 31, 1985, respectively, the aggregate rebates paid by
you to the Trust shall equal at least $178,000 for each such twelve-month
period. To the extent that payment of at least $178,000 during each such period
requires payment of an amount in addition to the monthly percentage rebates
computed as provided above, such payment shall be made on the tenth day of the
first month following such twelve month period. Your agreement hereunder to
rebate a portion of your compensation shall be modified if and to the extent
that an amendment, modification or termination of said Stipulation of Settlement
shall be agreed to by the parties thereto and approved by the court, and shall
have become effective.

      (c) You agree that your compensation for any fiscal year shall be reduced
by the amount, if any, by which the expenses of the Trust for such fiscal year
exceed the lowest applicable expense limitation established pursuant to the
statutes or regulations of any jurisdiction in which the shares of the Trust
may be qualified for offer and sale. You shall refund to the Trust the amount of
any reduction of your compensation pursuant to this paragraph 5 as promptly as
practicable after the end of such fiscal year, provided that you will not be
required to pay the Trust an amount greater than the fee paid to you in respect
of such year pursuant to this Agreement. As used in this paragraph 5(c),
"expenses" shall mean those expenses included in the applicable expense
limitation having the broadest specification thereof, and "expense limitation"
means


                                   -4-                                         
<PAGE>

a limit on the maximum annual expenses which may be incurred by an investment
company determined (i) by multiplying a fixed percentage by the average, or by
multiplying more than one such percentage by different specified amounts of the
average, of the values of an investment company's net assets for a fiscal year
or (ii) by multiplying a fixed percentage by an investment company's net
investment income for a fiscal year. The words "lowest applicable expense
limitation" shall be construed to result in the largest reduction of your
compensation for any fiscal year of the Trust.

      6. Avoidance of Inconsistent Position. In connection with purchases or
sales of portfolio securities for the account of the Trust, neither you nor any
of your directors, officers or employees will act as a principal or agent or
receive any commission. You or your agent shall arrange for the placing of all
orders for the purchase and sale of portfolio securities for the Trust's account
with brokers or dealers selected by you. In the selection of such brokers or
dealers and the placing of such orders, you are directed at all times to seek
for the Trust the most favorable execution and net price available. If any
occasion should arise in which you give any advice to clients of yours
concerning the shares of the Trust, you will act solely as investment counsel
for such clients and not in any way on behalf of the Trust. Your services to the
Trust pursuant to this Agreement are not to be deemed to be exclusive and it is
understood that you may render investment advice, management and other services
to others.

      7. Limitation of Liability of Adviser. You shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Trust in
connection with the matters to which this Agreement relates, except a loss
resulting from willful misfeasance, bad faith or gross negligence on your part
in the performance of your duties or from reckless disregard by you of your
obligations and duties under this Agreement. Any person, even though also
employed by you, who may be or become an employee of and paid by the Trust shall
be deemed, when acting within the scope of his employment by the Trust, to be
acting in such employment solely for the Trust and not as your employee or
agent.

      8. Duration and Termination of this Agreement. This Agreement shall remain
in force until September 30, 1986 and from year to year thereafter, but only so
long as such continuance is specifically approved at least annually by the vote
of a majority of the Trustees who are not interested persons of you or of the
Trust, cast in person at a meeting called for the purpose of voting on such
approval, and by a vote of the Trustees or of a majority of the outstanding
voting securities of the Trust. This Agreement may, on 60 days' writ-


                                   -5-                                         
<PAGE>

ten notice, be terminated at any time without the payment of any penalty, by the
Trustees, by vote of a majority of the outstanding voting securities of the
Trust, or by you. This Agreement shall automatically terminate in the event of
its assignment. In interpreting the provisions of this Agreement, the
definitions contained in Section 2(a) of the Investment Company Act of 1940
(particularly the definitions of "interested person," "assignment" and "majority
of the outstanding voting securities"), as from time to time amended, shall be
applied, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission by any rule, regulation or order.

      9. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, and no amendment of this Agreement shall be
effective until approved by vote of the holders of a majority of the outstanding
voting securities and by the Trustees, including a majority of the Trustees who
are not interested persons of you or of the Trust, cast in person at a meeting
called for the purpose of voting on such approval.

      10. Miscellaneous. It is understood and expressly stipulated that neither
the holders of shares of the Trust nor the Trustees shall be personally liable
hereunder. The captions in this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument. At the commencement of business on the effective date of this
Agreement, the Investment Advisory Agreement dated October 26, 1981 between the
Trust and you will terminate and the relations between the Trust and you will be
governed thereafter by the terms of this Agreement.

      If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this letter and return which
counterpart to the Trust, whereupon this letter shall become a binding contract.

                                Yours very truly,

                                SCUDDER CASH INVESTMENT TRUST


                                By /s/ David S. Lee
                                   ---------------------
                                        President


                                   -6-                                         
<PAGE>

      The foregoing Agreement is hereby accepted as of the date thereof.

                                SCUDDER, STEVENS & CLARK LTD.


                                By /s/ Daniel Pierce
                                   ---------------------


                                   -7-                                         



                          SCUDDER CASH INVESTMENT TRUST
                              Boston, Massachusetts

                                             July 20, 1976

Scudder Fund Distributors, Inc.
10 Post Office Square
Boston, Massachusetts  02109

                             Underwriting Agreement

Dear Sirs:

      This Trust (hereinafter called the "Trust") has been established as a
Massachusetts business trust to engage in the business of an investment company.
The Trust has selected you to act as principal underwriter (as such term is
defined in Section 2(a)(29) of the Investment Company Act of 1940, as amended)
of the shares of beneficial interest of the Trust (hereinafter called the
"Shares") and you are willing to act as such principal underwriter and to
perform the duties and functions of underwriter in the manner and on the terms
and conditions hereinafter set forth. Accordingly, the Trust hereby agrees with
you as follows:

      1. Delivery of Trust Documents. The Trust has furnished you with copies,
properly certified or authenticated, each of the following:

      (a)   Declaration of Trust of the Trust, dated    1975, as amended to 
            date.


<PAGE>

                                     -2-


      (b)   By-Laws of the Trust as in effect on the date hereof.

      (c)   Resolutions of the trustees selecting you as principal
            underwriter and approving this form of Agreement.

The Trust will furnish you from time to time with copies, properly certified or
authenticated, of all amendments of or supplements to the foregoing, if any.

      The Trust will furnish you promptly with properly certified or
authenticated copies of any registration statements filed by it with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
or the Investment Company Act of 1940, as amended, together with any financial
statements and exhibits included therein, and all amendments or supplements
thereto hereafter filed.

      2. Registration and Sale of Additional Shares. The Trust will from time to
time use its best efforts to register under the Securities Act of 1933, as
amended, such Shares as you may reasonably be expected to sell on behalf of the
Trust. You and the Trust will cooperate in taking such action as may be
necessary from time to time to qualify Shares so registered for sale by you or
the Trust in any states mutually agreeable to you and the Trust, and to maintain
such qualification. This Agreement relates to the issue and sale of Shares that
are duly authorized and registered and available for sale by the Trust,
including redeemed or repur-
<PAGE>

                                       -3-


chased Shares if and to the extent that they may be legally sold and if, but
only if, the Trust sees fit to sell them.

      3. Sale of Shares. Subject to the provisions of paragraphs 5 and 7 hereof
and to such minimum purchase requirements as may from time to time be currently
indicated in the Trust's prospectus, you are authorized to sell, as agent on
behalf of the Trust, Shares authorized for issue and registered under the
Securities Act of 1933, as amended. You may also purchase as principal such
Shares for resale to the public. Such sales will be made by you on behalf of the
Trust by accepting unconditional orders to purchase such Shares placed with you
by investors and such purchases will be made by you only after acceptance by you
of such orders. The sales price to the public of such Shares shall be the public
offering price as defined in paragraph 6 hereof.

      4. Solicitation of Orders. You will use your best efforts (but only in
states in which you may lawfully do so) to obtain from investors unconditional
orders for Shares authorized for issue by the Trust and registered under the
Securities Act of 1933, as amended, provided that you may in your discretion
refuse to accept orders for Shares from any particular investor.

      5. Sale of Shares by the Trust. Any right granted to you to accept orders
for Shares or to make sales on behalf of the Trust or to purchase Shares for
resale will not apply to Shares issued in connection with the merger or
consolidation of any other investment company with the Trust or its aquisition,
by
<PAGE>

                                       -4-


purchase or otherwise, of all or substantially all of the assets of any
investment company or substantially all the outstanding shares of any such
company, and such right shall not apply to Shares that may be offered by the
Trust to shareholders by virtue of their being shareholders of the Trust.

      6. Public Offering Price. All Shares sold to investors by you will be sold
at the public offering price. The public offering price for all accepted
subscriptions will be the net asset value per Share, as determined in the manner
provided in the Trust's Declaration of Trust, as now in effect or as it may be
amended, next after the order is accepted by you.

      7. Suspension of Sales. If and whenever the determination of net asset
value is suspended and until such suspension is terminated, no further orders
for Shares shall be accepted by you except such unconditional orders placed with
you before you had knowledge of the suspension. In addition, the Trust reserves
the right to suspend sales and your authority to accept orders for Shares on
behalf of the Trust if, in the judgment of the trustees, it is in the best
interests of the Trust to do so, such suspension to continue for such period as
may be determined by the trustees; and in that event, no Shares will be sold by
you on behalf of the Trust while such suspension remains in effect except for
Shares necessary to cover unconditional orders accepted by you before you had
knowledge of the suspension.
<PAGE>

                                       -5-


      8. Portfolio Securities. Portfolio securities of the Trust may be bought
or sold by or through you and you may participate directly or indirectly in
brokerage commissions or "spread" in respect of transactions in portfolio
securities of the Trust; provided, however, that all sums of money received by
you as a result of such purchases and sales or as a result of such participation
must, after reimbursement of your actual expenses in connection with such
activity, be paid over by you to or for the benefit of the Trust.

      9. Expenses. The Trust will pay (or will enter into arrangements providing
that others than you will pay) all fees and expenses in connection with the
preparation and filing of any registration statement and prospectus or
amendments thereto under the Securities Act of 1933, as amended, covering the
issue and sale of Shares and the costs of share certificates, if any, and in
connection with the qualification of Shares for sale in the various states in
which the Trust shall determine it advisable to qualify such Shares for sale. It
will also pay any issue taxes or (in case of Shares redeemed) any initial
transfer taxes, and all expenses of printing all prospectuses for its own use
and a reasonable number for your use. You will pay all fees and expenses in
connection with your qualification as a dealer in the various states and all
other expenses in connection with the sale and offering for sale of Shares which
have not been herein specifically allocated to the Trust.
<PAGE>

                                       -6-


      10. Conformity with Law. You agree that in selling Shares you will duly
conform in all respects with the laws of the United States and any state in
which such Shares may be offered for sale by you pursuant to this Agreement and
to the rules and regulations of the National Association of Securities Dealers,
Inc., of which you are a member.

      11. Independent Contractor. You shall be an independent contractor and
neither you nor any of your officers or employees is or shall be an employee of
the Trust in the performance of your duties hereunder. You shall be responsible
for your own conduct and the employment, control and conduct of your agents and
employees and for injury to such agents or employees or to others through your
agents or employees. You assume full responsibility for your agents and
employees under applicable statutes and agree to pay all employee taxes
thereunder.

      12. Indemnification. You agree to indemnify and hold harmless the Trust
and each of its trustees and officers and each person, if any, who controls the
Trust within the meaning of Section 15 of the Securities Act of 1933, as
amended, against any and all losses, claims, damages, liabilities or litigation
(including legal and other expenses) to which the Trust or such trustees,
officers or controlling person may become subject under such Act, under any
other statute, at common law or otherwise, arising out of the acquisition of any
Shares by any person which (i) may be based upon any wrongful act by you or any
of
<PAGE>

                                       -7-


your employees or representatives, or (ii) may be based upon any untrue
statement or alleged untrue statement of a material fact contained in a
registration statement or prospectus covering Shares or any amendment thereof or
supplement thereto or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading if such statement or omission was made in reliance upon
information furnished to the Trust by you, or (iii) may be incurred or arise by
reason of your acting as the Trust's agent instead of purchasing and reselling
Shares as principal in distributing Shares to the public, provided, however,
that in no case (i) is your indemnity in favor of a trustee or officer or any
other person deemed to protect such trustee or officer or other person against
any liability to which any such person would otherwise be subject by reason of
willful misfeasance, bad faith, or gross negligence in the performance of his
duties or by reason of his reckless disregard of obligations and duties under
this Agreement or (ii) are you to be liable under your indemnity agreement
contained in this paragraph with respect to any claim made against the Trust or
any person indemnified unless the Trust or such person, as the case may be,
shall have notified you in writing within a reasonable time after the summons
or other first legal process giving information of the nature of the claims
shall have been served upon the Trust or upon such person (or after the Trust or
such
<PAGE>

                                       -8-


person shall have received notice of such service on any designated agent), but
failure to notify you of any such claim shall not relieve you from any liability
which you may have to the Trust or any person against whom such action is
brought otherwise than on account of your indemnity agreement contained in this
paragraph. You shall be entitled to participate, at your own expense, in the
defense, or, if you so elect, to assume the defnese of any suit brought to
enforce any such liability, but, if you elect to assume the defense, such
defense shall be conducted by counsel chosen by you and satisfactory to the
Trust, to its officers and trustees, to any controlling person or persons,
defendant or defendants in the suit. In the event that you elect to assume the
defense of any such suit and retain such counsel, the Trust, such officers and
trustees or controlling person or persons, defendant or defendants in the suit,
shall bear the fees and expenses of any additional counsel retained by them,
but, in case you do not elect to assume the defense of any such suit, you will
reimburse the Trust, such officers and trustees or controlling person or
persons, defendant or defendants in such suit for the reasonable fees and
expenses of any counsel retained by them. You agree promptly to notify the Trust
of the commencement of any litigation or proceedings against it in connection
with the issue and sale of any Shares.

      The Trust agrees to indemnify and hold you and each of your directors and
officers and each person, if any, who con-
<PAGE>

                                       -9-


trols you within the meaning of Section 15 of the Securities Act of 1933, as
amended, against any and all losses, claims, damages, liabilities or litigation
(including legal and other expenses) to which you or such directors, officers or
controlling person may become subject under such Act, under any other statute,
at common law or otherwise, arising out of the acquisition of any Shares by any
person which (i) may be based upon any wrongful act by the Trust or any of its
employees or representatives, or (ii) may be based upon any untrue statement or
alleged untrue statement of a material fact contained in a registration
statement or prospectus covering Shares or any amendment thereof or supplement
thereto or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading if such statement or omission was made in reliance upon information
furnished to you by the Trust; provided, however, that in no case (i) is the
Trust's indemnity in favor of a director or officer or any other person deemed
to protect such director or officer or other person against any liability to
which any such person would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of his duties or
by reason of his reckless disregard of obligations and duties under this
Agreement or (ii) is the Trust to be liable under its indemnity agreement
contained in this paragraph with respect to any claims made against you or any
such
<PAGE>

                                      -10-


director, officer or controlling person unless you or such director, officer or
controlling person, as the case may be, shall have notified the Trust in writing
within a reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon you or upon
such director, officer or controlling person (or after you or such director,
officer or controlling person shall have received notice of such service on any
designated agent), but failure to notify the Trust of any such claim shall not
relieve it from any liability which it may have to the person against whom such
action is brought otherwise than on account of its indemnity agreement contained
in this paragraph. The Trust will be entitled to participate at its own expense
in the defense, or, if it so elects, to assume the defense of any suit brought
to enforce any such liability, but if the Trust elects to assume the defense,
such defense shall be conducted by counsel chosen by it and satisfactory to you,
its directors, officers or controlling peron or persons, defendant or defendants
in the suit. In the event the Trust elects to assume the defense of any such
suit and retain such counsel, you, your directors, officers or controlling
person or persons, defendant or defendants in the suit, shall bear the fees and
expenses of any additional counsel retained by them, but, in case the Trust does
not elect to assume the defense of any such suit, it will reimburse you or such
directors, officers or controlling person or persons, defendant or defendants
<PAGE>

                                      -11-


in the suit, for the reasonable fees and expenses of any counsel retained by
them. The Trust agrees promptly to notify you of the commencement of any
litigation or proceedings against it or any of its officers or trustees in
connection with the issuance or sale of any Shares.

      The Trust is not authorized to give any information or to make any
representations on behalf of you other than the information and representations
contained in a registration statement or prospectus covering Shares, as such
registration statement and prospectus may be amended or supplemented from time
to time.

      You are not authorized to give any information or to make any
representations on behalf of the Trust in connection with the sale of Shares
other than the information and representations contained in a registration
statement or prospectus covering Shares, as such registration statement and
prospectus may be amended or supplemented from time to time. No person other
than you is authorized to act as principal underwriter (as such term is defined
in the Investment Company Act of 1940, as amended) for the Trust.

      13. Duration and Termination of this Agreement. This Agreement shall
become effective upon the effective date of the Trust's initial registration
statement under the Securities Act of 1933, as amended, and will remain in
effect for a period of two years from the date hereof and from year to year
there-
<PAGE>

                                      -12-


after, but only so long as such continuance is specifically approved at least
annually by the vote of a majority of the trustees who are not interested
persons of you or of the Trust, cast in person at a meeting called for the
purpose of voting on such approval, and by vote of the trustees or of a majority
of the outstanding voting securities of the Trust. This Agreement may, on 60
days' written notice, be terminated at any time, without the payment of any
penalty, by the trustees, by a vote of a majority of the outstanding voting
securities of the Trust, or by you. This Agreement will automatically terminate
in the event of its assignment. In interpreting the provisions of this paragraph
13, the definitions contained in Section 2(a) of the Investment Company Act of
1940, as amended, (particularly the definitions of "interested person",
"assignment" and "majority of the outstanding voting securities") shall be
applied.

      14. Amendment of this Agreement. No provisions of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. If the Trust should at any time deem it
necessary or advisable in the best interests of the Trust that any amendment of
this Agreement be made in order to comply with the recommendations or
requirements of the Securities and Exchange Commission or other governmental
authority
<PAGE>

                                      -13-


or to obtain any advantage under state or federal tax laws and should notify you
of the form of such amendment, and the reasons therefor, and if you should
decline to assent to such amendment, the Trust may terminate this Agreement
forthwith. If you should at any time request that a change be made in the
Trust's Declaration of Trust or By-Laws or in its methods of doing business, in
order to comply with any requirements of federal law or regulations of the
Securities and Exchange Commission or of a national securities association of
which you are or may be a member relating to the sale of Shares, and the Trust
should not make such necessary change within a reasonable time, you may
terminate this Agreement forthwith.

      15. Miscellaneous. It is understood and expressly stipulated that neither
the holders of Shares nor the trustees shall be personally liable hereunder. The
captions in this Agreement are included for convenience of reference only and in
no way define or delimit any of the provisions hereof or otherwise affect their
construction or effect. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

      If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this
<PAGE>

                                      -14-

letter and return such counterpart to the Trust, whereupon this letter shall
become a binding contract.

                                      Yours very truly,

                                      SCUDDER CASH INVESTMENT TRUST


                                      By /s/ [ILLEGIBLE]
                                         --------------------------
                                         President

      The foregoing Agreement is hereby accepted as of the date thereof.

                                      SCUDDER FUND DISTRIBUTORS, INC.


                                      By /s/ [ILLEGIBLE]
                                         ---------------------------
                                         Vice President



                                EXHIBIT 8(a)(1)
<PAGE>

                               CUSTODIAN CONTRACT

      This Contract between Scudder Cash Investment Trust, a trust existing
under the laws of the Commonwealth of Massachusetts, hereinafter called the
"Fund", and State Street Bank and Trust Company, hereinafter called the
"Custodian",

      WITNESSETH:  That in consideration of the mutual covenants and
agreements hereinafter contained, the parties hereto agree as follows:

I.    Employment of Custodian and Property to be Held by It 

      The Fund hereby employs the Custodian as the Custodian of its assets
pursuant to the provisions of the Declaration of Trust. The Fund agrees to
deliver to the Custodian all securities and cash owned by it, and all payments
of income, payments of principal or capital distributions received by it with
respect to all securities owned by the Fund from time to time, and the cash
consideration received by it for such new or treasury shares of beneficial
interest, without par value, ("Shares") of the Fund as may be issued or sold
from time to time. The Custodian shall not be responsible for any property of
the Fund held or received by the Fund and not delivered to the Custodian.

      The Custodian may from time to time employ one or more sub-custodians, but
only in accordance with an applicable vote by the Trustees of the Fund, and
provided that the Custodian shall have no more or less responsibility or
liability to the Fund on account of any actions or omissions of any
sub-custodian so employed than any such sub-custodian has to the Custodian.
<PAGE>

      II.   Duties of the Custodian with Respect to Property of the Fund Held by
            the Custodian

      A.    Holding Securities. The Custodian shall hold and physically
            segregate for the account of the Fund all non-cash property,
            including all securities owned by the Fund, other than securities
            which are maintained pursuant to Section L of Article II in a
            clearing agency which acts as a securities depository or in a
            book-entry system authorized by the U.S. Department of the Treasury,
            collectively referred to herein as "Securities Systems".

      B.    Delivery of Securities. The Custodian shall release and deliver
            securities owned by the Fund held by the Custodian or in a
            Securities System account of the Custodian only upon receipt of
            proper instructions, which may be continuing instructions when
            deemed appropriate by the parties, and only in the following cases:

                  1)    Upon sale of such securities for the account of the Fund
                        and receipt of payment therefor;

                  2)    Upon the receipt of payment in connection with any
                        repurchase agreement related to such securities entered
                        into by the Fund.

                  3)    In the case of a sale effected through a Securities
                        System, in accordance with the provisions of Section L
                        hereof.

                  4)    To the depository agent in connection with tender or
                        other similar offers for portfolio securities of the
                        Fund.


                                       -2-
<PAGE>

                  5)    To the Issuer thereof or its agent when such securities
                        are called, redeemed, retired or otherwise become
                        payable; provided that, in any such case, the cash or
                        other consideration is to be delivered to the Custodian;

                  6)    To the Issuer thereof, or its agent, for transfer into
                        the name of the Fund or into the name of any nominee or
                        nominees of the Custodian or into the name or nominee
                        name of any agent appointed pursuant to Section K of
                        Article II or into the name or nominee name of any
                        sub-custodian appointed pursuant to Article I; or for
                        exchange for a different number of bonds, certificates
                        or other evidence representing the same aggregate face
                        amount or number of units; provided that, in any such
                        case, the new securities are to be delivered to the
                        Custodian;

                  7)    To the broker selling the same for examination in
                        accordance with the "street delivery" custom; provided
                        that the Custodian shall adopt such procedures, as the
                        Fund from time to time shall approve, to ensure their
                        prompt return to the Custodian by the broker in the
                        event the broker elects not to accept them;

                  8)    For exchange or conversion pursuant to any plan of
                        merger, consolidation, recapitalization, reorganization
                        or readjustment of the securities of the


                                       -3-
<PAGE>

                        Issuer of such securities, or pursuant to provisions for
                        conversion contained in such securities, or pursuant to
                        any deposit agreement; provided that, in any such case,
                        the new securities and cash, if any, are to be delivered
                        to the Custodian;

                  9)    In the case of warrants, rights or similar securities,
                        the surrender thereof in the exercise of such warrants,
                        rights or similar securities or the surrender of interim
                        receipts or temporary securities for definitive
                        securities; provided that, in any such case, the new
                        securities and cash, if any, are to be delivered to the
                        Custodian;

                  10)   For delivery in connection with any loans of securities
                        made by the Fund, but only against receipt of adequate
                        collateral as agreed upon from time to time by the
                        Custodian and the Fund, which may be in the form of cash
                        or obligations issued by the United States government,
                        its agencies or instrumentalities;

                  11)   For delivery as security in connection with any
                        borrowings by the Fund requiring a pledge of assets by
                        the Fund, but only against receipt of amounts borrowed;

                  12)   Upon receipt of instructions from the transfer agent
                        ("Transfer Agent") for the Fund, for delivery to such
                        Transfer agent or to holders of shares in


                                       -4-
<PAGE>

                        connection with distributions in kind, as may be
                        described from time to time in the Fund's currently
                        effective prospectus, in satisfaction of requests by
                        holders of Shares for repurchase or redemption; and

                  13)   For any other proper corporate purposes, but only upon
                        receipt of, in addition to proper instructions, a
                        certified copy of a resolution of the Trustees or of the
                        Executive Committee signed by an officer of the Fund and
                        certified by the Secretary or an Assistant Secretary,
                        specifying the securities to be delivered, setting forth
                        the purpose for which such delivery is to be made,
                        declaring such purposes to be proper corporate purposes,
                        and naming the person or persons to whom delivery of
                        such securities shall be made.

C.    Registration of Securities. Securities held by the Custodian (other than
      bearer securities) shall be registered in the name of the Fund or in the
      name of any nominee of the Fund or of any nominee of the Custodian which
      nominee shall be assigned exclusively to the Fund, unless the Fund has
      authorized in writing the appointment of a nominee to be used in common
      with other registered investment companies having the same investment
      adviser as the Fund, or in the name or nominee name of any agent appointed
      pursuant to Section K of Article II or in the name or nominee name of any
      sub-custodian


                                      -5-
<PAGE>

      appointed pursuant to Article I. All securities accepted by the Custodian
      on behalf of the Fund under the terms of this Contract shall be in
      "street" or other good delivery form.

D.    Bank Accounts. The Custodian shall open and maintain a separate bank
      account or accounts in the name of the Fund, subject only to draft or
      order by the Custodian acting pursuant to the terms of this Contract, and
      shall hold in such account or accounts, subject to the provisions hereof,
      all cash received by it from or for the account of the Fund, other than
      cash maintained by the Fund in a bank account established and used in
      accordance with Rule 17f-3 under the Investment Company Act of 1940. Funds
      held by the Custodian for the Fund may be deposited by it to its credit as
      Custodian in the Banking Department of the Custodian or in such other
      banks or trust companies as it may in its discretion deem necessary or
      desirable; provided, however, that every such bank or trust company shall
      be qualified to act as a custodian under the Investment Company Act of
      1940 and that each such bank or trust company and the funds to be
      deposited with each such bank or trust company shall be approved by vote
      of a majority of the Trustees of the Fund. Such funds shall be deposited
      by the Custodian in its capacity as Custodian and shall be withdrawable
      by the Custodian only in that capacity.

E.    Payments for Shares. The Custodian shall receive from the distributor of
      the Fund's Shares or from the Transfer Agent of the Fund and deposit into
      the Fund's account such payments


                                       -6-
<PAGE>

      as are received for Shares of the Fund issued or sold from time to time by
      the Fund. The Custodian will provide timely notification to the Fund and
      the Transfer Agent of any receipt by it of payments for Shares of the
      Fund.

F.    Investment and Availability of Federal Funds. Upon mutual agreement
      between the Fund and the Custodian, the Custodian shall, upon the receipt
      of proper instructions, which may be continuing instructions when deemed
      appropriate by the parties,

            1)    invest in such instruments as may be set forth in such
                  instructions on the same day as received all federal funds
                  received after a time agreed upon between the Custodian and
                  the Fund; and

            2)    make federal funds available to the Fund as of specified times
                  agreed upon from time to time by the Fund and the Custodian in
                  the amount of checks received in payment for Shares of the
                  Fund which are deposited into the Fund's account.

G.    Collection of Income. The Custodian shall collect on a timely basis all
      income and other payments with respect to registered securities held
      hereunder to which the Fund shall be entitled either by law or pursuant to
      custom in the securities business, and shall collect on a timely basis all
      income and other payments with respect to bearer securities if, on the
      date of payment by the Issuer, such securities are held by the Custodian
      or agent thereof and shall credit such income, as collected, to the


                                       -7-
<PAGE>

      Fund's custodian account. Without limiting the generality of the
      foregoing, the Custodian shall detach and present for payment all coupons
      and other income items requiring presentation as and when they become due
      and shall collect interest when due on securities held hereunder.

H.    Payment of Fund Moneys. Upon receipt of proper instructions, which may be
      continuing instructions when deemed appropriate by the parties, the
      Custodian shall pay out moneys of the Fund in the following cases only:

            1)    Upon the purchase of securities for the account of the Fund
                  but only (a) against the delivery of such securities to the
                  Custodian (or any bank, banking firm or trust company doing
                  business in the United States or abroad which is qualified
                  under the Investment Company Act of 1940, as amended, to act
                  as a custodian and has been designated by The Custodian as its
                  agent for this purpose) registered in the name of the Fund or
                  in the name of a nominee of the Custodian referred to in
                  Section C of Article II hereof or in proper form for transfer;
                  (b) in the case of a purchase effected through a Securities
                  System, in accordance with the conditions set forth in Section
                  L of Article II hereof or (c) in the case of repurchase
                  agreements entered into between the Fund and the Custodian, or
                  another bank, (i) against delivery of the securities either in
                  certificate form or through an entry crediting


                                       -8-
<PAGE>

                  the Custodian's account at the Federal Reserve Bank with such
                  securities or (ii) against delivery of the receipt evidencing
                  purchase by the Fund of securities owned by the Custodian or
                  other bank along with written evidence of the agreement by the
                  Custodian or other bank to repurchase such securities from the
                  Fund;

            2)    In connection with conversion, exchange or surrender of
                  securities owned by the Fund as set forth in Section B of
                  Article II hereof;

            3)    For the redemption or repurchase of Shares issued by the Fund
                  as set forth in Section J of Article II hereof;

            4)    For the payment of any expense or liability incurred by the
                  Fund, including but not limited to the following payments for
                  the account of the Fund: interest, taxes, management,
                  accounting, transfer agent and legal fees, and operating
                  expenses of the Fund whether or not such expenses are to be in
                  whole or part capitalized or treated as deferred expenses;

            5)    For the payment of any dividends declared pursuant to the
                  governing documents of the Fund;

            6)    For any other proper purposes, but only upon receipt of, in
                  addition to proper instructions, a certified copy of a
                  resolution of the Trustees or of the Executive Committee of
                  the Fund signed by an


                                       -9-
<PAGE>

                  officer of the Fund and certified by its Secretary or an
                  Assistant Secretary, specifying the amount of such payment,
                  setting forth the purpose for which such payment is to be
                  made, declaring such purpose to be a proper purpose, and
                  naming the person or persons to whom such payment is to be
                  made.

I.    Liability for Payment in Advance of Receipt of Securities Purchased. In
      any and every case where payment for purchase of securities for the
      account of the Fund is made by the Custodian in advance of receipt of the
      securities purchased in the absence of specific written instructions from
      the Fund to so pay in advance, the Custodian shall be absolutely liable to
      the Fund for such securities to the same extent as if the securities had
      been received by the Custodian, except that in the case of repurchase
      agreements entered into by the Fund with a bank which is a member of the
      Federal Reserve System, the Custodian may transfer funds to the account of
      such bank prior to the receipt of written evidence that the securities
      subject to such repurchase agreement have been transferred by book-entry
      into a segregated non-proprietary account of the Custodian maintained with
      the Federal Reserve Bank of Boston or of the safe-keeping receipt,
      provided that such securities have in fact been so transferred by
      book-entry.

J.    Payments for Repurchases or Redemptions of Shares of the Fund. From such
      funds as may be available for the purpose but sub-


                                      -10-
<PAGE>

      ject to the limitations of the Declaration of Trust and any applicable
      votes of the Trustees of the Fund pursuant thereto, the Custodian shall,
      upon receipt of instructions from the Transfer Agent, make funds available
      for payment to holders of Shares who have delivered to the Transfer Agent
      a request for redemption or repurchase of their Shares. In connection with
      the redemption or repurchase of Shares of the Fund, the Custodian is
      authorized upon receipt of instructions from the Transfer Agent to wire
      funds to or through a commercial bank designated by the redeeming
      shareholders. In connection with the redemption or repurchase of Shares of
      the Fund, the Custodian shall honor checks drawn on the Custodian by a
      holder of Shares, which checks have been furnished by the Fund to the
      holder of Shares, when presented to the Custodian in accordance with such
      procedures and controls as are mutually agreed upon from time to time
      between the Fund and the Custodian.

K.    Appointment of Agents. The Custodian may at any time or times in its
      discretion appoint (and may at any time remove) any other bank or trust
      company which is itself qualified under the Investment Company Act of
      1940, as amended, to act as a custodian, as its agent to carry out such of
      the provisions of this Article II as the Custodian may from time to time
      direct; provided, however, that the appointment of any agent shall not
      relieve the Custodian of any of its responsibilities or liabilities
      hereunder.


                                      -11-
<PAGE>

L.    Deposit of Fund Assets in Securities Systems. The Custodian may deposit
      and/or maintain securities owned by the Fund in a clearing agency
      registered with the Securities and Exchange Commission under Section 17A
      of the Securities Exchange Act of 1934, which acts as a securities
      depository, or in the book-entry system authorized by the U.S. Department
      of the Treasury and certain federal agencies, collectively referred to
      herein as "Securities Systems" in accordance with applicable Federal
      Reserve Board and Securities and Exchange Commission rules and
      regulations, if any, and subject to the following provisions:

            1)    The Custodian may keep securities of the Fund in a Securities
                  System provided that such securities are represented in an
                  account ("Account") of the Custodian in the Securities System
                  which shall not include any assets of the Custodian other than
                  assets held as a fiduciary, custodian, or otherwise for
                  customers.

            2)    The records of the Custodian with respect to securities of the
                  Fund which are maintained in a Securities System shall
                  identify by book-entry those securities belonging to the Fund.

            3)    The Custodian shall pay for securities purchased for the
                  account of the Fund upon (i) receipt of advice from the
                  Securities System that such securities have been transferred
                  to the Account, and (ii) the making of an entry on the records
                  of the


                                      -12-
<PAGE>

                  Custodian to reflect such payment and transfer for the account
                  of the Fund. The Custodian shall transfer securities sold for
                  the account of the Fund upon (i) receipt of advice from the
                  Securities System that payment for such securities has been
                  transferred to the Account, and (ii) the making of an entry on
                  the records of the Custodian to reflect such transfer and
                  payment for the account of the Fund. Copies of all advices
                  from the Securities System of transfers of securities for the
                  account of the Fund shall identify the Fund, be maintained for
                  the Fund by the Custodian and be provided to the Fund at its
                  request. The Custodian shall furnish the Fund confirmation of
                  each transfer to or from the account of the Fund in the form
                  of a written advice or notice and shall furnish to the Fund
                  copies of daily transaction sheets reflecting each day's
                  transactions in the Securities System for the account of the
                  Fund on the next business day.

            4)    The Custodian shall provide the Fund with any report obtained
                  by the Custodian on the Securities System's accounting system,
                  internal accounting control and procedures for safeguarding
                  securities deposited in the Securities System.


                                      -13-
<PAGE>

            5)    The Custodian shall have received the initial or annual
                  certificate, as the case may be, required by Article IX
                  hereof.

            6)    Anything to the contrary in this Contract notwithstanding, the
                  Custodian shall be liable to the Fund for any loss or damage
                  to the Fund resulting from use of the Securities System by
                  reason of any negligence, misfeasance or misconduct of the
                  Custodian or any of its agents or of any of its or their
                  employees or from any failure of the Custodian or any such
                  agent to enforce effectively such rights as it may have
                  against the Securities System; at the election of the Fund, it
                  shall be entitled to be subrogated to the rights of the
                  Custodian with respect to any claim against the Securities
                  System or any other person which the Custodian may have as a
                  consequence of any such loss or damage if and to the extent
                  that the Fund has not been made whole for any such loss or
                  damage.

M.    Ownership Certificates for Tax Purposes. The Custodian shall execute
      ownership and other certificates and affidavits for all federal and state
      tax purposes in connection with receipt of income or other payments with
      respect to securities of the Fund held by it and in connection with
      transfers of securities.

N.    Proxies. The Custodian shall, with respect to the securities held
      hereunder, cause to be promptly executed by the regis-

                                      -14-
<PAGE>

      tered holder of such securities, if the securities are registered
      otherwise than in the name of the Fund or a nominee of the Fund, all
      proxies, without indication of the manner in which such proxies are to be
      voted, and shall promptly deliver to the Fund such proxies, all proxy
      soliciting materials and all notices relating to such securities.

O.    Communications Relating to Fund Portfolio Securities. The Custodian shall
      transmit promptly to the Fund all written information (including, without
      limitation, pendency of calls and maturities of securities and expirations
      of rights in connection therewith) received by the Custodian from issuers
      of the securities being held for the Fund. With respect to tender or
      exchange offers, the Custodian shall transmit promptly to the Fund all
      written information received by the Custodian from issuers of the
      securities whose tender or exchange is sought and from the party (or his
      agents) making the tender or exchange offer. If the Fund desires to take
      action with respect to any tender offer, exchange offer or any other
      similar transaction, the Fund shall notify the Custodian at least three
      business days prior to the date on which the Custodian is to take such
      action.

P.    Proper Instructions. "Proper instructions" as used throughout this Article
      II means a writing signed or initialled by one or more person or persons
      as the Trustees shall have from time to time authorized. Each such writing
      shall set forth the specific transaction or type of transaction in-


                                      -15-
<PAGE>

      volved, including a specific statement of the purpose for which such
      action is requested. Oral instructions will be considered proper
      instructions if the Custodian reasonably believes them to have been given
      by a person authorized to give such instructions with respect to the
      transaction involved. The Fund shall cause all oral instructions to be
      confirmed in writing. Upon receipt of a certificate of the Secretary or an
      Assistant Secretary as to the authorization by the Trustees of the Fund
      accompanied by a detailed description of procedures approved by the
      Trustees, "proper instructions" may include communications effected
      directly between electro-mechanical or electronic devices provided that
      the Trustees and the Custodian are satisfied that such procedures afford
      adequate safeguards for the Fund's assets.

Q.    Actions Permitted without Express Authority. The Custodian may in its
      discretion, without express authority from the Fund:

            1)    make payments to itself or others for minor expenses of
                  handling securities or other similar items relating to its
                  duties under this contract, provided that all such payments
                  shall be accounted for to the Fund;

            2)    surrender securities in temporary form for securities in
                  definitive form;

            3)    endorse for collection, in the name of the Fund, checks,
                  drafts and other negotiable instruments; and


                                      -16-
<PAGE>

            4)    in general, attend to all non-discretionary details in
                  connection with the sale, exchange, substitution, purchase,
                  transfer and other dealings with the securities and property
                  of the Fund except as otherwise directed by the Trustees of
                  the Fund.

R.    Evidence of Authority. The Custodian shall be protected in acting upon any
      instructions, notice, request, consent, certificate or other instrument or
      paper believed by it to be genuine and to have been properly executed by
      or on behalf of the Fund. The Custodian may receive and accept a certified
      copy of a vote of the Trustees of the Fund as conclusive evidence (a) of
      the authority of any person to act in accordance with such vote or (b) of
      any determination or of any action by the Trustees pursuant to the
      Declaration of Trust as described in such vote, and such vote may be
      considered as in full force and effect until receipt by the Custodian of
      written notice to the contrary.

III.  Duties of Custodian with Respect to Books of Account and Calculation of
      Net Asset Value and Net Income

      The Custodian shall cooperate with and supply necessary information to the
entity or entities appointed by the Trustees of the Fund to keep the books of
account of the Fund and/or compute the net asset value per share of the
outstanding shares of the Fund or, if directed in writing to do so by the Fund,
shall itself keep such books of account and/or compute such net asset value per
share. The Custodian shall also calculate daily the


                                      -17-
<PAGE>

"net income" of the Fund as defined in the Declaration of Trust and shall advise
the Fund and the Transfer Agent daily of the total amounts of such net income
and, if instructed in writing by an officer of the Fund to do so, shall advise
the Transfer Agent periodically of the division of such net income among its
various components. The calculations of the net asset value per share and the
daily income of the Fund shall be made at the time or times described from time
to time in the Fund's currently effective prospectus.

IV.   Records

      The Custodian shall create and maintain all records relating to its
activities and obligations under this Contract in such manner as will meet the
obligations of the Fund under the Investment Company Act of 1940, with
particular attention to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder,
applicable federal and state tax laws and any other law or administrative rules
or procedures which may be applicable to the Fund. All such records shall be the
property of the Fund and shall at all times during the regular business hours of
the Custodian be open for inspection by duly authorized officers, employees or
agents of the Fund and employees and agents of the Securities and Exchange
Commission. The Custodian shall, at the Fund's request, supply the Fund with a
tabulation of securities owned by The Fund and held by the Custodian and shall,
when requested to do so by the Fund and for such compensation as shall be agreed
upon between the Fund and the Custodian, include certificate numbers in such
tabulations.


                                      -18-
<PAGE>

V.    Opinion of Fund's Independent Accountant

      The Custodian shall take all reasonable action, as the Fund may from time
to time request, to obtain from year to year favorable opinions from the Fund's
independent accountants with respect to its activities hereunder in connection
with the preparation of the Fund's Form N-1, and Form N-1R or other annual
reports to the Securities and Exchange Commission and with respect to any other
requirements of such Commission.

VI.   Reports to Fund by Independent Public Accountants

      The Custodian shall provide the Fund, at such times as the Fund may
reasonably require, with reports by independent public accountants on the
accounting system, internal accounting control and procedures for safeguarding
securities, including securities deposited and/or maintained in a Securities
System, relating to the services provided by the Custodian under this Contract;
such reports, which shall be of sufficient scope and in sufficient detail, as
may reasonably be required by the Fund, to provide reasonable assurance that any
material inadequacies would be disclosed, shall state in detail material
inadequacies disclosed by such examination, and, if there are no such
inadequacies, shall so state.

VII.  Compensation or Custodian

      The Custodian shall be entitled to reasonable compensation for its
services and expenses as Custodian, as agreed upon from time to time between the
Fund and the Custodian.


                                      -19-
<PAGE>

VIII. Responsibility of Custodian

      So long as and to the extent that it is in the exercise of reasonable
care, the Custodian shall not be responsible for the title, validity or
genuineness of any property or evidence of title thereto received by it or
delivered by it pursuant to this Contract and shall be held harmless in acting
upon any notice, request, consent, certificate or other instrument reasonably
believed by it to be genuine and to be signed by the proper party or parties.
The Custodian shall be held to the exercise of reasonable care in carrying out
the provisions of this Contract, but shall be kept indemnified by and shall be
without liability to the Fund for any action taken or omitted by it in good
faith without negligence. It shall be entitled to rely on and may act upon
advice of counsel (who may be counsel for the Fund) on all matters, and shall be
without liability for any action reasonably taken or omitted pursuant to such
advice. Notwithstanding the foregoing, the responsibility of the Custodian with
respect to redemptions effected by check shall be in accordance with a separate
Agreement entered into between the Custodian and the Fund.

      If the Fund requires the Custodian to take any action with respect to
securities, which action involves the payment of money or which action may, in
the opinion of the Custodian, result in the Custodian or its nominee assigned to
the Fund being liable for the payment of money or incurring liability of some
other form, the Fund, as a prerequisite to requiring the Custodian to take such
action, shall provide indemnity to the Custodian in an amount and form
satisfactory to it.

                                      -20-
<PAGE>

      IX. Effective Period, Termination and Amendment

      This Contract shall become effective as of its execution, shall continue
in full force and effect until terminated as hereinafter provided, may be
amended at any time by mutual agreement of the parties hereto and may be
terminated by either party by an instrument in writing delivered or mailed,
postage prepaid to the other party, such termination to take effect not sooner
than thirty (30) days after the date of such delivery or mailing; provided,
however that the Custodian shall not act under Section L of Article II hereof in
the absence of receipt of an initial certificate of the Secretary or an
Assistant Secretary that the Trustees of the Fund have approved the initial use
of a particular Securities System and the receipt of an annual certificate of
the Secretary or an Assistant Secretary that the Trustees have reviewed the use
by the Fund of such Securities System, as required in each case by Rule 17f-4
under the Investment Company Act of 1940, as amended; provided further, however,
that the Fund shall not amend or terminate this Contract in contravention of any
applicable federal or state regulations, or any provision of the Declaration of
Trust, and further provided, that the Fund may at any time by action of its
Trustees (i) substitute another bank or trust company for the Custodian by
giving notice as described above to the Custodian, or (ii) immediately terminate
this Contract in the event of the appointment of a conservator or receiver for
the


                                      -21-
<PAGE>

Custodian by the Comptroller of the Currency or upon the happening of a like
event at the direction of an appropriate regulatory agency or court of competent
jurisdiction.

      Upon termination of the Contract, the Fund shall pay to the Custodian such
compensation as may be due as of the date of such termination and shall likewise
reimburse the Custodian for its costs, expenses and disbursements.

X.    Successor Custodian

      If a successor custodian shall be appointed by the Trustees of the Fund,
the Custodian shall, upon termination, deliver to such successor custodian at
the office of the Custodian, duly endorsed and in the form for transfer, all
securities then held by it hereunder.

      If no such successor custodian shall be appointed, the Custodian shall, in
like manner, upon receipt of a certified copy of a vote of the Trustees of the
Fund, deliver at the office of the Custodian such securities, funds and other
properties in accordance with such vote.

      In the event that no written order designating a successor custodian or
certified copy of a vote of the Trustees shall have been delivered to the
Custodian on or before the date when such termination shall become effective,
then the Custodian shall have the right to deliver to a bank or trust company,
which is a "bank" as defined in the Investment Company Act of 1940, doing
business in Boston, Massachusetts, of its own selection, having an aggregate
capital, surplus, and undivided profits, as shown by


                                      -22-
<PAGE>

its last published report, of not less than $25,000,000, all securities, funds
and other properties held by the Custodian and all instruments held by the
Custodian relative thereto and all other property held by it under this
Contract. Thereafter, such bank or trust company shall be the successor of the
Custodian under this Contract.

      In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Fund to procure the certified copy of vote referred to or of the
Trustees to appoint a successor custodian, the Custodian shall be entitled to
fair compensation for its services during such period as the Custodian retains
possession of such securities, funds and other properties and the provisions of
this Contract relating to the duties and obligations of the Custodian shall
remain in full force and effect.

XI.   Interpretive and Additional Provisions

      In connection with the operation of this Contract, the Custodian and the
Fund may from time to time agree on such provisions interpretive of or in
addition to the provisions of this Contract as may in their joint opinion be
consistent with the general tenor of this Contract. Any such interpretive or
additional provisions shall be in a writing signed by both parties and shall be
annexed hereto, provided that no such interpretive or additional provisions
shall contravene any applicable federal or state regulations or any provision of
the Declaration of Trust of the Fund. No interpretive or additional provisions
made as provided in the preceding sentence shall be deemed to be an amendment of
this Contract.


                                      -23-
<PAGE>

XII.  Trustees

      All references to actions of or by Trustees herein shall require action by
such Trustees acting as a board or formally constituted group and not
individually.

XIII. Massachusetts Law to Apply

      This Contract shall be construed and the provisions thereof interpreted
under and in accordance with the laws of the Commonwealth of Massachusetts.

XIV.  Prior Contracts

      This Contract supersedes and terminates, as of the date hereof, all prior
contracts between the Fund and the Custodian relating to the custody of the
Fund's assets.

      The name "Scudder Cash Investment Trust" is the designation of the
Trustees for the time being under a Declaration of Trust dated December 12, 1975
as amended, and all persons dealing with the Trust must look solely to the Trust
property for the enforcement of any claims against the Trust as neither the
Trustees, officers, agents or shareholders assume any personal liability for
obligations entered into on behalf of the Trust.

      IN WITNESS WHEREOF, each of the parties has caused this instrument to
be executed in its name and behalf by its duly authorized representative and
its seal to be hereunder affixed as of the 19th day of March, 1980.


SEAL                                  SCUDDER CASH INVESTMENT TRUST


                                      By: /s/ David S. Lee
                                          ---------------------------------
                                          Executive Vice President

SEAL                                  STATE STREET BANK AND TRUST COMPANY


                                      By: /s/ L. G. Locke
                                          ---------------------------------
                                          L. G. Locke
                                          Vice President


                                          -24-  


                                                                 Exhibit 8(a)(2)

                                    AMENDMENT

      The Custodian Contract dated March 19, 1980 between Scudder Cash
Investment Trust (the "Fund") and State Street Bank and Trust Company (the
"Custodian") is hereby amended as follows:

      I.    Section II.A is amended to read as follows:

      "Holding Securities. The Custodian shall hold and physically segregate in
a separate account or each series ("Portfolio") of the Fund all non-cash
property allocated to each portfolio, including all securities owned by the Fund
and allocated to each Portfolio except that (a) securities which are maintained
pursuant to Section II.L. in a clearing agency which acts as a securities
depository or in a book-entry system authorized by the U.S. Department of
Treasury, collectively referred to herein as "Securities System", shall be
identified as belonging to a specified Portfolio and (b) commercial paper of an
issuer for which State Street Bank and Trust Company acts as issuing and paying
agent ("Direct Paper") which is deposited and/or maintained in the Direct Paper
System of the Custodian pursuant to Section II.L.1., shall be identified as
belonging to a specified Portfolio".

      II.   Sections II.B is amended to read, in relevant part as follows:

      "Delivery of Securities. The Custodian shall release and deliver
securities owned by the Fund held by the Custodian or in a Securities System
account of the Custodian or in the Custodian's Direct Paper book entry system
account ("Direct Paper System Account") only upon receipt of Proper
Instructions, which may be continuing instructions when deemed appropriate by
the parties, and only in the following cases:

      1) . . .
      .
      .
      .
      13) . . . . "

      III. Section II.B. 4) through 13) are renumbered 5) through 14) and the
following is added as subparagraph 4):

      "4)   In the case of a sale effected through the Direct Paper System, in
            accordance with the provisions of Section L.1 hereof."

      IV.   Section II.H(1) is amended to read in relevant part as follows:

      "Payment of Fund Monies. Upon receipt of Proper Instructions, which may be
continuing instructions when deemed appropriate by the parties, the Custodian
shall pay out monies of the Fund in the following cases only:

      1)    Upon the purchase of securities, options, futures contracts or
            options on futures contracts for the account of the Fund but only
            (a) against the delivery of such securities or evidence of title to
            such

<PAGE>

            options, futures contracts or options on futures contracts, to the
            Custodian (or any bank, banking firm or trust company doing business
            in the United States or abroad which is qualified under the
            Investment Act of 1940, as amended, to as as a custodian and has
            been designated by the Custodian as its agent for this purpose)
            registered in the name of the Fund or in the name of a nominee of
            the Custodian referred to in Section II.C hereof or in proper form
            for transfer; (b) in the case of a purchase effected through a
            Securities System, in accordance with the conditions set forth in
            Section II.L. hereof;

            (c) in the case of a purchase involving the Direct Paper System, in
            accordance with the conditions set forth in Section II.L.1.; or (d)
            in the case of repurchase agreements entered into between the Fund
            and the Custodian, or another bank, or a broker-dealer which is a
            member of NASD, (i) against delivery of the securities either in
            certificate form or thorugh an entry crediting the Custodian's
            account in which is holds securities as a fiduciary, custodian or
            otherwise for customers at the Federal Reserve Bank with such
            securities or (ii) in the case of purchase by the Fund of securities
            owned by State Street Bank and Trust Company ("State Street") for
            its own account, against (A) delivery of the receipt evidencing
            purchase by the Fund, (B) earmarking certificates for such
            securities to show ownership by the Fund or transfer of such
            securities from State Street's proprietary account at the Federal
            Reserve Bank to its account described in (i) above, unless the
            securities are already held in the latter account, (C) the entry on
            the records of State Street showing that such securities are held by
            the Fund, and (D) delivery of written evidence of the agreement of
            State Street to repurchase such securities from the Fund; provided
            that, upon receipt of Proper Instructions, the Custodian shall
            transfer to another bank or trust company qualified to act as a
            custodian under the Investment Company Act of 1940, as amended,
            securities held in a Securities System and purchased from State
            Street subject to State Street's agreement to repurchase such
            securities;"

      V. Following Section II.L., there is inserted a new Section II.L.1 to read
as follows:

L.1 "Fund Assets held in the Custodian's Direct Paper System. The Custodian may
deposit and/or maintain securities owned by the Fund for which the Custodian
acts as issuing and paying agent for the direct issue of commercial paper by and
for issuers through the Custodian's book-entry system, referred to herein as the
"Direct Paper System", subject to the following provisions:

            1)    No transaction relating to securities in the Direct Paper
                  System will be effected in the absence of Proper Instructions;

            2)    The Custodian may keep securities of the Fund in the Direct
                  Paper System only if such securities are represented in an
                  account ("Account") of the Custodian in the Direct Paper
                  System which shall not include any assets of the Custodian
                  other than assets held as a fiduciary, custodian or otherwise
                  for customers;


                                       -2-
<PAGE>

            3)    The records of the Custodian with respect to securities of the
                  Fund which are maintained in the Direct Paper System shall
                  identify by Portfolio by book-entry those securities belonging
                  to the Fund;

            4)    The Custodian shall pay for securities purchased for the
                  account of the Fund upon the making of an entry on the records
                  of the Custodian to reflect such payment and transfer of
                  securities to the account of the Fund. The Custodian shall
                  transfer securities sold for the account of the Fund upon the
                  making of an entry on the records of the Custodian to reflect
                  such transfer and receipt of payment for the account of the
                  Fund;

            5)    The Custodian shall furnish the Fund confirmation of each
                  transfer to or from the account of the Fund, in the form of a
                  written advice or notice, of Direct Paper on the next business
                  day following such transfer and shall furnish to the Fund
                  copies of daily transaction sheets reflecting each day's
                  transactions in the Direct Paper System for the account of the
                  Fund; and

            6)    The Custodian shall provide the Fund with any report on its
                  system of internal accounting control regarding the Direct
                  Paper System as the Fund may reasonably request from time to
                  time."

      VI.   Section IX is hereby amended to read as follows:

            Effective Period, Termination and Amendment

      This Contract shall become effective as of its execution, shall continue
in full force and effect until terminated as hereinafter provided, may be
amended at any time by mutual agreement to the parties hereto and may be
terminated by either party by an instrument in writing delivered or mailed,
postage prepaid to the other party, such termination to take effect not sooner
than thirty (30) days after the date of such delivery or mailing; provided,
however that the Custodian shall not act under Section II.L. hereof in the
absence of receipt of an initial certificate of the Secretary or an Assistant
Secretary that the Board of Trustees of the Fund has approved the initial use of
a particular Securities System and the receipt of an annual certificate of the
Secretary or an Assistant Secretary that the Board of Trustees has reviewed the
use by the Fund of such Securities System, as required in each case by Rule
17f-4 under the Investment Company Act of 1940, as amended and that the
Custodian shall not act under Section II.L.1 hereof in the absence of receipt of
an initial certificate of the Secretary or an Assistant Secretary that the Board
of Trustees has approved the initial use of the Direct Paper System and the
receipt of an annual certificate of the Secretary or an Assistant Secretary that
the Board of Trustees has reviewed the use by the Fund of the Direct Paper
System; provided further, however, that the Fund shall not amend or terminate
this Contract in contravention of any applicable federal or state regulations,
or any provision of the Declaration of Trust, and further provided, that the
Fund may at any time by action of its Board of Trustees (i) substitute another
bank or trust company for the Custodian by giving notice as described above to
the Custodian, or (ii) immediately terminate this Contract in the event of the
appointment of a conservator or receiver for the Custodian by the Comptroller of
the Currency, the Federal


                                       -3-
<PAGE>

Deposit Insurance Corporation or the Commissioner of Banks for the Commonwealth
of Massachusetts or upon the happening of a like event at the direction of an
appropriate regulatory agency or court of competent jurisdiction.

      Upon termination of the Contract, the Fund shall pay to the Custodian such
compensation as may be due as of the date of such termination and shall likewise
reimburse the Custodian for its costs, expenses and disbursements."

      Except as otherwise expressly amended and modified herein, the provisions
of the Custodian Contract shall remain in full force and effect.

      IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment
to be executed in its name on its behalf by its duly authorized representatives
and its Seal to be hereto affixed as of the 11th day of August, 1987.

ATTEST:                                SCUDDER CASH INVESTMENT TRUST


/s/ Marilyn J. Hayes                   By: /s/ David S. Lee
- --------------------                       ---------------------------


ATTEST:                                STATE STREET BANK AND TRUST COMPANY

                                                             
/s/ [ILLEGIBLE]                        By: /s/ E D Hawkes Jr.
- --------------------                       ---------------------------
 Assistant Secretary                             Vice President


                                       -4-



                                                                 Exhibit 8(a)(3)

                                AMENDMENT TO THE
                               CUSTODIAN CONTRACT

      AGREEMENT made this 9th day of August 1988 by and between STATE STREET
BANK AND TRUST COMPANY ("Custodian") and SCUDDER CASH INVESTMENT TRUST (the
"Fund").

                                WITNESSETH THAT:

      WHEREAS, the Custodian and the Fund are parties to a Custodian Contract
dated March 19, 1980 (as amended to date, the "Contract") which governs the
terms and conditions under which the Custodian maintains custody of the
securities and other assets of the Fund:

      NOW THEREFORE, the Custodian and the Fund hereby amend the terms of the
Custodian Contract and mutually agree to the following:

      Replace subsection 7) of Section II.B Delivery of Securities with the
      following new subsection 7):

            7) Upon the sale of such securities for the account of the Fund, to
            the broker or its clearing agent, against a receipt, for examination
            in accordance with "street delivery" custom; provided that in any
            such case, the Custodian shall have no responsibility or liability
            for any loss arising from the delivery of such securities prior to
            receiving payment for such securities except as may arise from the
            Custodian's own negligence or willful misconduct;

      IN WITNESS WHEREOF, each of the parties has caused this Amendment to be
executed in its name and on its behalf by a duly authorized officer as of the
day and year first above written.


ATTEST:                                SCUDDER CASH INVESTMENT TRUST


/s/ Marilyn J. Hayes                   By: /s/ David S. Lee
- --------------------                       ---------------------------


ATTEST:                                STATE STREET BANK AND TRUST COMPANY

                                                             
/s/ [ILLEGIBLE]                        By: /s/ [ILLEGIBLE]
- --------------------                       ---------------------------
 Assistant Secretary                             Vice President




                                                                 Exhibit 8(a)(4)

                       STATE STREET BANK AND TRUST COMPANY

                             Custodian Fee Schedule

                         SCUDDER, STEVENS & CLARK FUNDS

                              (See Attachment "A")

                            Effective October 1, 1986

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

I.    Administration

      Custody, Portfolio and Fund Accounting Service - Maintain custody of fund
      assets. Settle portfolio purchases and sales. Report buy and sell fails.
      Determine and collect portfolio income. Make cash disbursements and report
      cash transactions. Maintain investment ledgers, provide selected portfolio
      transactions, position and income reports. Maintain general ledger and
      capital stock accounts. Prepare daily trial balance. Calculate net asset
      value daily. Provide selected general ledger reports. Securities yield or
      market value quotations will be provided to State Street by the fund.

      The administration fee shown below is an annual charge, billed and payable
      monthly, based on average monthly net assets.

                            ANNUAL FEES PER PORTFOLIO

                                              Custody, Portfolio
            Fund Net Assets                   and Fund Accounting
            ---------------                   -------------------
                                       
            First $20 Million                     1/ 10 of 1%
            Next $80 Million                      1/ 25 of 1%
            Excess                                1/100 of 1%
                                   
            Minimum Monthly Charges       As stated in attachment "A"
                                          and $2,000 for all new funds

II.   Portfolio Trades - For each line item processed

      State Street Bank Repos                                 $ 7.00

      DTC or Fed Book Entry                                   $12.00

      New York Physical Settlements                           $25.00

      All other trades                                        $16.00
<PAGE>

                                                             [Logo] State Street

 III. Options

      Option charge for each option written or
      closing contract, per issue, per broker                 $25.00

      Option expiration charge, per issue, per broker         $15.00 

      Option exercised charge, per issue, per broker          $15.00

  IV. Interest Rate Futures

      Transactions -- no security movement                    $ 8.00

   V. Coupon Bonds

      Monitoring for calls and processing coupons -- 
      for each coupon issue held -- monthly charge            $ 5.00

  VI. Holdings Charge

      For each issue maintained -- monthly charge             $ 5.00

 VII. Principal Reduction Payments

      Per paydown                                             $ 3.00

VIII. Dividend Charges (For items held at the Request
      of Traders over record date in street form)             $50.00

  IX. Earnings Credit

      A balance credit equal to 75% of the 90 day CD rate in effect the last
      business day of each month will be applied to the Custodian Demand Deposit
      Account balance of each fund, net of check redemption service overdrafts,
      on a pro-rated basis against the fund's custodian fee, excluding
      out-of-pocket expenses. The balance credit will be cumulative and carried
      forward each month. Any excess credit remaining at year-end (December 31)
      will not be carried forward.
<PAGE>

                                                             [Logo] State Street

   X. Automated Pricing

      Monthly Base Fee                                       $175.00*

      Monthly Quote Charge -

      -     Municipal Bonds via Muller Data                  $ 21.00

      -     Municipal Bonds via Kenny Information
            Systems                                          $ 16.00

      -     Government, Corporate and Convertible
            Bonds via Merrill Lynch                          $ 11.00

      -     Corporate and Government Bonds via
            Muller Data                                      $ 11.00

      -     Options, Futures and Private Placements          $  6.00

      -     Foreign Equities and Bonds via Extel Ltd.        $  6.00

      -     Listed Equities, OTC Equities, and Bonds         $  6.00

      -     Corporate, Municipal, Convertible and 
            Government Bonds, Adjustable Rate Preferred 
            Stocks via IDSI                                  $  6.00

      For billing purposes, the monthly quote charge will be based on the
      average number of positions in the portfolio.

  XI. Special Services

      Fees for activities of a non-recurring nature such as fund consolidations
      or reorganizations, extraordinary security shipments and the preparation
      of special reports will be subject to negotiation. Fees for tax
      accounting/recordkeeping for options, financial futures, and other special
      items will be negotiated separately.

  *   Does not apply to Variable Life Series
<PAGE>

                                                             [Logo] State Street

XII.  Out-of-Pocket Expenses

      A billing for the recovery of applicable out-of-pocket expenses will be
      made as of the end of each month. Out-of-pocket expenses include, but are
      not limited to the following:

            Telephone
            Wire Charges ($4.70 per wire in and $4.55 out)
            Postage and Insurance 
            Courier Service 
            Duplicating 
            Legal Fees
            Supplies Related to Fund Records 
            Rush Transfer -- $8.00 Each 
            Transfer Fees 
            Sub-custodian Charges 
            Price Waterhouse Audit Letter 
            Federal Reserve Fee for Return Check items over $2,500 - $4.25 
            GNMA Transfer - $15 each

XIII. Payment

      The above fees will be charged against the fund's custodian
      checking account five (5) days after the invoice is mailed
      to the fund's offices.

SCUDDER, STEVENS & CLARK                  STATE STREET BANK AND TRUST CO.

By /s/ David S. Lee                       By /s/ [ILLEGIBLE]
   -------------------------                 --------------------------

Title     President                       Title     Vice President

Date   October 7, 1986                    Date      October 7, 1986

100786/0082q



                          Scudder Cash Investment Trust
                               175 Federal Street
                           Boston, Massachusetts 02110


State Street Bank and Trust Company
1776 Heritage Drive
North Quincy, Massachusetts 02171

Dear Sirs:

      We agree that for purposes of the amendment, dated November 13, 1990, to
the Custodian Contract, dated March 19, 1980, between the Fund and State Street
Bank and Trust Company, (i) the term "promptly" shall be defined to mean a time
period of within 90 calendar days; and (ii) the term "after written demand"
shall be defined to mean a time period of within 30 calendar days.


                                             Scudder Cash Investment Trust

                                             By: /s/ David S. Lee
                                                 ----------------------------
                                                 President


      The foregoing is hereby accepted as of the date first written above.

                                             State Street Bank and Trust Company

                                             By: /s/ [ILLEGIBLE]
                                                 ----------------------------
                                                 Title: Sr. Vice President



                             SUBCUSTODIAN AGREEMENT

            AGREEMENT dated as of March 27, 1979, between STATE STREET BANK AND
TRUST COMPANY, organized under the laws of the Commonwealth of Massachusetts
(the "Custodian"), and THE BANK OF NEW YORK, London Office, (the
"Subcustodian").

                                   WITNESSETH:

            WHEREAS, the Custodian has entered into a custodian agreement with
Scudder Cash Investment Trust ("Trust") dated July 29, 1976;

            WHEREAS, the Custodian desires to utilize Subcustodian for the
purpose of holding cash and securities outside the United States;

            WHEREAS, the Subcustodian is a bank within the meaning of Section
2(a)(5) of the Investment Company Act of 1940 having an aggregate capital,
surplus and undivided profits of not less than Two Million Dollars ($2,000,000);

            NOW, THEREFORE, the Custodian and Subcustodian hereby agree as
follows:

I. The Custodian may from time to time deposit securities or cash with the
Subcustodian. The Subcustodian shall not be responsible for any property of the
Trust not delivered to the Subcustodian.

II. The Subcustodian shall hold and depose of the securities hereafter held by
or deposited with the Subcustodian as follows:

            A. The Subcustodian shall hold in a separate account, and physically
segregated at all times from those of any other persons, firms or corporations,
pursuant to the provisions hereof, all securities received
<PAGE>

by it for the account of the Custodian as custodian for the Trust. If any
securities are registered in nominee name, such nominee name shall be used
solely for the Trust. All such securities are to be held or disposed of by the
Subcustodian for, and subject at all times to, the instructions of the Custodian
pursuant to the terms of this Agreement.

            B. Upon receipt of instructions from the Custodian, the Subcustodian
shall release or deliver securities owned by the Trust only for the following
purposes:

            (1) upon sale of securities for the account of the Trust against
            receipt of payment therefor by cash, certified or cashier's check,
            or bank credit;

            (2) to the issuer thereof or its agent when securities are called,
            redeemed, retired or otherwise become payable, provided that the
            cash is to be delivered to the Subcustodian;

            (3) for exchange for a different number of bonds or certificates
            representing the same aggregate face amount or number of units, for
            exchange or conversion pursuant to any plan or merger,
            consolidation, recapitalization, reorganization or readjustment of
            the securities of the issuer of such securities, or pursuant to
            provisions for conversion contained in such securities, or pursuant
            to any deposit agreement; provided that, in any such case, the new
            securities and cash, if any, are to be delivered to the
            Subcustodian;

            (4) In the case of warrants, rights or similar securities, the
            surrender thereof in the exercise of such warrants, rights or


                                       -2-
<PAGE>

            similar securities; provided that the surrender of interim receipts
            or temporary securities for definitive securities may be made at any
            time; provided that, in any such case, the new securities are to be
            delivered to the Subcustodian;

            (5) in the case of tender offers or similar offers to purchase
            received in writing, the delivery of securities to the designated
            depository or other receipt agent. The Subcustodian shall have full
            responsibility for transmitting to the Custodian any such offers
            received by it. Thereafter, the Custodian, if it desires to respond
            to such offer, shall have full responsibility for providing the
            Subcustodian with all necessary instructions in timely enough
            fashion for the Subcustodian to act thereon prior to any expiration
            time for such offer;

            (6) upon receipt from the Custodian of instructions directing
            disposition of securities in a manner other than or for purposes
            other than the manners and purposes enumerated in the foregoing five
            items; provided, however, that disposition pursuant to this item (6)
            shall be made by the Subcustodian only upon receipt of instructions
            from the Custodian specifying the amount of such securities to be
            delivered, the purpose for which the delivery is to be made, and the
            name of the person or persons to whom such delivery is to be made.


                                      -3-
<PAGE>

III. The Subcustodian shall hold and dispose of cash hereafter held by or
deposited with the Subcustodian as follows:

            A. The Subcustodian shall open and maintain a separate account or
accounts in the name of the Custodian as custodian for the Trust, subject only
to draft or order by the Subcustodian acting pursuant to the terms of this
Agreement. The Subcustodian shall hold in such account or accounts, subject to
the provisions hereof, all cash received by it for the account of the Custodian
as custodian for the Trust.

            B. Upon receipt of instructions from the Custodian, the Subcustodian
shall make payments of cash for the account of the Trust from such cash only for
the following purposes:

            (1) upon the purchase of securities for the account of the Trust but
            only against the delivery of such securities to the Subcustodian;

            (2) in connection with the subscription, conversion, exchange,
            tender or surrender of securities owned by the Trust as set forth in
            Paragraph IIIB hereof; and

            (3) for deposit with the Trust or with such other banking
            institutions as may from time to time be approved by the Trust.

IV. All instructions shall be in writing executed by the Custodian, and the
Subcustodian shall not be required to act on instructions otherwise
communicated; provided, however, that the Subcustodian may in its discretion act
on the basis of instructions received via telecommunications facilities if the
Subcustodian reasonably believes such instructions to have been dispatched by
the Custodian.


                                       -4-
<PAGE>

The Subcustodian may require that instructions received via telecommunications
facilities be authenticated. The Subcustodian shall be protected in acting upon
any instructions, notice, request, consent, certificate or other instrument or
paper reasonably believed by it to be genuine and to have been properly
executed. The Subcustodian may receive and accept a certificate signed by the
secretary of the Custodian as conclusive evidence of the authority of any person
to act on behalf of the Custodian, and such certificate may be considered as in
full force and effect until receipt by the Subcustodian of written notice to the
contrary.

V. Unless and until the Subcustodian receives instructions from the Custodian to
the contrary, the Subcustodian shall:

            A. Present for payment all coupons and other income items held by it
for the account of the Custodian as custodian for the Trust which call for
payment upon presentation and hold the cash received by it upon such payment for
the account of the Custodian as custodian for the Trust;

            B. Collect interest and cash dividends received, with notice to the
Custodian, for the account of the Custodian as custodian for the Trust;

            C. Hold for the account of the Custodian as custodian for the Trust
hereunder all stock dividends, rights and similar securities issued with respect
to any securities held by it hereunder.

VI. The Subcustodian shall execute on behalf of the Custodian, in the Trust's
name, any declarations, affidavits, or certificates of ownership


                                       -5-
<PAGE>

which may be necessary or useful from time to time for the Subcustodian to
perform any or several of its obligations arising under the provisions of this
Agreement.

VII. If the Subcustodian shall receive any notices or reports in respect of
securities held by it hereunder, it shall promptly upon receipt thereof transmit
to the Custodian by airmail, telecommunications facilities, or comparable means
any such notices or reports.

VIII. The Subcustodian may, from time to time, appoint (and may at any time
remove) any bank or trust company as its agent for purposes of acquiring or
disposing of securities or carrying out such provisions of this Agreement as the
Subcustodian may, from time to time, direct; provided that the Subcustodian
shall be fully liable to the Custodian for the acts or omissions of such agents
to the same extent as if the acts or omissions of the agents were the acts or
omissions of the Subcustodian.

IX. On each day on which there is a cash or securities transaction over the
account of the Custodian as custodian for the Trust, the Sub-custodian shall
dispatch to the Custodian (and to the Trust, if requested) separate cash and
securities advices. The Subcustodian shall furnish to the Custodian at the end
of every month a statement of the cash and securities held by the Subcustodian
and any Additional Subcustodians for the Custodian as custodian for the Trust.
Such statements shall be sent by air mail, telecommunications facilities or
comparable means to the Custodian within 15 days after the end of each month.
The Subcustodian shall furnish the Custodian with such additional statements as
the Custodian may reasonably request.


                                       -6-
<PAGE>

X. As compensation for the services rendered pursuant to this Agreement, the
Custodian shall pay the Subcustodian a fee computed in accordance with the
schedule attached hereto as Exhibit A, as such schedule may be amended from time
to time by written agreement between the Custodian and the Subcustodian. The
Custodian shall reimburse the Subcustodian for any reasonable out-of-pocket
expenses incurred by the Subcustodian in connection with its obligations
hereunder.

XI. Upon request, the Custodian shall deliver, or shall request the Trust to
deliver, to the Subcustodian, such proxies, powers-of-attorney or other
instruments as may be necessary or desirable in connection with the performance
by the Subcustodian of its obligations under this Agreement.

XII. So long as and to the extent that it is in the exercise of reasonable care,
the Subcustodian shall not be responsible for the title, validity or genuineness
of any property or evidence of title thereto received by it or delivered by it
pursuant to this Agreement. The Subcustodian shall not be liable for any action
taken or omitted in good faith upon any notice, request, certificate or other
instrument reasonably believed by it to be genuine and to be signed by the
proper party or parties. The Subcustodian shall be obligated to exercise
reasonable care and diligence in carrying out the provisions of this Agreement
and shall be without liability for any action taken or thing done by it in good
faith and without negligence, the standard for which shall be that applicable to
a bailee for hire under Massachusetts law. Notwithstanding the foregoing, the
Subcustodian shall not be liable for (a) any violation by the Trust of any
limitation applicable to its powers to make expenditures, to invest in or pledge
securities or to borrow which does not involve action


                                       -7-
<PAGE>

by the Subcustodian, and (b) any violation by the Trust of any limitation
applicable to its powers to make investments, to invest in or pledge securities
or to borrow which involves action by the Subcustodian, provided that such
action was authorized in accordance with Paragraphs II, III or IV hereof. The
Subcustodian shall be entitled to and may act upon advice of counsel (who may be
counsel for the Trust) on all matters, and shall be without liability for any
action reasonably taken or omitted pursuant to such advice.

XIII. This Agreement may be terminated at any time by the Custodian or the
Subcustodian by giving written notice to the other party at least thirty (30)
days prior to the date on which such termination is to become effective. In the
event of termination, the Subcustodian will deliver any securities held by it or
any Additional Subcustodians to the Custodian or to such successor subcustodian
as the Custodian shall instruct in a manner to be mutually agreed upon by the
parties hereto or, in the absence of such agreement, in a reasonable manner.
Further in the event of termination, the Subcustodian shall be entitled to
receive prior to the delivery of the securities held by it or any Additional
Subcustodians all accrued fees and unreimbursed expenses the payment of which is
contemplated by Paragraph X hereof upon receipt by the Custodian of a final
statement setting forth such fees and expenses.

XIV. Except as the parties shall from time to time otherwise agree, all
instructions, notices, reports and other communications contemplated by this
Agreement shall be dispatched as follows:


                                       -8-
<PAGE>

          If to the Custodian:  State Street Bank and Trust Company
                                225 Franklin Street
                                Boston, Massachusetts 02110
                                Attention: Fred Walsh, AVP
                                Telex No.: 940956
                                St St Bk2QNCY

          If to the Subcustodian:  The Bank of New York/London

                                   Telex No.: 851-"884502"

XV. This Agreement constitutes the entire understanding and agreement of the
parties hereto, and neither this Agreement nor any provisions hereof may be
changed, waived, discharged or terminated except by a statement in writing
signed by the party against which enforcement of the change, waiver, discharge
or termination is sought.

XVI. This Agreement shall be binding upon and shall inure to the benefit of the
Custodian and the Subcustodian and their successors and assignees provided that
neither the Custodian nor the Subcustodian may assign this Agreement or any of
the rights or obligations hereunder without the prior written consent of the
other party.

XVII. This Agreement shall be construed in accordance with and governed by the
laws of the Commonwealth of Massachusetts. The parties hereto agree that
notwithstanding any provision or provisions of this Agreement of apparent
contrary effect, the Subcustodian shall have no obligation to take any action
which is contrary to any one or several provisions of the laws, orders or
regulations of England. The Subcustodian shall not be liable for any expense or
damage to the Custodian or the Trust that may result from violation of any or
several of the foregoing laws, orders and regulations, except as such expense or
damage is caused by the wilful misconduct or negligence of the Subcustodian.


                                      -9-
<PAGE>

XVIII. This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original, but all of which shall constitute one and the same
instrument. This Agreement shall become effective when one or more counterparts
have been signed and delivered by each of the parties.

            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.

                                      STATE STREET BANK AND TRUST COMPANY 
                                              (the "Custodian")

                                      By /s/ E D Hawkes, Jr. VICE PRESIDENT
                                         -----------------------------------

                                      THE BANK OF NEW YORK
                                      (the "Subcustodian")

                                      THE BANK OF NEW YORK
                                      147 LEADENHALL STREET,
                                      LONDON, [ILLEGIBLE] 4pm

                                      By    /s/ D. H. Stubbs
                                         ------------------------------
                                               DERRICK H. STUBBS
                                               ASSISTANT MANAGER
<PAGE>

                                   SCHEDULE A
                            TO SUBCUSTODIAN AGREEMENT
                   BETWEEN STATE STREET BANK AND TRUST COMPANY
                            AND THE BANK OF NEW YORK

The fee pursuant to Section X shall be $ 25.00 for each transfer of a security
into or out of the Subcustodian account.


                                                   Dated: March 27 , 1979


                                      -11-



                                                                 Exhibit 9(a)(1)

                     TRANSFER AGENCY AND SERVICE AGREEMENT

                                    between

                         SCUDDER CASH INVESTMENT TRUST

                                      and

                          SCUDDER SERVICE CORPORATION

<PAGE>

                     TRANSFER AGENCY AND SERVICE AGREEMENT

      AGREEMENT made as of October 2, 1989, by and between SCUDDER CASH
INVESTMENT TRUST, a Massachusetts business trust, having its principal office
and place of business at 175 Federal Street, Boston, Massachusetts 02110 (the
"Company") and SCUDDER SERVICE CORPORATION, a Massachusetts corporation, having
its principal office and place of business at 160 Federal Street, Boston,
Massachusetts 02110 (the "Agent").

      WHEREAS, the Company desires to appoint the Agent as a transfer agent,
dividend disbursing agent in connection with certain other activities and the
Agent desires to accept such appointment;

      NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:

Article 1. Terms of Appointment: Duties of the Agent.

      1.01. Subject to the terms and conditions set forth in this Agreement, the
Company hereby employs and appoints the Agent to act as, and the Agent agrees to
act as, transfer agent for the Company's authorized and issued shares of
beneficial interest ("Shares"), dividend disbursing agent and agent in
connection with any accumulation, open-account or similar plans provided to the
shareholders of the Company ("Shareholders") and set out in a currently
effective prospectus ("Prospectus") or currently effective statement of
additional information ("Statement of Additional Information") of the Company,
including without limitation any periodic investment plan or periodic withdrawal
program. If the Company offers two or more series of Shares as of the date
hereof, the term "Company shall be deemed to apply to each series of Shares,
unless the context otherwise requires.

      1.02. The Agent agrees that it will perform the following services:

         (a) In accordance with procedures established from time to time by
agreement between the Company and the Agent, the Agent shall:

              (i)    Receive for acceptance orders for the purchase of Shares
                     and promptly deliver payment and appropriate documentation
                     thereof to the duly authorized custodian of the Company
                     (the "Custodian").

              (ii)   Pursuant to orders for the purchase of Shares, record the
                     purchase of the appropriate number of Shares in the
                     Shareholder's account and, if requested by the Shareholder,
                     and if the Trustees of the Company have authorized the
                     issuance of stock certificates, issue a certificate for the
                     appropriate number of Shares;

<PAGE>

              (iii)  Pursuant to instructions provided by Shareholders, reinvest
                     income dividends and capital gain distributions;

              (iv)   Receive for acceptance redemption requests and redemption
                     directions and deliver the appropriate documentation
                     thereof to the Custodian;

              (v)    Provide an appropriate response to Shareholders with
                     respect to all correspondence and rejected trades;

              (vi)   At the appropriate time as and when it receives monies paid
                     to it by the Custodian with respect to any redemption, pay
                     over or cause to be paid over in the appropriate manner
                     such monies as instructed by the redeeming Shareholders;

              (vii)  Effect transfers of Shares by the registered owners thereof
                     upon receipt of appropriate instructions;

              (viii) Prepare and transmit payments for dividends and
                     distributions declared by the Company;

              (ix)   Report abandoned property to the various states as
                     authorized by the Company in accordance with policies and
                     principles agreed upon by the Company and Agent;

              (x)    Maintain records of account for and advise the Company and
                     its Shareholders as to the foregoing;

              (xi)   Record the issuance of Shares of the Company and maintain
                     an accurate control book with respect to Shares pursuant to
                     SEC Rule 17Ad-10(e) under the Securities Exchange Act of
                     1934. The Agent shall also provide the Company on a regular
                     basis with the total number of Shares which are issued and
                     outstanding and shall have no obligation, when recording
                     the issuance of Shares, to monitor the issuance of such
                     Shares or to take cognizance of any laws relating to the
                     issue or sale of such Shares, which functions shall be the
                     sole responsibility of the Company;

              (xii)  Respond to all telephone inquires from shareholders or
                     their authorized representatives regarding the status of
                     Shareholder accounts;

              (xiii) Respond to correspondence from Shareholders or their
                     authorized respresentatives regarding the status of
                     Shareholder accounts or information related to Shareholder
                     accounts; and


                                      -2-
<PAGE>

              (xiv)  Perform all Shareholder account maintenance updates.

         (b) In addition to and neither in lieu nor in contravention of the
services set forth in the above paragraph (a), the Agent shall: (i) perform the
customary services of a transfer agent, dividend disbursing agent and, as
relevant, agent in connection with accumulation, open-account or similar plans
(including without limitation any periodic investment plan or periodic
withdrawal program). The detailed definition, frequency, limitations and
associated costs (if any) set out in the attached fee schedule, include but are
not limited to: maintaining all Shareholder accounts, preparing Shareholder
meeting lists, mailing proxy statements and proxies, receiving and tabulating
proxies, mailing shareholder reports and prospectuses to current Shareholders,
and withholding all applicable taxes (including but not limited to all
withholding taxes imposed under the U.S. Internal Revenue Code and Treasury
regulations promulgated thereunder, and applicable state and local laws to the
extent consistent with good industry practice), preparing and filing U.S.
Treasury Department Forms 1099, Form 941 when applicable and other appropriate
forms required with respect to dividends, distributions and taxes withheld on
Shareholder accounts by federal authorities for all registered Shareholders,
preparing and mailing confirmation forms and statements of account to
Shareholders for all purchases and redemptions of Shares and other confirmable
transactions in Shareholder accounts, preparing and mailing activity statements
for Shareholders, and providing Shareholder account information, (ii) provide
daily and monthly a written report and access to information which will enable
the Company to monitor the total number of Shares sold and the aggregate public
offering price thereof in each State by the Company, added by sales in each
State of the registered Shareholder or dealer branch office, as defined by the
Company, and (iii) if directed by the Company, (A) each confirmation of the
purchase which establishes a new account will be accompanied by a Prospectus and
any amendment or supplement thereto, and (B) a Prospectus, and any amendment or
supplement thereto, will be mailed to each Shareholder at the time a
confirmation of the first purchase by such Shareholder, subsequent to the
effective date of a Prospectus or any amendment or supplement thereto, is mailed
to such Shareholders.

         (c) In addition, the Company shall (i) identify to the Agent in writing
those transactions and assets to be treated as exempt from blue sky reporting to
the Company for each state and (ii) approve those transactions to be included
for each state on the blue sky system prior to activation and thereafter monitor
the daily activity for each state. The responsibility of the Agent for the
Company's blue sky State registration status is solely limited to the initial
establishment of transactions subject to blue sky compliance by the Company
and the reporting of such transactions as provided above.


                                      -3-
<PAGE>

         (d) The Agent shall utilize a system to identify all share transactions
which involve purchase and redemption orders that are processed at a time other
than the time of the computation of net asset value per share next computed
after receipt of such orders, and shall compute the net effect upon the Company
of such transactions so identified on a daily and cumulative basis.

         (e) The Agent shall supply to the Company from time to time, as
mutually agreed upon, reports summarizing the transactions identified pursuant
to paragraph (d) above, and the daily and cumulative net effects of such
transactions, and shall advise the Company at the end of each month of the net
cumulative effect at such time. The Agent shall promptly advise the Company if
at any time the cumulative net effect exceeds a dollar amount equivalent to 1/2
of 1 cent per outstanding Share.

         (f) The Agent shall make appropriate arrangements with banking
institutions in connection with effecting timely redemptions of shares by a
Write-a-Check redemption feature described in the Company's Prospectus and
Statement of Additional Information.

      1.03. The Agent's offices, personnel and computer and other equipment
shall be adequate to perform the services contemplated by this Agreement for the
Company and for other investment companies advised by Scudder, Stevens & Clark,
Inc. and its affiliates. The Agent shall notify the Company in the event that it
proposes to provide such services for any investment companies or other entities
other than those managed by Scudder, Stevens & Clark, Inc. and its affiliates.

Article 2. Fees and Expenses

      2.01. For the performance by the Agent pursuant to this Agreement, the
Company agrees to pay the Agent an annual maintanence fee for each Shareholder
account as set out in a fee schedule agreed to by both parties in writing. Such
fees and out-of-pocket expenses and advances identified under Section 2.02 below
may be changed from time to time subject to mutual written agreement between the
Company and the Agent, as approved by a majority of the Trustees who are not
"interested persons" (as defined in the Investment Company Act of 1940) of the
Company.

      2.02. In addition to the fee paid under Section 2.01 above, the Company
agrees to reimburse the Agent for out-of-pocket expenses or advances incurred by
the Agent for the items set out in the fee schedule agreed to by both parties in
writing. In addition, any other expenses incurred by the Agent at the request or
with the consent of the Company will be reimbursed by the Company.

      2.03. The Company agrees to pay all fees and reimbursable expenses
promptly, the terms, method and procedures for which are detailed on the fee
schedule agreed to by both parties in writing. Postage for mailing of dividends,
proxy statements, Company reports and other mailings to all Shareholders
accounts shall be advanced to


                                      -4-
<PAGE>

the Agent by the Company at least two (2) days prior to the mailing date of such
materials.

      2.04. The Company may engage accounting firms or other consultants to
evaluate the fees paid by the Company and quality of services rendered by the
Servicing Company hereunder, and such firms or other consultants shall be
provided access by the Servicing Company to such information as may be
reasonably required in connection with such engagement. The Servicing Company
will give due consideration and regard to the recommendations to the Company in
connection with such engagement, but shall not be bound thereby.

Article 3. Representations and Warranties of the Agent.

      The Agent represents and warrants to the Company that:

      3.01. It is a corporation duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts.

      3.02. It has the legal power and authority to carry on its business in The
Commonwealth of Massachusetts.

      3.03. It is empowered under applicable laws and by its charter and by-laws
to enter into and perform this Agreement.

      3.04. All requisite proceedings have been taken to authorize it to enter
into and perform this Agreement.

      3.05. It is duly registered as a transfer agent under Section 17A of the
Securities Exchange Act of 1934, as amended.

      3.06. It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.

Article 4. Representations and Warranties of the Company.

      The Company represents and warrants to the Agent that:

      4.01. It is a business trust duly organized and existing and in good
standing under the laws of Massachusetts.

      4.02. It is empowered under applicable laws and by its Declaration of
Trust and By-Laws to enter into and perform this Agreement.

      4.03. All proceedings required by said Declaration of Trust and By-Laws
have been taken to authorize it to enter into and perform this Agreement.

      4.04. It is an investment company registered under the Investment Company
Act of 1940, as amended.


                                      -5-
<PAGE>

      4.05. A registration statement under the Securities Act of 1933 is
currently effective (or will be effective prior to commencement by the Agent of
performance of services hereunder) and will remain effective, and appropriate
state securities law filings have been made and/or will continue to be made,
with respect to all Shares of the Company being offered for sale.

Article 5. Indemnification

      5.01. To the extent that the Agent acts in good faith and without
negligence or willful misconduct, the Agent shall not be responsible for, and
the Company shall indemnify and hold the Agent harmless from and against, any
and all losses, damages, costs, charges, counsel fees, payments, expenses and
liabilities arising out of or attributable to:

         (a) All actions of the Agent or its agents or subcontractors required
to be taken and correctly executed pursuant to this Agreement.

         (b) The Company's lack of good faith, negligence or willful misconduct
or which arise out of the breach of any representation or warranty of the
Company hereunder.

         (c) The reasonable reliance on or use by the Agent or its agents or
subcontractors of information, records and documents or services which are
received or relied upon by the Agent or its agents or subcontractors and
furnished to it or performed by or on behalf of the Company.

         (d) The reasonable reliance on, or the carrying out by the Agent or its
agents or subcontractors of, any written instructions or requests of the
Company.

         (e) The offer or sale of Shares in violation of any requirement under
the federal securities laws or regulations, or the securities laws or
regulations of any state that such Shares be registered in such state, or in
violation of any stop order or other determination or ruling by any federal
agency or any state with respect to the offer or sale of such Shares in such
state, unless such violation is the result of the Agent's negligent or willful
failure to comply with the provisions of Section 1.02(b) of this Agreement.

      5.02. The Agent shall indemnify and hold the Company harmless from and
against any and all losses, damages, costs, charges, counsel fees, payments,
expenses and liabilities arising out of or attributable to the Agent's refusal
or failure to comply with the terms of this Agreement (whether as a result of
the acts or omissions of the Agent or of its agents or subcontractors) or
arising out of the lack of good faith, negligence or willful misconduct of the
Agent, or its agent or subcontractors, or arising out of the breach of any
representation or warranty of the Agent hereunder.


                                      -6-
<PAGE>

      5.03. At any time the Agent may apply to any officer of the Company for
instructions, and may consult with outside legal counsel with respect to any
matter arising in connection with the services to be performed by the Agent
under this Agreement, and the Agent and its agents or subcontractors shall not
be liable and shall be indemnified by the Company for any action reasonably
taken or omitted by it in reliance upon such instructions or upon the opinion of
such counsel. The Agent, its agents and subcontractors shall be protected and
indemnified in acting upon any paper or document furnished by or on behalf of
the Company, reasonably believed to be genuine and to have been signed by the
proper person or persons, or upon any instruction, information, data, records or
documents provided to the Agent or its agents or subcontractors by
machine-readable input, telex, CRT data entry or other similar means authorized
by the Company, and shall not be held to have notice of any change of authority
of any person, until receipt by the Agent of written notice thereof from the
Company. The Agent, its agents and subcontractors shall also be protected and
indemnified in recognizing stock certificates which are reasonably believed to
bear the proper manual or facsimile signatures of the officers of the Company,
and the proper countersignature of any former transfer agent or registrar, or of
a co-transfer agent or co-registrar.

      5.04. In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, equipment or
transmission failure or damage reasonably beyond its control, or other causes
reasonably beyond its control, such party shall not be liable to the other for
any damages resulting from such failure to perform or otherwise from such
causes.

      5.05. Neither party to this Agreement shall be liable to the other party
for consequential damages under any provision of this Agreement, but each shall
be liable for general damages resulting from breach of this Agreement. For the
purposes of this Agreement, the term "general damages" shall include but shall
not be limited to:

            (a)   All costs of correcting errors made by the Agent or its agents
                  or subcontractors in Company shareholder accounts, including
                  the expense of computer time, computer programming and
                  personnel;

            (b)   Amounts which the Company is liable to pay to a person (or his
                  representative) who has purchased or redeemed, or caused to
                  be repurchased, Shares at a price which is higher, in the case
                  of a purchase, or lower, in the case of a redemption or
                  repurchase, than correct net asset value per Share, but only
                  to the extent that the price at which such Shares were
                  purchased, redeemed or repurchased was incorrect as a result
                  of either (i) one or more errors caused by the Agent or its
                  agents or subcontractors in processing shareholder accounts of
                  the Company or (ii) the posting by the Agent of the purchase,
                  redemption or repurchase of Shares subsequent to the time such
                  purchase, redemption or repurchase


                                      -7-
<PAGE>

                  should have been posted pursuant to laws and regulations
                  applicable to open-end investment companies, if the delay is
                  caused by the Agent, its agents or subcontractors;

            (c)   The value of dividends and distributions which were not
                  credited on Shares because of the failure of the Agent or its
                  agents or subcontractors to timely post the purchase of such
                  Shares;

            (d)   The value of dividends and distributions which were
                  incorrectly credited on Shares because of the failure of the
                  Agent or its agents or subcontractors to timely post the
                  redemption or repurchase of such Shares;

            (e)   The value of dividends and distributions, some portion of
                  which was incorrectly credited, or was not credited, on Shares
                  because of the application by the Agent or its agents or
                  subcontractor of an incorrect dividend or distribution factor
                  or otherwise;

            (f)   Penalties and interest which the Company is required to pay
                  because of the failure of the Agent or its agents or
                  subcontractors to comply with the information reporting and
                  withholding (including backup withholding) requirements of the
                  Internal Revenue Code of 1986, as amended, and applicable
                  Treasury regulations thereunder, applicable to Company
                  Shareholder accounts; and

            (g)   Interest in accordance with the laws of The Commonwealth of
                  Massachusetts on any damages from the date of the breach of
                  this Agreement.

      5.06. In order that the indemnification provisions contained in this
Article 5 shall apply, upon the assertion of a claim or loss for which either
party may be required to indemnify the other, the party seeking indemnification
shall promptly notify the other party of such assertion or loss, and shall keep
the other party advised with respect to all developments concerning such claim.
The party who may be required to indemnify shall have the option to participate
at its expense with the party seeking indemnification in the defense of such
claim. The party seeking indemnification shall in no case confess any claim or
make any compromise in any case in which the other party may be required to
indemnify it except with the other party's prior written consent.

      5.07. Losses incurred by the Company arising from the Agent effecting a
share transaction at a trade (pricing) date prior to the processing date shall
be governed by a separate agreement between the Agent and the Company.

      The obligations of the parties hereto under this Article 5 shall survive
the termination of this Agreement.


                                      -8-
<PAGE>

Article 6. Covenants of the Company and the Agents.

6.01. The Company shall promptly furnish to the Agent the following:

         (a) A certified copy of the resolution of the Board of Trustees of the
Company authorizing the appointment of the Agent and the execution and delivery
of this Agreement.

         (b) A copy of the Declaration of Trust and By-Laws of the Company and
all amendments thereto.

      6.02. The Agent hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Company for safekeeping of stock
certificates, check forms and facsimile signature imprinting devices, if any;
and for the preparation or use, and for keeping account, of such certificates,
forms and devices.

      6.03. The Agent shall at all times maintain insurance coverage which is
reasonable and customary in light of its duties hereunder and its other
obligations and activities.

      6.04. The Agent shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable. To the
extent required by Section 31 of the Investment Company Act of 1940, as amended,
(the "Act") and the Rules thereunder, the Agent agrees that all such records
prepared or maintained by the Agent relating to the services to be performed by
the Agent hereunder and those records that the Company and the Agent agree from
time to time to be the records of the Company are the property of the Company
and will be preserved, maintained and made available in accordance with such
Sections and Rules, and will be surrendered promptly to the Company on and in
accordance with its request. Records surrendered hereunder shall be in machine
readable form, except to the extent that the Agent has maintained such a record
only in paper form.

      6.05. The Agent and the Company agree that all books, records, information
and data pertaining to the business of the other party which are exchanged or
received pursuant to the negotiation or the carrying out of this Agreement shall
remain confidential and shall not be voluntarily disclosed to any other person,
except as may be required by law.

      6.06. In case of any requests or demands for the inspection of the
Shareholders records of the Company, the Agent will endeavor to notify the
Company and to secure instructions from an authorized officer of the Company as
to such inspection. The Agent reserves the right, however, to exhibit the
Shareholders records to any person whenever it is reasonably advised by its
counsel that it may be held liable for the failure to exhibit the Shareholders
records to such person.


                                      -9-
<PAGE>

      6.07. The Agent agrees to maintain or provide for redundant facilities or
a compatible configuration and to maintain or provide for backup of the
Company's master and input files and to store such files in a secure
off-premises location so that in the event of a power failure or other
interruption of whatever cause at the location of such files the Company's
records are maintained intact and transactions can be processed at another
location.

      6.08. The Agent acknowledges that the Company, as a registered investment
company under the Act, is subject to the provisions of the Act and the rules and
regulations thereunder, and that the offer and sale of the Company's Shares are
subject to the provisions of federal and state laws and regulations applicable
to the offer and sale of securities. The Company acknowledges that the Agent is
not responsible for the Company's compliance with such laws and regulations. If
the Company advises the Agent that a procedure of the Agent related to the
discharge of its obligations hereunder has or may have the effect of causing the
Company to violate any of such laws or regulations, the Agent shall use its best
efforts to develop a mutually agreeable alternative procedure which does not
have such effect.

Article 7. Termination of Agreement.

      7.01. This Agreement may be terminated by either party upon one hundred
twenty (120) days written notice to the other.

      7.02. Should the Company exercise its right to terminate, all reasonable
out-of-pocket expenses of the Agent associated with the movement of records and
materials required by this Agreement will be borne by the Company. Additionally,
the Agent reserves the right to charge for any other reasonable expenses
associated with such termination.

Article 8. Additional Series.

      8.01. In the event that the Company establishes one or more series of
Shares with respect to which it desires to have the Agent render services as
transfer agent under the terms hereof, it shall so notify the Agent in writing,
and unless the Agent objects in writing to providing such services, the term
"Company" hereunder, unless the context otherwise requires, shall be deemed to
include each such series of Shares. All recordkeeping and reporting shall be
done separately for each series. Unless the Company and the Agent agree to an
amended fee schedule, the fee schedule attached hereto shall apply to each
series separately.

Article 9. Assignment.

      9.01. Except as provided in Section 9.03 below, neither this Agreement nor
any rights or obligations hereunder may be assigned by either party without the
written consent of the other party.


                                      -10-
<PAGE>

      9.02. This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and assigns.

      9.03. The Agent may, with notice to and consent on the part of the
Company, which consent shall not be unreasonably withheld, subcontract for the
performance of certain services under this Agreement to qualified service
providers, which shall be registered as transfer agents under Section 17A of the
Securities Exchange Act of 1934 if such registration is required; provided,
however, that the Agent shall be as fully responsible to the Company for the
acts and omissions of any subcontractor as it is for its own acts and omissions.

Article 10. Amendment.

      10.01. This Agreement may be amended or modified by a written agreement
executed by both parties and authorized or approved by a resolution of the Board
of Directors or Trustees of each party.

Article 11. Massachusetts Law to Apply.

      11.01. This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of The Commonwealth of
Massachusetts.

Article 12. Form N-SAR.

      12.01. The Agent shall maintain such records as shall enable the Company
to fulfill the requirements of Form N-SAR or any successor report which must be
filed with the Securities and Exchange Commission.

Article 13. Merger of Agreement.

      13.01. This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject hereof
whether oral or written.

Article 14. Counterparts.

      14.01. This Agreement may be executed by the parties hereto in any number
of counterparts, and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.


                                      -11-
<PAGE>

Article 15. Limitation of Liability of the Trustees and the Shareholders

      It is understood and expressly stipulated that none of the Trustees,
officers, agents, or shareholders of the Company shall be personally liable
hereunder. The name of the Company is the designation of the Trustees for the
time being under the Company's Declaration of Trust, as the same is now stated
or may hereafter be amended, and all persons dealing with the trust must look
solely to the property of the trust for the enforcement of any claims against
the trust as neither the Trustees, officers, agents or shareholders assume any
personal liability for obligations entered into on behalf of the trust. No
series of the Company, if any, shall be liable for the obligations of any other
series.

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their names and on their behalf under their seals by and through
their duly authorized officers, as of the day and year first above written.


ATTEST:                            SCUDDER CASH INVESTMENT TRUST


/s/ Marilyn J. Hayes               BY: /s/ David S. Lee
- ----------------------------           --------------------------
                                       Title: President

ATTEST:                            SCUDDER SERVICE CORPORATION


/s/ Marilyn J. Hayes               BY: /s/ Daniel Pierce
- ----------------------------           --------------------------
                                       Title: Vice President


                                      -12-



                                                                 Exhibit 9(a)(2)

                           SCUDDER SERVICE CORPORATION
                   FEE INFORMATION FOR SERVICES PROVIDED UNDER
                      TRANSFER AGENCY AND SERVICE AGREEMENT
                             Scudder Family of Funds

Annual maintenance fee for each account

1/12th of the annual maintenance fee shall be charged and payable each month. It
will be charged for any account which at any time during the month had a share
balance in the fund. The minimum monthly charge to any portfolio is $1,000.

         Money Market Funds*                  $28.90
         Monthly Income Funds                  25.00
         Quarterly Distribution Funds          20.40
         Annual Distribution Funds             17.55

Other fees

 New Account Set Up                           $3.15 each 
 Disaster Recovery                             0.25 per year 
 Closed Accounts                               1.20 per year 
 TIN Certificates                              0.15 each 
 TIN Maintenance                               0.25 each 
 Check Writing:                              
    Set Up                                     5.00 per account
    Retail Check Clearance                     0.96 per check
    Corporate Check Clearance                  0.46 per check
 Payroll Deduction Processing System (PDPS):
    Annual Base Fee                            240,000.00              
    Annual Maintenance:                      
          IRA                                  6.00 per account
          403B                                 7.00 per account
          401K                                 8.00 per account
                                     
Out of pocket expenses shall be reimbursed by the fund to Scudder Service
Corporation or paid directly by the fund. Such expenses include but are not
limited to the following:

      Telephone (portion allocable to servicing accounts) 
      Postage, overnight service or similar services 
      Stationery and envelopes 
      Shareholder Statements - printing and postage 
      Checks - stock supply, printing and postage 
      Data circuits 
      Lease and maintenance of S.A.I.L. and Easy Access
      Forms 
      Microfilm and microfiche
      Expenses incurred at the specific direction of the fund

Payment

The above will be billed within the first five (5) business days of each month
and will be paid by wire within five (5) business days of receipt.

On behalf of the Funds listed in Attachment A:      Scudder Service Corporation:


By  /s/ David S. Lee                                By /s/ Daniel Pene
    ------------------------                           ------------------------

Date  October 2, 1989                               Date  October 2, 1989
     -----------------------                             ----------------------

* SCIT per account change is $25.78
<PAGE>

                                  ATTACHMENT A

                      TRANSFER AGENCY AND SERVICE AGREEMENT

Money Market Accounts

      Scudder California Tax Free Money Fund
      Scudder Cash Investment Trust
      Scudder Government Money Fund
      Scudder New York Tax Free Money Fund
      Scudder Tax Free Money Fund

Monthly Income Funds

      Scudder California Tax Free Fund 
      Scudder GNMA Fund 
      Scudder High Yield Tax Free Fund 
      Scudder International Bond Fund 
      Scudder Managed Municipal Bonds
      Scudder Massachusetts Tax Free Fund 
      Scudder New York Tax Free Fund 
      Scudder Ohio Tax Free Fund 
      Scudder Pennsylvania Tax Free Fund 
      Scudder Short Term Bond Fund
      Scudder Tax Free Target Fund - 1990 Portfolio
      Scudder Tax Free Target Fund - 1993 Portfolio
      Scudder Tax Free Target Fund - 1996 Portfolio

Quarterly Distribution Funds

      Scudder Equity Income Fund
      Scudder Growth and Income Fund
      Scudder Income Fund

Annual Distribution Funds

      Scudder Capital Growth Fund
      Scudder Development Fund
      Scudder Global Fund
      Scudder Gold Fund
      Scudder International Fund
      Scudder U.S. Government Zero Coupon Target 1990 Portfolio
      Scudder U.S. Government Zero Coupon Target 1995 Portfolio
      Scudder U.S. Government Zero Coupon Target 2000 Portfolio

October 2, 1989



                                                                 Exhibit 9(b)(1)

                           COMPASS SERVICE AGREEMENT

      THIS AGREEMENT made as of this 1st day of January, 1990, by and between
SCUDDER TRUST COMPANY, a New Hampshire banking corporation ("Trust Company") and
SCUDDER CASH INVESTMENT TRUST, a Massachusetts business trust ("the Fund").

                                   WITNESSETH:

      WHEREAS, Trust Company is engaged in the business of providing certain
recordkeeping and other services; and

      WHEREAS, the Fund is engaged in business as an open-end investment company
registered under the Investment Company Act of 1940, as amended; and

      WHEREAS, Trust Company is willing to provide to the Fund certain
recordkeeping and other services in connection with certain omnibus accounts
maintained with the Fund on the terms and conditions hereinafter set forth;

      NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:

Article 1. Terms of Appointment: Duties of the Service.

      1.01. Subject to the terms and conditions set forth in this Agreement, the
Fund hereby employs and appoints Trust Company to act as, and Trust Company
agrees to act as, recordkeeping agent with respect to the authorized and issued
shares of beneficial interest of the Fund ("Shares") or units representing such
Shares ("Units") which are held in plan-level omnibus accounts (individually an
"Account" or collectively the "Accounts") in connection with certain retirement
arid employee benefit plans established under the Internal Revenue Code of 1986
including but not limited to defined contribution plans, Section 403(b) plans,
individual retirement accounts and deferred compensation plans (each a "Plan" or
collectively the "Plans"), utilizing the Comprehensive Participant Accounting
Services ("COMPASS"), and established by plan administrators, employers,
trustees, custodians and other persons (each individually an "Administrator" or
collectively the "Administrators") on behalf of employers (each individually an
"Emp1oyer" or collectively the "Employers") and individuals for certain
participants in such Plans (each individually a "Participant" or collectively
the "Participants").

      1.02. Trust Company agrees that it will perform the following services in
accordance with procedures established from time to time by agreement between
the Fund and Trust Company. Subject to instructions from the Administrators,
Trust Company shall:

            (i) receive from Administrators instructions for the purchase of
Shares of the Fund, confirm compliance with such instructions and, as agent of
the respective Administrators, deliver
<PAGE>

within a reasonable time such instructions and any appropriate documentation
therefor to the Transfer Agent of the Fund duly appointed by the Trustees of the
Fund (the "Transfer Agent");

            (ii) record the purchase by Plans of the appropriate number of
Shares or Units and within a reasonable time allocate such Shares or Units among
the Participants' Accounts;

            (iii) record dividends and capital gains distributions on behalf of
Participants;

            (iv) receive from Administrators instructions for redemption and
repurchase requests and directions, confirm compliance with such instructions
and as agent of the respective Administrators deliver within a reasonable time
such instructions and any appropriate documentation therefor to the Transfer
Agent;

            (v) record the redemption or repurchase by Plans of the appropriate
number of Shares or Units and within a reasonable time make the appropriate
adjustments among the Participants' accounts;

            (vi) certify to the Fund no less frequently than annually the number
of Participants accounts for which records are maintained hereunder;

            (vii) maintain records of account for and advise the Fund and
Administrators and Participants, when appropriate, as to the foregoing;

            (viii) maintain all Plan and Participant accounts other than
accounts maintained by the Transfer Agent; and

            (ix) maintain and mail administrative reports and Participant
statements.

      Procedures applicable to certain of these services may be established from
time to time by agreement between the Fund and Trust Company.

Article 2. Fees and Expenses

      2.01. For Performance by Trust Company of services pursuant to this
Agreement, the Fund agrees to pay Trust Company an annual maintenance fee for
each Participant account as set out in the fee schedule, as amended from time to
time. Such fee schedule and out-of-pocket expenses and advances identified under
Section 2.02 below may be changed from time to time by mutual agreement between
the Fund and Trust Company.


                                       -2-
<PAGE>

      2.02. In addition to the fee paid under Section 2.01 above, the Fund
agrees to reimburse Trust Company for out-of-pocket expenses or advances
incurred by Trust Company for the items set out in the fee schedule. In
addition, any other expenses incurred by Trust Company, at the request or with
the consent of the Fund, will be reimbursed by the Fund.

      2.03. The Fund agrees to pay all fees and reimbursable expenses promptly.
Postage and the cost of materials for mailing of administrative reports,
Participant statements and other mailings to all Employer accounts or
Participants shall be advanced to Trust Company by the Fund at least two (2)
days prior to the mailing date of such materials or paid within two (2) days of
the receipt by the Fund of a bill therefor.

Article 3. Representations and Warranties of Trust Company.

      Trust Company represents and warrants to the Fund that:

      3.01. It is a banking corporation duly organized and existing and in good
standing under the laws of The State of New Hampshire.

      3.02. It has the legal power and authority to carry on its business in any
jurisdiction where it does business.

      3.03. It is empowered under applicable laws and by its charter and by-laws
to enter into and perform this Agreement.

      3.04. All requisite corporate proceedings have been taken to authorize it
to enter into and perform this Agreement.

      3.05. It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.

Article 4. Representations and Warranties of the Fund.

      The Fund represents and warrants to Trust Company that:

      4.01. It is a business trust duly organized and existing and in good
standing under the laws of The Commonwealth of Massachusetts.

      4.02. It is empowered under applicable laws and by its Declaration of
Trust and By-Laws to enter into and perform this Agreement.


                                       -3-
<PAGE>

      4.03. All proceedings required by said Declaration of Trust and By-Laws
have been taken to authorize it to enter into and perform this Agreement.

      4.04. It is an investment company registered under the Investment Company
Act of 1940, as amended (the "Act").

      4.05. It makes available its Shares in connection with certain Plans.

      4.06. A majority of the Trustees of the Fund who are not interested
persons have made findings to the effect that:

            (a) the Agreement is in the best interest of the Fund and its
shareholders;

            (b) the services to be performed pursuant to the Agreement are
services required for the operation of the Fund;

            (c) Trust Company can provide services the nature and quality of
which are at least equal to those provided by others offering the same or
similar services; and

            (d) the fees charged by Trust Company for such services are fair and
reasonable in the light of the usual and customary charges made by others for
services of the same nature and quality.

      4.07. A registration statement under the Securities Act of 1933, as
amended, has been filed and has become effective, and appropriate state
securities law filings have been made with respect to all Shares of the Fund
being offered for sale. The Fund shall notify Trust Company (i) if such
registration statement or any state securities registration or qualification has
been terminated or a stop order has been entered with respect to the Shares or
(ii) if such registration statement shall have been amended to cover Shares of
any additional Series (as hereinafter defined in Section 8.01).

Article 5. Indemnification

      5.01. Trust Company shall not be responsible for, and the Fund shall
indemnify and hold Trust Company harmless from and against, any and all losses,
damages, costs, charges, counsel fees, payments, expenses and liabilities
arising out of or attributable to:

            (a) All actions of Trust Company or its agents required to be taken
pursuant to this Agreement, provided that such actions are taken in good faith
and without negligence or willful misconduct.

            (b) The Fund's refusal or failure to comply with the terms of this
Agreement, or which arise out of the Fund's lack of good faith, negligence or
willful misconduct or which arise out of the breach of any representation or
warranty of the Fund hereunder.


                                       -4-
<PAGE>

            (c) The reliance on or use by Trust Company or its agents of
information, records and documents which (i) are received by Trust Company or
its agents and furnished to it by or on behalf of the Fund, and (ii) have been
prepared and/or maintained by the Fund or any other person or firm (except Trust
Company) on behalf of the Fund.

            (d) The reliance on or the carrying out by Trust Company or its
agents of any written instructions or requests of the Fund or any person acting
on behalf of the Fund.

            (e) The offer or sale of Shares in violation of any requirement
under the federal securities laws or regulations, or the securities laws or
regulations of any state that such Shares be registered in such state, or in
violation of any stop order or other determination or ruling by any federal
agency or any state with respect to the offer or sale of such Shares in such
state.

      5.02. Trust Company shall indemnify and hold the Fund harmless from and
against any and all losses, damages, costs, charges, counsel fees, payments,
expenses and liabilities arising out of or attributable to Trust Company's
refusal or failure to comply with the terms of this Agreement, or which arise
out of Trust Company's lack of good faith, negligence or willful misconduct or
which arise out of the breach of any representation or warranty of Trust Company
hereunder.

      5.03. At any time Trust Company may apply to any officer of the Fund for
instructions, and may consult with legal counsel (which may also be legal
counsel for the Fund) with respect to any matter arising in connection with the
services to be performed by Trust Company under this Agreement, and Trust
Company shall not be liable and shall be indemnified by the Fund for any action
taken or omitted by it in reliance upon such instructions or upon the opinion of
such counsel. Trust Company and its agents shall be protected and indemnified
in acting upon any paper or document furnished by or on behalf of the Fund,
reasonably believed to be genuine and to have been signed by the proper person
or persons, or upon any instruction, information, data, records or documents
provided Trust Company or its agents by telephone, in person, machine-readable
input, telex, CRT data entry or other similar means authorized by the Fund, and
shall not be held to have notice of any change of authority of any person, until
receipt of written notice thereof from the Fund.

      5.04. Trust Company may at any time or times in its discretion appoint
(and may at any time remove) another individual, corporation, partnership, trust
or company as its agent to carry out such of the provisions of this Agreement as
Trust Company shall from time to time direct.

      5.05. In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, equipment or
transmission failure or damage reasonably


                                       -5-
<PAGE>

beyond its control, or other causes reasonably beyond its control, such party
shall not be liable to the other for any damages resulting from such failure to
perform or otherwise from such causes.

      5.06. In order that the indemnification provisions contained in this
Article 5 shall apply, upon the assertion of a claim for which either party may
be required to indemnify the other, the party seeking indemnification shall
promptly notify the other party of such assertion, and shall keep the other
party advised with respect to all developments concerning such claim. The party
who may be required to indemnify shall have the option to participate with the
party seeking indemnification in the defense of such claim. The party seeking
indemnification shall in no case confess any claim or make any compromise in any
case in which the other party may be required to indemnify it except with the
other party's prior written consent.

Article 6. Covenants of the Fund and Trust Company.

      6.01. Trust Company hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Fund for safekeeping of records and for
the preparation or use, and for keeping account of, such records.

      6.02. Trust Company shall at all times maintain insurance coverage which
is reasonable and customary in light of its duties hereunder and its other
obligations and activities, and shall notify the Fund of any changes in its
insurance coverage unless the Fund is covered by the same policy and such change
is also applicable to the Fund.

      6.03. Trust Company shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable.

      6.04. Trust Company and the Fund agree that all books, records,
information and data pertaining to the business of the other party which are
exchanged or received pursuant to the negotiation or the carrying out of this
Agreement shall remain confidential, and shall not be voluntarily disclosed to
any other person, except as may be required by law.

      6.05. In case of any requests or demands for the inspection of the records
relating to Plan Accounts and Participant accounts with the Fund, Trust Company
will endeavor to notify the Fund and to secure instructions from an authorized
officer of the Fund as to such inspection. Trust Company reserves the right,
however, to exhibit such records to any person whenever it is reasonably advised
by counsel to the Fund that it may be held liable for the failure to exhibit
such records to such person.

      6.06. Trust Company acknowledges that the Fund, as a registered investment
company under the Act, is subject to the of the provisions of the Act and the
rules and regulations thereunder, and


                                      -6-
<PAGE>

that the offer and sale of the Fund's Shares are subject to the provisions of
federal and state laws and regulations applicable to the offer and sale of
securities. The Fund acknowledges that Trust Company is not responsible for the
Fund's compliance with such laws, rules and regulations. If the Fund advises
Trust Company that a procedure of Trust Company related to the discharge of its
obligations hereunder has or may have the effect of causing the Fund to violate
any of such laws or regulations, Trust Company shall use its best efforts to
develop an alternative procedure which does not have such effect.

      6.07. Trust Company acknowledges to the Fund that, as the offeror of
COMPASS, Trust Company does not act as a plan administrator or as a fiduciary
under the Employee Retirement Income Security Act of 1974, as amended from time
to time, with respect to any Plan. Trust Company shall not be responsible for
determining whether the terms of a particular Plan or the Shares of the Fund are
appropriate for the Plan or Participant and does not guarantee the performance
of the Fund.

Article 7. Termination of Agreement.

      7.01. This Agreement may be terminated by either party on the last day of
the month next commencing after thirty (30) days written notice to the other
party.

      7.02. Upon termination of this Agreement, the Fund shall pay to Trust
Company such fees and expenses as may be due as of the date of such termination.

      7.03. Should the Fund exercise its right to terminate this Agreement,
Trust Company reserves the right to charge for any other reasonable expenses
associated with such termination.

Article 8. Additional Series of the Fund.

      8.01. Shares of the Fund are of a single class; however, Shares may be
divided into additional series ("Series") that may be established from time to
time by action of the Trustees of the Fund. If the context requires and unless
otherwise specifically provided herein, the term "Fund" as used in this
Agreement shall mean in addition each separate Series currently existing or
subsequently created, and the term "Shares" shall mean all shares of beneficial
interest of the Fund, whether of a single class or divided into separate Series
of the Fund currently existing or hereinafter created.

      8.02. In the event that the Fund establishes one or more or additional
Series of Shares in addition to the original Series with respect to which it
desires to have Trust Company render services as recordkeeping agent under the
terms hereof, it shall so notify Trust


                                       -7-
<PAGE>

Company in writing, and upon the effectiveness of a registration statement under
the Securities Act of 1933, as amended, relating to such Series of Shares and
unless Trust Company objects in writing to providing such services, such Series
shall be subject to this Agreement.

      8.03. In the event that the Fund suspends the offering of Shares of any
one or more Series, it shall so notify Trust Company in writing to such effect.

Article 9. Assignment.

      9.01. Neither this Agreement nor any rights or obligations hereunder may
be assigned by either party without the written consent of the other party.

      9.02. This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and assigns.

Article 10. Amendment.

      10.01. This Agreement may be amended or modified by a written agreement
executed by both parties.

Article 11. Massachusetts Law to Apply.

      11.01. This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of The Commonwealth of
Massachusetts.

Article 12. Entire Agreement.

      12.01. This Agreement constitutes the entire agreement between the parties
hereto.

Article 13. Correspondence.

      13.01. Trust Company will answer correspondence from Administrators
relating to Accounts and such other correspondence as may from time to time be
mutually agreed upon and notify the Fund of any correspondence which may require
an answer from the Fund.

Article 14. Further Actions.

      14.01. Each party agrees to perform such further acts and execute such
further documents as are necessary to effectuate the purposes hereof.


                                      -8-
<PAGE>

Article 15. Interpretive Provisions.

      15.01. In connection with the operation of this Agreement, Trust Company
and the Fund may agree from time to time on such provisions interpretive of or
in addition to the provisions of this Agreement as may in their joint opinion be
consistent with the general tenor of this Agreement. Any such interpretive or
additional provisions are to be signed by the parties and annexed hereto, but no
such provisions shall contravene any applicable federal or state law or
regulation and no such interpretive or additional provision shall be deemed to
be an amendment of this Agreement.

Article 16. Miscellaneous.

      16.01. The name Scudder Cash Investment is the designation of the Trustees
for the time being under a Declaration of Trust dated November 3, 1987, as
amended, and all persons dealing with the Fund must look solely to the Fund
property for the enforcement of any claims against the Fund as neither the
Trustees, officers, agents nor shareholders assume any personal liability for
obligations entered into on behalf of the Fund. No Series of the Fund shall be
liable for any claims against any other Series of the Fund.

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below as of the day and year first above
written.

                                                 SCUDDER TRUST COMPANY


                                                 BY: /s/ [ILLEGIBLE]
                                                    ----------------------------
                                                 Title: Vice President/Treasurer


                                                 SCUDDER CASH INVESTMENT TRUST


                                                 BY: /s/ David S. Lee
                                                    ----------------------------
                                                 Title: President/Trustee


                                      -9-



                                                                 Exhibit 9(b)(2)

                             SCUDDER TRUST COMPANY

                  FEE INFORMATION FOR SERVICES PROVIDED UNDER

                           COMPASS SERVICE AGREEMENT

Annual maintenance fee for each participant in a retirement and employee benefit
plan:

                                              First               Each
                                           Participant         Additional
                                             Account             Account
                                           -----------         ----------
Money Market Funds                           $28.90              $14.45
Monthly Income Funds                          25.00               12.50
Quarterly Distribution Funds                  20.40               10.20
Annual Distribution Funds                     17.55                8.78

1/12th of the annual maintenance fee shall be charged and payable each month. It
will be charged for any participant who at any time during the month had a share
or unit account balance in the fund.

Out of pocket expenses shall be reimbursed by the fund to Scudder Trust Company.
Such expenses include but are not limited to the following:

Supplies:
      Paper and envelopes in connection with participant statements and
      administrative reports.
Telephone (portion allocable to servicing accounts)
Postage, overnight service or similar services
Microfilm
Microfiche

On behalf of the Funds listed in
Attachment A:                                 Scudder Trust Company:


By  /s/ David S. Lee                          By  /s/ [ILLEGIBLE]
    -----------------------------                 ------------------------------

Date January 1, 1990                          Date January 1, 1990
     -----------------------------                 -----------------------------



                                                                 Exhibit 9(b)(3)

                                   SHAREHOLDER
                               SERVICES AGREEMENT

      This Agreement, made as of the lst day of June, 1990, between SCUDDER CASH
INVESTMENT TRUST (the "Fund") an open-end Investment Company which is registered
under the Investment Company Act of 1940, as amended, ("1940 Act"), and CHARLES
SCHWAB & CO., INC. ("Schwab"), a corporation organized under the laws of
California which is a Securities and Exchange Commission licensed transfer agent
which has its principal place of business at 101 Montgomery Street, San
Francisco, California 94104.

      WHEREAS, Schwab has established the Charles Schwab & Co., Inc. Defined
Contribution Prototype Plan (the "Prototype Plan") pursuant to which employers
may establish or amend employee benefit plans and their related Trusts
("Trusts"), and Schwab will offer to provide record keeping and trustee services
with respect to participants in Prototype Plans; and

      WHEREAS, participants in Prototype Plans may direct that all or a portion
of their accounts may be invested in shares of the Fund; and

      WHEREAS, the Fund desires that Schwab perform certain services for it; and

      WHEREAS, the performance of such services by Schwab will benefit the Fund
and those participants in Prototype Plans who have directed that all or a
portion of their accounts be invested in shares of the Fund; and

      WHEREAS, Schwab is willing to perform such services on the terms and
conditions set forth in this Agreement.

      NOW THEREFORE, in consideration of mutual promises set forth below, the
parties agree as follows:

1.    Omnibus Account. The Fund will cause to be maintained on its shareholder
      records a single account in the name of Schwab, which account shall
      include all shares of the Fund held by "Trust Client Shareholders", as
      defined below, for the benefit of participants in the Prototype Plans.


                                       1
<PAGE>

2.    Trust Client Shareholders. Trusts which are related to Prototype Plans and
      which acquire an interest in the Fund shall herein be referred to as
      Schwab's "Trust Client Shareholders".

3.    Services. Schwab will Perform for the Fund the shareholder services set
      forth in Exhibit A hereto. Schwab also agrees to perform for the Fund such
      special services incidental to the performance of the services set forth
      herein as agreed to by the parties from time to time. Schwab will perform
      such additional services as are provided on an amendment to Exhibit A
      hereof, in consideration of the fees set forth in Section 7 below.

4.    Agents or Schwab. Upon 60 days prior written notice to the Fund, unless
      waived by the Fund, Schwab may, in its discretion, appoint in writing
      other parties qualified to perform shareholder services to carry out some
      or all of its responsibilities under this Agreement.

5.    Compliance With Law. The Fund assumes full responsibility for the
      preparation and contents of each prospectus, annual report or proxy
      statement of the Fund and for compliance thereof with all applicable
      requirements or the Securities Act of 1933, as amended, the Investment
      Company Act of 1940, as amended, and any other laws, rules and regulations
      or governmental authorities having jurisdiction. Schwab will comply with
      all regulatory requirements applicable to it with respect to transmitting
      orders to purchase or redeem Fund shares.

6.    Mailing of Materials and Tabulation of Proxies. Subject to Section 5
      hereof, the Fund Specifically agrees that Schwab may designate a party for
      the purpose of mailing the materials described in Section 5 hereof on
      behalf of the Fund to Schwab's Trust Client Shareholders and for
      tabulation of returned proxy ballots, with the Fund bearing the reasonable
      costs of postage and mail house handling. Within a reasonable period prior
      to the record date, the Fund shall contact such designated party to
      establish the procedures for such mailing and tabulation of all returned
      proxy ballots.

7.    Fee. For the services provided under this Agreement, the Fund will compute
      and pay Schwab a monthly fee as follows:

      $1.50 per month per participant account in each Trust Client Shareholder.
      The fee shall be charged only for participant accounts which held shares
      in the Fund during the month.


                                        2
<PAGE>

      Schwab, through the recordkeeper for adopters of the Prototype Plan, will
      provide the Fund with a monthly accounting of the assets and the number of
      participants accounts on whose behalf Schwab's Trust Client Shareholders
      have invested in Fund Shares. Such accounting shall be for the purpose of
      computing the fee to be paid Schwab. Each month's fee shall be determined
      independently of every other month's fee, and shall be paid to Schwab
      monthly.

8.    Nonexclusivity. The services furnished to the Fund by Schwab under this
      agreement are not to be deemed exclusive and Schwab shall be free to
      furnish similar services to other investment companies registered under
      the 1940 Act so long as its services under this Agreement are not impaired
      thereby. Nothing under this Agreement shall limit or restrict the right of
      any employee, officer or director of Schwab to engage in any other
      business or to devote his or her time and attention in part of the
      management or other aspects of any other business, whether of a similar or
      dissimilar nature.

9.    Proprietary Information. The Fund agrees that neither it nor its
      representatives or agents will use or distribute the names of Schwab's
      Trust Client Shareholders that it may obtain by reason of the relationship
      with Schwab under this Agreement.

10.   Schwab's Reliance on Records and Instructions. Schwab may rely on any
      written records or instructions provided to it by the Fund.

11.   Uncontrollable Events. Schwab assumes no responsibility hereunder, and
      will not be liable, for any damage, loss of data, delay or any other loss
      whatsoever caused by events beyond its reasonable control.

12.   Standard of Care. Schwab will use its best efforts to ensure the accuracy
      of all services performed under this Agreement, but will not be liable to
      the Fund for any action taken or omitted by Schwab in the absence of bad
      faith, willful misconduct or negligence. Schwab shall not be liable for
      any losses to the Fund caused by the Fund but shall use reasonable efforts
      to recover losses to the Fund.


                                        3
<PAGE>

13.   Reports. Schwab will furnish to the Fund and to the Fund's properly
      authorized auditors, investment advisers, examiners, distributors,
      dealers, underwriters, salesmen, insurance companies and others designated
      by the Fund in writing, such reports at such times as are reasonably
      agreed upon by the Fund and Schwab.

14.   Rights of Ownership. All computer programs and procedures developed by
      Schwab to perform services required to be provided by Schwab under this
      Agreement are the property of Schwab, except such programs and procedures
      developed by the Fund or Scudder, Stevens & Clark, Inc. and its
      affiliates.

15.   Assignment. This Agreement and the rights and duties hereunder shall not
      be assignable by either of the parties hereto except by the specific
      written consent of the other party. This Section shall not limit or in any
      way affect Schwab's right to appoint an agent pursuant to Section 4
      hereof.

16.   Terms. This Agreement may be terminated by either party upon sixty (60)
      days written notice mailed to the Fund at: c/o D.M. Cronin, Scudder Fund
      Distributors Inc., 175 Federal Street; Boston, MA 02110 and to Schwab at
      101 Montgomery Street, San Francisco, California 94101, Attention: General
      Counsel.

17.   If the Fund is a Massachusetts Business trust the obligations or the Fund
      under this agreement are not binding upon any of the Trustees, officers,
      agents or shareholders of the Fund individually, but bind only the trust
      estate of the Fund, and all persons dealing with the Fund must look solely
      to the Fund property for the enforcement of any claims against the Fund.
      Furthermore, the parties hereto acknowledge that the Fund may be an
      investment company whose assets may be allocated to two or more series. In
      such a case, Schwab agrees to seek satisfaction of all obligations
      hereunder solely out of the assets of the series on whose behalf the
      transaction giving rise to the obligation was entered into.

18.   Governing Law. This Agreement shall be governed by, and construed in
      accordance with, the laws of the State of California


                                        4
<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in their names and on their behalf by and through their duly authorized officers
as of the date and year first above written.


      CHARLES SCHWAB & CO., INC.

      Dated: June 4,  1990                   By: /s/ David Krimm
                                                 ------------------------
                                                 David Krimm
                                                 Vice President
                                             ----------------------------
                                                    (Typed Name)

      SCUDDER CASH INVESTMENT TRUST

      Dated: 6/1/90                          By: /s/ David S. Lee
                                                 ------------------------
                                                 David S. Lee
                                             ----------------------------
                                                    (Typed Name)


                                        5



                                            THE
                                            SCUDDER
                                            FLEXI-PLAN
                                            ---------------------
Plan Document
                                            A profit sharing plan and
                                            money purchase pension
                                            plan

                                            SCUDDER
                                            SERVING INVESTORS SINCE 1919

<PAGE>

                             SCUDDER PROTOTYPE PLAN
                               TABLE OF CONTENTS

                                                                            Page
                                                                            ----
SECTION 1   Introduction ..................................................   2
SECTION 2   Definitions ...................................................   2
SECTION 3   Eligibility ...................................................   3
SECTION 4   Contributions .................................................   3
SECTION 5   Code Section 415 Limitations on Allocations ...................   4
SECTION 6   Time and Manner of Making Contributions .......................   6
SECTION 7   Vesting .......................................................   6
SECTION 8   Distribution Upon Death .......................................   6
SECTION 9   Other Distributions ...........................................   6
SECTION 10  Loans .........................................................   7
SECTION 11  Trust Provisions ..............................................   7
SECTION 12  Administration ................................................   9
SECTION 13  Fees and Expenses .............................................   9
SECTION 14  Benefit Recipient Incompetent or Difficult to
             Ascertain or Locate ..........................................   9
SECTION 15  Designation of Beneficiary ....................................   9
SECTION 16  Spendthrift Provision .........................................  10
SECTION 17  Necessity of Qualification ....................................  10
SECTION 18  Amendment or Termination ......................................  10
SECTION 19  Transfers .....................................................  10
SECTION 20  Owner-Employee Provisions .....................................  10
SECTION 21  Top-Heavy Provisions ..........................................  10
SECTION 22  Waiver of Minimum Funding Standard ............................  11
SECTION 23  Miscellaneous .................................................  12


                                                                               1

<PAGE>

                             SCUDDER PROTOTYPE PLAN

SECTION 1.
INTRODUCTION

     The Employer has established this Plan (the "Plan"), consisting of the
Adoption Agreement and the following provisions (the "Prototype Plan") for the
exclusive benefit of its Employees and their Beneficiaries.

SECTION 2.
DEFINITIONS

     Where the following words and phrases appear in this Plan, they shall have
the respective meanings set forth below, unless their context clearly indicates
a contrary meaning. The singular herein shall include the plural, and vice
versa, and the masculine gender shall include the feminine gender, and vice
versa, where the context requires.

     2.1 "Account" shall mean the Trust assets held by the Trustee for the
benefit of a Participant, which shall be the sum of the Participant's Employer
Contribution Account, Nondeductible Voluntary Contribution Account, Deductible
Voluntary Contribution Account and Rollover Account.

     2.2 "Act" shall mean the Employee Retirement Income Security Act of 1974,
as amended.

     2.3 "Administrator" shall mean the person or persons specified in Section
12.1.

     2.4 "Adoption Agreement" shall mean the agreement by which the Employer has
most recently adopted or amended the Plan.

     2.5 "Beneficiary" shall mean any person or legal representative entitled to
receive benefits on or after the death of a Participant.

     2.6 "Code" shall mean the Internal Revenue Code of 1954, as amended.
Reference to a section of the Code shall include any comparable section or
sections of future legislation that amends, supplements or supersedes such
section.

     2.7 "Compensation" shall mean the amount paid during the Plan Year by the
Employer to the Employee for services rendered while a Participant, as
reportable to the Federal Government for the purpose of withholding Federal
income taxes, but not including amounts attributable to any category specified
in the Adoption Agreement. If so specified in the Adoption Agreement,
Compensation shall also mean amounts paid to the Employee for services rendered
for the entire Plan Year in which an Employee became a Participant whether or
not such an Employee was a Participant for the entire Plan Year. In the case of
a Self-Employed Individual, the above determination of Compensation shall be
made on the basis of the Self-Employed Individual's Earned Income.
Notwithstanding the previous sentence, for the purposes of the limitations
imposed by Section 4.1(a)(i)(B) below, Compensation of a Self-Employed
Individual shall be determined on the basis of the Self-Employed Individual's
Earned Income determined in accordance with the rules provided by Code Section
404(a)(8)(D).

     2.8 "Current or Accumulated Earnings and Profits" of an Employer other than
a sole-proprietorship or partnership shall mean the Employer's current or
accumulated earnings and profits, as determined on the basis of the Employer's
books of account in accordance with generally accepted accounting practices,
without any deductions for Employer Contributions under the Plan (or any other
qualified plan) for the current Year or for income taxes for the current Year,
and without regard to the Employer's election to be taxed as a small business
corporation, if it has so elected. If the Employer is a sole-proprietorship or
partnership, "Current or Accumulated Earnings and Profits" shall mean the net
income of such Employer before deduction for income taxes and contributions made
hereunder.

     2.9 "Deductible Voluntary Contribution Account" shall mean the separate
account maintained pursuant to Section 6.3(c) hereof for the Deductible
Voluntary Contributions made by the Participant and the income, expenses, gains
and losses attributable thereto.

     2.10 "Deductible Voluntary Contributions" shall mean the contributions made
by Participants in accordance with Section 4.2 hereof, which respective
contributing Participants designate as "Deductible Voluntary Contributions" at
the time of contribution, and which comply with the requirements of Code Section
219.

     2.11 "Designated Investment Company" shall mean a regulated investment
company for which Scudder, Stevens & Clark, its successor or any of its
affiliates, acts as investment adviser and which is designated by Scudder Fund
Distributors, Inc. or its successors, as eligible for investment under the Plan.

     2.12 "Designation of Beneficiary" or "Designation" shall mean the document
executed by a Participant under Section 15.

     2.13 "Disability" shall mean the inability to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment that can be expected to last for a continuous period of 12 months or
more, as certified by a licensed physician selected by the Participant and
approved by the Employer.

     2.14 "Distributee" shall mean the Beneficiary or other person entitled to
receive the undistributed portion of the Participant's Account under Section 8
because of death or under Section 14 because of incompetency or inability to
ascertain or locate such individual.

     2.15 "Distributor" shall mean Scudder Fund Distributors, Inc. or its
successor.

     2.16 "Earned Income" shall mean the net earnings from self-employment in
the trade or business with respect to which the Plan is established, for which
personal services of the Owner-Employee or Self-Employed Individual are a
material income-producing factor. Net earnings will be determined without regard
to items not included in gross income and the deductions allocable to such
items. Net earnings are reduced by contributions by the Employer to a qualified
plan, including this Plan, to the extent deductible under Code Section 404.

     2.17 "Effective Date" shall mean the date specified by the Employer in the
Adoption Agreement.

     2.18 "Employee" shall mean an individual who performs services in the
business of the Employer in any capacity except for, (a) if specified in the
Adoption Agreement, non-resident aliens who receive no earned income from United
States sources (as described in Code Section 410(b)(3)(C)), (b) if specified in
the Adoption Agreement, individuals who are covered by a collective bargaining
contract between the Employer and a recognized bargaining agent, if contract
negotiations considered retirement benefits in good faith and unless such
contract specifically provides for participation in the Plan, and (c) such other
individuals as are excluded under the Adoption Agreement.

     2.19 "Employer" shall mean the organization or other entity named as such
in the Adoption Agreement and any successor organization or entity which adopts
the Plan. Any two or more organizations or entities which are "related
businesses" within the meaning of Section 3.6 hereof may adopt and maintain the
plan as a single Plan.

     2.20 "Employer Contribution Account" shall mean the separate account
maintained pursuant to Section 6.3(a) hereof for the Employer Contributions
allocated to a Participant and the income, expenses, gains and losses
attributable thereto.

     2.21 "Employer Contributions" shall mean the contributions made by the
Employer in accordance with Section 4.1 hereof.

     2.22 "Hour of Service" shall mean:

     (a) Each hour for which an Employee is paid, or entitled to payment, for
the performance of duties for the Employer. These hours shall be credited to the
Employee for the computation period in which the duties are performed;

     (b) Each hour for which an Employee is paid, or entitled to payment, by the
Employer on account of a period of time during which no duties are performed
(irrespective of whether the employment relationship has terminated) due to
vacation, holiday, illness, incapacity (including Disability), layoff, jury
duty, military duty or leave of absence. No more than 501 Hours of Service shall
be credited under this paragraph for any single continuous period (whether or
not such period occurs in a single computation period). Hours under this
paragraph shall be calculated and credited pursuant to section 2530.200b-2 of
the Department of Labor Regulations which are incorporated herein by this
reference; and

     (c) Each hour for which back pay, irrespective of mitigation of damages, is
either awarded or agreed to by the Employer. The same Hours of Service shall not
be credited both under paragraph (a) or paragraph (b), as the case may be, and
under this paragraph (C). These hours shall be credited to the Employee for the
computation period or periods to which the award or agreement pertains rather
than the computation period in which the award, agreement or payment is made.

     Where the Employer maintains the plan of a predecessor employer, service
for such predecessor employer shall be treated as Service of the Employer. Where
the Employer does not maintain the plan of a predecessor employer, employment by
a predecessor employer, upon the written election of the Employer made in a
uniform and non-discriminatory manner, shall be treated as Service for the
Employer.

     2.23 "Integration Level" for a Plan Year shall mean the lesser of the
Social Security Wage Base or the dollar amount specified in the Adoption
Agreement.

     2.24 "Integration Rate" for a Plan Year shall mean the lesser of the OASDI
Rate or the rate specified in the Adoption Agreement.

     2.25 "Loan Trustee" shall mean the Trustee or, if the Employer has
specified otherwise in the Adoption Agreement, the individual or individuals so
appointed to act as trustee solely for the purpose of administering the
provisions of Section 10 and holding the Trust assets to the extent that they
are invested in loans pursuant to such Section.

     2.26 "Nondeductible Voluntary Contribution Account" shall mean the separate
account maintained pursuant to the Section 6.3(b) hereof for Nondeductible
Voluntary Contributions made by the Participant and the income, expenses, gains
and losses attributable thereto.

     2.27 "Nondeductible Voluntary Contributions" shall mean all Contributions
by Participants which are not Deductible Voluntary Contributions, Rollover
Contributions, or contributions of accumulated deductible employee contributions
made pursuant to Section 4.2(b)(vi) hereof.

     2.28 "Normal Retirement Date" or "Normal Retirement Age" shall mean the
earlier of (a) the date selected by the Employer in the Adoption Agreement or,
(b) if the Employer enforces a mandatory retirement age, the first day of the
month in which the Participant reaches such age.

     2.29 "OASDI Rate" for a Plan Year shall mean the tax rate applicable, on
the first day of the Plan Year, to employer contributions for old age,
survivors, and disability insurance under the Social Security Act.

     2.30 "One-Year Break in Service" shall mean a 12-consecutive-month period
in which an Employee does not complete more than 500 Hours of Service unless the
number of Hours of Service specified in the Adoption Agreement for purposes of
determining a Year of Service is less than 501, in which case a
12-consecutive-month period in which an Employee has fewer than that number of
Hours of Service shall be a One-Year Break in Service. The computation period
over which One-Year Breaks in Service shall be measured shall be the same
computation period over which Years of Service are measured as selected in the
Adoption Agreement.

     2.31 "Owner-Employee" shall mean an Employee who is a sole proprietor
adopting this Plan as the Employer, or who is a partner owning more than 10% of
either the capital or profits interest of a partnership adopting this Plan as
the Employer.

     2.32 "Participant" shall mean an Employee who is eligible to participate in
the Plan under Section 3 and who has not, since becoming a Participant, died,
retired, otherwise terminated employment with the Employer or transferred from
an eligible class to a class of Employees ineligible to participate in the Plan.

     2.33 "Plan" shall mean the Prototype Plan and Adoption Agreement.

     2.34 "Plan Year" shall mean the fiscal year of the Employer or a different
12-consecutive-month period as specified in the Adoption Agreement.

     2.35 "Prototype Plan" shall mean these Sections 1-23.

     2.36 "Rollover Account" shall mean the separate account maintained pursuant
to Section 6.3(d) hereof for any Rollover Contributions (as described in Section


2
<PAGE>

4.3 hereof) made by the Participant and the income, expenses, gains and losses
attributable thereto.

     2.37 "Rollover Contributions" shall mean contributions made to the Trust by
Participants in accordance with Section 4.3 hereof.

     2.38 "Self-Employed Individual" shall mean an Employee who has Earned
Income for the Plan Year from the trade or business for which the Plan is
established, or an individual who would have had Earned Income but for the fact
that the trade or business had no Current or Accumulated Earnings and Profits
for the Plan Year.

     2.39 "Service" shall mean employment by the Employer and, if the Employer
is maintaining the plan of a predecessor employer, or if the Employer is not
maintaining the plan of a predecessor employer but has so elected in the manner
described in Section 2.22 above, employment by such predecessor employer.

     2.40 "Social Security Wage Base" for a Plan Year means the maximum amount
of annual earnings which may be considered wages under Code Section 3121(a)(1)
as in effect on the first day of such Plan Year.

     2.41 "Sponsor" shall mean any of the organizations (a) which have requested
a favorable opinion letter from the National Office of the Internal Revenue
Service for this Plan or (b) to which a favorable opinion letter for this Plan
has been issued by the National Office of the Internal Revenue Service.

     2.42 "Trust" shall mean the trust established under Section 11 of this Plan
for investment of Trust assets.

     2.43 "Trust Fund" shall mean the contribution to the Trust and any assets
into which such contributions shall be invested or reinvested in accordance with
Sections 11.1 and 11.3 of this Plan.

     2.44 "Trustee" shall mean the person or persons, including any successor or
successors thereto, named in the Adoption Agreement to act as trustee of the
Trust and hold the Trust assets in accordance with Section 11 hereof.

     2.45 "Valuation Date" shall mean the last day of each Plan Year.

     2.46 "Vesting Years" shall be measured on the 12-consecutive-month period
specified in the Adoption Agreement. A Participant will have a Vesting Year
during such computation period only if the Participant completes the number of
Hours of Service selected in the Adoption Agreement for purposes of computing a
Year of Service or, if so specified in the Adoption Agreement, the Participant
will have a Vesting Year for each Plan Year for which the Participant shares in
the allocation of Employer Contributions for the Plan Year. However, when
determining Vesting Years, unless the Employer has otherwise specified in the
Adoption Agreement, there shall be excluded: (a) if this Plan is a continuation
of an earlier plan which would have disregarded such service, Service before the
first Plan Year to which the Act is applicable; (b) Service after a One-Year
Break in Service (but this exclusion shall apply only for the purpose of
computing the vested percentage of Employer Contributions made before such
break); (c) Service before a One-Year Break in Service, if the Participant had
no vested interest at the time of such break and the number of consecutive
One-Year Breaks in Service equals or exceeds the number of Vesting Year before
such break without counting Vesting Years excluded by an earlier application of
this provision; (d) Service before the first Plan Year in which the Participant
attained age 22; (e) Service before the Employer maintained this Plan or a
predecessor plan; and (f) Service before January 1, 1971, unless the Participant
has completed at least 3 Vesting Years after December 31, 1970.

     2.47 "Year" shall mean the fiscal year of the Employer.

     2.48 "Year of Service" shall mean a 12-consecutive-month period, beginning
on an Employee's initial date of employment or an anniversary thereof during
which the Employee completes the number of Hours of Service specified in the
Adoption Agreement. The initial date of employment is the first day on which the
Employee performs an Hour of Service.

SECTION 3.
ELIGIBILITY

     3.1 Entry. Each Employee of the Employer, who on the Effective Date of this
Plan meets the conditions specified in the Adoption Agreement, shall become
eligible to participate in the Plan commencing with the Effective Date. Each
other Employee of the Employer, including future Employees, shall become
eligible to participate in the Plan when the eligibility requirements specified
in the Adoption Agreement are met.

     3.2 Interrupted Service. All Years of Service with the Employer are counted
towards eligibility except the following:

     (a) If the Employer has specified in the Adoption Agreement that more than
one Year of Service is required before becoming a Participant, and if the
individual has a One-Year Break in Service before satisfying the Plan's
eligibility requirements, Service before such break will not be taken into
account.

     (b) In the case of a Participant who does not have any nonforfeitable right
to the Employer Contribution Account, Years of Service before a One-Year Break
in Service will not be taken into account in computing Years of Service for
purposes of eligibility if the number of consecutive One-Year Breaks in Service
equals or exceeds the aggregate number of such Years of Service before such
break. Such aggregate number of Years of Service before such break will not
include any Years of Service disregarded under this Section by reason of a prior
break in service.

     3.3 Reentry. If a former Participant either (a) had a nonforfeitable right
to all or a portion of his or her Employer Contribution Account at the time of
termination from Service or (b) did not have any nonforfeitable right to his or
her Employer Contribution Account but does not have Service prior to the break
in Service disregarded by operation of Section 3.2(b) hereof, such former
Participant shall become a Participant immediately upon return to the employ of
the Employer as a member of an eligible class of Employees.

     3.4 Transfer to Eligible Class. In the event an Employee who is not a
member of an eligible class of Employees becomes a member of an eligible class,
such Employee shall participate immediately if such Employee has satisfied the
minimum age and Service requirements and would have previously become a
Participant had he or she been a member of an eligible class throughout the
period of employ with the Employer.

     3.5 Determination by Administrator. Eligibility shall be determined by the
Administrator and the Administrator shall notify each Employee upon his or her
admission as a Participant in the Plan.

     3.6 Related Businesses. If the Employer is a member of (a) a controlled
group of corporations (as defined under Code Section 414(b)), (b) group of
trades or businesses (whether or not incorporated) which are under common
control (as defined under Code Section 414(c)), or (c) an affiliated service
group (as defined under Code Section 414(m)), all service of an Employee for any
member of such a group shall be treated as if it were Service for the Employer
for purposes of the eligibility requirements of the Adoption Agreement and this
Section 3.

     In addition, all service for any individual who is considered a leased
employee of the Employer under Code Section 414(n) shall be treated as if it
were Service for the Employer for purposes of the eligibility requirements of
the Adoption Agreement and this Section 3. However, qualified plan contributions
or benefits provided by the leasing organization which are attributable to
Services performed for the Employer shall be treated as provided by the
Employer. The provisions of this paragraph shall not apply to any leased
employee if such employee is covered by a money purchase pension plan maintained
by the leasing organization providing: (a) a non-integrated employer
contribution rate of at least 7-1/2% of compensation, (b) immediate
participation, and (c) full and immediate vesting. For purposes of this section
3.6, the term "leased employee" means any person who pursuant to an agreement
between the recipient and any other person ("leasing organization") has
performed services for the Employer (or for the Employer and related persons
determined in accordance with Code Section 414(n)(6)) on a substantially
full-time basis for a period of at least 1 year and such services are of a type
historically performed by employees in the business field of the Employer.

SECTION 4.
CONTRIBUTIONS

     4.1 Employer Contributions and Allocation.

     (a) Profit Sharing Plan. If the Employer has adopted this Plan as a profit
sharing plan, the following provisions shall apply:

     (i) Contribution. Beginning in the Plan Year in which the Plan is adopted,
and for each Plan Year thereafter, the Employer will contribute the amount
determined by it, in its discretion, for the Plan Year in question; provided,
however, that such Employer Contributions may not exceed the lesser of (A) the
Employer's Current or Accumulated Earnings and Profits for the Plan Year or (B)
15% (or such larger percentage as may be permitted by the Code as a current
deduction to the Employer with respect to any Plan Year) of the total
Compensation (disregarding any exclusion from Compensation specified by the
Employer in the Adoption Agreement) paid to, or accrued by the Employer for,
Participants for that Plan Year plus any unused credit carryovers from previous
Plan Years. For this purpose, a "credit carryover" is the amount by which
Employer Contributions for a previous Plan Year was less than 15% of the total
Compensation (disregarding any exclusion from Compensation specified by the
Employer in the Adoption Agreement) paid or accrued by the Employer to
Participants for such Plan Year, but such unused credit carryover shall in no
event permit the Employer Contributions for a Plan Year to exceed 25% (or such
larger percentage as may be permitted by the Code as a deduction to the
Employer) of the total Compensation (disregarding any exclusion from
Compensation specified by the Employer in the Adoption Agreement) paid or
accrued by the Employer to Participants for the Plan Year in question.

     (ii) Allocation Under Non-Integrated, Profit Sharing Plan. If the Employer
has adopted this Plan as a profit sharing plan under which allocations shall be
made on a non-integrated basis, Employer Contributions, plus any forfeitures
under Section 7.3, for a Plan Year shall be allocated according to the
provisions of this subsection (ii) as of the Valuation Date for such Plan Year.
Unless the Employer has specified otherwise in the Adoption Agreement, such
amount shall be allocated among the Employer Contribution Accounts of all
Participants and former Participants who were employed by the Employer during
the Plan Year. If the Employer has specified in the Adoption Agreement that a
minimum number of Hours of Service are necessary to share in the allocation of
Employer Contributions and forfeitures for a Plan Year in which the Plan is not
Top Heavy, Participants and former Participants, as the case may be, who fail to
complete the required number of Hours of Service during such a Plan Year shall
not share in the allocation. If the Employer has so specified in the Adoption
Agreement, Employer Contributions and forfeitures shall be allocated only among
otherwise entitled Participants who are employed by the Employer on such
Valuation Date. Employer Contributions and forfeitures shall be allocated to
Participants entitled to share in the allocation of Employer Contributions and
forfeitures for that Plan Year in proportion to their Compensation for such Plan
Year.

     (iii) Allocation Under Integrated, Profit Sharing Plan. If the Employer has
adopted this Plan as a profit sharing plan under which allocations shall be made
on an integrated basis, Employer Contributions, plus any forfeitures under
Section 7.3, for a Plan Year shall be allocated according to the provisions of
this subsection (iii) as of the Valuation Date for such Plan Year. Unless the
Employer has specified otherwise in the Adoption Agreement, such amount shall be
allocated among all Participants and former Participants who were employed by
the Employer during the Plan Year. If the Employer has specified in the Adoption
Agreement that a minimum number of Hours of Service are necessary to share in
the allocation of Employer Contributions and forfeitures for a Plan Year in
which the Plan is not Top Heavy, Participants and former Participants, as the
case may be, who fail to complete the required number of Hours of Service during
such a Plan Year shall not share in the allocation. If the Employer has so
specified in the Adoption Agreement, Employer Contributions and forfeitures
shall be allocated only among otherwise entitled Participants who are employed
by the Employer on such Valuation Date. Employer Contributions and forfeitures
shall be allocated to Participants


                                                                               3

<PAGE>

entitled to share in the allocation of Employer Contributions and forfeitures
for that Plan Year as follows:

          (A) First, Employer Contributions and forfeitures will be allocated to
     the Employer Contribution Account of each Participant entitled to share in
     the allocation of such amounts in the ratio that each such Participant's
     Compensation for the Plan Year in excess of the Integration Level bears to
     the Compensation in excess of the Integration Level for all such
     Participants, provided that the amount so credited to any such
     Participant's Employer Contribution Account for the Plan Year shall not
     exceed the product of the Integration Rate times the Participant's
     Compensation in excess of the Integration Level.

          (B) Next, any remaining Employer Contributions or forfeitures will be
     allocated to the Employer Contribution Accounts of all Participants
     entitled to share in the allocation of the Employer Contributions for the
     Plan Year in the ratio that each such Participant's Compensation for the
     Plan Year bears to all such Participants' Compensation for that Plan Year.

     (b) Money Purchase Pension Plan. If the Employer has adopted this Plan as a
money purchase pension plan, the Employer will, beginning for the Plan Year in
which the Plan is adopted, and for each Plan year thereafter, contribute, for
allocation to the Employer Contribution Account of each Participant entitled to
share in the allocation of Employer Contributions, the amount specified in the
Adoption Agreement reduced by any forfeitures arising during the preceding Plan
Year pursuant to Section 7.3 hereafter.

          (i) Employer has specified otherwise in the Adoption Agreement, the
     amount of the Employer Contribution shall be calculated on the basis of the
     Compensation of all Participants and former Participants who were employed
     by the Employer during the Plan Year. If the Employer has specified in the
     Adoption Agreement that a minimum number of Hours of Service are necessary
     to receive an Employer Contribution in a Plan Year in which the Plan is not
     Top Heavy, Participants and former Participants, as the case may be, who
     fail to complete the required number of Hours of Service during such a Plan
     Year shall not be considered when calculating the amount of the Employer
     Contribution. If the Employer has so specified in the Adoption Agreement,
     only Participants who are employed by the Employer on such Valuation Date
     and who are otherwise entitled to receive an allocation shall be considered
     when calculating the amount of the Employer Contribution. Employer
     Contributions shall be allocated to the Employer Contribution Accounts of
     only those Participants who were included in the calculation of the amount
     of the Employer Contribution.

          (ii) To the extent that the Employer Contribution for a Plan Year is
     reduced by forfeitures, such forfeitures shall be added to such Employer
     Contribution and allocated as a part thereof.

          (iii) Any excess forfeitures not allocated pursuant to this Section
     4.1(b) shall be carried over to future Plan Years.

     4.2 Participant Contributions. If, in the Adoption Agreement, the Employer
has specified that Participants may make either Deductible Voluntary
Contributions or Nondeductible Voluntary Contributions, or both, a Participant
may make such permitted contributions to his or her Account; provided, however,
that a Participant's right to make such contribution(s) shall be subject to the
conditions and limitations specified below.

     (a) The following conditions and limitations shall apply if the Employer
has specified that Participants may make Nondeductible Voluntary Contributions:

          (i) The aggregate amount of a Participant's Nondeductible Voluntary
     Contributions, plus any nondeductible voluntary contributions he or she
     makes under any other qualified retirement plan maintained by the Employer,
     shall not exceed 10% of his or her Compensation (disregarding any
     exclusions from Compensation specified by the Employer in the Adoption
     Agreement) for the period in which he or she has been a Participant in the
     Plan.

          (ii) The aggregate amount of a Participant's Nondeductible Voluntary
     Contributions shall not cause the Annual Addition (as defined in Section
     5.5(a) hereof) to his or her Account to exceed the limitations set forth in
     Section 5.

          (iii) A Participant's Nondeductible Voluntary Contributions shall be
     allocated to his or her Nondeductible Voluntary Contribution Account under
     Section 6.3 hereof.

          (iv) A Participant's right to his or her Nondeductible Voluntary
     Contribution Account shall be nonforfeitable and the Participant may
     withdraw all or a portion of his or her Nondeductible Voluntary
     Contribution Account upon 30 days written notice to the Administrator.

     (b) The following conditions and limitations shall apply if the Employer
has specified that Participants may make Deductible Voluntary Contributions:

          (i) The aggregate amount of a Participant's Deductible Voluntary
     Contributions in any calendar year may not exceed the lesser of (1) $2,000
     or (2) the Participant's compensation for calendar year for which the
     contribution is made. Compensation for this purpose means all wages,
     salaries, earned income and other amounts received or derived from personal
     services actually rendered and includible in gross income, but does not
     include amounts derived from or received as earnings or profits from
     property or amounts received as a pension or annuity or as deferred
     compensation. This limitation applies to all the Participants' Deductible
     Voluntary Contributions made for the calendar year to all qualified
     retirement plans maintained by the Employer.

          (ii) A Participant may not make Deductible Voluntary Contributions for
     the calendar year in which he or she attains age 70-1/2 or any calendar
     year thereafter.

          (iii) A Deductible Voluntary Contribution will be considered
     contributed for the calendar year in which it is actually made. However, if
     a Participant makes a Deductible Voluntary Contribution on or before April
     15, he or she may notify the Administrator at the time the Deductible
     Voluntary Contribution is made that it is made for the preceding calendar
     year. A Deductible Voluntary Contribution may only be made for a calendar
     year in which the Employee was a Participant, and in no event may a
     Deductible Voluntary Contribution be made by an Employer after he or she
     has ceased to be a Participant.

          (iv) A Participant's Deductible Voluntary Contributions shall be
     allocated to his or her Deductible Voluntary Contribution Account under
     Section 6.3 hereof.

          (v) A Participant's right to his or her Deductible Voluntary
     Contribution Account shall be nonforfeitable and the Participant may
     withdraw all or a portion of his or her Deductible Voluntary Contribution
     Account upon written application to the Administrator. However, if at the
     time the Participant receives the withdrawal, he or she has not attained
     age 59-1/2 and is not disabled, the Participant will be subject to a
     federal income tax penalty unless he or she rolls over the amount withdrawn
     to a qualified retirement plan or individual retirement plan within 60 days
     of the date he or she receives it.

          (vi) The Administrator may, in its discretion, accept accumulated
     deductible employee contributions (as defined in Code Section 72(o)(5))
     that were distributed from a qualified retirement plan and rolled over
     pursuant to Code Sections 402(a)(5), 402(a)(7), 403(a)(4), or 408(d)(3).
     The rolled over amount will be added to the Participant's Deductible
     Voluntary Contribution Account, but will not be taken into account in
     applying the restrictions specified in Section 4.2(b)(i) and (ii) above. In
     no case may the Administrator authorize the Plan to accept rollovers of
     accumulated deductible employee contributions from a qualified plan under
     which the Participant was covered as a Self-Employed Individual.

     4.3 Rollover Contributions. The Administrator may, in its discretion,
direct the Trustee to accept a Rollover Contribution upon the express request of
the Participant wishing to make such Rollover Contribution, the same to be held,
administered and distributed by the Trustee in accordance with the terms of this
Plan, provided that the Trustee consents if the contribution includes property
other than cash. A Rollover Contribution shall only be a contribution, comprised
of money and/or property, which is a "rollover amount" within the meaning of
Code Section 402(a)(5) or a "rollover contribution" within the meaning of Code
Section 408(d)(3)(A)(ii) (as modified by Code Section 408(d)(3)(C)with respect
to which both of the following conditions are met:

     (a) The transfer of such amount is being made within 60 days of its receipt
by the Participant and

     (b) No part of such amount is attributable to contributions made on behalf
of the Participant while he or she was a Key Employee (as defined in Section
21.2(a) and applied to such other employer) in a Top-Heavy Plan (as defined in
Section 21.2(b) and applied to such other plan).

     All Rollover Contributions made under this Section 4.3 must be accepted by
the Trustee within the 60-day period referred to in paragraph (a) above. A
Participant's Rollover Contribution shall at no time be included in the
computation of the maximum allocation to a Participant's Account as set forth in
Section 5 hereof. Each Rollover Contribution made by a Participant shall be
allocated to his or her Rollover Account pursuant to Section 6.3(d) hereof. Such
Rollover Account shall be invested by the Trustee as part of the Trust Fund,
pursuant to Section 11 hereafter, except as it may be held in kind as permitted
above. A Participant may withdraw all or a portion of his or her Rollover
Account upon 30 days' written notice to the Administrator.

     4.4 Transfers from other Qualified Plans. The Administrator may, in its
discretion, direct the Trustee to accept the transfer of any assets held for a
Participant's benefit under a qualified retirement plan of a former employer of
such Participant. Such a transfer shall be made directly between the trustee or
custodian of the former employer's plan and the Trustee in the form of cash or
its equivalent, and shall be accompanied by written instruction showing
separately the portion of the transfer attributable to contributions by the
former employer and by the Participant respectively. To the extent that the
amount transferred is attributable to contributions by the former employer, it
shall be maintained in a Participant's Rollover Account. To the extent that the
amount transferred is attributable to contributions by the Participant, it shall
be maintained in the Participant's Nondeductible Voluntary Contribution Account
or Deductible Voluntary Contribution Account as is appropriate.

SECTION 5.
CODE SECTION 415 LIMITATIONS ON ALLOCATIONS

     5.1 Employers Maintaining No Other Plan.

     (a) If a Participant does not participate in, and has never participated in
another qualified plan maintained by the Employer, the amount of the Annual
Addition which may be credited to the Participant's Account for any Limitation
Year shall not exceed the lesser of the Maximum Permissible Amount or any other
limitation contained in the Plan.

     (b) If the Employer Contribution that would otherwise be allocated to a
Participant's Account would cause the Annual Addition for the Limitation Year to
exceed the Maximum Permissible Amount, the amount allocated will be reduced so
that any Excess Amount shall be eliminated and, consequently, the Annual
Addition for the Limitation Year will equal the Maximum Permissible Amount.

     (c) Any Excess Amount shall be eliminated pursuant to the following
procedure:

          (i) The portion of the Excess Amount consisting of Nondeductible
     Voluntary Contributions which are a part of the Annual Addition (as defined
     in Section 5.5(a)) shall be returned to the Participant as soon as
     administratively feasible;

          (ii) If after the application of subparagraph (i) an Excess Amount
     still exists and the Participant is covered by the Plan at the end of the
     Limitation Year, the Excess Amount in the Participant's Account will be
     used to reduce Employer Contributions (including any allocation of
     forfeitures) for such Participant in the next Limitation Year, and each
     succeeding Limitation Year if necessary;

          (iii) If after the application of subparagraph (i) an Excess Amount
     still exists and the Participant is not covered by the Plan at the end of
     the Limitation Year, the Excess Amount will be held unallocated in a
     suspense account. The


4

<PAGE>

     suspense account will be applied to reduce proportionately future
     Employer Contributions (including any allocation of forfeitures) for all
     remaining Participants in the next Limitation Year, and each succeeding
     Limitation Year, if necessary. If a suspense account is in existence at any
     time during the Limitation Year pursuant to this subparagraph, it will not
     participate in the allocation of the Trust's investment gains and losses.
     In the event of termination of the Plan, the suspense account shall revert
     to the Employer to the extent it may not then be allocated to any
     Participant's Account.

          (d) Notwithstanding any other provision in subsections (a) through
     (c), the Employer shall not contribute any amount that would cause an
     allocation to the suspense account as of the date the contribution is
     allocated.

     5.2 Employers Maintaining Other Master or Prototype Defined Contribution
Plans.

     (a) This Section applies if, in addition to this Plan, a Participant is
covered under another qualified Master or Prototype defined contribution plan
maintained by the Employer during any Limitation Year. The Annual Addition which
may be allocated to any Participant's Account for any such Limitation Year shall
not exceed the Maximum Permissible Amount, reduced by the sum of any portion of
the Annual Addition credited to the Participant's account under such other plans
for the same Limitation Year.

     (b) If the Annual Addition with respect to a Participant under other
defined contribution plans maintained by the Employer of what would be portions
of the Annual Addition (if the allocations were made under the Plan) are less
than the Maximum Permissible Amount and the Employer Contribution that would
otherwise be contributed or allocated to the Participant's Account under this
Plan would cause the Annual Addition for the Limitation Year to exceed this
limitation, the amount contributed or allocated will be reduced so that the
Annual Addition under all such plans for the Limitation Year will equal the
Maximum Permissible Amount.

     (c) If the Annual Addition with respect to the Participant under such other
defined contribution plans in the aggregate are equal to or greater than the
Maximum Permissible Amount, no amount will be contributed or allocated to the
Participant's Account under this Plan for the Limitation Year.

     (d) If an Excess Amount was allocated to a Participant under this Plan on a
date which coincides with the date an allocation was made under another plan,
the Excess Amount attributed to this Plan will be the product of,

          (i)  the total Excess Amount allocated as of such date, multiplied by

          (ii) the quotient obtained by dividing

               (A) the portion of the Annual Addition allocated to the
          Participant for the Limitation Year as of such date by

               (B) the total would-be and actual Annual Addition allocations to
          the Participant for the Limitation Year as of such date under this and
          all the other qualified Master or Prototype defined contribution plans
          maintained by the Employer.

     (e) Any Excess Amount attributed to the Plan will be disposed in the manner
described in Section 5.1.

     5.3 Employers Maintaining Other Defined Contribution Plans. If a
Participant is covered under another qualified defined contribution plan which
is not a Master or Prototype plan, the Annual Addition credited to the
Participant's Account under this Plan for any Limitation Year will be in
accordance with the provisions of Section 5.2 as though the plan were a Master
or Prototype Plan, unless the Employer provides other limitations pursuant to
the Adoption Agreement.

     5.4 Employers Maintaining Defined Benefit Plans. If the Employer maintains,
or at any time maintained, a qualified defined benefit plan covering any
Participant in this Plan, the sum of the Participant's Defined Benefit Plan
Fraction and Defined Contribution Plan Fraction will not exceed 1.0 in any
Limitation Year. The Annual Addition which may be credited to the Participant's
Account under this Plan for any Limitation Year will be limited in accordance
with the provisions of Section 5.2, unless the Employer provides other
limitations pursuant to the Adoption Agreement.

     5.5 Definitions. For the purposes of this Section 5, the following terms
shall be defined as follows:

     (a) Annual Addition. With respect to any Participant, the "Annual Addition"
shall be the sum of the following amounts credited to a Participant's Account
for the Limitation Year:

          (i) Employer Contributions;

          (ii) forfeitures; and

          (iii) the lesser of

               (A) one-half (1/2) the allocated Nondeductible Voluntary
          Contributions or

               (B) the amount of allocated Nondeductible Voluntary Contributions
          in excess of 6% of the Participant's Compensation for the Limitation
          Year.

Any Excess Amount applied under subparagraphs (ii) or (iii) of subsection (c) of
Section 5.1 or subsection (e) of Section 5.2 in a Limitation Year to reduce
Employer Contributions will be considered part of the Annual Addition for such
Limitation Year.

     (b) Compensation. For the purposes of this Section 5, a Participant's
"Compensation" shall include any earned income, wages, salaries, and fees for
professional services and other amounts received for personal services actually
rendered in the course of employment with the Employer maintaining the Plan
(including, but not limited to commissions paid salesmen, compensation for
services on the basis of a percentage of profits, commissions on insurance
premiums, tips and bonuses), and excluding the following:

          (i) Employer contributions to a plan of deferred compensation which
     are not includible in the Participant's gross income for the taxable year
     in which contributed, or Employer contributions under a simplified employee
     pension plan to the extent such contributions are deductible by the
     Participant, or any distributions from a plan of deferred compensation;

          (ii) Amounts realized from the exercise of a nonqualified stock
     option, or when restricted property held by the Participant either becomes
     freely transferable or is no longer subject to a substantial risk of
     forfeiture;

          (iii) Amounts realized from the sale, exchange or other disposition of
     stock acquired under a qualified stock option; and

          (iv) other amounts which received special tax benefits, or
     contributions made by the Employer (whether or not under a salary reduction
     agreement) towards the purchase of an annuity described in Code Section
     403(b) (whether or not the amounts are actually excludable from the gross
     income of the Participant).

     For purposes of applying the limitations of this Section 5, Compensation
for a Limitation Year is the Compensation actually paid or includible in gross
income during such year.

     Notwithstanding the preceding sentence, Compensation for a Participant who
is permanently and totally disabled (as defined in Code Section 37(e)(3)) is the
Compensation such Participant would have received for the Limitation Year if the
Participant was paid at the rate of Compensation paid immediately before
becoming permanently and totally disabled; such imputed compensation for the
disabled Participant may be taken into account only if the Participant is not an
officer, an owner, or highly compensated, and contributions made on behalf of
such a Participant are nonforfeitable when made.

     (c) Defined Benefit Fraction. The "Defined Benefit Fraction" shall be a
fraction, the numerator of which is the sum of the Participant's Projected
Annual Benefits under all the defined benefit plans (whether or not terminated)
maintained by the Employer, and the denominator of which is the lesser of 125%
of the dollar limitation in effect for the Limitation Year under Code Section
415(b)(1)(A) or 140% of the Participant's Highest Average Compensation.

     Notwithstanding the above, if the Participant was a participant in one or
more defined benefit plans maintained by the Employer which were in existence on
July 1, 1982, the denominator of this fraction will not be less than 125% of the
sum of the annual benefits under such plans which the Participant had accrued as
of the later of the end of the last Limitation Year beginning before January 1,
1983. The preceding sentence applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements of Code Section 415
as in effect at the end of the 1982 Limitation Year. For purposes of this
paragraph, a Master or Prototype plan with an opinion letter issued before
January 1, 1983, which was adopted by the Employer on or before June 30, 1983,
is treated as a plan in existence on July 1, 1982.

     (d) Defined Contribution Fraction. The "Defined Contribution Fraction"
shall be a fraction, the numerator of which is the sum of the Annual Additions
to the Participant's account under all the defined contribution plans (whether
or not terminated) maintained by the Employer for the current and all prior
Limitation Years (including the Annual Additions attributable to the
Participant's nondeductible employee contributions to all defined benefit plans,
whether or not terminated, maintained by the Employer), and the denominator of
which is the sum of the Maximum Aggregate Amounts for the current and all prior
Limitation Years of service with the Employer (regardless of whether a defined
contribution plan was maintained by the Employer). The Maximum Aggregate Amount
in any Limitation Year is the lesser of 125% of the dollar limitation in effect
under Code Section 415(C)(1)(A) or 35% of the Participant's Compensation for
such year.

     If the Participant was a participant in one or more defined contribution
plans maintained by the Employer which were in existence on July 1, 1982, the
numerator of this fraction will be adjusted if the sum of this Defined
Contribution Fraction and the Defined Benefit Fraction would otherwise exceed
1.0 under the terms of this Plan. Under the adjustment, an amount equal to the
product of

          (i) the excess of the sum of the fractions over 1.0, multiplied by

          (ii) the denominator of this Defined Contribution Fraction, will be
     permanently subtracted from the numerator of this fraction. The adjustment
     is calculated using the fractions as they would be computed as of the later
     of the end of the last Limitation Year beginning before January 1, 1983 or
     September 30, 1983. This adjustment also will be made if at the end of the
     last Limitation Year beginning before January 1, 1984, the sum of the
     fractions exceeds 1.0 because of accruals or additions that were made
     before the limitations of this Section 5 became effective to any plans of
     the Employer in existence on July 1, 1982. For purposes of this paragraph,
     a Master or Prototype plan with an opinion letter issued before January 1,
     1983, which is adopted by the Employer on or before September 30, 1983, is
     treated as a plan in existence on July 1, 1982.

     (e) Employer. "Employer" means the Employer that adopts this Plan and all
members of (i) a controlled group of corporations (as defined in Code Section
414(b) as modified by Code Section 415(h)), (ii) commonly controlled trades or
businesses (whether or not incorporated) (as defined in Code Section 414(c) as
modified by Code Section 415(h)), or (iii) affiliated service groups (as defined
in Code Section 414(m)) of which the Employer is a part.

     (f) Excess Amount. The "Excess Amount" is the excess of what would
otherwise be a Participant's Annual Addition for the Limitation Year over the
Maximum Permissible Amount. If at the end of a Limitation Year when the Maximum
Permissible Amount is determined on the basis of the Participant's actual
Compensation for the year, an Excess Amount results, the Excess Amount will be
deemed to consist of the portion of the Annual Addition last allocated.

     (g) Highest Average Compensation. A Participant's "Highest Average
Compensation" is his or her average Compensation for the 3 consecutive Years of
Service with the Employer that produces the highest average. A Year of Service
with the Employer is the 12-consecutive-month period defined in the Adoption
Agreement.

     (h) Limitation Year. A Limitation Year is the Plan Year or any other
12-consecutive-month period specified by the Employer in the Adoption Agreement.
All qualified plans maintained by the Employer must use the same Limitation
Year. If the Limitation Year is amended to a different 12-consecutive-month
period, the new Limitation Year must begin on a date within the Limitation Year
in which the amendment is made.

     (i) Master or Prototype Plan. A "Master or Prototype" plan is a plan the
form of which is the subject of a favorable opinion letter from the Internal
Revenue Service.


                                                                               5

<PAGE>

     (j) Maximum Permissible Amount. For a Limitation Year, the "Maximum
Permissible Amount" with respect to any Participant shall be the lesser of

          (i) $30,000 (or beginning January 1, 1986, such larger amount
     determined by the Commissioner of Internal Revenue for the Limitation Year)
     or

          (ii) 25% of the Participant's Compensation for the Limitation Year.

     If a short Limitation Year is created because of an amendment changing the
     Limitation Year to a different 12-consecutive-month period, the Maximum
     Permissible Amount will not exceed the quotient determined by first
     multiplying $30,000 by the number of months in the short Limitation Year
     and then dividing the product by 12. Prior to determining the Participant's
     actual Compensation for the Limitation Year, the Employer may determine the
     Maximum Permissible Amount for a Participant on the basis of a reasonable
     estimation of the Participant's Compensation for the Limitation Year,
     uniformly determined for all Participants similarly situated. As soon as is
     administratively feasible after the end of each Limitation Year, the
     Maximum Permissible Amount for the Limitation Year will be determined on
     the basis of Participants' actual Compensation for the Limitation Year.

     (k) Projected Annual Benefit. The "Projected Annual Benefit" is the annual
retirement benefit (adjusted to an actuarilly equivalent straight life annuity
if such benefit is expressed in a form other than a straight life annuity or
qualified joint and survivor annuity) to which the Participant would be entitled
under the terms of the plan assuming:

          (i) the Participant will continue employment until normal retirement
     date under the plan (or current age, if later), and

          (ii) the Participant's compensation for the current Limitation Year
     and all other relevant factors used to determine benefits under the plan
     will remain constant for all future Limitation Years.

SECTION 6.
TIME AND MANNER OF MAKING CONTRIBUTIONS

     6.1 Manner. Unless otherwise agreed to by the Trustee, contributions to
said Trustee shall be made only in cash. All contributions may be made in one or
more installments.

     6.2 Time. Employer Contributions and Participant Contributions with respect
to a Plan Year shall be made before the time limit, including extensions
thereof, for filing the Employer's federal income tax returns for the Year with
or within which the particular Plan Year ends (or such later time as permitted
by regulations authorized by the Secretary of the Treasury or delegate).
Rollover Contributions may be made at any time acceptable to the Administrator
in accordance with Section 4.3 hereof. All contributions shall be paid to the
Administrator for transfer to the Trustee, as soon as possible, or, if
acceptable to the Administrator and the Trustee, such contributions may be paid
directly to the Trustee. The Administrator shall transfer such contributions to
the Trustee as soon as possible. The Administrator may establish a payroll
deduction system or other procedure to assist the making of Participant
Contributions to the Trust, and the Administrator may from time to time adopt
rules or policies governing the manner in which such contributions may be made
so that the Plan may be conveniently administered.

     6.3 Separate Accounts. For each Participant, a separate account shall be
maintained for each of the following types of contributions and the income,
expenses, gains and losses attributable thereto:

     (a) Employer Contributions;

     (b) Nondeductible Voluntary Contributions, if selected in the Adoption
Agreement;

     (c) Deductible Voluntary Contributions, if selected in the Adoption
Agreement; and

     (d) Rollover Contributions, if the Administrator accepts such contributions
pursuant to Section 4.3 hereof.

Notwithstanding the above, if a Participant's rights to Employer Contributions
are immediately and fully nonforfeitable, Employer Contributions allocated on
behalf of such Participant and his or her Nondeductible Voluntary Contributions
may be maintained in a single account.

SECTION 7.
VESTING

     7.1 When Vested. A Participant's interest in his or her Nondeductible
Voluntary Contribution Account, Deductible Voluntary Contribution Account and
Rollover Account shall always be fully vested and nonforfeitable. A
Participant's interest in his or her Employer Contribution Account shall be
vested and nonforfeitable at Normal Retirement Date, death, Disability, upon
termination (including a complete discontinuance of Employer Contributions) or
partial termination of the Plan and otherwise only to the extent specified in
the Adoption Agreement.

     7.2 Amendment of Vesting Schedule. If the Adoption Agreement has been
executed as an amendment to an existing plan, Participants with 5 or more
Vesting Years before the expiration of the election period described in the next
sentence shall have the right to elect the vesting schedule in effect on the day
before the election period. The election period shall commence on the date the
amendment is adopted and end on the latest of (a) 60 days after the amendment is
adopted, (b) 60 days after the Effective Date, or (c) 60 days after the
Participant is issued written notice of the amendment by the Administrator.
Failure to so elect shall be treated as a rejection and such election or
rejection shall be final.

     7.3 Forfeitures. If a Participant's employment with the Employer is
terminated before his or her Employer Contribution Account is fully vested in
accordance with Section 7.1 hereof, the portion of the Employer Contribution
Account which is not vested shall be held in suspense until the Participant
becomes reemployed, dies, becomes disabled or completes a One-Year Break in
Service, whichever occurs first. If the Participant is reemployed, dies or
becomes disabled before a One-Year Break in Service, the amount held in suspense
shall be restored to the Employer Contribution Account. If the Participant is
reemployed by the Employer before a One-Year Break in Service and thereafter has
a One-Year Break in Service before the Employer Contribution Account has become
fully vested, the portion of the Employer Contribution Account which is then
vested shall be determined by adding to the then value of the Employer
Contribution Account, the amount, if any, previously distributed, applying the
vesting percentage then applicable, and then subtracting the amount previously
distributed. If a One-Year Break in Service occurs before reemployment with the
Employer, death or Disability, the portion of the Participant's Employer
Contribution Account held in suspense shall be forfeited and (a) if this Plan is
adopted as a profit sharing plan, allocated as of the next Valuation Date in the
same manner, and to the same Participants' Employer Contribution Accounts as the
Employer Contribution for that Plan Year is allocated pursuant to Section 4.1
hereof, or (b) if this Plan is adopted as a money purchase pension plan, applied
to reduce the Employer Contributions for the next Plan Year.

SECTION 8.
DISTRIBUTION UPON DEATH

     8.1 Distribution to Beneficiary. If a Participant's employment terminates
because of death, the Trustee shall, upon the direction of the Administrator,
distribute the Participant's Account or the undistributed remainder thereof, as
the case may be, in accordance with the provisions of Section 8.2, to the
Beneficiary or Beneficiaries validly named in the most recent Designation of
Beneficiary form filed by the Participant with the Trustee before death in
compliance with Section 15. The Administrator's direction shall include
notification of the Participant's death, the identity of the Beneficiary or
Beneficiaries so named, and the appropriate manner of distribution.

     8.2 Manner of Distribution. A distribution made under this Section 8 shall
be made in such manner as the Participant shall in his or her most recent
Designation of Beneficiary have validly elected. In the absence of such an
election, such distribution shall be made in such manner as the Participant's
Beneficiary (or Beneficiaries) may elect, or in the absence of such an election,
in such manner as the Administrator shall determine. If a Participant dies
before benefits commence and the surviving spouse is not the Beneficiary, the
Participant's entire Account balance must be distributed to the Participant's
Beneficiary within 5 years. However, if distributions have commenced to the
Participant before the Participant's death, distributions to the Participant's
surviving spouse, Beneficiary or estate may continue over the period selected by
the Participant.

SECTION 9.
OTHER DISTRIBUTIONS

     9.1 Normal Distributions. The Account of any Participant, to the extent it
is vested pursuant to Section 7.1 hereof, will normally be distributed in
monthly installments which must commence at or within 60 days after the end of
the Plan Year in which occurs his or her Normal Retirement Date or in which his
or her Employment ceases, whichever is later, to continue over a period of 120
months; provided, however, that in the case of a Participant who is a Key
Employee (as defined in Section 21.2 hereafter), monthly installments to such a
Participant must commence no later than the last day of the Participant's
taxable year in which such Participant attains age 70-1/2, but only if this Plan
is Top-Heavy (as defined in Section 21.2 hereafter). The monthly amount shall
normally be the vested balance of the Participant's Account divided by the
remaining number of months in such 120 months, all rounded to the nearest cent.
However, the amount of each monthly installment may be recomputed and adjusted
from time to time no more frequently than monthly as the Trustee may reasonably
determine.

     9.2 Optional Distribution. All Participants may request the Administrator
to approve, in its sole discretion, any of the following variations from the
normal pattern of distribution:

     (a) Distribution made or commencing before the Participant's Normal
Retirement Date.

     (b) Distributions made or commencing after the normal time of distribution
described in Section 9.1; provided, however, that any such deferred distribution
must commence no later than the last day of the Participant's taxable year in
which the Participant attains age 70-1/2.

     (c) Distribution of the Participant's entire Account at one time.

     (d) Installment payments of a fixed amount, such payments to be made until
exhaustion of the Participant's Account.

     (e) Distribution in kind.

     (f) Any reasonable combination of the foregoing or any reasonable time or
manner of distribution within the above stated limitations.

Notwithstanding the above, if this Plan is adopted as an integrated, profit
sharing plan, such distribution may not commence before termination of Service.
Furthermore, the minimum distribution to be made each calendar year shall be the
amount equal to the quotient obtained by dividing the Participant's Account
balance at the beginning of the year by the greater of the life expectancy of
the Participant or the joint life and last survivor expectancy of the
Participant and spouse. For purposes of this minimum distribution rule, life
expectancy and joint life and last survivor expectancy shall be determined as of
the date the Participant attained age 70, reduced by one for each calendar year
commencing after the Participant's attainment of age 70-1/2, reduced by one for
each calendar year commencing after the Participant's attainment of age 70-1/2.
In the case of a Participant who becomes a Key Employee (as defined in Section
21.2 hereafter) after age 70-1/2 but before termination of Employment, and if
this Plan is Top-Heavy (as defined in Section 21.2 hereafter), such Participant
must begin to receive distribution of his or her Account by the end of the
calendar year in which Participant becomes such a Key Employee.

     9.3 Special One-Time Distribution Election. Notwithstanding any Plan
provision to the contrary, distribution on behalf of any Employee, including a
Key Employee (as defined in Section 21.2(a) below) in a Plan Year in which this
Plan is Top-Heavy, may be made in accordance with the following requirements
(regardless of when such distribution commences):

     (a) The distribution is one which would not have disqualified the Plan
under Code Section 401(a)(9) as it was in effect prior to its amendment by the
Tax Equity


6

<PAGE>

and Fiscal Responsibility Act of 1982.

     (b) The distribution is in accordance with a method of distribution
designated by the Participant whose interest in the Plan is being distributed
or, if the Participant has died, by a beneficiary of such Participant.

     (c) Such designation was in writing, was signed by the Participant or the
beneficiary, and was made before January 1, 1984.

     (d) The Participant had accrued a benefit under the Plan as of December 31,
1983.

     (e) The method of distribution designated by the Participant or the
beneficiary specifies the time at which distribution will commence, the period
over which distributions will be made, and in the case of any distribution upon
the Participant's death, the Beneficiaries of the Participant are listed in
order of priority.

A distribution upon death will not be covered by this Section 9.3 unless the
information in the designation contains the required information described above
with respect to the distributions to be made upon the death of the Participant.

     For any distribution which commences before January 1, 1984, but continues
after December 31, 1983, the Participant, or the Beneficiary, to whom such
distribution is being made, will be presumed to have designated the method of
distribution under which the distribution is being made if the method of
distribution was specified in writing and the distribution satisfies the
requirement in subsection (a) above.

     If a designation is revoked, any subsequent distribution must satisfy the
requirements of Code Section 401(a)(9) as amended by the Tax Equity and Fiscal
Responsibility Act of 1982. Any changes in the designation will be considered to
be a revocation of the designation. However, the mere substitution or addition
of another Beneficiary (one not named in the designation) under the designation
will not be considered to be a revocation of the designation, so long as such
substitution or addition does not alter the period over which distributions are
to be made under the designation, directly or indirectly (for example, by
altering the relevant measuring life).

SECTION 10.
LOANS

     10.1 Availability of Loans. If, in the Adoption Agreement, the Employer has
specified that loans to Participants are permitted, the Loan Trustee shall, upon
the direction of the Administrator, make one or more loans, including any
renewal thereof, to a Participant (other than a Participant who is an
Owner-Employee). Any such loan shall be subject to such terms and conditions as
the Administrator shall determine pursuant to a uniform policy adopted by the
Administrator for this purpose, which policy shall be at least as restrictive as
required by this Section 10.

     10.2 Equivalent Basis. No such loan may be made to a disqualified person
within the meaning of Code Section 4975(3), unless such loans are available to
all Participants on a reasonably equivalent basis and are not made available to
officers, shareholders or highly paid Participants in an amount which, when
stated as a percentage of such Participant's Account, if greater than is
available to other Participants.

     10.3 Limitation on Amount. The amount of any such loan, when added to the
outstanding balance of all other loans from the Plan (and any other qualified
retirement plans of the Employer's) to the Participant, shall not exceed the
following:

Participant's Vested                             Maximum Amount
   Account Balance                                   of Loan
- -------------------                         -------------------------
$0-$10,000                                  100% of vested Account balance
$10,000-$20,000                             $10,000
$20,000-$100,000                            50% of vested Account balance
over $100,000                               $50,000

The value of the Participant's Account balance shall be as determined by the
Administrator; provided, however, that such determination in no event take into
account the portion of the Participant's Account attributable to the
Participant's Deductible Voluntary Contribution Account.

     10.4 Maximum Term. The term of any such loan shall not exceed 5 years;
provided, however, that such limitation shall not apply to any loan used to
acquire, construct, reconstruct, or substantially rehabilitate any dwelling unit
which within a reasonable time is to be used (determined at the time the loan is
made) as a principal residence of the Participant or a member of the
Participant's family (within the meaning of Code Section 267(c)(4)).

     10.5 Promissory Note. Any such loan shall be evidenced by a promissory note
executed by the Participant and payable to the Loan Trustee, on the earliest of
(i) a fixed maturity date meeting the requirements of Section 10.4 above, but in
no event later than the Participant's Normal Retirement Date, (ii) the
Participant's death, or (iii) when distribution hereunder is to be made to the
Participant (other than a withdrawal which will not reduce the value of his or
her Account to the extent that the aggregate amount owing could not be made as a
new loan within the limitation set forth in Section 10.3 above). Such promissory
note shall be secured by an assignment of the Participant's Account to the Loan
Trustee. Such promissory note shall evidence such terms as are required by this
Section 10.

     10.6 Interest. Any such loan shall be subject to a reasonable rate of
interest.

     10.7 Repayment. If a note is not paid when the Participant's benefits
hereunder are to be distributed, then any unpaid portion of such loan and unpaid
interest thereon shall be deducted by the Loan Trustee from the Participant's
Account before benefits are paid from or purchased out of the Account. Such
deduction shall, to the extent thereof, cancel the indebtedness of the
Participant. If a note is not paid when it otherwise becomes payable under
Section 10.5, or if at any time the Administrator determines that the aggregate
amounts owing by a Participant upon such notes exceed the vested value of the
Participant's Account, the Participant shall be promptly notified in writing
that unless such loan or excess is repaid within 30 days, action will be taken
to collect the same plus any cost of collections.

     10.8 Accounting. Loans shall be made only from the Account of the
Participant (exclusive of that portion of the Account attributable to the
Participant's Deductible Voluntary Contribution Account) requesting the loan,
and shall be treated as an investment of such Account. All interest payments
made with respect to such loan shall be credited to the Participant's Account.

     10.9 Precedence. This Section 10 overrides Section 16 below.

SECTION 11.
TRUST PROVISIONS

     11.1 Manner of Investment. All contributions to the Account of a
Participant shall be held in trust by the Trustee designated in the Adoption
Agreement. Except to the extent that a Participant's Account is invested in a
loan pursuant to Section 10 hereof, the Account of a Participant may only be
invested and reinvested in shares of Designated Investment Companies, unless the
Distributor permits less than 100% of the Trust assets to be so invested. If the
Administrator or the Participant, as the case may be, has elected to have a
portion of an Account invested in other than shares of Designated Investment
Companies and the Distributor has authorized the investment of less than 100% of
Trust assets in such shares, the Trustee shall invest such amount in such
investments as it is empowered to invest in under Section 11.3 hereof. The
Designated Investment Companies available for investment may be limited by the
Employer. Investment in the shares of more than one Designated Investment
Company is not permitted unless the value of the Participant's Account and the
value of the investment in each additional Designated Investment Company exceed
amounts from time to time determined by the Distributor.

     11.2 Investment Decision.

     (a) The decision as to the investment of an Account shall be made by the
person designated in the Adoption Agreement, and the Trustee shall have no
responsibility for determining how an Account is to be invested or to see that
investment directions communicated to it comply with the terms of the Plan. If
the decision is made by the Participant, the Participant shall convey investment
instructions to the Trustee. Further, if the decision is to be made by the
Participant, the right to make such a decision shall remain with the Participant
upon retirement and shall pass to the Distributee upon death.

     (b) The person designated to make the decision as to the investment of an
Account may direct that the investment medium of an Account be changed, provided
that no such change may be made from or to an investment other than a Designated
Investment Company except to the extent permitted under Section 11.1 above and
by the terms of that other investment vehicle. If the Distributor determines in
its own judgment that there has been trading of shares of Designated Investment
Companies in the Accounts of the Participants, any Designated Investment Company
may refuse to sell its shares to such Accounts. When an investment is being made
or changed, the person designated to do so shall specify the type of Account to
which the change refers.

     (c) If any decision as to investments is to be made by the Administrator,
it shall be made on a uniform basis with respect to all Participants.

     (d) The Administrator and the Trustee may adopt procedures permitting
Participants to convey their investment instructions directly to the Trustee or
to the transfer agent for the Designated Investment Company or Companies or for
any other investment permitted by the Distributor.

     (e) Whenever a Participant is the person designated to make the decision as
to the investment of an Account, the Administrator shall ascertain that the
Participant has received a copy of the current prospectus relating to the shares
of any Designated Investment Company in which such Account is to be invested
plus, where required by any state or federal law, the current prospectus
relating to any other investment in which the Account is to be invested. With
respect to contributions designated for investment by a Participant, by
remitting such a contribution to the Trustee, the Administrator shall be deemed
to warrant to the Trustee that the Participant has received all such
prospectuses. By remitting any other contribution to the Trustee, the
Administrator shall be deemed to warrant to the Trustee that the Administrator
has received a current prospectus of any Designated Investment Company in which
the contribution is to be invested, plus, where required by any state or federal
law, the current prospectus relating to any other investment in which
contributions are to be invested.

     11.3 Investment Powers. To the extent that a portion of the Trust assets
are invested other than in shares of Designated Investment Companies pursuant to
Section 11.1 above, the Trustee is hereby granted full power and authority to
invest and reinvest the Trust assets in any property of any kind or nature
whatsoever (speculative or otherwise) or in any rights or interests therein, or
in any evidences or indicia thereof and whether real, personal or mixed, or
whether tangible or intangible (including for illustration but not to be limited
to the following, or anything of a similar kind, character or class: common or
preferred stocks, evidences or ownership in so-called Massachusetts business
trusts, fees, beneficial interests, leaseholds, bonds, mortgages, leases, notes
or obligations, oil and gas payments, oil and gas contracts and other
securities, instruments or commodities) without regard to any rule of law or
statute of the state of the Trustee designating investments eligible for trust
funds, and without respect to any custom or practice either as to types of
investments or diversification of investments, and to hold cash uninvested at
any time and from time to time in such amounts and to such extent as the Trustee
in its own uncontrolled discretion and judgment deems advisable; provided,
however, that the Trustee is to act with the care, skill and diligence, under
the circumstances then prevailing, which would characterize the actions of a
prudent man who is acting as such a Trustee and who is familiar with the duties
of such a Trustee; further provided that the Trustee shall diversify the
investments of the Trust Fund so as to minimize the risk of large losses unless,
under the circumstances, such diversification would not be prudent; further
provided that the Trustee is not empowered to enter into any investment which
would be prohibited under the Act or otherwise by the provisions of this Plan.


                                                                               7

<PAGE>

Notwithstanding the above, the following restrictions on he investment of a
Participant's Accounts shall apply:

     (a) No part of a Participant's Deductible Voluntary Contribution Account
may be used to purchase life insurance.

     (b) No more than one-half of the aggregate Employer Contributions allocated
to a Participant's Employer Contributions Account may be used to pay premiums
attributable to the purchase of ordinary life insurance contracts (life
insurance contracts with both nondecreasing death benefits and nonincreasing
premiums).

     (c) No more than one-quarter of aggregate Employer Contributions allocated
to a Participant's Employer Contribution Account may be used to pay premiums on
term life insurance contracts, universal life insurance contracts, and all other
life insurance contracts which are not ordinary life insurance contracts.

     (d) One-half of the amount used to pay premiums on ordinary life insurance
contracts plus the amount used to pay premiums on all other life insurance
contracts may not exceed an amount equal to one-quarter of the aggregate
Employer Contributions allocated to a Participant's Employer Contribution
Account.

     11.4 Appointment of Investment Manager. To the extent that a portion of the
Trust assets is invested other than in shares of Designated Investment Companies
pursuant to Sections 11.1 and 11.3 above, the Employer may designate Scudder,
Stevens & Clark, or its successor or any affiliate, to act as investment manager
(within the meaning of the Act), and may at any time revoke such designation. If
an investment manager is so designated, the Trustee shall follow all investment
directions given by the investment manager with respect to the retention,
investment and reinvestment of the Plan assets to the extent they are under the
control of such investment manager. If permitted by the Trustee, the investment
manager may issue orders for the purchase and sale of securities, including
orders through any affiliate of such investment manager. Such an investment
manager is specifically allowed to direct or make investments in shares of any
Designated Investment Company. The Trustee shall not be liable for following any
direction given by, or any actions of, an investment manager so appointed.

     11.5 Trustee: Number, Qualifications and Majority Action.

     (a) The number of Trustees shall be one, two or three. Any natural person
and any corporation having power under applicable law to act as a trustee of a
pension or profitsharing plan may be a Trustee. No person shall be disqualified
from being a Trustee by being employed by the Employer, by being the
Administrator, by being a trustee under any other qualified retirement plan of
the Employer or by being a Participant in this Plan or such other qualified
plan.

     (b) A Trustee holding office as sole Trustee hereunder shall have all the
powers and duties herein given the Trustees. When the number of Trustees
hereunder is three, any two of them may act, but the third Trustee shall be
promptly informed of the action. When there are two or three Trustees hereunder,
they may, by written instrument communicated to the Employer and the
Administrator, allocate among themselves the powers and duties herein given to
the Trustee hereunder. If such an allocation is made, to the extent permitted by
applicable law, no Trustee shall be liable either individually or as a trustee
for loss to the Plan from the acts or omissions of another Trustee with respect
to duties allocated to such other Trustee.

     11.6 Change of Trustee.

     (a) Any Trustee may resign as Trustee upon notice in writing to the
Employer, and the Employer may remove any Trustee upon notice in writing to each
Trustee. The removal of a Trustee shall be effective immediately, except that a
corporation serving as a Trustee shall be entitled to 60 days' notice which it
may waive, and the resignation of a Trustee shall be effective immediately,
provided that, if the Trustee is the sole Trustee, neither a removal nor a
resignation of the Trustee shall be effective until a successor Trustee has been
appointed and has accepted the appointment. If within 60 days of the delivery of
the written resignation or removal of a sole Trustee another Trustee shall not
have been appointed and have accepted, the resigning or removed Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee or may terminate the Plan pursuant to Section 18 of the Prototype Plan.
The Trustee shall not be liable for the acts and omissions of any successor
trustee.

     (b) At any time when the number of Trustees is one or two the Employer may
but need not appoint one or two additional Trustees, provided that the number of
Trustees shall not be more than three. Such an appointment and the acceptance
thereof shall be in writing, and shall take effect upon the delivery of written
notice thereof to all the Trustees and the Administrator and such acceptance by
the appointed Trustee, provided that if a corporation is a Trustee then in the
absence of its consent, such an appointment of an additional or successor
Trustee shall not become effective until 60 days after its receipt of notice.

     (c) Although any Employer adoption the Plan may choose any Trustee who is
willing to accept the Trust, the Distributor or its successors may make or may
have made tentative standard arrangements with any bank or trust company with
the expectation it will be used as the Trustee by a substantial group of
Employers. It is also contemplated that more favorable results can be obtained
with a substantial volume of business, and that it may become advisable to
remove such bank or trust company as Trustee and substitute another Trustee.
Therefore, anything in the prior two subsections of this Section 11.6
notwithstanding, each Employer adopting this Plan hereby agrees that the
Distributor may, upon a date specified in a notice of at least 30 days to the
affected Employer and in absence of written objection by the Employer received
by the Distributor before such date, (i) remove any such Trustee and in that
case, or if such a Trustee has resigned as to a group of Employers, (ii) appoint
such a successor Trustee, provided such action is taken with respect to all
Employers similarly circumstanced of which the Distributor has knowledge, and
provided such notice is given in writing mailed postage prepaid to the Employer
at the latest address furnished to the Distributor directly or supplied to it by
such Trustee which is to be succeeded. If within 60 days after such Trustee's
resignation or removal, the Employer has not appointed a successor which has
accepted such appointment (unless the appointment of a successor Trustee is
waiting for action by the Distributor pursuant to the next preceding sentence
according to notice which has been given), the Trustee may petition an
appropriate court for the appointment of its successor. The Trustee shall not be
liable for the acts and omissions of such successor.

     (d) Successor Trustees qualifying under this Section 11.5 shall have all
rights and powers and all the duties and obligations of original Trustees.

     11.7 Valuation. Annually, on the Valuation Date, or more frequently in the
discretion of the Trustee, the assets of the Trust shall be revalued at fair
market value and the accounts of the Trust shall be proportionately adjusted to
reflect income, gains, losses or expenses, if the system of accounting does not
directly accomplish all such adjustments. The Trust Fund shall be administered
separately from, and shall not include any assets being administered under, any
other plan of an Employer. Interim valuations, if any, shall be applied
uniformly and in a non-discriminatory manner for all Employees.

     11.8 Registration. Any assets in the Trust Fund may be registered in the
name of the Trustee or any nominee designated by the Trustee.

     11.9 Certifications and Instructions.

     (a) Any pertinent vote or resolution of the Board of Directors of the
Employer (if it is a corporation) shall be certified to the Trustee over the
signature of the Secretary or an Assistant Secretary of the Employer and under
its corporate seal. The Employer shall promptly furnish to the Trustee
appropriate certification evidencing the appointment and termination of the
individual or individuals serving as Administrator under Section 12.1 of the
Plan.

     (b) The Administrator shall furnish to the Trustee appropriate
certification of the individual or individuals authorized to give notice on
behalf of the Administrator and providing specimens of their signatures. All
requests, directions, requisitions for money and instructions by the
Administrator to the Trustee shall be in writing and signed. There may be
standing requests, directions, requisitions or instructions to the extent
acceptable to the Trustee.

     11.10 Accounts and Approval.

     (a) The Trustee shall keep accurate and detailed accounts of all
investments, receipts and disbursements and other transactions hereunder, and
all books and record relating thereto shall be open at all reasonable times to
inspection and audit by any person or persons designated by the Administrator or
by the Employer.

     (b) Within 90 days following the close of each Plan Year the Trustee may,
and upon the request of the Employer or the Administrator shall, file with the
Administrator and the Employer a written report setting forth all securities or
other investments (including insurance contracts) purchased and sold, all
receipts, disbursements and other transactions effected by it during the period
since the date covered by the next prior report, and showing the securities and
other property held at the end of such period, and such other information about
the Trust Fund as the Administrator shall request. Unless the Employer or
Administrator, within 90 days from the date of mailing of such report, objects
to the contents of such report, the report shall be deemed approved. Any such
objection shall set forth the specific grounds on which they are based.

     11.11 Taxes. The Trustee may assume that any taxes assessed on or in
respect of the Trust Fund are lawfully assessed unless the Administrator shall
in writing advise the Trustee that in the opinion of counsel for the Employer
such taxes are not lawfully assessed. In the event that the Administrator shall
so advise the Trustee, the Trustee, if so requested by the Administrator and
suitable provision for their indemnity having been made, shall contest the
validity of such taxes in any manner deemed appropriate by the Administrator or
counsel for the Employer. The word "taxes" in this Section 11 shall be deemed to
include any interest or penalties that may be levied or imposed in respect to
any taxes assessed. Any taxes, including transfer taxes incurred in connection
with the investment or reinvestment of the assets of the Trust Fund that may be
levied or assessed in respect to such assets shall, if allocable to the Accounts
of specific Participants, be charged to such Accounts, and if not so allocable,
they shall be equitably apportioned among all such Participants' Accounts.

     11.12 Employment of Counsel. The Trustee may employ legal counsel (who may
be counsel for the Employer) and shall be fully protected in acting or
refraining from acting, upon such counsel's advice in respect to any legal
questions.

     11.13 Compensation of Trustee. An individual Trustee who is an Employee of
the Employer shall not be compensated for services as Trustee. A corporation, or
an individual who is not an Employee of the Employer, serving as a Trustee shall
be entitled to reasonable compensation for services; such compensation shall be
paid in accordance with Section 13.

     11.14 Limitation of Trustee's Liability.

     (a) The Trustee shall have no duty to take any action other than as herein
specified, unless the Administrator shall furnish it with instructions in proper
form and such instructions shall have been specifically agreed to by it, or to
defend or engage in any suit unless it shall have first agreed in writing to do
so and shall have been fully indemnified to its satisfaction.

     (b) The Trustee may conclusively rely upon and shall be protected in acting
in good faith upon any written representation or order from the Administrator or
any other notice, request, consent, certificate or other instrument or paper
believed by the Trustee to be genuine and properly executed, or any instrument
or paper if the Trustee believes the signature thereon to be genuine.

     (c) The Trustee shall not be liable for interest on any reasonable cash
balances maintained in the Trust.

     (d) The Trustee shall not be obligated to, but may, in its discretion,
receive a contribution from a Participation unless forwarded by the
Administrator.

     11.15 Successor Trustee. Any corporation into which a corporation acting as
a Trustee hereunder may be merged or with which it may be consolidated, or any
corporation resulting from any merger, reorganization or consideration to which
such Trustee may be a party, shall be the successor of the Trustee hereunder,
without the necessity of any appointment or other action, provided the Trustee
does not resign and is not removed.

     11.16 Enforcement of Provisions. To the extent permitted by applicable law,
the Employer and the Administrator shall have the exclusive right to enforce any
and all provisions of this Agreement on behalf of all Employees or former
Employees of the Employer or their Beneficiaries or other persons having or
claiming to have


8

<PAGE>

an interest in the Trust Fund or under the Plan. In any action or proceeding
affecting the Trust Fund or any property constituting a part or all thereof, or
the administration thereof or for instructions to the Trustee, the Employer, the
Administrator and the Trustee shall be the only necessary parties and shall be
solely entitled to any notice of process in connection therewith; any judgment
that may be entered in such action or proceeding shall be binding and conclusive
on all persons having or claiming to have any interest in the Trust Fund or
under the Plan.

     11.17 Voting. The Trustee shall deliver, or cause to be executed and
delivered, to the Administrator all notices, prospectuses, financial statements,
proxies and proxy soliciting materials received by the Trustee relating to
securities held by the Trust. The Administrator shall deliver these to the
appropriate Participant or Beneficiary of a deceased Participant, but only if
the Employer has specified in the Adoption Agreement that investment decisions
shall be made by Participants pursuant to Section 11.2 hereof. The Trustee shall
not vote any securities held by the Trust except in accordance with the written
instructions of the person or persons entitled to make investment decisions
pursuant to Section 11.2.

     11.18 Applicability to Loan Trustee. Where appropriate, the foregoing
provisions of this Section 11 shall apply to the Loan Trustee on the same basis
as if the Loan Trustee were the Trustee.

SECTION 12.
ADMINISTRATION

     12.1 Appointment of Administrator. From time to time, the Employer may, by
identifying such person(s) in writing to both the Trustee and the Participants,
appoint one or more persons as Administrator (hereinafter referred to in the
singular). Such Administrator shall have all power and authority necessary to
carry out the terms of the Plan. A person appointed as Administrator may also
serve in any other fiduciary capacity, including that of Trustee, with respect
to the Plan. The Administrator may resign upon 15 days advance written notice to
the Employer, and the Employer may at any time revoke the appointment of the
Administrator with or without cause. The Employer shall exercise the power and
fulfill the duties of the Administrator if at any time, an Administrator has not
been properly appointed in accordance with this Section 12.1 or the position is
otherwise vacant.

     12.2 Named Fiduciaries. The "Named Fiduciaries" within the meaning of the
Act shall be the Administrator and the Trustee.

     12.3 Allocation of Responsibilities. Responsibilities under the Plan shall
be allocated among the Trustee, the Administrator and the Employer as follows:

     (a) Trustee: The Trustee shall have exclusive responsibility to hold,
manage and invest, pursuant to instructions communicated to it in accordance
with Section 11.2 above, the funds received by it subject to the powers granted
to it under Section 11 hereof. To the extent that loans are made to Participants
in accordance with Section 10 hereof, these responsibilities shall fall to the
Loan Trustee.

     (b) The Administrator: The Administrator shall have the responsibility and
authority to control the operation and administration of the Plan in accordance
with its terms including, without limiting the generality of the foregoing, (i)
any investment decisions assigned to it under the Adoption Agreement or
transmission to the Trustee of any Participant investment decision under Section
11.2; (ii) interpretation of the Plan, conclusive determination of all questions
of eligibility, status, benefits and rights under the Plan and certification of
the Trustee of all benefit payments under the Plan; (iii) hiring of persons to
provide necessary services to the Plan not provided by Employees; (iv)
preparation and filing of all statements, returns and reports required to be
filed by the Plan with any agency of Government; (v) compliance with all
disclosure requirements of all state or federal law; (vi) maintenance and
retention of all Plan records as required by law, except those required to be
maintained by the Trustee; and (vii) all functions otherwise assigned to it
under the terms of the Plan.

     (c) Employer: The Employer shall be responsible for the design of the Plan,
as adopted or amended, the designation of the Administrator and Trustee (and, if
appropriate, the Loan Trustee) as provided in the Plan, the delivery to the
Administrator and the Trustee of Employee information necessary for operation of
the Plan, the timely making of the Employer Contributions pursuant to Section
4.1 hereof, and the exercise of all functions provided in or necessary to the
Plan except those assigned in the Plan to other persons.

     (d) This Section 12.3 is intended to allocate individual responsibility for
the prudent execution of the functions assigned to each of the Trustees, the
Loan Trustee, the Administrator and the Employer and none of such
responsibilities or any other responsibility shall be shared among them unless
specifically provided in the Plan. Whenever one such person is required by the
Plan to follow the directions of another, the two shall not be deemed to share
responsibility, but the person who gives the direction shall be responsible for
giving it and the responsibility of the person receiving the direction shall be
to follow it insofar as it is on its face proper under applicable law.

     12.4 More Than One Administrator. If more than one individual is appointed
as Administrator under Section 12.1, such individuals shall either exercise the
duties of the Administrator in concert, acting by a majority vote or allocate
such duties among themselves by written agreement delivered to the Employer and
the Trustee. In such a case, the Trustee may rely upon the instruction of any
one of the individuals appointed as Administrator regardless of the allocation
of duties among them.

     12.5 No Compensation. The Administrator shall not be entitled to receive
any compensation from the funds held under the Plan for its services in that
capacity unless so determined by the Employer or required by law.

     12.6 Record of Acts. The Administrator shall keep a record of all its
proceedings, acts and decisions, and all such records and all instruments
pertaining to Plan administration shall be subject to inspection by the Employer
at any time. The Employer shall supply, and the Administrator may rely on the
accuracy of, all Employee data and other information needed to administer the
Plan.

     12.7 Bond. The Administrator shall be required to give bond for the
faithful performance of its duties to the extent, if any, required by the Act,
the expense to be borne by the Employer.

     12.8 Agent for Service of Legal Process. The Administrator shall be agent
for service of legal process on the Plan.

     12.9 Rules. The Administrator may adopt or amend and shall publish to the
Employees such rules and forms for the administration of the Plan, and may
employ or retain such attorneys, accountants, physicians, investment advisors,
consultants and other persons to assist in the administration of the Plan as it
deems necessary or advisable.

     12.10 Delegation. To the extent permitted by applicable law, the
Administrator may delegate all or part of its responsibilities hereunder and at
any time revoke such delegation, by written statement communicated to the
delegate and the Employer. The Trustee may, but need not, act on the
instructions of such a delegate. The Administrator shall annually review the
performance of all such delegates.

     12.11 Claims Procedure. It is anticipated that the Administrator will
administer the Plan to provide Plan benefits without waiting for them to be
claimed, but the following procedure is established to provide additional
protection to govern unless and until a different procedure is established by
the Administrator and published to the Participants and Beneficiaries.

     (a) Manner of Making Claim. A claim for benefits by a Participant or
Beneficiary to be effective under this procedure must be made to the
Administrator and must be in writing unless the Administrator formally or by
course of conduct waives such requirements.

     (b) Notice of Reason for Denial. If an effective claim is wholly or
partially denied, the Administrator shall furnish such Participant or
Beneficiary with written notice of the denial within 60 days after the original
claim was filed. This notice of denial shall set forth in a manner calculated to
be understood by the claimant (i) the reason or reasons for denial, (ii)
specific reference to pertinent plan provisions on which the denial is based,
(iii) a description of any additional information needed to perfect the claim
and an explanation of why such information is necessary, and (iv) an explanation
of the Plan's claim procedure.

     (c) The Participant or Beneficiary shall have 60 days from receipt of the
denial notice in which to make written application for review by the
Administrator. The Participant or Beneficiary may request that the review be in
the nature of a hearing. The Participant or Beneficiary shall have the rights
(i) to have representation, (ii) to review pertinent documents, and (iii) to
submit comments in writing.

     (d) The Administrator shall issue a decision on such review within 60 days
after receipt of an application for review, except that such period may be
extended for a period of time not to exceed an additional 60 days if the
Administrator determines that special circumstances (such as the need to hold a
hearing) requires such extension. The decision on review shall be in writing and
shall include specific reasons for the decision, written in a manner calculated
to be understood by the claimant, and specific references to the pertinent Plan
provisions on which the decision is based.

SECTION 13.
FEES AND EXPENSES

     All reasonable fees and expenses of the Administrator or Trustee incurred
in the performance of their duties hereunder or under the Trust shall be paid by
the Employer; and to the extent not so paid by the Employer, said fees and
expenses shall be deemed to be an expense of the Trust and the Trustee is
authorized to charge the same to the Accounts of the Participants, and unless
allocable to the Accounts of specific Participants, they shall be charged
against the respective accounts of all or a reasonable group of Participants in
such reasonable manner as the Trustee shall determine.

SECTION 14.
BENEFIT RECIPIENT INCOMPETENT OR DIFFICULT TO
ASCERTAIN OR LOCATE

     14.1 Incompetency. If any portion of the Trust Fund becomes distributable
to a minor or to a Participant or Beneficiary who, as determined in the sole
discretion of the Administrator, is physically or mentally incapable of handling
his or her financial affairs, the Administrator may direct the Trustee to make
such distributions either to the legal representative or custodian of, or any of
the relatives and friends of, the incompetent or to apply such distribution
directly for the incompetent's support and maintenance. Payments which are made
in good faith shall completely discharge the Employer, Administrator and Trustee
from liability therefore.

     14.2 Difficulty to Ascertain or Locate. If it is impossible or difficult to
ascertain the person who is entitled to receive any benefit under the Plan, the
Administrator in its discretion may direct that such benefit be (i) paid to
another person in order to carry out the Plan's purposes; or (ii) retained in
the Trust; or (iii) paid to a court pending judicial determination of the right
thereto.

SECTION 15.
DESIGNATION OF BENEFICIARY

     Each Participant may submit to the Trustee a properly executed Designation
of Beneficiary form. In order to be effective, such Designation must have been
properly executed and submitted to the Trustee before the death of the
Participant. The last effective Designation accepted by the Trustee shall be
controlling, and whether or not fully dispositive of the Participant's Account,
thereupon shall revoke all Designations previously submitted by the Participant.
Each such executed Designation is hereby specifically incorporated herein by
reference and shall be construed and enforced in accordance with the laws of the
state in which the Employer has its principal place of business. To the extent
that any portion of an Account of


                                                                               9

<PAGE>

a deceased Participant is not governed by an effective Designation which names
at least one living Beneficiary designated by the Participant, that portion of
the Account shall be distributed to the deceased Participant's surviving spouse,
or if that is not possible, to the estate of the deceased Participant.

SECTION 16.
SPENDTHRIFT PROVISION

     No interest of any Participant or Beneficiary shall be assigned,
anticipated or alienated in any manner nor shall it be subject to attachment,
bankruptcy proceedings or to any other legal process or to the interference or
control of creditors or others, except to the extent that Participants may
secure loans from the Trust with their Accounts pursuant to Section 10 hereof.

SECTION 17.
NECESSITY OF QUALIFICATION

     This Plan is established with the intent that it shall qualify under Code
Section 401(a) as that Section exists at the time the Plan is established. If
the Plan as adopted by the Employer fails to attain such qualification, the Plan
will no longer participate in this Prototype Plan and will be considered an
individually designed plan. If that the Plan as adopted by the Employer fails to
attain or retain such qualification, the Employer shall promptly either amend
the Plan under Code Section 401(b) so that it does qualify, or direct the
Trustee to terminate the Plan and distribute all the assets of the Trust
equitably among the contributors thereto in proportion to their contributions,
and the Plan shall be considered to be rescinded and of no force and effect.

SECTION 18.
AMENDMENT OR TERMINATION

     18.1 Amendment or Termination. The Employer may at any time, and from time
to time amend this Prototype Plan and the Adoption Agreement (including a change
in any election it has made in the Adoption Agreement), or suspend or terminate
this Plan by giving written notice to the Trustee, but the Trust may not thereby
be diverted from the exclusive benefit of the Participants, their Beneficiaries,
survivors or estates, or the administrative expenses of the Plan, nor revert to
the Employer, nor may an allocation or contribution theretofore made be changed
thereby, nor may any amendment directly or indirectly deprive a Participant of
such Participant's nonforfeitable rights to benefits accrued to the date of the
amendment, nor may any amendment otherwise operate retroactively beyond the
first day of the Plan Year in which such amendment is made except as the same
may be deemed necessary in order to make the Plan qualify under Code Section
401(a). An amendment shall be deemed necessary for this purpose if counsel for
the Employer certifies and advises that in its opinion the written ruling of the
Commissioner of Internal Revenue that the Plan meets such requirements can be
obtained within a reasonable time only with such retroactive amendment. Any
amendment by the Employer which is other than the amendment of the Employer's
prior designation of an option or provision set forth or referred to in the
Adoption Agreement will constitute a substitution by the Employer of an
individually designed plan for this Prototype Plan and the general amendment
procedure of the Internal Revenue Service governing individually designed plans
will be applicable. Nothing contained herein shall constitute an agreement or
representation by the Distributor that it will continue to maintain its
sponsorship of the Plan indefinately.

     18.2 Delegation. The Employer hereby delegates to the Sponsor the authority
to amend so much of the Adoption Agreement and this Prototype Plan as is in
prototype form and, to the extent to which the Employer could effect such
amendment, the Employer shall be deemed to have consented to any amendment so
made. The Sponsor, in turn, delegates to the Distributor such authority to amend
so much of the Adoption Agreement and this Prototype Plan as is in prototype
form and, to the extent to which the Sponsor could effect such amendment, it
shall be deemed to have consented to any amendment so made. When an election
within the prototype form has been made by the Employer, it shall be deemed to
continue after amendment of the prototype form unless and until the Employer
expressly further amends the election, notwithstanding that the provision for
the election in the amended prototype form is in a different form or place;
provided, however, that if the amended form inadvertently fails to provide means
to duplicate exactly the earlier election, such earlier election shall continue
until such further amendment. The immediately preceding sentence is subject to
the qualification that each Employer hereby delegates to the Distributor, in the
event of such an amendment of the prototype form, authority to determine
conclusively that such a continuation of an earlier election by the Employer is
not advisable and to make the election for the Employer in the amended prototype
form which in the judgment of the Distributor most nearly corresponds with the
election made by the Employer before the amendment of the prototype form,
provided the following procedure is followed: the election for the Employer may
be made with respect to any specified Employers as to whom it may be applicable
singly, or such election may be made with respect to all Employers as to whom it
may be applicable as a group; and the election shall be made as of an effective
date which has been specified in a notice mailed or delivered, at the last
address(es) of the Employer(s) on the records of the Distributor, to the
Employer(s) at least 20 days before the end of the remedial amendment period.
Such notice may be mailed to Employers to whom it cannot be applicable by reason
of a previous election made by the Employer or otherwise, but it shall be
effective only as to those Employers who have received the notice and have not
themselves made a new election with respect to that item since the amendment of
the prototype form and previous to the effective date of such election by the
Distributor. The foregoing delegations of authority to make elections, or to
make amendments, shall not impose any duty on the Distributor to make them nor
shall it affect the interpretation of the Plan if they are not used.

     18.3 Distribution of Accounts Upon Termination. Upon termination of the
Plan or complete discontinuance of Employer Contributions under it, the
Administrator shall determine whether to pay the interests of Participants,
former Participants and Beneficiaries immediately, to retain such interest in
the Trust and pay them in the future according to Section 9, or to use what
other methods the Administrator deems advisable in order to furnish whatever
benefits the Trust will provide, subject to the limitations of Section 9.2
limiting the length of the period over which an Account can be paid.

SECTION 19.
TRANSFERS

     Nothing contained herein shall prevent the merger or consolidation of the
Plan with, or transfer of assets or liabilities of the Plan to, another plan
meeting the requirements of Code Section 401(a) or the transfer to the Plan of
assets or liabilities of another such plan so qualified under the Code. Any such
merger, consolidation or transfer shall be accompanied by the transfer of such
existing records and information as may be necessary to properly allocate such
assets among Participants, including any tax or other information necessary for
the Participants or persons administering the plan which is receiving the
assets. The terms of such merger, consolidation or transfer must be such that if
this Plan is then terminated, each Participant would receive a benefit
immediately after the merger, consolidation or transfer equal to or greater than
the benefit he or she would have received if the Plan had terminated immediately
before the merger, consolidation or transfer.

SECTION 20.
OWNER-EMPLOYEE PROVISIONS

     20.1 Purpose of Section. This Section is intended to insure that the Plan
complies with Code Section 401(d). Any ambiguity herein will be construed to
that end, and this Section 20 will override any other provision of the Plan with
which it may be inconsistent.

     20.2 Control. For purposes of this Section 20, "Control" means the
ownership directly or indirectly of more than 50% of either the capital interest
or the profits interest in a partnership or on unincorporated trade or business.

     20.3 Limitations. No benefits shall be provided to an Owner-Employee under
this Plan unless:

     (a) if an Owner-Employer or group of Owner-Employees Controls the trade or
business covered by this Plan and also Control as an Owner-Employee or
Owner-Employees one or more other trades or businesses, this Plan and the plans
established for such other trades or businesses, when taken together, form a
single plan which satisfies the requirements of Section 401(a) and (d) of the
Code with respect to the employees of all the controlled trades or businesses;
and

     (b) if an Owner-Employee or group of Owner-Employees controls another trade
or business but does not control the trade or business covered by this Plan, the
employees of such other trades or businesses are included in a plan which
satisfies the requirements of Sections 401(a) and (d) of the Code and which
provides contributions and benefits for such employees which are not less
favorable than those provided for Owner-Employees under this Plan.

SECTION 21.
TOP-HEAVY PROVISIONS

     21.1 Purposes of Section. This Section is intended to insure that the Plan
complies with Code Section 4.16. If the Plan is or becomes Top-Heavy in any Plan
Year beginning after December 31, 1983, the provisions of this Section will
supersede any conflicting provision in the Plan.

     21.2 Definitions. The terms used in this Section shall have the following
meanings:

     (a) Key Employee: Any Employee or former Employee (and the Beneficiaries of
such Employee) who at any time during the determination period was an officer of
the Employer having an annual compensation greater than 1.5 multiplied by the
amount in effect under Code Section 415(C)(1)(A) for the Plan Year, an owner (or
considered an owner under Code Section 318) of 1 of the 10 largest interests in
the Employer if such individual's compensation exceeds the dollar limitation
under Code Section 415(C)(1)(A), a five-percent owner of the Employer, or a
one-percent owner of the Employer who has an annual compensation of more than
$150,000. The determination period is the Plan Year containing the Determination
Date and the 4 preceding Plan Years. The determination of who is a Key Employee
will be made in accordance with Code Section 416(i)(1) and the regulations
thereunder.

     (b) Top-Heavy Plan. For any Plan Year beginning after December 31, 1983,
this Plan is Top-Heavy if any of the following conditions exists:

          (i) If the Top-Heavy Ratio for this Plan exceeds 60% and this Plan is
     not part of any Required Aggregation Group or Permissive Aggregation Group
     of plans.

          (ii) If this Plan is a part of a Required Aggregation Group and part
     of a Permissive Aggregation Group and the Top-Heavy Ratio for the Required
     Aggregation Group of plans exceeds 60%.

          (iii) If this Plan is a part of a Required Aggregation Group and part
     of a Permissive Aggregation Group of plans and the Top-Heavy Ratio for the
     Permissive Aggregation Group exceeds 60%.

     (c) Top-Heavy Ratio.

          (i) If the Employer maintains one or more defined contribution plans
     (including any Simplified Employee Pension Plan within the meaning of Code
     Section 408(k)) and the Employer has never maintained any defined benefit
     plan which has covered or could cover a Participant in this Plan, the
     Top-Heavy Ratio is a fraction, the numerator of which is the sum of the
     account balances of all Key Employees under all of the plans as of the
     Determination


10

<PAGE>

     Date (including any part of any account balance distributed in the
     five-year period ending on the Determination Date), and the denominator of
     which is the sum of all account balances (including any part of any account
     balance distributed in the five-year period ending on the Determination
     Date) of all Participants as of the Determination Date. Both the numerator
     and denominator of the Top-Heavy Ratio are adjusted to reflect any
     contribution which is due but unpaid as of the Determination Date.

          (ii) If the Employer maintains one or more defined contribution plans
     (including any Simplified Employee Pension Plan within the meaning of Code
     Section 408(k)) and the Employer maintains or has maintained one or more
     defined benefit plans which have covered or could cover a Participant in
     this Plan, the Top-Heavy Ratio is a fraction, the numerator of which is the
     sum of account balances under the defined contribution plans for all Key
     Employees and the present value of accrued benefits under the defined
     benefit plans for all Key Employees, and the denominator of which is the
     sum of the account balances under the defined contribution plans for all
     participants and the present value of accrued benefits under the defined
     benefit plans for all participants. Both the numerator and denominator of
     the Top-Heavy Ratio are adjusted for any distribution of an account balance
     or an accrued benefit made in the five-year period ending on the
     Determination Date and any contribution due but unpaid as of the
     Determination Date.

          (iii) For purposes of (i) and (ii) above, the value of account
     balances and the present value of accrued benefits will be determined as of
     the most recent Valuation Date and falls within or ends with the
     twelve-month period ending on the Determination Date. The account balances
     and accrued benefits of a Participant who is not a Key Employee but who was
     a Key Employee in a prior Plan Year will be disregarded. The calculation of
     the Top-Heavy Ratio, and the extent to which distributions, rollovers, and
     transfers are taken into account will be made in accordance with Code
     Section 416 and the regulations thereunder. Deductible Voluntary
     Contributions and any deductible employee contributions under any other
     qualified plan maintained by the Employer will not be taken into account
     for purposes of computing the Top-Heavy Ratio. When aggregating plans the
     value of account balances and accrued benefits will be calculated with
     reference to the Determination Dates that fall within the same calendar
     year.

     (d) Permissive Aggregation Group. The Required Aggregation Group of plans
plus any other plan or plans of the Employer which, when considered as a group
with the Required Aggregation Group, would continue to satisfy the requirements
of Code Sections 401(a)(4) and 410.

     (e) Required Aggregate Group. (i) Each qualified plan of the Employer in
which at least one Key Employee participates, and (ii) any other qualified plan
of the Employer which enables a plan described in (I) to meet the requirements
of Code Sections 401(a)(4) and 410.

     (f) Determination Date. For any Plan Year subsequent to the first Plan
Year, the last day of the preceding Plan Year. For the first Plan Year, the last
day of that Year.

     (g) Valuation Date. See Section 2.45.

     (h) Present Value. Present value shall be based only on the interest rate
employed as of the date in question by the Pension Plan Benefit Guaranty
Corporation to value immediate annuities and the mortality rate specified in
Table LN at Treas. Reg. [s]20.2031-10, unless otherwise specified in the most
recently adopted or amended defined benefit plan maintained by the Employer.

     21.3 Minimum Allocation.

     (a) In any Plan Year in which this Plan is Top-Heavy, except as otherwise
provided in (d), (e) and (f) below, the Employer Contributions and forfeitures
allocated on behalf of any Participant who is not a Key Employee shall not be
less than the lesser of 3% of such Participant's Compensation or, in the case
where the Employer has no defined benefit plan which designates this Plan to
satisfy Code Section 401, the largest percentage of Employer Contributions and
forfeitures stated as a percentage of the first $200,000 of a Key Employee's
Compensation, allocated on behalf of any Key Employee for that Plan Year. The
minimum allocation is determined without regard to any Social Security
contribution by the Employer.

     (b) For purposes of computing the minimum allocation, "Compensation" will
have the same meaning as in Section 2.7, disregarding any exclusion from
Compensation specified by the Employer in the Adoption Agreement.

     (c) During any Plan Year for which a minimum allocation is required under
subsections (a) or (f) to a plan under which allocations shall be made on an
integrated basis, Employer Contributions and forfeitures will be allocated to
each Participant's Employer Contribution Account in the ratio that each
Participant's Compensation for the Plan Year bears to all Participants'
Compensation for the Plan Year but not in excess of 3% of such Compensation. The
provisions of this Section 21.3(C) shall take precedence over any conflicting
provisions of Section 4.1. To the extent any amount of Employer Contributions
and forfeitures remains unallocated after the application of this Subsection
(C), such amount shall be allocated in accordance with the provisions of Section
4.1 hereof.

     (d) The provision in subsection (a) above shall not apply to any
Participant who was not employed by the Employer on the last day of the Plan
Year.

     (e) The provision in subsection (a) above shall not apply to any
Participant to the extent the Participant is covered under any other plan (other
than a plan which incorporates this Prototype Plan) or plans of the Employer,
and the Employer has provided in the Adoption Agreement that the minimum
allocation or benefit requirement applicable to Top-Heavy Plans will be met in
such other plan or plans.

     (f) The provision in subsection (a) above shall not apply in the case of a
Participant who is an Employee of an Employer who has adopted both a profit
sharing plan and a money purchase pension plan which incorporates this Prototype
Plan. In such case, the aggregate total of the Employer Contributions and
forfeitures under both plans allocated to the Employer Contribution Account of a
Participant who is not a Key Employee shall not be less than 3% of such
Participant's Compensation. Unless the Employer has specified otherwise in the
Adoption Agreement and such specification is sufficient to satisfy the minimum
allocation requirement referred to in the preceding sentence, subsection (c)
above shall apply to the allocation of Employer Contributions and forfeitures
under the money purchase pension plan and, only to the extent that such
allocation is insufficient to satisfy the minimum allocation requirement
referred to in the preceding sentence, the profit sharing plan.

     21.4 Non-forfeitability of Minimum Allocation. The minimum allocation
required (to the extent required to be nonforfeitable under Code Section 416(b))
may not be forfeited under Code Section 411(a)(3)(B) or 411(A)(3)(D).

     2.15 Limitation on Compensation. For any Plan Year in which the Plan is
Top-Heavy, only the first $200,000 (or such larger amount as may be prescribed
by the Secretary of the Treasury or his or her delegate) of a Participant's
Compensation for the Plan Year shall be taken into account for purposes of
allocation Employer Contributions under the Plan.

     21.6 Minimum Vesting Schedule. Unless the Employer has specified a more
rapid vesting schedule in the Adoption Agreement, for any Plan Year in which
this Plan is Top-Heavy, the following minimum vesting schedule shall apply:

                                         Nonforfeitable Percentage
    Vesting Years                      of Employer Contribution Account
- -------------------------------     -----------------------------------
    1                                                0%
    2                                               20%
    3                                               40%
    4                                               60%
    5                                               80%
    6 or more                                      100%

The minimum vesting schedule applies to all benefits within the meaning of Code
Section 411(a)(7) attributable to Employer Contributions and forfeitures,
including benefits accrued before the effective date of Code Section 416 and
benefits accrued before the Plan became Top-Heavy. Further, no reduction in
vested benefits may occur in the event the Plan's status as Top-Heavy changes
for any Plan Year. However, this Section 21.6 does not apply to the Employer
Contribution Account balances of any former Participant who does not have an
Hour of Service after the Plan has initially become Top-Heavy and such former
Participant's vested Employer Contribution Account balance will be determined
without regard to this Section.

     21.7 Effect on Code Section 415 Limitations. Notwithstanding anything to
the contrary in Section 5 above, the following provisions apply if the Plan is
Top-Heavy.

     (a) In any Plan Year in which the Top-Heavy ratio exceeds 90% (and the Plan
therefore becomes super Top-Heavy) the denominators of the Defined Benefit
Fraction (as defined in Section 5.5(C) above) and the Defined Contribution
Fraction (as defined in Section 5.5(d) above) shall be computed using 100% of
the dollar limitation stated therein instead of 125%.

     (b) In any Plan Year in which the Top-Heavy Ratio exceeds 60%, but is less
than 90%, the denominators of the Defined Benefit Fraction (as defined in
Section 5.5(c) above) and the Defined Contribution Fraction (as defined in
Section 5.5(d) above) shall be computed using 100% of the dollar limitation
described therein instead of 125%, unless the Employer has specified in the
Adoption Agreement that the minimum allocation provisions of Section 21.3 above
shall be computed using 4% of a Participant's Compensation instead of 3%, in
which case the dollar limitations of the Defined Benefit Fraction (as defined in
Section 5.5(c) above) and the Defined Contribution Fraction (as defined in
Section 5.5(d) above) shall continue to be computed using 125% of the dollar
limitations.

     21.8 Termination of Top-Heavy Status. If the Plan ceases to be Top-Heavy
for any Plan Year and if the Employer has not specified otherwise in the
Adoption Agreement, the minimum vesting schedule described in Section 21.6 shall
continue to apply. If the Employer has specified in the Adoption Agreement that,
upon conversion of the Plan to non-Top-Heavy status, Participants' vested
benefits are to be determined according to a schedule other than the minimum
vesting schedule described in Section 21.6, such change in vesting schedules
shall be treated as an amendment, and the election referred to in Section 7.2
hereof shall apply.

SECTION 22.
WAIVER OF MINIMUM FUNDING STANDARD

     If an Employer who has adopted this Prototype Plan as a money purchase
pension plan is unable to satisfy the minimum funding standard (as described in
Code Section 412) for a given Plan Year, it may apply to the Internal Revenue
Service for a waiver of such minimum funding standard. If the waiver is granted,
the following provisions apply:

     (a) An adjusted Account balance shall be maintained for each Participant
whose actual Account balance is less than or equal to his or her adjusted
Account balance.

          (i) For the Plan Year for which the first waiver is granted, the
     adjusted Account balance as of the Valuation Date for each affected
     Participant equals:

               (A) the Participant's actual Account balance, plus

               (B) the amount that such Participant would have received if the
          amount waived had been contributed.

          (ii) For each Plan Year following the Plan Year for which a waiver is
     granted, the adjusted Account balance for each Participant affected by such
     waiver (calculated as of the Valuation Date for that Plan Year) equals:

               (A) the adjusted Account balance as of the Valuation Date in the
          prior Plan Year, plus

               (B) the amount equal to the actual investment return credited or
          charged to the Participant's actual Account balance, plus

               (C) the amount equal to 5% of the excess of the amount in (A)
          over the Participant's actual Account balance calculated as of the
          same date, plus

               (D) the amount equal to such Participant's allocated share of the


                                                                              11

<PAGE>

          required Employer Contribution (whether or not waived) for the Plan
          Year (determined without regard to adjusted waiver payments and
          discretionary Employer Contributions), minus

               (E) the amount of the Participant's adjusted Account balance
          forfeited during the Plan Year under the Plan's provisions.

     (b) For a given Year, the Employer is required to contribute a certain
amount in order to satisfy the minimum funding standard for such Plan Year. For
each Plan Year which follows a Plan Year for which a waiver of the minimum
funding standard was granted the amount equals:

          (i) the amount due as determined under Section 4.1(b) above (without
     regard to this Section), plus

          (ii) the adjusted waiver amount.

     (c) The adjusted waiver amount for given Plan Year equals:

          (i) the sum of the amounts necessary to amortize each waived funding
     deficiency over a period of 15 Plan Years (measured from the Valuation Date
     of the Plan Year for which the corresponding waiver was granted) at 5%
     interest, compounded annually, minus

          (ii) the sum of the amounts necessary to amortize the total of each
     Plan Year's forfeitures (which have arisen since the first waiver was
     granted) over a period of 15 Plan Years (measured from the Valuation Date
     of the Plan Year in which the corresponding forfeitures arose) at 5%
     interest, compounded annually.

     (d) An amount equal to the adjusted waiver amount must be contributed only
until each Participant's actual Account balance equals the Participant's
adjusted Account balance.

     (e) Any Plan provision which provides that Employer Contributions shall be
reduced immediately by forfeitures is revoked until each Participant's actual
Account balance equals that Participant's adjusted Account balance.

     (f) Discretionary Employer Contributions, which are in addition to the
amounts contributed to satisfy the minimum funding standard, can be made in any
given Plan Year. However, the total Employer Contribution for the Plan Year
cannot exceed the then remaining underfunded amount (the sum of Participants'
adjusted Account balances minus total Plan assets).

     (g) The adjusted waiver payments, discretionary Employer contributions and
the forfeitures of actual Account balances for the current Plan Year shall be
allocated as of that Plan Year's Valuation Date to the actual Account balances
of the affected Participants.

     (h) Each time a waiver is granted, an original waiver account ("OWA") will
be determined for each affected Participant. The OWA equals the Participant's
portion of the amount which was waived.

     (i) Commencing with the Valuation Date of the Plan Year for which a waiver
is granted, a remaining original waiver amount ("ROWA") must be calculated for
each affected Participant. As of such Valuation Date the OWA equals the ROWA. On
the Valuation Date of a succeeding Plan Year the ROWA equals the prior Plan
Year's ROWA multiplied by 1.05, minus the forfeiture of amounts in the prior
Plan Year's ROWA incurred in the current Plan Year. For each waiver that is
granted one OWA and a corresponding ROWA will be established for each affected
Participant.

     (j) The sum of the adjusted waiver payments, discretionary Employer
Contributions and forfeitures of actual Account balances for a given Plan Year
are allocated to those Participants who have ROWAs by multiplying the sum of
these three amounts by the fraction:

          (i) the numerator of which equals the sum of OWAs for a particular
     Participant, and

          (ii) the denominator of which equals the sum of the OWAs for all
     Participants.

To determine the portion of this allocation which is to be assigned to a given
ROWA, multiply the allocation by the corresponding OWA, then divide by the sum
of the OWAs for the particular Participant.

     (k) If the calculation of a ROWA results in a value which is less than
zero, then

          (i) the ROWA is set equal to zero,

          (ii) the corresponding OWA is set equal to zero, and

          (iii) the excess payments will be reallocated to the remaining ROWAs.

     (l) A distribution is determined by multiplying a Participant's vested
percentage by his or her adjusted Account balance. However, distributions from
the Plan may not exceed a Participant's actual Account balance. If so limited,
plan Participants shall receive subsequent distributions derived from future
adjusted waiver payments.

SECTION 23.
MISCELLANEOUS

     23.1 Misrepresentation. Notwithstanding any other provisions herein, if an
Employee misrepresents his or her age or any other fact, any benefit payable
hereunder shall be the smaller of: (i) the amount that would be payable if no
facts had been misrepresented, or (ii) the amount that would be payable if the
facts were as misrepresented.

     23.2 Legal or Equitable Action. If any legal or equitable action with
respect to the Plan is brought by or maintained against any person, and the
results of such action are adverse to that person, attorney's fees and all other
costs to the Employer, the Administrator or the Trust of defending or bringing
such action shall be charged against the interest, if any, of such person under
the Plan.

     23.3 No Enlargement of Plan Rights. It is a condition of the Plan, and each
Participant by participating herein expressly agrees, that he or she shall look
solely to the assets of the Trust for the payment of any benefit under the Plan.

     23.4 No Enlargement of Employment Rights. Nothing appearing in or done
pursuant to the Plan shall be construed (a) to give any person a legal or
equitable right or interest in the assets of the Trust or distribution
therefrom, nor against the Employer, except as expressly provided herein or (b)
to create or modify any contract of employment between the Employer and any
Employee or obligate the Employer to continue the services of any Employee.

     23.5 Written Orders. In taking or omitting to take any action under this
Plan, the Trustee may conclusively rely upon and shall be protected in acting
upon any written orders from or determinations by the Employer or the
Administrator as appropriate, or upon any other notices, requests, consents,
certificates or other instruments or papers believed by it to be genuine and to
have been properly executed, and so long as it acts in good faith, in taking or
omitting to take any other action.

     23.6 No Release from Liability. Nothing in the Plan shall relieve any
person from liability for any responsibility under Part 4 of Title I of the Act.
Subject thereto, neither the Trustee, the Loan Trustee, or the Administrator nor
any other person shall have any liability under the Plan, except as a result of
negligence or willful misconduct, and in any event the Employer shall fully
indemnify and save harmless all persons from any liability except that resulting
from their negligence or willful misconduct.

     23.7 Discretionary Actions. Any discretionary action, including the
granting of a loan pursuant to Section 10 hereof, to be taken by the Employer or
the Administrator under this Plan shall be non-discriminatory in nature and all
Employees similarly situated shall be treated in a uniform manner.

     23.8 Headings. Headings herein are primarily for convenience of reference,
and if they conflict with the text, the text shall control.

     23.9 Applicable Law. This Plan shall, to the extent state law is
applicable, be construed and enforced in accordance with, and the rights of the
parties shall be governed by, the laws of the state in which (a) if the Trustee
is a corporation, the Trustee has its principal place of business; (b) if the
Trustee is an individual, the Trustee resides; or (c) if the Trustee is
individuals, where a majority of the individuals serving as Trustees reside. The
Employer's execution of the Adoption Agreement may be acknowledged where
required by applicable law.

     23.10 No Reversion. Notwithstanding any other contrary provision of the
Plan, but subject nevertheless to Sections 5 and 16, no part of the assets in
the Trust shall revert to the Employer, and no part of such assets, other than
that amount required to pay taxes or administrative expenses, shall be used for
any purpose other than exclusive benefit of Employees or their Beneficiaries.

     23.11 Notices. The Employer will provide the notice to other interested
parties contemplated under Code Section 7476 before requesting a determination
by the Secretary of the Treasury or his or her delegate with respect to the
qualification of the Plan.

     23.12 Conflict. In the event of any conflict between the provisions of this
Plan and the terms of any contract or agreement issued thereunder or with
respect thereto, the provisions of the Plan shall control.


12

<PAGE>

SCUDDER
- -------

This booklet is not to be used in connection
with the offering of any of the Scudder funds
unless preceded or accompanied by the
appropriate current prospectuses. Scudder
Fund Distributors, Inc. is the underwriter
of the Scudder no-load mutual funds.

11-10-104 (C) Scudder Fund Distributors, Inc.



Scudder
    IRA
============================


Plan and
Disclosure Statement


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





SCUDDER
SERVING INVESTORS SINCE 1919
<PAGE>

Introduction

     When Congress approved IRAs as a tax incentive to save for retirement, it
required that all IRA investments be held by an IRA Custodian or Trustee.  The
job of the Custodian or Trustee is to hold and safeguard your IRA assets until
you withdraw them.

     The Custodian of the Scudder IRA is State Street Bank and Trust Company.
As Custodian, State Street Bank and Trust Company is the registered owner of
your investments in Scudder fund shares and holds them for your benefit.

     This booklet and the accompanying adoption agreement comprise the agreement
between you and State Street Bank and Trust Company.  It gives a detailed
explanation of the procedures governing the Scudder IRA.  These procedures are
set by Congress and the Internal Revenue Service and are common to all IRAs.

     Accompanying this document is "Scudder IRA: A guide to saving taxes while
building retirement income", which explains the Scudder IRA in plain English.
It is intended for your use as an easy reference guide for your Scudder IRA
investment.

     If you have any questions, please call 1-800-225-2470.


                                        2
<PAGE>

Form 5305-A                                            OMB No. 1545-0365
(Rev. November 1983)                                   -----------------

Department of the Treasury                               DO NOT FILE
Internal Revenue Service                                 with Internal
                                                       Revenue Service


                            READ BUT DO NOT COMPLETE
                                        
                     Individual Retirement Custodial Account
              Scudder IRA Form 12084 for use with the Scudder Funds
               (Under Section 408(a) of the Internal Revenue Code)

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

                    See Adoption Agreement, Article IX,
                    Paragraph 1 hereof (hereafter referred
                    to as A/A)

State of  ____________________________________________________  SS

County of ____________________________________________________

                                                       [_]  Amendment

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

Depositor's name              See A/A
                    ------------------------------------------------------------
Depositor's date of birth          See A/A
                           -----------------------------------------------------
Depositor's social security number           See A/A
                                     -------------------------------------------
Depositor's address                See A/A
                      ----------------------------------------------------------
Custodian's name    State Street Bank & Trust Company
                  --------------------------------------------------------------
Custodian's address or principal place of business
                         Boston, Massachusetts
- --------------------------------------------------------------------------------


- --------------------------------------------------------------------------------
     The Depositor whose name appears above is establishing an individual
retirement account (under section 408(a) of the Internal Revenue Code) to
provide for his or her retirement and for the support of his or her
beneficiaries after death.

     The Custodian named above had given the Depositor the disclosure statement
required under the Income Tax Regulations under section 408(i) of the Code.

     The Depositor has deposited with the Custodian    See A/A    dollars
($   See A/A   ) in cash.

     The Depositor and the Custodian make the following agreement:

                                    Article I
                                        
     The Custodian may accept additional cash contributions on behalf of the
Depositor for a tax year of the Depositor.  The total cash contributions are
limited to $2,000 for the tax year unless the contribution is a rollover
contribution described in section 402(a)(5), 402(a)(7), 403(a)(4), 403(b)(8),
405(d)(3), 408(d)(3), or 409(b)(3)(C) of the Code or an employer contribution to
a simplified employee pension plan as described in section 408(k).

                                   Article II
                                        
     The Depositor's interest in the balance in the custodial account is
nonforfeitable.

- --------------------------------------------------------------------------------
For Paperwork Reduction Act Notice, see back of this form.


                                        3
<PAGE>

                                   Article III
                                        
     1.   No part of the custodial funds may be invested in life insurance
contracts, nor may the assets of the custodial account be commingled with other
property except in a common trust fund or common investment fund (within the
meaning of section 408(a)(5) of the Code).

     2.   No part of the custodial funds may be invested in collectibles (within
the meaning of section 408(m) of the Code).

                                   Article IV
                                        
     1.   The Depositor's entire interest in the custodial account must be, or
begin to be, distributed before the end of the tax year in which the Depositor
reaches age 70 1/2.  By the end of that tax year, the Depositor may elect, in a
manner acceptable to the Custodian, to have the balance in the custodial account
distributed in:

     (a)  A single-sum payment.
     
     (b)  An annuity contract that provides equal or substantially equal
          monthly, quarterly, or annual payments over the life of the Depositor.
          The payments must begin by the end of that tax year.
     
     (c)  An annuity contract that provides equal monthly, quarterly, or annual
          payments over the joint and last survivor lives of the Depositor and
          his or her spouse.  The payments must begin by the end of the tax
          year.
     
     (d)  Equal or substantially equal monthly, quarterly, or annual payments
          over a specified period that may not be longer than the Depositor's
          life expectancy.
     
     (e)  Equal or substantially equal monthly, quarterly, or annual payments
          over a specified period that may not be longer than the joint life and
          last survivor expectancy of the Depositor and his or her spouse.
     
     Even if distributions have begun to be made under option (d) or (e), the
Depositor may receive a distribution of the balance in the custodial account at
any time by giving written notice to the Custodian.  If the Depositor does not
choose any of the methods of distribution described above by the end of the tax
year in which he or she reaches age 70 1/2, distribution to the Depositor will
be made before the end of that tax year by a single-sum payment.  If the
Depositor elects as a means of distribution (b) or (c) above, the annuity
contract must satisfy the requirements of section 408(b)(1), (3), (4), and (5)
of the Code.  If the Depositor elects as a means of distribution (d) or (e)
above, figure the payments made in tax years beginning in the tax year the
Depositor reaches age 70 1/2 as follows:

     (i)  For the minimum payment, divide the Depositor's entire interest in the
          custodial account at the beginning of each year by the life expectancy
          of the Depositor (or the joint life and last survivor expectancy of
          the Depositor and his or her spouse, or the period specified under (d)
          or (e), whichever applies).  Determine the life expectancy in either
          case on the date the Depositor reaches 70 1/2 minus the number of
          whole years passed since the Depositor became 70 1/2.
     
     (ii) For the minimum monthly payment, divide the result in (i) above by 12.
     
     (iii) For the minimum quarterly payment, divide the result in (i) above by
          4.
     
     2.   If the Depositor dies before his or her entire interest in the account
is distributed to him or her, or if distribution is being made as provided in
(e) above to his or her surviving spouse, and the surviving spouse dies before
the entire interest is distributed, the entire remaining undistributed interest
will, within 5 years after


                                        4
<PAGE>

the Depositor's death or the death of the surviving spouse, be distributed to
the beneficiary or beneficiaries of the Depositor or the Depositor's surviving
spouse.

                                    Article V
                                        
     Unless the Depositor dies, is disabled (as defined in section 72(m) of the
Code), or reaches age 59 1/2 before any amount is distributed from the account,
the Custodian must receive from the Depositor a statement explaining how he or
she intends to dispose of the amount distributed.

                                   Article VI
                                        
     1.   The Depositor agrees to provide the Custodian with information
necessary for the Custodian to prepare any reports required under section 408(i)
of the Code and the related regulations.

     2.   The Custodian agrees to submit reports to the Internal Revenue Service
and the Depositor as prescribed by the Internal Revenue Service.

                                   Article VII
                                        
     Notwithstanding any other articles which may be added to or incorporated,
the provisions of Articles I through III and this sentence will be controlling.
Any additional articles that are not consistent with section 408(a) of the Code
and related regulations will be invalid.

                                  Article VIII
                                        
     This agreement will be amended from time to time to comply with the
provisions of the Code and related regulations.  Other amendments may be made
with the consent of the persons whose signatures appear below.

- --------------------------------------------------------------------------------
Note:     The following space (Article IX) may be used for any other provisions
          you wish to add.  If you do not wish to add any other provisions, draw
          a line through this space.  If you add provisions, they must comply
          with applicable requirements of State law and the Internal Revenue
          Code.
- --------------------------------------------------------------------------------

                                   Article IX

     1.   These provisions of Article IX are set forth in the Adoption Agreement
which is incorporated herein by reference and which Depositor acknowledges
having received and read.

     2.-13.    The remaining provisions of Article IX are set forth in Appendix
"A" to this Adoption Agreement, which is incorporated herein by reference, and
which Depositor acknowledges having received and read.  Paragraph 7 thereof
amplifies Article IV and Paragraph 9 thereof amplifies Article VIII.
- --------------------------------------------------------------------------------

Depositor's Signature                   See A/A
                         -------------------------------------------------------
Custodian's Signature                   See A/A
                         -------------------------------------------------------
Date                See A/A
     -----------------------------------------
Witness                  See A/A
          ----------------------------------------------------------------------
(Use only if signature of Depositor or Custodian is required to be witnessed.)
- --------------------------------------------------------------------------------

Instructions

(Section references are to the Internal Revenue Code unless otherwise noted.)

Paperwork Reduction Act Notice

     The Paperwork Reduction Act of 1980 says that we must tell you why we are
collecting this information, how it is to be used, and whether you have to
provide it.  The information is


                                        5
<PAGE>

used to determine if you are entitled to a deduction for contributions to this
custodial account.  Your completing this information is only required if you
want to adopt this model custodial account.

Purpose of Form

     This model custodial account may be used by an individual who wishes to
adopt an individual retirement account under section 408(a).  When fully
executed by the Depositor and the Custodian not later than the time prescribed
by law for filling the federal income tax return for the Depositor's tax year, a
Depositor will have an individual retirement account (IRA) custodial account
which meets the requirements of Section 408(a).  This custodial account must be
created in the United States for the exclusive benefit of the Depositor or
his/her beneficiaries.

Definitions

     Custodian. -- The Custodian must be a bank or a savings and loan
association, as defined in section 408(n), or other person who has the approval
of the Internal Revenue Service to act as Custodian.

     Depositor. -- The Depositor is the person who establishes the account.

IRA for Non-Working Spouse

     Contributions to an IRA custodial account for a non-working spouse must be
made to a separate IRA custodial account established by the non-working spouse.

     This form may be used to establish the IRA custodial account for the non-
working spouse.

     An employee's social security number will serve as the identification
number of his or her individual retirement account.  An employer identification
number is not required for each individual retirement account, nor for a common
fund created for individual retirement accounts.

     For more information get a copy of the required disclosure statement from
your Custodian or get Publication 590, Individual Retirement Arrangements,
IRA's.

Specific Instructions

     Article IV. -- Distributions made under this Article may be made in a
single sum, periodic payment, or a combination of both.  The distribution option
should be reviewed in the year the Depositor reaches age 70 1/2 to make sure the
requirements of section 408(a)(6) have been met.  For example, if a Depositor
elects distributions over a period permitted in (d) or (e) of Article IV, the
period may not extend beyond the life expectancy of the Depositor at age 70 1/2
(under option (d)) or the joint life and last survivor expectancy of the
Depositor (at age 70 1/2) and the Depositor's spouse (under option e)).  For
this purpose, life expectancies must be determined by using the expected return
multiples in section 1.72-9 of the Income Tax Regulations (26 CFR Part 1).  The
balance in the account as of the beginning of each tax year beginning on or
after the Depositor reaches age 70 1/2 will be used in computing the payments
described in (d) and (e) of Article IV.  Article IV does not preclude a mode of
distribution different from those described in (a) through (e) of Article IV
prior to the close of the tax year of the Depositor in which he/she attains age
70 1/2.

     Article IX. -- This article and any that follow it may incorporate
additional provisions that are agreed upon by the Depositor and Custodian to
complete the agreement.  These may include, for


                                        6
<PAGE>

example: definitions, investment powers, voting rights, exculpatory provisions,
amendment and termination, removal of custodian, custodian's fees, state law
requirements, beginning date of distributions, accepting only cash, treatment of
excess contributions, prohibited transactions with the depositor, etc.  Use
additional pages if necessary, and add them to this form.

     Note:  This form may be reproduced and reduced in size for adoption to
passbook or card purposes.

     U.S. Government Printing Office: 1984--421-108/258.


                                        7
<PAGE>

                         Appendix "A" Incorporated Into
                           Article IX of Agreement on
                             Scudder IRA Form 12-84
                         Between Custodian and Depositor
                                        
                             ----------------------
                                        
     1.   Please refer to Scudder IRA Adoption Agreement.

     2.   Depositor's Selection of Investments

          Depositor directs Custodian to invest all custodial funds in
investment funds issued by the "Mutual Fund(s)," or in the other investments
which have been designated by Scudder Fund Distributors, Inc. (or its
successors) as eligible for investment hereunder, which have been selected by
Depositor until Depositor hereafter gives Custodian contrary instructions
pursuant to Article IX, paragraph ("para.") 6 below, which governs investment of
the custodial account in "Mutual Fund" shares or other investments.

     3.   Contributions

          (a)  Period Contributions.  Periodic contributions which Depositor
intends to be tax-deductible under Internal Revenue Code Section 219 shall be in
cash and are to be invested under this Agreement.  Depositor contemplates future
periodic contributions within the tax-deductible limits and in accordance with
the rules for tax-deductibility specified in the Internal Revenue Code.
Depositor assumes full and sole responsibility for making sure that the sum of
periodic contributions during a single taxable year of Depositor does not exceed
those limits or violate those rules.  Depositor should not contribute to the
custodial account after it ceases to be exempt by reason of either section
408(e) or 415(g) of the Internal Revenue Code.

          (b)  Rollover Contributions From an Individual Retirement Account or
Individual Retirement Annuity Funded Exclusively With Deductible Contributions.
A rollover contribution by Depositor from an individual retirement account or
individual retirement annuity funded exclusively with deductible contributions
shall be a deposit in cash to be invested under this agreement, with respect to
which contribution, Depositor warrants that

(1) it meets the requirements for a rollover contribution from such an
individual retirement account or individual retirement annuity as are contained
in Code Section 408(d) and that

(2) no portion of such rollover contribution is attributable to a distribution
from an employees' trust, an employee annuity, an annuity contract or a U.S.
retirement bond as described in Internal Revenue Code Sections 402(a)(5),
403(a)(4), 403(b)(8), 405(d)(3), or 409(b)(3)(C).

          (c)  Rollover Contributions Attributable to Distributions From
Employer Plans.  A rollover contribution by Depositor other than a contribution
described in paragraph (b) above shall be a deposit in cash to be invested under
this Agreement with respect to which contribution Depositor warrants that (1)
the amount rolled over is attributable to a distribution from an employees'
trust, an employee annuity, an annuity contract, a qualified bond purchase plan,
or a U.S. retirement bond, which meets the requirements of Code sections
402(a)(5), 403(a)(4), 403(b)(8), 405(d)(3), or 409(b)(3)(C); and (2) Depositor
will make no additional contributions to the custodial account in which such
contribution is deposited, except as otherwise permitted by Scudder Fund
Distributors, Inc.

          If permitted by Scudder Fund Distributors, Inc., rollover
contributions may be received under this Agreement with respect to qualified
voluntary employee contributions as defined in Internal Revenue Code Section
219(e)(2) and such contributions shall thereafter be held and administered
hereunder by the Custodian in accordance with all applicable law with respect to
accumulated deductible employee contributions as defined in Internal Revenue
Code Section 72(o)(5)(B).


                                        8
<PAGE>

          (d)  Transfer from an Individual Retirement Account or Individual
Retirement Annuity.  Depositor may make an opening contribution hereunder by
directing the transfer of a cash amount from a custodian or trustee of an
individual retirement account or individual retirement annuity to the Custodian
be made for investment under this Agreement.

          (1)  From IRA Funded with Deductible Contributions.  Where no portion
          of such transferred amount is attributable to a distribution from an
          employees' trust, an employee annuity, an annuity contract or a U.S.
          retirement bond as described in Internal Revenue Code Sections
          402(a)(5), 403(a)(4), 403(b)(8), 405(d)(3), or 409(b)(3)(C), Depositor
          warrants that Depositor did not inherit the account or annuity, or if
          Depositor did inherit the account or annuity, that Depositor is the
          surviving spouse of the individual for whose benefit the account was
          originally maintained or the annuity was originally purchased.
          
          (2)  From IRA Funded with Distributions Attributable to an Employer
          Plan.  With respect to any other transferred amount, Depositor:
          
               (A)  agrees that no additional contributions will be made to the
               custodial account in which such contribution is deposited, except
               as otherwise permitted by Scudder Fund Distributors, Inc.;
               
               (B)  that the entire amount of such transferred amount is
               attributable to a distribution from an employees' trust, an
               employee annuity, an annuity contract, a qualified bond purchase
               plan, or a U.S. retirement bond, as described in Internal Revenue
               Code Sections 402(a)(5), 403(a)(4), 403(b)(8), 405(d)(3), or
               409(b)(3)(C), or other applicable law:
          
          (3)  that if the transferred amount had been a rollover contribution,
          it would have complied with the requirements of subparagraph (b) or
          (c) above.
          
     4.   Tax and Other Legal Matters

          DEPOSITOR ACKNOWLEDGES HAVING READ THE SECTIONS ENTITLED
"INSTRUCTIONS" AT BOTTOM ON PAGE 5 OF I.R.S. FORM 5305-A (of which this is a
part), which describe some of the tax and other matters important to Depositor,
and "ADDITIONAL INSTRUCTIONS" preceding Appendix "A".

     5.   Custodian's Fees

          (a)  Custodian shall be entitled to receive such reasonable fees with
respect to the establishment and administration of this custodial account as are
established by it from time to time.

          (b)  Upon thirty (30) days prior written notice, Custodian may change
its fee schedule.

          Custodian's fees, any income, gift, estate and inheritance taxes or
other taxes of any kind whatsoever, including transfer taxes incurred in
connection with the investment or reinvestment of the assets of the custodial
account, that may be levied or assessed in respect to such assets, and all other
administrative expenses incurred by Custodian in the performance of its duties
including fees for legal services rendered to Custodian, may be charged to the
custodial account, with the right to liquidate Mutual Fund shares or other
investments for this purpose, or (at Custodian's option) to the Depositor.

     6.   Custodial Account

          (a)  This Agreement shall take effect only when accepted and signed by
Custodian.  As directed, Custodian shall then open and maintain a separate
custodial account for Depositor and invest the initial contribution hereunder in
shares of the Mutual Fund(s) or other investments selected by Depositor in
Article IX Para. 1.  "Mutual Fund" means a regulated investment company which is
defined in Internal Revenue Code Section 851(a) and which has been designated by
Scudder Fund Distributors, Inc. (or its successors) as appropriate for
investment hereunder.


                                        9
<PAGE>

          (b)  Every subsequent contribution shall be invested in accordance
with instructions authorized by Depositor indicating Depositor's choice of the
Mutual Funds or other investments designated by Scudder Fund Distributors, Inc.
(or its successors) as appropriate for investment hereunder.  Depositor agrees
that the listing shall not be construed as an endorsement by Custodian of the
Mutual Funds or other investments in which contributions may be invested, final
choice of which is in the sole discretion of Depositor.  The Custodian does not
undertake to render any investment advice whatsoever to Depositor; its sole
duties are those prescribed in Article IX, para. 8(c).

          (c)  The Custodian shall invest subsequent contributions as directed.
However, if any such instructions authorized by Depositor are not received as
required, or if received, are in the opinion of Custodian unclear, or if the
accompanying contribution would cause the Depositor to exceed the maximum
limitation on tax deductibility, Custodian may hold or return all or a portion
of the contribution uninvested without liability for loss of income or
appreciation or for other loss, and without liability for interest, pending
receipt of written instructions or clarification.

          (d)  All dividends and capital gains distributions received on shares
of a Mutual Fund held in the custodial account shall (unless received in
additional such shares) be reinvested in shares of that Mutual Fund, if
available, which shall be credited to the account.  If any distribution on such
shares may be received at the election of the shareholder in additional such
shares or in cash or other property, Custodian shall elect to receive it in
additional such shares.  All accumulations on account of other investments shall
be reinvested in Depositor's custodial account.

          (e)  All Mutual Fund shares or other investments acquired by Custodian
hereunder shall be registered in the name of Custodian (with or without
identifying Depositor) or of its nominee.  Custodian shall deliver, or cause to
be executed and delivered, to Depositor all notices, prospectuses, financial
statements, proxies, and proxy soliciting materials relating to such Mutual Fund
shares or other investments held in the custodial account.  Custodian shall not
vote any such Mutual Fund shares or other investments except in accordance with
any written instructions received from Depositor.

     7.   Distributions.

          (This paragraph 7 supplements Article IV on Scudder IRA Form 12-84 of
the Agreement and must be read in conjunction with it.)

          (a)  Distribution of the custodial account assets in accordance with
Article VI shall be made in a manner set forth in subparagraph (c)(1) or (2),
whichever applies, except as Article IV otherwise requires and at such time as
Depositor (or Depositor's Beneficiary if Depositor is deceased) shall elect by
written order to Custodian, provided that distribution (except for distribution
on account of Depositor's disability or death, return of an "excess
contribution" referred to in subparagraph (d) or a "rollover" from this
account), must be no earlier than age 59 1/2 if Depositor wants to avoid an
"early distribution additional tax" under Code section 408(f) or other
applicable law.  For that purpose, Depositor will be considered disabled if
Depositor can prove, as provided in Code section 72(m)(7), that Depositor is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or be of long-continued and indefinite duration.  Depositor (or
Depositor's Beneficiary if Depositor is deceased) will order distribution in the
manner and at the time permitted or required by Article IV and this paragraph.
Custodian assumes no responsibility for the tax treatment of any distribution
from the custodial account; such responsibility accrues solely to the person
ordering the distribution.

          (b)  Custodian assumes (and shall have) no responsibility to make any
distribution on order of Depositor (or Depositor's Beneficiary if Depositor is
deceased) unless and until such order specifies the occasion for


                                       10
<PAGE>

such distribution, the elected manner of distribution, and any declaration
required by Article V.  Also, before making any such distribution or before
honoring any assignment of the custodial account, Custodian shall be furnished
with any and all application, certificates, tax waivers, signature guarantees,
and other documents (including proof of any legal representative's authority)
deemed necessary or advisable by Custodian, but Custodian shall not be
responsible for complying with an order which appears on its face to be genuine,
or for refusing to comply if not satisfied it is genuine, and assumes no duty of
further inquiry.

          (c)  Upon receipt of a proper written order as required above,
Custodian shall distribute the assets of the custodial account in cash or kind
as follows:

          (1)  Distribution to Depositor. If the distribution order calls for
          the custodial account to be paid to Depositor under Article IV, then
          distribution shall be made in one or more of the following ways as
          specified in the order.
          
               (A)  In a lump sum.
               
               (B)  In installments pursuant to a cash withdrawal plan, provided
               that such a plan suitable for prearranging the distributions
               described in this subparagraph (B) is available for Custodian's
               use under the rules governing the investments held in the
               custodial account.  A suitable cash withdrawal plan will provide
               for periodic liquidation of some of investments held in the
               custodial account to yield the cash necessary to pay each
               installment.  Prior to January 1, 1985, a suitable cash
               withdrawal plan will provide for payment of installments over a
               period not longer than the life expectancy of Depositor and
               Depositor's spouse.  Subsequent to December 31, 1984, a suitable
               cash withdrawal plan will provide for payment of installments
               ratably over a period of not longer than the life expectancy of
               the Depositor or the joint life and last survivor expectancy of
               the Depositor and the Depositor's Beneficiary (as defined in
               subparagraph (c)(2) of this Para. 7).  The life expectancies
               referred to in this Agreement shall be determined by using
               applicable Internal Revenue Service tables.  The amount
               distributed each year shall be at least equal to the quotient
               obtained by dividing the entire custodial account remaining at
               the beginning of that year by the adjusted life expectancy of
               Depositor and Depositor's spouse, or the joint life and last
               survivor expectancy of Depositor's Beneficiary (whichever is
               applicable).  Prior to January 1, 1985, the life or joint life
               expect and last survivor expectancy used to calculate the minimum
               amount to be distributed in a given year shall be equal to the
               relevant expectancy as it was determined as of when Depositor
               attained age 70 1/2 reduced by the number of whole years elapsed,
               if any, since Depositor attained age 70 1/2.  Subsequent to
               December 31, 1984, the adjusted life or joint life and last
               survivor expectancy used to calculate the minimum amount to be
               distributed in a given year shall be, at the Depositor's
               election, either determined by referring to the applicable
               Internal Revenue Service table and determining the relevant
               expectancy as of the particular year in question or by using a
               previously determined expectancy and reducing such expectancy by
               the number of whole years elapsed since it was determined.
               Notwithstanding any implication to the contrary in this
               subsection (B), no distribution need be made in any year, or a
               lesser amount may be distributed during such year, if the
               aggregate amounts distributed through the end of such year are at
               least equal to the aggregate of the minimum amounts required by
               this sub-


                                       11
<PAGE>

               paragraph (B) to have been so distributed.  Moreover, during
               Depositor's lifetime the entire custodial account remaining for
               distribution at any time under this subparagraph (B) may,
               pursuant to a proper supplementary written order as specified
               above, be distributed to Depositor.
               
               (c)  By the purchase and distribution of a single-premium
               contract meeting the requirements of Code section 408(b)(1), (3),
               (40 and, prior to January 1, 1985, (5) applicable to an
               "individual retirement annuity".

          (2) Distribution upon Death of Depositor or Depositor's Spouse. Prior
          to January 1, 1985, if Custodian receives a proper written order for
          distribution on account of the Depositor's death, or the spouse's
          death, if distributions were being made to the spouse over the joint
          life and last survivor expectancy, Custodian shall distribute the
          then- remaining custodial account to Depositor's (of, if applicable,
          the spouse's) Beneficiary within five (5) years of Depositor's (or, if
          applicable, the spouse's) death either in a lump sum or installments;
          provided, however, that if distributions have already begun before
          Depositor's death for a specified term, the Custodian may instead
          continue to make the distribution in the same manner and without
          regard to the foregoing five-year limitation; provided further, that
          if Depositor's Beneficiary is Depositor's spouse and if Depositor's
          Beneficiary elects to treat the account as if Depositor's Beneficiary
          were the Depositor, then the Custodian may distribute the account as
          directed by the Depositor's Beneficiary as if such person were the
          Depositor and in accordance with Articles IV and IX. Subsequent to
          December 31, 1984, if Custodian receives a proper written order for
          distribution on account of the Depositor's death or, the spouse's
          death, if distributions were being made to the Depositor's surviving
          spouse, then the Custodian shall distribute the then-remaining
          custodial account to the Depositor's (or, if applicable, the spouse's)
          Beneficiary over the life of the Depositor's (or, if applicable, the
          spouse's) Beneficiary or within a period not greater than the greater
          of five (5) years after the Depositor's (or, if applicable, the
          spouse's) death or the life expectancy of Depositor's (or, if
          applicable, the spouse's) Beneficiary; provided, however, that if
          distributions have already begun before Depositor's death for a
          specified term, Custodian shall continue to distribute the custodial
          account over a period at least as rapid as that specified term. The
          term "Depositor's Beneficiary" means the person or persons designated
          as such by the "designating person" (as defined below) on a form
          acceptable to Custodian for use in connection with this Agreement,
          signed by the designating person, and filed with the Custodian in
          accordance with this subparagraph (2). The form may name persons or
          estates to take upon the contingency of survival. However, the term
          "Depositor's Beneficiary" means the designating person's estate to the
          extent no such designation on such a form effectively disposes of the
          custodial account as of when such distribution is to commence.
          Moreover, a form shall not become effective for that purpose until it
          is filed with the Custodian during the lifetime of the designating
          person. The form last accepted by Custodian before such distribution
          is to commence, upon becoming effective during the designating
          person's lifetime, shall be controlling, and, whether or not fully
          dispositive of the custodial account, thereupon shall revoke all such
          forms previously filed by that person. The term "designating person"
          means Depositor; after Depositor's death, it also means the person or
          persons (other than Depositor's estate) who begin to receive a portion
          of the custodial account pursuant to such a designation by Depositor,
          and designations by such a person shall relate solely to the balance
          of that


                                       12
<PAGE>

          portion remaining in the custodial account as of when distribution
          pursuant to a designation by that person is to commence.  The
          Custodian shall accept all such forms only in the Commonwealth of
          Massachusetts, and they shall be considered part of this Agreement for
          purposes of Article IX, para. 13(c).
          
          (3)  Any annuity which Custodian is to purchase and distribute under
          this Agreement may be fixed or variable, but Custodian shall not be
          required to distribute in that manner unless the premium for that
          annuity is at least $1,000.
          
          (4)  Depositor's Beneficiary shall not have the right or power to
          anticipate any part of the custodial account or to sell, assign,
          transfer, pledge or hypothecate any part thereof.   The custodial
          account shall not be liable for the debts of Depositor's Beneficiary
          or subject to any seizure, attachment, execution or other legal
          process in respect thereto.
          
          (d)  If during a taxable year under Article 1 a total amount is
contributed which exceeds the amount deductible for that year, either because
such amount exceeds the tax-deductible limits specified in the Internal Revenue
Code, or because of attainment of age 70 1/2 in that year, or for some other
reason, then upon receiving written notice specifying the year in question, the
amount of the excess, the reason it is an excess, and the amount of net income
in the custodial account attributable to such excess -- Custodian shall
distribute cash to Depositor in an amount equal to the sum of such excess and
earnings.  If the excess contribution did not arise because of attainment of age
70 1/2. then (in Custodian's discretion unless otherwise instructed by
Depositor) in lieu of being distributed, said sum shall be treated by Depositor
as a contribution in the then current or a succeeding taxable year, in
accordance with applicable law.

     8.   Additional Provisions Regarding the Custodian

          (a)  When and after distributions of the custodial account to
Depositor's Beneficiary commence, all rights and obligations assigned to
Depositor by provisions of this Agreement shall inure to, and be enjoyed and
exercised by, Depositor's Beneficiary instead of Depositor.  Until such
distributions commence to such a person, the Custodian shall not be responsible
for treating such person's predecessor to such rights and obligations as still
possessing the same.

          (b)  Custodian shall keep adequate records of transactions it is
required to perform hereunder.  Not later than sixty (60) days after the close
of each calendar year or after the Custodian's resignation or removal pursuant
to Article IX, para. 10(a), Custodian shall render to Depositor a written report
or reports reflecting the transactions effected by it during such period and the
assets of the custodial account at the close of the period.  Sixty (60) days
after rendering such report(s), Custodian shall be forever released and
discharged from all liability and accountability to anyone with respect to its
acts and transactions shown in or reflected by such report(s), except with
respect to those as to which the recipient of such report(s) shall have filed
written objections with the Custodian within the latter such sixty-day period.

          (c)  Custodian shall be an agent for Depositor to receive and invest
contributions as authorized by Depositor, hold and distribute such investments,
and keep adequate records and report thereon, all in accordance with this
Agreement.  The parties do not intend to confer any fiduciary duties on
Custodian, and none shall be implied.  Custodian may perform any of its
administrative duties through other persons designated by Custodian from time to
time, except that Mutual Fund shares or other investments must be registered as
stated in para. 6(e) of this Article IX; and Custodian intends initially to
delegate all such duties to Boston Financial Data Services, Inc., which is
partially owned by Custodian's parent company; but no such delegation or future
change therein shall be considered as an amendment to this Agreement.  Custodian
shall not be liable (and assumes no responsibility) for the collection of
contributions, the


                                       13
<PAGE>

deductibility of any contribution or its propriety under this Agreement, or the
purpose or propriety of any distribution ordered in accordance with Article IX,
para. 7, or made in accordance with Article IX, para. 12, which matters are the
sole responsibility of Depositor and Depositor's Beneficiary.

          (d)  Depositor shall always fully indemnify Custodian and save it
harmless from any and all liability whatsoever which may arise either (1) in
connection with this Agreement and matters which it contemplates, except that
which arises due to Custodian's negligence or willful misconduct, or (2) with
respect to making or failing to make any distribution, other than for failure to
make distribution in accordance with an order therefor which is in full
compliance with both Article IV and para. 7(a) and (b) of Article IX.  Custodian
shall not be obligated or expected to commence or defend any legal action or
proceeding in connection with this Agreement or such matters unless agreed upon
by Custodian and Depositor, and unless fully indemnified for so doing to
Custodian's satisfaction.

          (e)  Custodian may conclusively rely upon and shall be protected in
acting upon any written order from or authorized by Depositor or Depositor's
Beneficiary or any other notice, request, consent, certificate or other
instrument, paper, or other communication believed by it to be genuine and to
have been issued in proper form and with proper authority, and, so long as it
acts in good faith, in taking or omitting to take any other action in reliance
thereon.

     9.   Amendment

          (This paragraph 9 supplements Article VIII on Scudder IRA Form 12-84
of the Agreement and must be read in conjunction with it.)

          (a)  Depositor retains the right to amend this Agreement in any
respect at any time, effective on a stated date which shall be at least sixty
(60) days after giving written notice of the amendment (including its exact
terms) to Custodian by registered or certified mail unless Custodian waives such
notice as to that amendment.  If Custodian does not wish to continue serving in
that capacity under this Agreement as so amended, it may resign in accordance
with Article IX, para. 10.  Depositor also delegates, to the distributor
(principal underwriter) of a plurality of the Mutual Funds described in Article
IX, para. 6(b), Depositor's right so to amend including retroactively, as
necessary or appropriate in the opinion of counsel satisfactory to the
distributor, in order to conform with pertinent provisions of the Code and other
laws or successor provisions of law or to obtain a governmental ruling that such
requirements are met, to adopt a prototype or master plan (when one becomes
available) for investment in shares of such Mutual Funds or other investments,
or as otherwise may be advisable in the opinion of such counsel, provided the
distributor amends in the same manner all agreements comparable to this one,
having the same Custodian, permitting investment in shares of such Mutual Funds
or other investments, and under which such power has been delegated to it.  Such
an amendment by the distributor shall be communicated in writing to Depositor
and Custodian, and Depositor shall be deemed to have consented thereto unless,
within thirty (30) days after such communication to Depositor is mailed,
Depositor either (1) gives Custodian a proper written order for a lump-sum
distribution of the custodial account, or (2) removes Custodian and
simultaneously appoints a Successor Custodian under Article IX, para. 10.

          (b)  This paragraph 9 shall not be construed to restrict Custodian's
freedom to agree with distributors of Mutual Fund shares, or others, upon the
terms by which shares of additional Mutual Funds or other investments may be
chosen for investment as contemplated in Article IX, para. 6(b), or Custodian's
freedom to change fee schedules in the manner proved by Article IX, para. 5(b),
and no such agreement or change shall be deemed to be an amendment of this
Agreement.


                                       14
<PAGE>

     10.  Resignation or Removal of Custodian.

          (a)  Custodian may resign at any time upon at least thirty (30) days
prior notice in writing to Depositor, and may be removed by Depositor at any
time upon at least thirty (30) days prior notice in writing to Custodian.  Upon
such resignation or removal, Depositor shall appoint a Successor Custodian to
serve under this Agreement.  Upon receipt by Custodian of written acceptance of
such appointment by the Successor Custodian, Custodian shall transfer to such
Successor the assets of the custodial account and all necessary records (or
copies thereof) pertaining thereto, provided that (if so requested by Custodian)
any Successor Custodian agrees not to dispose of any such records without
Custodian's consent.  Custodian is authorized, however, to reserve such a
portion of such assets as it may deem advisable for payment of all its fees,
compensation, costs, and expenses, or for payment of any other liabilities
constituting a charge on or against the assets of the custodial account or on or
against Custodian, with any balance of such reserve remaining after the payment
of all such items to be paid over to the Successor Custodian.

          (b)  If within thirty (30) days after Custodian's resignation or
removal or such longer time as Custodian may agree to, Depositor has not
appointed a Successor Custodian which has accepted such appointment, Custodian
shall terminate the custodial account pursuant to Article IX, para. 11, unless
within that time the distributor referred to in Article IX, para. 9(a), appoints
such Successor and gives written notice thereof to Depositor and Custodian.

          (c)  Custodian shall not be liable for the acts or omissions of such
Successor.

          (d)  The Custodian, and every Successor Custodian appointed to serve
under this Agreement, must be a bank as defined in Code section 408(n) or such
other person who qualifies to serve in the manner prescribed by Code section
408(a)(2) and satisfies the Depositor, distributor, or Custodian, upon request,
as to such qualification.

          (e)  After Custodian has transferred the custodial account assets
(including any reserve balance as contemplated above) to the Successor
Custodian, Custodian shall be relieved of all further liability with respect to
this Agreement, the custodial account, and the assets thereof.

     11.  Termination of Account

          (a)  Custodian shall terminate the custodial account if, within the
time specified in Article IX, para. 10(b), after Custodian's resignation or
removal, neither Depositor nor the distributor has appointed a Successor
Custodian which has accepted such appointment.  Termination of the custodial
account shall be effected by distributing all assets thereof in a lump sum in
cash or in kind to Depositor subject to Custodian's right to reserve funds as
provided in Article IX, para. 10(a).

          (b)  Upon termination of the custodial account, this Agreement shall
terminate and have no further force and effect, and Custodian shall be relieved
from all further liability with respect to this Agreement, the custodial
account, and all assets thereof so distributed.

     12.  Liquidation of Account

          (a)  Notwithstanding anything contained in this Agreement to the
contrary, Scudder Fund Distributors, Inc. shall have the right to direct
Custodian, by written order to Custodian, to liquidate the custodial account if
the value of the account at the time of such written order is less than a
minimum value established on a non-discriminatory basis from time to time by
Scudder Fund Distributors, Inc., and upon receipt of such written order (which
Scudder Fund Distributors, Inc. shall have no duty to make and which, if made,
may be made with respect to any specified accounts as to which it may be made
applicable singly or to all accounts as to which it may be made applicable as a
group), Custodian shall forthwith proceed to liquidate the custodial account by
distributing all assets thereof in a lump sum in cash or in kind to Depositor,
subject to Custodian's right to reserve such a portion of such assets as it may
deem advis-


                                       15
<PAGE>

able for payment of all its fees, compensation, costs, and expenses, or for
payment of any other liabilities constituting a charge on or against the assets
of the custodial account or on or against Custodian, with any balance of such
reserve remaining after the payment of all such items to be paid over to
Depositor.

          (b)  Neither Scudder Fund Distributors, Inc. nor Custodian shall be
liable for, or in any way responsible with respect to, any penalty or any other
loss incurred by any person with respect to a distribution made hereunder and
upon liquidation of the custodial account as aforesaid, this Agreement shall
terminate and have no further force and effect, and Custodian and Scudder Fund
Distributors, Inc. shall be relieved from all further liability with respect to
this Agreement, the custodial account, and all assets thereof so distributed.

     13.  Miscellaneous

          (a)  References herein to the "Internal Revenue Code" or "Code" and
sections thereof shall mean the same as amended from time to time hereafter,
including successors to such sections.

          (b)  Except where otherwise specifically required in this Agreement,
any notice from Custodian to any person provided for in this Agreement shall be
effective if sent by first-class mail to such person at that person's last
address on Custodian's records.

          (c)  This agreement is accepted by Custodian in, and shall be
construed and administered in accordance with the laws of the Commonwealth of
Massachusetts.  This Agreement is intended to qualify under section 408 of the
Code as an Individual Retirement Account and for the Retirement Savings
deduction under section 219 of the Code, and if any provision hereof is subject
to more than one interpretation or any term used herein is subject to more than
one construction, such ambiguity shall be resolved in favor of that
interpretation or construction which is consistent with that intent.  However,
neither the Custodian, nor any Mutual Fund (or company associated therewith)
shall be responsible for whether or not such intentions are achieved through use
of this Agreement, and Depositor is referred to Depositor's attorney for any
such assurances.


CUSTODIAN
DISCLOSURE STATEMENT

     The following information is being provided to you by the State Street Bank
and Trust Company, the Custodian of the Scudder Individual Retirement Accounts,
in accordance with the requirements of the Internal Revenue Service.  Please
read it together with the Individual Retirement Plan and the prospectus for the
shares of each Mutual Fund selected by you for the investment of your
contributions to that Plan, copies of which you should have already received
from the distributor of those shares.  The provisions of the Plan and prospectus
must prevail over this statement in any instance where the statement is
incomplete or appears to conflict.

     The Employee Retirement Income Security Act of 1974 has provided an
entirely new program that may enable you to plan for your retirement by creating
a "retirement plan" with federally tax-deductible dollars.  This federal income
tax deduction is available even if you do not otherwise itemize your deductions.
In addition, any earnings on the assets held in your individual retirement
account will not be subject to federal income tax until you actually begin to
receive a distribution from your account.  The state income tax treatment of
your account may differ, and details should be available from your state taxing
authority or your own tax adviser.

     As with most other laws that provide special tax treatment, there are
certain restrictions and limitations involved with respect to your individual
retirement account:


                                       16
<PAGE>

     1.   Only a limited amount of savings can qualify for the preferential tax
          treatment -- 100% of your compensation or earnings from self-
          employment up to an annual maximum of $2,000.  Under certain
          conditions, an individual and his or her non-employed spouse may each
          open an IRA.  Annual deductions for contributions are allowable if a
          joint income tax return is filed and the deductions are limited to the
          lesser of 100% of the employed spouse's compensation or $2,250, and
          the amount contributed to either individual retirement account may not
          exceed $2,000.
     
          In the case of an individual retirement account which meets the
          requirements of a so-called Simplified Employee Pension Plan, an
          employer may contribute a deductible amount equal to 15% of the
          employee's compensation up to an annual maximum of $30,000, the amount
          of such contribution is includible in the employee's income as wages
          (for federal income tax purposes) but is deductible by him or her.
          The employee is also allowed an annual deduction for his or her own
          individual retirement account contributions limited to the lesser of
          100% of the employee's compensation or $2,000.
     
          There is a 6% penalty tax on any so-called "excess contribution" if
          you make one, that is, on the portion of a contribution made to your
          IRA in excess of the amount which can be currently deducted.  Some
          examples of when this can occur are when you make a contribution to
          your IRA in excess of the allowable deduction limitations, or your
          contribute during or after the calendar year in which you reach 70
          1/2, or in the case of a spousal IRA, if the non-employed spouse
          receives any compensation during the calendar year.  The 6% penalty
          tax on any "excess contribution" also attaches for each following year
          until the excess is withdrawn or used up.  If an excess contribution
          plus earnings on it is withdrawn before the time for filing the
          individual's tax return for the year of the contribution (including
          extensions), there will be no 6% penalty tax.  The amount withdrawn
          will not be considered a premature distribution nor taxed as ordinary
          income, except the earnings withdrawn will be included in the income
          of the taxpayer.  In addition, in certain cases an excess contribution
          may be withdrawn after the time for filing the individual's tax return
          without resulting in taxable income to the individual.  Also, excess
          contributions for one year may be carried forward and deducted in the
          next year.
     
     2.   Contributions must be made to a Trust or Custodial Account in which
          the Trustee/Custodian is either a bank or such other person who has
          been approved by the Secretary of the Treasury.  No part of your
          contribution may be invested in life insurance or be commingled with
          other property except in a common trust fund or common investment
          fund.
     
     3.   No deduction is allowed for (a) contribution other than in cash; (b)
          contributions (other than those by an employee to a Simplified
          Employee Pension Plan) made during your calendar year in which you
          attain age 70 1/2 or thereafter; or (c) for any amount you contribute
          which was a distribution from another retirement plan ("rollover"
          contribution).  However, the limitations in paragraph 1 do not apply
          to such rollovers.
     
     4.   Individuals receiving compensation may establish their own individual
          retirement accounts even if they are already covered under tax-
          qualified plans (including Keogh plans for self-employed individuals),
          government plans, or certain annuities.
     
     5.   Your interest in the account must be nonforfeitable at all times.
     
     6.   An individual is allowed to transfer, as a so-called "rollover"
          contribution, such individual's investment in one type of individual
          retirement plan to another without any tax liability.  Also,


                                       17
<PAGE>

          under certain conditions, an individual may so roll over (tax-free) a
          distribution received from a qualified plan or a tax-sheltered
          annuity.  However, strict limitations apply to such rollovers, and you
          should seek competent tax advice in order to comply with all the rules
          governing rollovers.
     
     7.   Since the purpose of the IRA savings plan is to accumulate funds for
          retirement, your receipt or use of any portion of this account (for
          example, as collateral for a loan) before you attain age 59 1/2 would
          be considered as an early distribution unless the distribution is a
          result of death or disability.  The amount of early distribution would
          be includable in your gross income and would also subject you to a
          penalty tax equal to 10% of the distribution unless you transfer it to
          another IRA under circumstances whereby it qualifies as a rollover.
     
     8.   If you or your beneficiary were to engage in any prohibited
          transaction (such as any sale, exchange or leasing of any property
          between you and the account, or any interference with the independent
          status of the account) then the account would lose its exemption from
          tax and be treated as having been distributed to you.  The value of
          the entire account would be includable in your gross income, and if
          your then under age 59 1/2 you would also be subject to the 10%
          penalty tax on early distributions.
     
     9.   If you attain age 70 1/2 before the end of 1984, your entire interest
          in your account must be distributed to you, or begin to be distributed
          to you, before the close of the year in which you attain age 70 1/2.
          The distribution may be made at once in a lump sum, or it may be made
          in installments.  However, installment payments cannot be scheduled to
          be made over a period which extends beyond your life expectancy, or
          the combined life expectancy of you and your spouse.  If the amount
          distributed during a calendar year is less than the minimum amount
          required to be distributed, the recipient would be subject to a
          penalty tax equal to 50% of the difference between the amount required
          to be distributed and the amount actually distributed.  If you die
          before the entire interest is distributed to you, similar rules
          require prompt, level payments to your beneficiary.
     
     10.  If you do not attain age 70 1/2 until January 1, 1985 or later, your
          entire interest in your account must be distributed, or begin to be
          distributed, to you no later than the first April 1st of the year
          following the later of the year in which you attain age 70 1/2 or
          retire.  Distribution may be made at once in a lump sum, or it may be
          made in installments.  However, installment payments cannot be
          schedule to be made over a period which extends beyond your life
          expectancy (as determined annually), or the joint life and last
          survivor expectancy of you and the beneficiary your designate (as
          redetermined annually, if that beneficiary is your spouse).  If the
          amount distributed during a calendar year is less than the minimum
          amount required to be distributed, the recipient would be subject to a
          penalty tax equal to 50% of the difference between the amount required
          to be distributed and the amount actually distributed.  If you die
          before the entire interest is distributed to you, but after you have
          begun to receive distributions, your entire account must be
          distributed to your beneficiary over a period no longer than the last
          determined life expectancy or life and last survivor expectancy over
          which your account was being distributed prior to your death.  If you
          die before the entire interest has begun to be distributed to you and
          your spouse is your beneficiary, distributions to your spouse must
          either (a) be completed within 5 years of your death or (b) commence
          before the later of one year after your death or the


                                       18
<PAGE>

          date on which you would have attained age 70 1/2, and continue over
          his or her life or a period not exceeding his or her life expectancy.
          If you die before the entire interest has begun to be distributed to
          you and your spouse is not your beneficiary, distributions to your
          beneficiary must either (a) be completed within five years of your
          death of (b) commence within one year after your death and continue
          over your beneficiary's life or a period not exceeding his or her life
          expectancy.
     
     11.  Amounts distributed to you are includable in your gross income when
          you receive them and are taxable as ordinary income without any
          special lump-sum distribution privileges.  However, normal four-year
          income averaging may be available.
     
     12.  If you die before the end of 1984, the first $100,00 worth of
          distributions paid to your beneficiary (other than your estate) are
          not subject to federal estate and gift tax when they are paid in a
          series of substantially equal period statements over the life of the
          beneficiary or over a period of at least 36 months after your death.
          After December 31, 1984, this special federal estate and gift tax
          exclusion will no longer be available.
     
     13.  You must file Treasury Form 5329 with the Internal Revenue Service for
          each calendar year during which there is an excess contribution,
          premature distribution, or during which there is an insufficient
          distribution as referred to in paragraphs 9 and 10 above.
     
     14.  The Individual Retirement Account Plan has been approved as to form by
          the Internal Revenue Service.  This approval is a determination only
          as to the form of the account and does not represent a determination
          of the merits of such account.
     
     15.  Information about the shares of each mutual fund available for
          investment by your individual retirement account must be furnished to
          you in the form of a prospectus governed by rules of the Securities
          and Exchange Commission.  Please refer to the prospectus for detailed
          information concerning your mutual fund.  Growth in the value of your
          account cannot be guaranteed or projected.  However, the income and
          operating expenses of a mutual fund will affect the value of its
          shares, and hence the value of your account, as does any increase or
          decrease in the value of the assets of the mutual fund.  The fund's
          prospectus contains information regarding current income and expenses
          of your mutual fund.
     
          Fees and other expenses of maintaining your account may be charged to
          you or your account.  The Custodian's fee schedule is referred to in
          Article IX of the Plan document and is distributed to you with it.
     
     If you have not received this Disclosure Statement at least seven calendar
days before the establishment of your Individual Retirement Account, you have
the right to revoke your Individual Retirement Account during the seven calendar
day period following the establishment of it.  In order to so revoke your
Individual Retirement Account, you must do so in writing and you must mail or
deliver your revocation to Scudder Fund Distributors, Inc., c/o State Street
Bank and Trust Company, P.O. Box 1912, Boston, Massachusetts 02105.  If your
revocation is mailed, the date of the postmark (or the date of certification or
registration if sent by certified or registered mail) will be considered your
revocation date.  If you so revoke your individual retirement account during the
seven-day period, the entire amount of your account, without any adjustments
(for items such as administrative expenses, fees, or fluctuation in market
value) will be returned to you.

     You may obtain further information from any district office of the Internal
Revenue Service.

                     (C)1984 Scudder Fund Distributors, Inc.
                               All rights reserved


                                       19
<PAGE>

============================




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








SCUDDER
- ----------
12/34-3-15



SCUDDER
403(b)
PLANS


Plan Agreement


                                                    SCUDDER
                                                    SERVING INVESTORS SINCE 1919


<PAGE>

                            Scudder 403(b) Agreement

         This Scudder 403(b) Agreement ("the Agreement") is entered into by and
among (i) each employer who executes a Scudder 403(b) Application ("the
Employer") and thereby certifies that the Employer is duly qualified as an
organization described in section 403(b)(1)(A) of the Internal Revenue Code of
1954, as amended ("the Code"), (ii) the Custodian which executes a Scudder
403(b) Application and thereby certifies that it is duly qualified as a bank
described in section 401(d)(1) of the Code, and (iii) each employee who executes
a Scudder 403(b) Application ("the Employee") and thereby certifies that the
Employee is an employee of the Employer, and this Agreement shall be effective
as of the date acknowledgment of the receipt by the Custodian of such Scudder
403(b) Application is mailed by the Custodian to the Employee.

ARTICLE 1.  DEFINITIONS

         A. Code means the Internal Revenue Code of 1954, as amended.

         B. Contribution means the amount to be transmitted by the Employer to
the Custodian for addition to the Employee's Custodial Investment Account.

         C. Custodial Investment Account or Account means the account or
accounts established and maintained by the Custodian for an Employee pursuant to
this Agreement and, when the contect so implies, may mean the assets, if any, at
the time held therein by the Custodian.

         D. Scudder 403(b) Agreement or Agreement means this document,
incorporating by reference the Scudder 403(b) Application and Designation of
Beneficiary.

         E. Custodian shall mean the bank, or any successor thereto, set forth
in the Scudder 403(b) Application.

         F. Designation of Beneficiary or Designation means the document
executed by the Employee pursuant to Article II, Part C.

         G. Employee means each person employed by the Employer who has properly
executed an Application.

         H. Employer means the organization, state, political subdivision of a
state, or agency or instrumentality of such state or political subdivision named
in this Agreement.

         I. Regulated Investment Company or Company means a domestic corporation
which is a regulated investment company within the meaning of Section 851(a) of
the Code and which issues only redeemable stock for which Scudder, Stevens and
Clark (or its successor) is acting as the investment adviser and which has been
designated by Scudder Fund Distributors, Inc. (or its successor) as appropriate
for investment hereunder.

         J. Scudder 403(b) Application or Application means the document
executed by the Employer, the Employee and the Custodian pursuant to Article II,
Part A.

         K. Normal Retirement Age means age 59 1/2.

ARTICLE II.  ESTABLISHMENT OF CUSTODIAL INVESTMENT ACCOUNTS

         A. Request for participation. Each Employee who properly executes an
Application thereby becomes a party to this Agreement with the right to enforce
its terms against any other party. Such executed Application is hereby
specifically incorporated herein by reference. An Application is properly
executed when signed by the Employer, the Employee and the Custodian. The
Custodian may rely on the validity of the signatures thereon, on the existence
of the employment relation thereby affirmed, and on the irrevocable subscription
to the provisions of this Agreement therein contained.

         B. Opening of Account. Upon acceptance of an Application by the
Custodian, the Custodian shall open a separate Custodial Investment Account
("the Account") for the benefit of the Employee. The Account shall be maintained
pursuant to the terms of this Agreement, including the documents incorporated
herein by reference.

         C. Employee's Designation of Beneficiary. Each Employee may submit to
the Custodian a properly executed Employee's Designation of Beneficiary form or
other written instrument acceptable to the Custodian for use in connection with
this Agreement (which are referred to hereinafter interchangeably as a
"Designation") which shall not become effective until it is filed with the
Custodian at the Custodian's home office during the lifetime of the Employee.
The last effective Designation accepted by the Custodian shall be controlling,
and whether or not fully dispositive of the Account, thereupon shall revoke all
other such Designations previously filed by the Employee. Each such executed
Designation is hereby specifically incorporated herein by reference and shall be
construed, enforced and administered according to the laws of the state in which
the home office of the Custodian is located.

ARTICLE III.  CONTRIBUTIONS

         A. Adjustment of compensation, transmittal of Contributions, and
exclusion allowance. Each agreement between the Employer and the Employee as to
the adjustment of the Employee's compensation, whether made pursuant to an
Application or pursuant to a separate written agreement between the Employer and
the Employee, shall be effective only as to amounts earned by the Employee after
such an agreement becomes effective. Each such agreement between the Employer
and the Employee as to the adjustment of the Employee's compensation, whether
made pursuant to an Application or pursuant to a separate written agreement
between the Employer and the Employee, shall be irrevocable as to both the
Employer and the Employee except that either of them may terminate such
agreement as of the end of any payroll period so that it will not apply to
compensation subsequently earned. Subject to the immediately preceding sentence,
the Employee may, in the manner provided for in subpart (a) of Part B of Article
VIII, change such agreement between the Employer and the Employee as to the
adjustment of the Employee's compensation, but such change may be made no more
than once in each taxable year of the Employee. All Contributions shall be
transmitted to the Custodian. The Employee shall be responsible for computing
the maximum amount that may be contributed on his behalf for each tax year in
accordance with the Employee's "exclusion allowance" as that term is defined in
section 403(b)(2) of the Code. The Employee shall determine the applicable
limitation(s) on contributions under section 415(c) of the Code, and the
Employee shall have the right to avail himself of and make any of the elections
provided under said section 415. Such computations and determinations shall be
made at least annually, and the Employee shall communicate the results to the
Employer no later than thirty (30) days before the last day on which the
Employee can execute a new Application or other written agreement with the
Employer for the taxable year without violating the pertinent rules and
regulations promulgated by the Treasury Department. Neither the Custodian,
Scudder Fund Distributors, Inc., any Regulated Investment Company, nor the
Employer shall have any obligation to verify the correctness of the Employee's
computation of the Employee's exclusion allowance or limitations on
contributions under section 415 of the Code or any responsibility with respect
to any election available to the Employee under said section 415 or any matters
relating to any tax consequences with respect to the Employee's contributions,
including the identification and correction of an "excess contribution" as that
term is defined in section 4973 of the Code, all of which foregoing matters
shall be solely the responsibility of the Employee.

         B. Transfers and rollovers.

         (a) Transfers from and to other Accounts. The Employer or the Employee
         may cause the transfer of assets acceptable to the Custodian and
         available from an existing custodial account qualified under section
         403(b)(7) of the Code and/or from an existing annuity contract
         qualified under section 403(b) of the Code to his Custodial Investment
         Account. Once transferred into the Employee's Custodial Investment
         Account, such assets shall be treated as a Contribution for purposes of
         this Agreement and shall be invested, distributed and otherwise dealt
         with as such. The Employer or Employee may cause the transfer of assets
         agreed to by the Custodian from the Employee's Custodial Investment
         Account to a custodial account established under section 403(b)(7) of
         the Code and/or to an annuity qualified under section 403(b) of the
         Code.

         (b) Rollover contributions. The Custodian may accept contributions in
         the form of assets acceptable to the Custodian received from an annuity
         contract or a custodial account described in section 403(b) of the
         Code, an individual retirement account described in section 408(a) of
         the Code, an individual retirement annuity described in section 408(b)
         of the Code, or a retirement bond described in section 409(a) of the
         Code, provided that such contribution qualifies in all respects as a
         rollover contribution in accordance with the requirements of section
         403(b)(8), section 408(d)(3) or section 409(b)(3)(C) of the Code
         (including the requirement that no part of the amount received from an
         individual retirement account, individual retirement annuity or
         retirement bond be attributable to any source other than a rollover
         contribution from any annuity contract or custodial account described
         in section 403(b) of the Code) or other applicable provisions of the
         Code in effect from time to time. Such rollover contribution shall be
         held by the Custodian in a separate Account for the benefit of the
         Employee which consists only of such rollover contributions and the
         earnings thereon. Once transferred into the Employee's Custodial
         Account, such assets shall be treated as a Contribution for purposes of
         this Agreement and shall be invested, distributed and otherwise dealt
         with as such. The right is reserved to transfer the assets of the
         Custodial Investment Account to another form of annuity contract or
         custodial account described in section 403(b) of the Code or to an
         individual retirement account, individual retirement annuity, or
         retirement bond plan established pursuant to section 408 or 409 of the
         Code.

      If permitted by Scudder Fund Distributors, Inc., in accordance with
      applicable law, rollover contributions with respect to qualified voluntary
      employee contributions as defined in section 219(e)(2) of the Code may be
      received under this Agreement with respect to taxable years


2
<PAGE>


      beginning after December 31, 1981, and such contributions shall thereafter
      be held and administered hereunder by the Custodian in accordance with all
      applicable law with respect to accumulated deductible employee
      contributions as defined in section 72(o)(5)(B) of the Code.

      (c) Limitation of liabilities. Neither the Custodian nor Scudder Fund
      Distributors, Inc. shall have any responsibility with respect to any
      matters relating to the tax consequences with respect to any transfer or
      rollover made under this Part B of Article III.

ARTICLE IV.  INVESTMENT

         A. Purchase. The Custodian shall receive and, as soon as practical,
shall invest all contributions in accordance with the Employee's investment
instructions which are then in effect for the Employee.

         B. Registration and safekeeping. Any stock of a Regulated Investment
Company held under this Agreement shall be held by the Custodian. Such stock may
be registered in the name of the Custodian or its nominee, but the Custodian
need not require issuance of certificates for such stock.

         C. Eligibility. The Custodian shall invest only in stock of a Regulated
Investment Company. Nothing in this Agreement shall prevent the Employer from
purchasing an annuity policy which qualifies under section 403(b) of the Code,
but such a policy, if selected by the Employee, shall be issued directly to such
Employee.

         A Custodial Investment Account shall be limited to investment in stock
of one Regulated Investment Company, except that the Employee may choose that
the investment be divided between the stock of more than one Regulated
Investment Company if the value of the stock of each Company in which an
investment is being made is, upon completion of the investment, equal to a
minimum value established from time to time by a designation by Scudder Fund
Distributors, Inc. (including a designation that there shall be no such minimum
investment limitation).

         If a Company in whose stock investments have been made is no longer
designated by Scudder Fund Distributors, Inc as appropriate for investment
hereunder, Scudder Fund Distributors, Inc. shall advise the Employee for whose
Account the investments were made and shall provide said Employee with a current
list of Companies available for investment. If, within 30 days of providing of
such current list, the Employee does not submit new investment instructions, the
Employee's investment in the deleted Company shall be changed to an investment
for the Employee's Account in stock of Scudder Cash Investment Trust or in stock
of another Regulated Investment Company or Companies designated by Scudder Fund
Distributors, Inc. and no additional investments shall be made in said deleted
Company.

         D. Reports and voting of securities. The Custodian shall deliver to the
Employee all notices, reports, prospectuses, financial statements, proxies and
proxy-soliciting materials received by it as to investments made for the
Employee's Account. The Custodian shall vote all shares only in accordance with
the instructions of the Employee as expressed in the executed proxy. If the
Employee desires to attend a meeting at which securities held in this account
may be voted, the Custodian shall furnish a proxy at the Employee's request.

         E. Dividends. All capital gain distributions and dividends received on
the stock of a Regulated Investment Company shall be reinvested in the stock of
that Regulated Investment Company. The Custodian shall elect to receive any such
distribution in the stock of the distributing Company whenever possible.

         F. Change of investments. An Employee or his designated beneficiary or
beneficiaries who has (have) survived the Employee and to whom distributions are
being made (by unanimous agreement if there is more than one beneficiary) may
direct in writing (or by any other manner of direction designated by Scudder
Fund Distributors, Inc.) that the investment medium of the Accout be changed to
stock of another Regulated Investment Company or Companies. However, if Scudder
Fund Distributors, Inc. determines in its own judgment that there has been
trading within the Account, any Regulated Investment Company may refuse to sell
its shares to such Account. If the Employee's Account is invested in stock of
more than one Regulated Investment Company, a separate account shall be kept
with respect to the stock of each such Company, and he or they may designate the
portion of any new contribution, withdrawal, or change of investment which is to
be allocated to each such separate account.

ARTICLE V.  CUSTODIAN

         A. Duties. The Custodian shall:

         (1) Receive contributions transmitted by the Employer;
         (2) Provide safekeeping for the securities and other assets in the
         Custodial Investment Account;
         (3) Collect income;
         (4) Execute orders for purchase, sale or exchange of securities and
         make settlement in accordance with general practice;
         (5) Maintain records of all transactions in the Account;
         (6) Transmit to each Employee, not less frequently than annually,
         appropriate statements of the amount of the Custodian's compensation,
         if any, charged to the account.
         (7) File with the Internal Revenue Service and/or any other government
         agency such returns, reports, forms, and other information as may be
         required of it as Custodian;
         (8) Perform all other duties and services consistent with the purposes
         and intentions of this Agreement. The Custodian may perform any of its
         administrative duties through other persons designated by the Custodian
         from time to time, except that all assets in the Account shall be held
         by the Custodian; and if State Street Bank and Trust Company is the
         Custodian, it intends initially to delegate all such duties to Boston
         Financial Data Services, Inc., which is partially owned by the
         Custodian's parent company; but no such delegation or future change
         therein shall be considered as an amendment of this Agreement.

         B. Cash requirements. If cash funds are required to pay taxes, fees, or
other expenses pursuant to Article VI or to make payments to the Employee or his
beneficiaries (other than withdrawals under Article VII, Part C), the Employee
shall instruct the Custodian in writing which Regulated Investment Company
shares shall be redeemed or sold if there is more than one account, unless the
item for which cash is required is clearly allocable to an investment in a
specific Regulated Investment Company. In the absence of such written
instructions, the Custodian shall exercise its own discretion. However, the
Custodian's fee, if any, for each account within a Custodial Investment Account
shall be charged to such account.

         C. Limitation of liabilities and duties.

         (1) The Custodian shall be fully protected in acting or omitting to
         take any action in reliance upon any order or other direction believed
         by the Custodian to be genuine and properly given.

         (2) To the extent permitted by law, upon the expiration of a 30-day
         period after providing to the Employee the statements required under
         Article V, Part A(6), the Custodian shall be released and discharged
         from all liability to the Employee or any third party as to the matters
         contained in such statement unless the Employee files written
         objections with the Custodian within such 30-day period.

         (3) In no event shall the Custodian be under a fiduciary duty to the
         Employee in regard to the selection of investments or be liable for any
         loss so incurred.

         (4) The Custodian shall have no responsibility to see to the initial or
         continued qualification of the Custodial Investment Account under
         section 403(b)(7) of the Code.

         (5) The Custodian shall not be obligated to determine the amount of any
         contribution due or collect such contribution from the Employer.

         (6) The Custodian shall not be held responsible for determining the
         amount, character, or timing of any distribution to the Employee except
         as provided in Article IX.

         (7) The Custodian shall have no responsibility with respect to the
         computation of the Employee's "exclusion allowance" as defined in
         Section 403(b)(2) of the Code, any applicable limitation(s) on
         contributions under Section 415(c) of the Code, any election available
         to the Employee under said section 415, or any matters relating to any
         tax consequences with respect to the Employee's contributions,
         including the identification and correction of an "excess contribution"
         as that term is defined in section 4973 of the Code, all of which
         foregoing matters shall be solely the responsibility of the Employee.

         (8) The Custodian shall not be required to carry out any instructions
         not given in accordance with this Agreement and the various documents
         incorporated herein by reference. If such instructions are not received
         as required or if received, are in the opinion of the Custodian
         unclear, the Custodian shall not be liable for loss of income or
         appreciation or depreciation and shall not be liable for interest,
         pending receipt of written instructions or other clarification.
         Furthermore, the Custodian assumes (and shall have) no responsibility
         to make any distribution (or process a withdrawal) by order of the
         Employer, the Employee or a Beneficiary unless and until the requisite
         instructions specify the occasion for such action and the Custodian is
         furnished with any and all applications, certificates, tax waivers,
         signature guarantees and other documents (including proof of any legal
         representative's authority) deemed necessary or advisable to the
         Custodian. The Custodian shall not be responsible for complying with
         any instructions or acting in accordance with any other documents which
         appear on their face to be genuine, or for refusing to comply or so act
         if not satisfied to that effect, and assumes no further duty of
         inquiry. The Custodian shall have no liability to the Employee (or the
         Employee's beneficiary) for any tax penalty or other damages resulting
         from any inadvertent failure by the Custodian to make a distribution
         under this Agreement.

         (9) The Custodian shall not be liable (and assumes no responsibility)
         for the collection of contributions or the deductibility of


                                                                               3
<PAGE>

         any contribution, or its propriety under this Agreement, or the purpose
         or propriety of any distribution made pursuant to this Agreement, which
         matters are the responsibility of the Employer and the Employee.

         (10) The Custodian shall not be liable for interest on temporary cash
         balances, if any, maintained in the Account.

         (11) To the extent permitted by law, the Employee shall always fully
         idemnify the Custodian and save it harmless from any and all liability
         whatsoever which may arise either (i) in connection with this Agreement
         and matters which it contemplates, except that which arises due to the
         Custodian's negligence or willful misconduct, or (ii) with respect to
         making or failing to make any distribution, other than for failure to
         make distribution in accordance with an order therefor which is in full
         compliance with Article IX or Article VII, Part C or this Part C of
         Article V. Except as required by law, the Custodian shall not be
         obligated or expected to commence or defend any legal action or
         proceeding in connection with this Agreement or such matters unless
         agreed upon by the Custodian and the Employee, and unless fully
         indemnified for so doing to the Custodian's satisfaction.

         (12) The Employer assumes neither any responsibility nor any liability
         for any acts or omissions of the Custodian hereunder.

         D. Compensation. In consideration for its services hereunder, the
Custodian shall be entitled to receive the fees specified in its then current
fee schedule for the services specified on the schedule. The Custodian may
substitute a revised fee schedule from time to time upon thirty (30) days'
written notice to the Employer or Employee. A Custodian shall be entitled to
such reasonable additional fees as it may from time to time determine for
additional services required of it, if such additional services are not clearly
identified on the fee schedule.

         E. Resignation and removal. The Custodian may resign by giving at least
30 days' written notice to the Employer. The Employer or Scudder Fund
Distributors, Inc. may remove the Custodian hereunder by giving at least 30
days' written notice to the Custodian. In each case, the Employer or Scudder
Fund Distributors, Inc. shall designate a successor custodian qualified under
section 403(b)(7) of the Code, which successor custodian shall accept such
appointment by a writing to be submitted to the Employer and the Custodian.

         If, within 30 days after the giving of notice of resignation or
removal, neither the Employer nor Scudder Fund Distributors, Inc. designates a
successor custodian which accepts the appointment, this Agreement shall
terminate, and all assets in the Account shall be distributed in kind to the
Employee, or in the event of his death, to his designated beneficiary or
beneficiaries subject to the Custodian's right to reserve funds as provided in
this Part E of Article V.

         On the effective date of its resignation or removal, the Custodian
shall transfer to the designated successor the assets and records (or copies
thereof) of the Custodial Investment Accounts provided, however, that the
Custodian may retain whatever assets it deems necessary for payment of its fees,
costs and expenses, compensation, and any other liabilities which constitute a
charge on or against the assets of the Account or on or against the Custodian.

ARTICLE VI.  FEES, TAXES, AND OTHER EXPENSES

         A. Fees, taxes, and other expenses. Any income taxes of any kind
whatsoever that may be levied or assessed upon or in respect of a Custodial
Investment Account created hereunder (including any transfer taxes incurred in
connection with the investment and reinvestment of the assets), and all other
expenses, fees, and administrative costs incurred by the Custodian in the
performance of its duties, including fees for legal services rendered to the
Custodian, and the compensation to the Custodian as determined under Article V,
Part D of this Agreement shall constitute a charge upon the assets of the
Custodial Investment Account and be paid from the assets held in such Account,
or (at the Custodian's option) be paid by the Employee.

ARTICLE VII.  PROTECTION OF EMPLOYEE BENEFITS

         A. Non-forfeitable. At no time shall it be possible for any part of the
assets held by the Custodian in the Employee's Account to be used for or
diverted to purposes other than for the exclusive benefit of the Employee. The
Employee's rights to or derived from the Employer's contributions to the
Custodian for addition to the Employee's Account shall be non-forfeitable at all
times after such payments are made to the Custodian.

         B. Non-alienable. Any right or benefit which shall be payable under the
terms of this Agreement shall not be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and any
attempt at such shall be void, and any such right or benefit shall not in any
way be subject to the debts, contracts, liabilities, engagements or torts of the
person who is entitled to such right or benefit, nor shall Such right or benefit
be subject to attachment or legal process for or against such person, except as
provided in Part C of this Article VII.

         C. Employee withdrawals.

         (a) At any time or times prior to the completion of distributions
         pursuant to Article IX, an Employee who has attained age 59 1/2 may
         withdraw amounts of cash from his Account, including the entire balance
         thereof, if the Employee submits to the Custodian written proof
         satisfactory to the Custodian of the attainment of such age and, also,
         written instructions to the Custodian as to the amounts to be so
         withdrawn. If the Employee makes any withdrawal at any time pursuant to
         the provisions of this subpart (a) of this Part C of Article VII, no
         additional contributions may be made to the Employee's Account for a
         period of one (1) year after such withdrawal and the employee may not
         participate in any other custodial account for regulated investment
         company stock involving the Employer under section 403(b) of the Code
         for a period of one (1) year after such withdrawal.

         (b) In addition to the foregoing, at any time or times prior to the
         completion of distributions pursuant to Article IX, an Employee may
         withdraw amounts of cash from his Account, including the entire balance
         thereof, if the Employee encounters financial hardship, as determined
         under rules of uniform application and in accordance with applicable
         law, governmental regulations or rulings, by a person designated by the
         Employer in accordance with applicable legal authority, and if the
         Employee submits to the Custodian written proof satisfactory to the
         Custodian of such determination of hardship and, also, written
         instructions to the Custodian as to the amounts to be so withdrawn.

         (c) Any withdrawal made pursuant to the provisions of either subparts
         (a) or (b) of this Part C may not be in kind but may only be in the
         cash proceeds received by the Custodian from redemptions or sales of
         shares of the Regulated Investment Companies held in the Employee's
         Account. If there is more than one account, the Employee shall instruct
         the Custodian in writing as to which Regulated Investment Company
         shares shall be redeemed or sold before any distribution is made under
         this Part C of Article VII.

ARTICLE VIII.  AMENDMENT.

         A. By Employer. This Agreement and/or the various documents
incorporated herein may be modified or amended by the Employer by delivering to
the Employee and to the Custodian a written copy of such modification or
amendment signed by the Employer.

         B. By Employee. The Employee may amend this Agreement by making any of
the following changes:

         (a) No more than one in each taxable year of the Employee, and subject
         to other applicable provisions of Part A of Article III, the Employee
         may change the agreement between the Employer and the Employee as to
         the adjustment of the Employee's compensation either by submitting to
         the Employer and the Custodian, in accordance with Article II, Part A,
         a revised Application or in lieu thereof, by the execution of a
         separate written agreement between the Employer and the Employee;
         (b) The Employee may change investments pursuant to Article IV, Part F;
         or
         (c) The Employee may change his designated beneficiary or beneficiaries
         by submitting to the Custodian at any time a revised Designation of
         Beneficiary pursuant to Article II, Part C.

         C. By Scudder Fund Distributors, Inc. The Employer hereby delegates
authority to Scudder Fund Distributors, Inc. to modify or amend this Agreement
and/or the various documents incorporated herein, including authority to adopt a
prototype or master plan (if one becomes available) for investment in shares of
Regulated Investment Companies, and the Employer shall be deemed to have
consented to any such modification or amendment. Scudder Fund Distributors, Inc.
shall provide copies of such modification or amendment to the Employer or the
Employee, and the Custodian. However, Scudder Fund Distributors, Inc. has no
affirmative obligation to amend any of the foregoing documents pursuant to this
portion of the Agreement.

         D. Limitations. Notwithstanding the powers granted in Parts A, B, and C
above, no amendment shall be made which would:

         (a) Cause or permit any part of the assets in the Account to be
         diverted to purposes other than for the exclusive benefit of the
         Employee and/or his beneficiaries, or cause or permit any portion of
         such assets to revert to or become the property of the Employer.

         (b) Place any greater burden on a Custodian without its written
         consent, or

         (c) Retroactively deprive any Employee of any benefit to which he was
         entitled under this Agreement by reason of contributions made by the
         Employer, unless such modification or amendment is necessary to conform
         the Agreement to, or satisfy the conditions of any law, governmental
         regulation or ruling, and to permit the Agreement and Account to meet
         the requirements of Section 403(b) of the Code, or any similar statute
         enacted in lieu thereof, and any such retroactive modification or
         amendment must be pursuant to an opinion of counsel that it is
         necessary or advisable to conform the Agreement to the requirements for
         qualification under Section 403(b) of the Code and Regulations
         prescribed thereunder.


4
<PAGE>

ARTICLE IX.  DISTRIBUTION

         A. Time of distribution.

         (a) Subject to the remaining provisions of this Article IX and to the
         provisions of Part C of Article VII, distribution of assets held in the
         Employee's Investment Account shall be made or shall commence at the
         earliest time of the occurrence of one of the following events:

            (1) The disability of the Employee within the meaning of Section
            72(m)(7) of the Code. An Employee shall be considered to be so
            disbabled if he is unable to engage in any substantial gainful
            activity because of any medically determinable physical or mental
            impairment which can be expected to result in death or to be of
            long-continued and indefinite duration and an individual shall not
            be considered to be disabled, and, therefore, the Custodian shall
            not be required to make distribution on account of the Employee's
            disability, unless and until the Custodian has received a
            physician's certificate to that effect;

            (2) The Employee's actual retirement or attainment of the Normal
            Retirement Age, whichever is later; or 
 
            (3) The Employee's death.

         (b) In addition to the foregoing, distribution shall be made or shall
         commence upon the Employee's separation from the service of the
         Employer, prior to the occurrence of any of the events listed in
         subpart (a) of this Part A or Article IX, if the Employee, either at
         any time prior to or upon the Employee's separation from the service of
         the Employer, files with the Custodian a written, irrevocable election
         to have distribution commence upon such separation from service.

         (c) The Custodian shall not be responsible for making any distributions
         until such time as it has been notified in writing by either the
         Employer or the Employee of the occurrence of one of the events set
         forth in subparts (a)(1),(a)(2), or (b) of this Part A, or by the
         designated beneficiary or beneficiaries (or by the Employee's Executor
         or other personal representative if no such beneficiary survives the
         Employee) of the occurrence of the event set forth in subpart (a)(3) of
         this Part A.

         B. Mode of distribution to Employee. Distributions to the Employee of
amounts held by the Custodian in his Custodial Investment Account shall normally
be made in the form of annual, quarterly or monthly installments in cash or in
kind or in the form of a lump sum, provided that:

         (a) Installment payments in cash or in kind shall be made in
         approximately equal amounts or approximately equal fractions of the
         Employee's Custodial Investment Account;

         (b) If payments to the Employee are made in the form of installments,
         there shall be credited to such Employee's Custodial Investment Account
         all earnings thereon during the period of such installments; and

         (c) Except in the case where the distribution is made in the form of an
         annuity for a period measured by the life of the Employee and his
         spouse (regardless of whether the Employee's beneficiary is someone
         other than his spouse), the present value of the payments to be made to
         the Employee must be more than 50 percent of the present value of total
         payments to be made to the Employee and his beneficiaries.

         Stock of a Regulated Investment Company shall not be distributed in
kind unless at the time distribution is made or, if it is to be made in
installments, at the time it commences, the value of such stock held in the
Custodial Investment Account is five hundred ($500) dollars or more.
Distribution may also be made by distributing an annuity contract which
qualifies under section 403(b)(1)(A) of the Code.

         C. Election. The Employee may elect or alter his election of the method
of distribution to the Employee by filing with the Custodian a written election
of a method of distribution which is consistent with the provisions of Part B of
this Article IX at any time prior to seven (7) days before the time of
distribution determined under Part A of this Article IX. Such election may be
changed at any time prior to the beginning of said seven (7)-day period.

         In the event that an Employee fails to properly elect a method of
distribution of his Account, unless the Custodian in its absolute discretion
chooses another method of distribution consistent with the provisions of Part B
of this Article IX, installment payments pursuant to said Part B will be made in
cash or in kind to the Employee on a monthly basis over a 10-year-period, if a
systematic withdrawal plan is available for the Regulated Investment Company
stock held in the Account and if the assets in such Account are determined to be
sufficient by Scudder Fund Distributors, Inc. If such a plan is unavailable or
if such assets are deemed to be insufficient by Scudder Fund Distributors, Inc.,
the shares of the Regulated Investment Company stock held in the Account will be
distributed in cash or in kind promptly to the Employee, unless the Custodian in
its absolute discretion chooses another method of distribution consistent with
the provisions of said Part B of this Article IX.

         D. Method of distribution to beneficiaries. In the event of the death
of the Employee either before or after the occurrence of any of the times for
distribution listed in Part A of this Article IX, any amounts held by the
Custodian in the Employee's Account shall be distributed to the beneficiary or
beneficiaries named in the Employee's Designation by the method acceptable to
the Custodian and stipulated in such form, but only after such beneficiary or
beneficiaries have notified the Custodian in writing of the Employee's death and
provided the Custodian with adequate verification of such death, as provided in
subpart (8) of Part C of Article V. Until such distributions commence to such
beneficiary or beneficiaries, the Custodian shall not be responsible for
treating such person's predecessor to such rights and obligations as still
possessing the same.

         In the event that the Employee fails to properly stipulate a method of
distribution of his Account to such beneficiary or beneficiaries, unless the
Custodian in its absolute discretion chooses another mode of distribution,
installment payments will be made in cash or in kind to such beneficiary or
beneficiaries on a monthly basis over a 10-year period from the date of the
Employee's death, if a systematic withdrawal plan is available for the Regulated
Investment Company stock held in the Account and if the assets in such Account
are determined to be sufficient by Scudder Fund Distributors, Inc. If such a
plan is unavailable or if such assets are deemed to be insufficient by Scudder
Fund Distributors, Inc., the shares of the Regulated Investment Company stock
held in the Account will be distributed in cash or in kind promptly to such
beneficiary or beneficiaries, unless the Custodian in its absolute discretion
chooses another method of distribution.

         If the Employee so elects in the Designation of Beneficiary form in
effect at the time of his death, his designated beneficiary or beneficiaries who
has (have) survived him and to whom distributions are to be made, may direct the
Custodian in writing (by unanimous agreement if there is more than one
beneficiary) to change the method of distribution to such beneficiary or
beneficiaries (that is, the method either selected in the Employee's Designation
or provided for in this Part D of Article IX, as the case may be), but only
within sixty (60) days after the day on which such beneficiary or beneficiaries
first became entitled to any distribution from the Account and only if such
change is acceptable to the Custodian.

         If a distribution is payable to a person known by the Custodian to be a
minor or a person under a legal disability, the Custodian may in its absolute
discretion make the whole or any part of the distribution to (i) a parent of
such person, (ii) the guardian, committee or other legal representative,
wherever appointed, of such person, including a custodian for such person under
a Uniform Gifts to Minors Act or similar act, (iii) any person having the
control and custody of such person, or (iv) to such person directly, the receipt
of the distributee to whom any such payment or distribution is so being made a
sufficient discharge therefor.

         Insofar as the disposition of the Account of a deceased Employee is not
governed by a valid Designation which names at least one beneficiary who
survives the Employee, the Account shall be distributed to the estate of the
deceased Employee. Any portion of an Account of a deceased Employee remaining
undisposed of after the death of an Employee's designated beneficiary who has
survived the Employee, shall be distributed to the estate of such deceased
beneficiary.

ARTICLE X.  TERMINATION.

         A. Voluntary termination. With respect to amounts not yet earned by an
Employee, this Agreement may be terminated by either such Employee or the
Employer by giving written notice to the other.

         Copies of such notice shall be sent forthwith to the Custodian. Unless
otherwise mutually agreed upon by the Employer and the Employee, any such
termination shall take effect as of the last day of the month next following the
month in which such written notice shall have been given, the Employee's
compensation level shall be increased by the amount by which it otherwise would
be reduced pursuant to the Application, or other written agreement between the
Employer and the Employee as to the adjustment of the Employee's compensation,
and the obligations under this Agreement of the Employer with respect to future
pay periods shall cease.

         B. Termination on distribution. This Agreement shall terminate as to an
Employee when all the assets held in the Custodial Investment Account
established for him hereunder have been distributed.

         C. Termination on disqualification. This Agreement shall terminate as
to an Employee, if after notification by the Internal Revenue Service that the
Employee's Account does not qualify under section 403(b)(7) of the Code, Scudder
Fund Distributors, Inc. fails or is unable to make the amendments necessary to
so qualify the Account. On such termination of this Agreement, all assets in an
Account shall be distributed in kind by the Custodian to the Employee or, in the
event of his death, to his designated beneficiaries, subject to the Custodian's
right to reserve funds as provided in Article V, Part E, except that where the
value of such assets is less than five hundred ($500) dollars, the distribution
shall be in cash.

ARTICLE XI.  MISCELLANEOUS

         A. Adjustment regarding other employee benefits. Unless provided
otherwise in a separate written agreement between the Employer and the Employee,
all employee benefits furnished (either wholly or in part) by the Employer for
the benefit of the Employee(other than those provided for under this Agreement)
which are based on the amount of compensation payable to an employee, and which
would ordinarily be subject to reduction in the event of any salary adjustment
other than that provided for


5
<PAGE>

under this Agreement, shall continue to be based on the Employee's compensation
level without regard to any adjustment in compensation provided for under this
Agreement, if such employee benefits arrangements themselves are consistent with
this Part A of Article XI.

         B. Qualified Voluntary Employee Contributions. If permitted by Scudder
Fund Distributors, Inc., qualified voluntary employee contributions as defined
in section 219(e)(2) of the Code may be received under this Agreement with
respect to taxable years beginning after December 31, 1981, and such
contributions shall thereafter be held and administered hereunder by the
Custodian in accordance with all applicable law with respect to accumulated
deductible employee contributions as defined in section 72(o)(5)(B) of the Code.

         C. Applicable law. This Agreement and all documents incorporated herein
by reference shall be construed and administered in accordance with the laws of
the state in which the home office of the Custodian is located.

         D. Terminology. Any masculine terminology in this Agreement shall
include the feminine.

         E. Headings. Headings herein are primarily for convenience of
reference, and if they conflict with the text, the text shall control.

         F. Counterparts. This Agreement may be executed in any number of
counterparts, each of which, when executed and delivered, shall be an original,
but such counterparts shall together constitute one and the same instrument.

         G. Change of address. The Employer shall notify the Custodian in
writing of any change of address within 30 days of such change.
 
         H. Notice. Any notice from the Custodian to the Employee pursuant to
this Agreement shall be effective if sent by first class mail to the business
address of the Employer until the Employer specifies a different address
acceptable to the Custodian. Any notice to the Custodian pursuant to this
Agreement shall be by first class mail addressed to its home office.

         I. Successors. This Agreement shall be binding upon and shall inure to
the benefit of the successors in interest of the parties hereto.

         J. Not employment contract. This Agreement shall not be deemed to
constitute a contract of employment between the parties hereto, nor shall any
provision hereof restrict the right of the Employer to discharge the Employee or
of the Employee to terminate his employment.

         K. Construction. No provision of this Agreement, including the
documents incorporated herein by reference, shall be construed to conflict with
any provision of a Treasury Department or Internal Revenue Service regulation,
ruling, release or other order which affects the terms of this Agreement or its
qualification under section 403(b)(7) of the Code. It is intended that this
Agreement, including the documents incorporated herein by reference, qualify as
a custodial account under said section 403(b)(7) and this Agreement, including
said documents, shall be construed and limited and the powers and discretions
conferred hereunder and by applicable laws shall be exercised in a manner
consistent with that purpose. Subject to the foregoing provisions of this Part K
of Article XI, in the event of any conflict between this Agreement and the
documents incorporated herein by reference, the provisions of this Agreement
shall prevail.

         L. Tax treatment. The tax treatment of any contributions to the Account
and of any earnings of the Account depends, among other things, upon the nature
of the Employer, and the amount and nature of contributions made in any year to
the Account (and to other plans, accounts or contracts with the benefit of
special tax treatment) for the benefit of the Employee. The Custodian and
Scudder Fund Distributors, Inc. assume no responsibility with respect to such
matters, nor shall any term or provision of this Agreement be construed so as to
place any such responsibility upon any one of them. Furthermore, the Employer
and the Employee shall file and shall have sole responsibility for filing with
the Internal Revenue Service and/or any other government agency such returns,
reports, forms, and other information as may be required of them.

         M. Separability. If any provision of this Agreement shall be held
invalid or illegal for any reason, such determination shall not affect any
remaining provisions of this Agreement, but this Agreement shall be construed
and enforced as if such invalid or illegal provision had never been included in
this Agreement.

         N. If the Employer does not sign the Application and is not required to
do so under the Code and the regulations thereunder, the Employee, to the extent
allowed by law, assumes all obligations and responsibilities of the Employer
under the Application and this Agreement.

         O. Separate Employer Plan. If the Employer has established a written
separate 403(b) plan, intending to provide for the investment in Regulated
Investment Companies, the terms of such plan will supersede any provisions of
this Agreement which conflict with such terms. This provision shall not be
effective until the Employer has provided Scudder Fund Distributors, Inc. with a
copy of such written plan and the Custodian has agreed in writing to be bound by
terms thereof.


6
<PAGE>

Telephone
numbers and
addresses

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

National Toll Free
Telephone Numbers
and Addresses

                    ------------------------------------------------------------
                    For general information,
                        CALL (toll-free) 1-800-225-2470
                             (within Massachusetts, call collect 617-426-8300)

                                       or

                        WRITE to: Scudder Fund Distributors, Inc.
                                  175 Federal Street
                                  Boston, MA 02110

                    Shareholder representatives from Scudder Fund Distributors,
                    Inc., underwriter for the Scudder funds, will answer your
                    calls and letters.
                    ------------------------------------------------------------

                    ------------------------------------------------------------
                    For prospectuses, call 1-800-453-3305.
                    
                    For questions about an existing account and to arrange
                    transactions,
                    
                         CALL (toll-free) 1-800-225-5163
                              (in Boston, call 328-5000)
                    
                         WRITE to:  The Scudder Funds
                                    c/o Boston Financial Data Services
                                    P.O. Box 1912
                                    Boston, MA 02105
                    
                    Account representatives from the transfer agent for the
                    Scudder funds will answer your calls and letters.
                    ------------------------------------------------------------

- --------------------------------------------------------------------------------
Local Telephone
Numbers and Addresses
of Scudder Fund
Distributors, Inc.

Boca Raton
150 East Palmetto Park Road
Boca Raton, Florida 33432
305-395-0040

Los Angeles
333 South Hope Street
Los Angeles, California 90071
213-628-1144

Boston
175 Federal Street
Boston, Massachusetts 02110
617-426-8300

New York
345 Park Avenue
New York, New York 10154
212-350-8370

Chicago
Suite 2200, 111 East Wacker Drive
Chicago, Illinois 60601
312-861-2700

Philadelphia
Three Mellon Bank Center
Philadelphia, Pennsylvania 19102
215-864-7200

Cincinnati
540 Carew Tower
Cincinnati, Ohio 45202
513-621-4200

Portland, Oregon
1211 S.W. Fifth Avenue
Portland, Oregon 97204
503-224-3999

Cleveland
Suite 700, 1801 East Ninth Street
Cleveland, Ohio 44114
216-241-7744

San Francisco
Suite 4100, 101 California Street
San Francisco, California 94111
415-981-8191

Houston
1530 Bank of the Southwest Building
Houston, Texas 77002
713-659-3838


                                                                               7
<PAGE>

SCUDDER [LOGO]
- --------------

This booklet is not to be used in
connection with the offering of any of
the Scudder funds unless preceded or
accompanied by the appropriate current
prospectus. The prospectus will be sent
to you by the fund's underwriter,
Scudder Fund Distributor's, Inc.

14-6-84 (C) Scudder Fund Distributors, Inc.



                                   THE
                                   SCUDDER
                                   FUNDS


Plan agreement,                    The Scudder
sample plan                        Employer-Select
documents                          403(b) plan











                                   SCUDDER
                                   SCUDDER, STEVENS & CLARK INVESTMENT COUNSEL
<PAGE>

Contents

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

How employers establish
a Scudder Employer-
Select 403(b) program              3
- ------------------------------------

Explanation of employer
selections                         4
- ------------------------------------

Worksheet for employer
to select plan options             7
- ------------------------------------

Sample employer
adoption agreement                10
- ------------------------------------

Sample employee
application                       12
- ------------------------------------

Sample designation of
beneficiary form                  13
- ------------------------------------

Sample salary reduction
agreement                         14
- ------------------------------------

Plan agreement                    15
- ------------------------------------

Telephone numbers and
addresses                         23
- ------------------------------------

- ------------------------------------
     The term "Scudder 403(b) Plan"
refers to the Scudder 403(b) Plan
and includes functions performed by:

     o    Scudder Fund Distributors,
          Inc. which offers Scudder
          403(b) Plans and acts as
          principal underwriter for
          each Scudder fund,
     
     o    State Street Bank and
          Trust Company, as
          custodian and transfer
          agent of the Scudder funds
          and as custodian of the
          Scudder 403(b) Plans, and
     
     o    Boston Financial Data
          Services, Inc. (an
          affiliate of State Street
          Bank), the service agent
          responsible for
          maintaining shareholder
          account records for the
          Scudder funds.
     
     Scudder, Stevens & Clark acts
as investment adviser to the Scudder
funds.
- ------------------------------------


Introduction

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

The Scudder Funds booklet "Tax Deferred Annuity Plans (TDAs and TSAs) under
Section 403(b)(7)" describes the Scudder 403(b) program.  This program consists
of eight Scudder no-load mutual funds, a processing and record keeping system
that segregates contributions by contribution type and by individual employee,
and either the Scudder Employee-Select or the Scudder Employer-Select 403(b)
plan.

     The Employer-Select plan described in this booklet is a flexible plan that
allows employers to select among many options to tailor a plan in accordance
with their objectives and the needs of their employees.  It is designed to
accept direct employer contributions as well as various types of employee
contributions and permits the employer to impose certain controls over the
investment and withdrawal of contributions.

     This booklet explains how employers establish a Scudder Employer-Select
program.  In addition to the plan itself, the booklet includes a worksheet
showing how employers select various plan options.

     The booklet also contains samples of an employer adoption agreement, an
employee application form, a designation of beneficiary form, and an employee
salary reduction agreement.


2
<PAGE>

How employers establish
a Scudder Employer-
Select 403(b) program
- --------------------------------------------------------------------------------
Plan adoption                           The Scudder Employer-Select 403(b) plan
                                   permits employers to select among various
                                   options that determine many of the important
                                   terms of their plan.  The employer makes
                                   these elections on a worksheet provided by a
                                   Scudder Group Retirement Specialist, as
                                   illustrated on pages 7-9.  Scudder then
                                   prepares an individually-designed adoption
                                   agreement that reflects all selections made
                                   and eliminates any reference to options not
                                   selected.  The plan becomes effective after
                                   the employer and State Street Bank and Trust
                                   Company, acting as custodian, sign the
                                   adoption agreement.

- --------------------------------------------------------------------------------
Employee applications                   Based on the employer's selections,
                                   Scudder prepares a package of individually
                                   designed employee applications and
                                   information.  The employee applications
                                   specify which Scudder fund or funds the
                                   employees are permitted to select for
                                   contributions and the allocation of
                                   contributions among funds.  Depending on how
                                   the employer completes the worksheet,
                                   employees may also be able to make other
                                   selections such as normal retirement age.  A
                                   designation of beneficiary form can be
                                   printed on the reverse side of the
                                   application.  Salary reduction agreements, if
                                   desired by the employer, can also be
                                   provided.

                                        The Scudder information package also
                                   includes prospectuses and information about
                                   the investment characteristics of the funds
                                   designated by the employer.  This information
                                   acquaints employees with the nature of mutual
                                   funds and helps them select the fund or funds
                                   most suited to their investment objectives.
                                   Scudder can also provide copies of the plan
                                   agreement and the completed adoption
                                   agreement for distribution to participants if
                                   the employer wishes.

- --------------------------------------------------------------------------------
Establishing the plan on the            To establish a 403(b) plan on the
Scudder processing system          Scudder processing system, the employer needs
                                   only to provide certain background
                                   information about the plan and payroll
                                   processing details.  Thereafter the employer
                                   remits funds and information about how the
                                   amount submitted should be allocated among
                                   participants and how it is broken down by
                                   contribution type, if more than one type of
                                   contribution is involved.  The booklet "The
                                   Scudder Processing System" provides more
                                   information.

- --------------------------------------------------------------------------------
Reporting and disclosure                A 403(b) plan sponsored by an employer
                                   is subject to the reporting and disclosure
                                   requirements of ERISA.  Scudder will provide
                                   information to help comply with the reporting
                                   requirements.  In addition, Scudder will
                                   prepare a sample summary plan description
                                   tailored to the selections made by the
                                   employer and suitable for distribution to
                                   employees.


                                                                               3
<PAGE>

Explanation of
employer selections
- --------------------------------------------------------------------------------
How to use the worksheet                The plan agreement beginning on page 15
                                   contains the provisions of the Scudder
                                   Employer-Select 403(b) plan.  Employers are
                                   urged to review it to develop a full
                                   understanding of the plan and of the various
                                   selections available to them.

                                        Employers first indicate the selections
                                   which they wish to make on a worksheet
                                   provided for the employer's convenience by a
                                   Scudder Group Retirement Specialist.  Later,
                                   Scudder prepares an individually-designed
                                   employer adoption agreement reflecting only
                                   the selections made by the employer and
                                   eliminating references to unselected options.
                                   A copy of the worksheet begins on page 7.
                                   The selections made by the employer include
                                   the determination of which contribution types
                                   in addition to direct employer contributions
                                   the employer wishes to permit.  Employer
                                   selections also establish certain fundamental
                                   procedures such as those involving changes of
                                   investment, withdrawal of contributions by
                                   employees, and distribution of benefits to
                                   employees.

- --------------------------------------------------------------------------------
Normal retirement age                   The employer can determine whether
                                   employees may select normal retirement age.

Section II                              This section gives employers the option
                                   of selecting the normal retirement age for
                                   all their employees.  Alternatively,
                                   employers may give individual employees the
                                   right to select their own.  The normal
                                   retirement age is the age at which employees
                                   usually begin to receive distributions from
                                   their plans.  It cannot be less than age
                                   59 1/2.

- --------------------------------------------------------------------------------
Determination of                        Employers can elect to permit various
employer and employee              types of contributions in a Scudder Employer-
contribution types                 Select 403(b) plan in addition to direct
                                   employer contributions.  (Direct employer
                                   contributions are automatically permitted but
                                   are not required).  Optional contribution
                                   types include employer contributions pursuant
                                   to employee salary reduction agreements,
                                   mandatory contributions, employer matching
                                   thrift contributions, thrift contributions,
                                   employee non-deductible voluntary
                                   contributions, and employee deductible
                                   voluntary contributions (often called
                                   "QVECs").  Rollover and transfer
                                   contributions are also permitted.

                                        The Scudder processing system segregates
                                   all contribution types in order to maintain
                                   the identity of each and to permit different
                                   investment selections, investment procedures,
                                   and distribution and withdrawal provisions to
                                   apply to some contribution types than apply
                                   to others.

Section III                             This section determines whether
                                   employees may make contributions to the plan
                                   by means of a salary reduction agreement.  If
                                   the employer permits either mandatory
                                   contributions or matching thrift
                                   contributions, the employer must permit
                                   salary reduction contributions.


4
<PAGE>

- --------------------------------------------------------------------------------
Section IV                              Employers have the option under this
                                   section of requiring employees to make
                                   "mandatory contributions", (defined as
                                   employee contributions of up to 6% of
                                   compensation) to be eligible to receive
                                   employer contributions.  The employer may
                                   make contributions on behalf of those
                                   employees who contribute the mandatory
                                   contributions, although there is no
                                   requirement for the employer to make such
                                   contributions.

Section V                               This section permits employers to offer
                                   matching thrift contributions in order to
                                   encourage employees to make salary reduction
                                   contributions.  Employers must match any
                                   employee contributions made under the terms
                                   of the matching agreement.  The amount of the
                                   employer's matching contribution may vary
                                   from employee to employee but must then be
                                   based on a formula established and
                                   implemented by the employer that applies to
                                   all employees.  Employees with 20 years of
                                   service, for example, could be offered a
                                   higher matching contribution than employees
                                   with five years of service.

Section VI                              The Scudder Employer-Select 403(b) plan
                                   allows employees to make non-deductible
                                   voluntary contributions to their plan if
                                   permitted by the employer.  Although not
                                   deductible, employee contributions accumulate
                                   tax-free until withdrawn.  Non-deductible
                                   voluntary contributions (but not earnings
                                   from these contributions) may be withdrawn
                                   from the plan.

                                        The plan also permits employees to make
                                   deductible voluntary contributions ("QVECs")
                                   to the plan which are normally in lieu of IRA
                                   contributions.  These contributions are fully
                                   tax-deductible but subject to certain
                                   limitations concerning maximum contribution
                                   amounts and withdrawals.

- --------------------------------------------------------------------------------
Investment selection                    The Scudder Employer-Select plan permits
                                   employers to limit the Scudder funds eligible
                                   for new contributions and to limit the funds
                                   available to employees who wish to change the
                                   investment of already-contributed amounts.
                                   The plan also permits the employer to set
                                   different fund-selection limitations for
                                   different contribution types.

Section VII                             This selection permits employers to
                                   limit the number of Scudder funds available
                                   for contributions.  Some employers, for
                                   example, might wish to limit the selection to
                                   one money market fund, an income fund, and a
                                   common stock fund investing in large
                                   established companies.

- --------------------------------------------------------------------------------
Investment changes                      Under the plan, new contributions are
                                   invested identically.  If, for example, a
                                   monthly plan contribution consists of a
                                   direct employer contribution and a salary
                                   reduction contribution, the contributions
                                   would be invested in two contribution
                                   accounts and the investment allocation within
                                   each contribution account would be in the
                                   same proportions.  Changes in the allocation
                                   among funds of new contributions in the
                                   future apply to all contribution types until
                                   instructions are issued to the contrary.


                                                                               5
<PAGE>

Explanation of
employer selections, cont.
- --------------------------------------------------------------------------------
                                        However, the plan permits investment
                                   changes involving already-contributed amounts
                                   to be made in different proportions among
                                   contribution types if allowed by the
                                   employer.  The employer, for example, could
                                   permit employees to arrange investment
                                   changes in their salary reduction accounts
                                   without restriction.  These investment
                                   changes could result in money being invested
                                   in funds other than those permitted for new
                                   contributions.  Employers could also permit
                                   employees to make investment changes in their
                                   salary reduction accounts by telephone at any
                                   time while requiring that investment changes
                                   in their direct employer contribution
                                   accounts be arranged in writing no more
                                   frequently than quarterly.

Section VIII                            This section permits employers to
                                   require investment changes to be made through
                                   the plan administrator, and enables employers
                                   to limit the frequency with which employees
                                   make investment changes.

                                        Under this section, if employees are
                                   given the right to make investment changes
                                   directly with the custodian, the employer
                                   cannot limit the frequency of investment
                                   changes.

- --------------------------------------------------------------------------------
Withdrawals and                         Employers may select various provisions
distributions                      affecting the timing and manner of
                                   distributions.

Section IX                              This section permits employers to decide
                                   whether employees who have not reached normal
                                   retirement age will be allowed to make
                                   withdrawals from the plan upon attainment of
                                   age 59 1/2.

Section X                               This section permits employers to decide
                                   whether employees will be able to receive
                                   distributions from the plan for reasons of
                                   financial hardship before distribution would
                                   normally begin.

Section XI                              This section permits employers to decide
                                   whether employees are automatically entitled
                                   to distributions upon separation from
                                   service, or whether distributions would be
                                   subject to guidelines imposed by the
                                   employer.

Section XII                             The employer may select whether the
                                   employer or the employee is to determine the
                                   method of distribution of benefits to
                                   employees.


6
<PAGE>

Worksheet for Scudder 403(b) Plan,
Employer Adoption Agreement, and
Summary Plan Description
- --------------------------------------------------------------------------------
The undersigned Employer will be establishing a custodial account, under
Internal Revenue Code Section 403(b)(7), and will be adopting a Scudder 403(b)
Plan pursuant to the provisions of the Scudder 403(b) Agreement and the
provisions selected below by the Employer in this worksheet.  This worksheet is
provided only for the convenience of the Employer and is not a part of any Plan
or any Scudder 403(b) Agreement, nor is any portion of this worksheet
incorporated by reference into any Scudder 403(b) Agreement.

This plan will be for the benefit of each employee of the employer who signs a
Scudder 403(b) Plan Employee Application which is accepted by the Custodian.
However, if the Employer specifies in a writing pertaining to eligibility that
only employees of a certain class or classes are eligible to participate in this
403(b) plan, then this plan will be for the benefit of only such employees who
sign a Scudder 403(b) Plan Employee Application which is accepted by the
Custodian.

I.   NAME OF PLAN

               The Name of the 403(b) Plan to be adopted shall be the
               ___________________________________ 403(b) Plan.
                    (insert name of Employer)

II.  NORMAL RETIREMENT AGE

               An Employee's Normal Retirement Age (which may not be less than
               age 59 1/2) shall be:
          
Select One     [] (1) age 65 unless another age is indicated by the Employer
and Complete      here: _________________________________
if Applicable           (may not be less than age 59 1/2)
and if
Desired        [] (2) age 65 unless another age is indicated by the Employee
                  in the Scudder 403(b) Plan Employee Application.

III. EMPLOYER CONTRIBUTIONS BY SALARY REDUCTION AGREEMENT

     [NOTE: If either Mandatory Contributions by Salary Reduction Agreement
     under Section IV(2) or Employer Matching Thrift Contributions under Section
     V(2) are selected, Section III(1) must be selected to permit Employer
     Contributions by means of a Salary Reduction Agreement.]

Select One     [] (1) Employer Contributions made in accordance with a Salary
                      Reduction Agreement, made between the Employer and
                      Employee, described in Article III, Part B of the Scudder
                      403(b) Agreement.

               [] (2) Employer contributions by means of a Salary Reduction
                      Agreement made between the Employer and the Employee are
                      not permitted.

IV.  MANDATORY CONTRIBUTIONS BY SALARY REDUCTION AGREEMENT

     [NOTE: Section IV(2) should NOT be completed to require Mandatory
     Contributions if Employer Matching Thrift Contributions have been selection
     under Section V(2), or if Employer Contributions by means of a Salary
     Reduction Agreement are not permitted under Section III(2).]

Select One and [] (1) Mandatory Contributions are not required.
Complete if
Necessary      [] (2) In order to participate in any Employer Contributions
                      which the Employer may wish to (but need not) make, with
                      respect to a taxable year of the Employee, directly to
                      the Employee's Employer Contribution Account, the
                      Employee must agree with the Employer for Mandatory
                      Contributions to be made, in accordance with a Salary
                      Reduction Agreement between the Employer and the
                      Employee, to the Employee's Mandatory Contribution
                      Account, with the total of such Mandatory Contributions
                      for such taxable year of the Employee to be an amount
                      equal to __________% (insert not over 6%) of the
                      Employee's Compensation with respect to such taxable year
                      of the Employee.


                                                                               7
<PAGE>

V.   MATCHING THRIFT CONTRIBUTIONS

     [NOTE: Section V(2) should NOT be completed to permit Employer Matching
     Thrift Contributions if Mandatory Contributions have been selected under
     Section IV(2), or if Employer Contributions by means of a Salary Reduction
     Agreement are not permitted under Section III(2).]
     
Select Either  [] (1) Matching Thrift Contributions are not permitted.
(1) or (2);
and, if (2)    [] (2) For each taxable year of the Employee with respect to
is Selected,          which the Employee has agreed with the Employer for Thrift
Complete it           Contributions to be made, in accordance with a Salary
and, if               Reduction Agreement between the Employer and the Employee,
Desired,              to the Employee's Thrift Contribution Account in a total
Select (3)            amount not exceeding  __________% (insert not over 6%) of
                      the Employee's Compensation for such taxable year of the
                      Employee, the Employer will make Employee Matching Thrift
                      Contributions directly to the Employer Matching Thrift
                      Contribution Account in a total amount equal to _____% of
                      the total amount of the Employee's Thrift Contributions
                      for such taxable year of the Employee.

               [] (3) The preceding sentence of this Section V to the
                      contrary notwithstanding, the total amount of the
                      Employer Matching Thrift Contributions for the Employee
                      for such taxable year of the Employee shall not exceed an
                      amount designated in writing by the Employer and
                      communicated to the Employee based on a written formula
                      established by the Employer and applied in a uniform and
                      nondiscriminatory manner with respect to all Employees, a
                      copy of which formula is to be attached to the Scudder
                      403(b) Plan Employer Adoption Agreement before it is
                      signed by the Employer and the Custodian.

VI.  EMPLOYEE CONTRIBUTIONS

               A.   Employee Non-deductible Voluntary Contributions:

Select One     [] (1) Employee Non-deductible Voluntary Contributions, subject
                      to the provisions of Article III, Part A(e) of the
                      Scudder 403(b) Agreement, are permitted.

               [] (2) Employee Non-deductible Voluntary Contributions are not
                      permitted.

               B.   Employee Deductible Voluntary Contributions:

Select One     [] (1) Employee Deductible Voluntary Contributions, subject to
                      the provisions of Article III, Part A(f) of the Scudder
                      403(b) Agreement, are permitted.

               [] (2) Employee Deductible Voluntary Contributions are not
                      permitted.

VII. PERMITTED INVESTMENTS

Select as           Scudder Fund
Many as        [] Government Money Fund
are Desired    [] Cash Investment Trust
               [] Income Fund
               [] Target Fund (multi Portfolios)
               [] Capital Growth Fund
               [] Common Stock Fund
               [] Development Fund
               [] International Fund
               [] Such other Scudder Fund or Funds, if
                  any, as may be designated from time to
                  time by Scudder Fund Distributors,
                  Inc. (or its successor) as appropriate
                  for investment hereunder


8
<PAGE>

VIII. PROCEDURES FOR CHANGE OF INVESTMENTS BY EMPLOYEE OR BENEFICIARY

     [NOTE: Section VIII(3), concerning telephone exchange instructions, may be
     selected ONLY if Section VIII(2) has been selected to permit Account
     investment changes by directions given directly to the Custodian.]

Select Either  [] (1) An Employee or the Employee's designated beneficiary or
(1) or (2);           beneficiaries may change the investment medium of an
and, if (2)           Account by directions given to the Plan Administrator in
is Selected           such fashion and at such times as provided in Article IV,
and, if               Part F of the Scudder 403(b) Agreement.
Desired,
Select (3)     [] (2) An Employee or the Employee's designated beneficiary or
                      beneficiaries may change the investment medium of an
                      Account by directions given to the Custodian in such
                      fashion and at such times as provided in Article IV, Part
                      F of the Scudder 403(b) Agreement.

               [] (3) The preceding sentence of this Section VIII to the
                      contrary notwithstanding, an Employee or the Employee's
                      designated beneficiary or beneficiaries is permitted to
                      change the investment medium of an Account, by
                      exchanging, by telephone, telegram or TWX instructions
                      given directly to the Custodian, shares in one Scudder
                      fund for shares of another Scudder fund for which
                      telephone exchange is available, unless the Employee
                      elects otherwise in Item 3C of the Scudder 403(b) Plan
                      Employee Application.

IX.  WITHDRAWALS BY AN EMPLOYEE WHO HAS ATTAINED AGE 59 1/2

               Withdrawals from an Account by an Employee who has attained age
               59 1/2, subject to the provisions of Article VII, Part C(a) of
               the Scudder 403(b) Agreement:

Select One     [] (1) are permitted, except that such withdrawals are permitted
and Complete          only if the Employee has attained another age if another
if Applicable         age is indicated here: _________________________________
and if Desired                               (may not be less than age 59 1/2)

               [] (2) are not permitted.

X.   WITHDRAWALS BY AN EMPLOYEE IN CASE OF FINANCIAL HARDSHIP

               Withdrawals from an Account by an Employee who encountered
               financial hardship, subject to the provisions of Article VII,
               Part C(b) of the Scudder 403(b) Agreement:

Select One     [] (1) are permitted.

               [] (2) are not permitted.

XI.  DISTRIBUTION TO AN EMPLOYEE UPON SEPARATION FROM SERVICE

               Distribution from an Account to an Employee, subject to the
               provisions of Article IX, Part A(b) of the Scudder 403(b)
               Agreement:

Select One     [] (1) shall be made or shall commence upon the Employee's
                      separation from the service of the Employer if so
                      determined by the Employer in a uniform and
                      nondiscriminatory manner with respect to all Employees.

               [] (2) shall be made or shall commence upon the Employee's
                      separation from the service of the Employer, if the
                      Employee so elects.

XII. DETERMINATION OF METHOD OF DISTRIBUTION OF BENEFITS TO AN EMPLOYEE

               The method of distribution of benefits to an Employee from an
               Account, subject to the provisions of Article IX, Part C of the
               Scudder 403(b) Agreement:
               
Select One     [] (1) shall be determined by the Employer.

               [] (2) shall be determined by the Employee.


- -------------------------------------     -------------------------------------
          Signature of Employer                   Printed name of Employer


- -------------------------------------     -------------------------------------
               Date                                         Date


                                                                               9
<PAGE>

Sample employer
adoption agreement

- --------------------------------------------------------------------------------
     The adoption agreement appearing below reflects one possible combination of
worksheet selections which an employer might choose.

- --------------------------------------------------------------------------------
                                        
                           Employer Adoption Agreement
                                        
The undersigned Employer by completing this Employer Adoption Agreement and the
undersigned Custodian hereby establish a custodial account, under section
403(b)(7) of the Internal Revenue Code of 1954, as amended (the "Code"), as
follows.  (For definition of terms, see Article 1 of the Scudder 403(b)
Agreement.)

I.   NAME OF PLAN

     The Name of the 403(b) Plan hereby adopted shall be The Sample Organization
     403(b) Plan.

II.  NORMAL RETIREMENT AGE

     An Employee's Normal Retirement Age shall be 65.

III. EMPLOYER CONTRIBUTIONS BY SALARY REDUCTION AGREEMENT

     Employer Contributions may be made in accordance with a Salary Reduction
     Agreement, made between the Employer and Employee, described in Article
     III, Part B of the Scudder 403(b) Agreement.

IV.  MANDATORY CONTRIBUTIONS BY SALARY REDUCTION AGREEMENT

     Mandatory Contributions are not required.

V.   MATCHING THRIFT CONTRIBUTIONS

     For each taxable year of the Employee with respect to which the Employee
     has agreed with the Employer for Thrift Contributions to be made, in
     accordance with a Salary Reduction Agreement between the Employer and the
     Employee, to the Employee's Thrift Contribution Account in a total amount
     not exceeding 6% of the Employee's Compensation for such taxable year of
     the Employee, the Employer will make Employer Matching Thrift Contributions
     directly to the Employee's Employer Matching Thrift Contribution Account in
     a total amount to equal 50% of the total amount of the Employee's Thrift
     Contributions for such taxable year of the Employee.

VI.  EMPLOYEE CONTRIBUTIONS

     A.   Employee Non-deductible Voluntary Contributions:
     
          Employee Non-deductible Voluntary Contributions, subject to the
          provisions of Article III, Part A(e) of the Scudder 403(b) Agreement,
          are permitted.
     
     B.   Employee Deductible Voluntary Contributions:
     
          Employee Deductible Voluntary Contributions, subject to the provisions
          of Article III, Part A(f) of the Scudder 403(b) Agreement, are
          permitted.

VII. PERMITTED INVESTMENTS

     Initial and subsequent contributions to an account, subject to the
     provisions of Article IV of the Scudder 403(b) Agreement, are permitted in
     stock of the following Regulated Investment Companies:
     
       Scudder Fund
     Government Money Fund
     Income Fund
     Capital Growth Fund
     Common Stock Fund

VIII. PROCEDURES FOR CHANGE OF INVESTMENTS BY EMPLOYEE OR BENEFICIARY

     An Employee or the Employee's designated beneficiary or beneficiaries may
     change the investment medium of an Account by directions given to the Plan
     Administrator in such fashion and at such times as provided in Article IV,
     Part F of the Scudder 403(b) Agreement.
     
- --------------------------------------------------------------------------------


10
<PAGE>

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

IX.  WITHDRAWALS BY AN EMPLOYEE WHO HAS ATTAINED AGE 59 1/2

     Withdrawals from an Account by an Employee who has attained age 50 1/2,
     subject to the provisions of Article VII, Part C(a) of the Scudder 403(b)
     Agreement are not permitted.

X.   WITHDRAWALS BY AN EMPLOYEE IN CASE OF FINANCIAL HARDSHIP

     Withdrawals from an Account by an Employee who has encountered financial
     hardship, subject to the provisions of Article VII, Part C(b) of the
     Scudder 403(b) Agreement are permitted.

XI.  DISTRIBUTION TO AN EMPLOYEE UPON SEPARATION FROM SERVICE

     Distribution from an Account to an Employee, subject to the provisions of
     Article IX, Part A(b) of the Scudder 403(b) Agreement shall be made or
     shall commence upon the Employee's separation from the service of the
     Employer if so determined by the Employer in a uniform and
     nondiscriminatory manner with respect to all Employees.

XII. DETERMINATION OF METHOD OF DISTRIBUTION OF BENEFITS

     The method of distribution of benefits to an Employee from an Account,
     subject to the provisions of Article IX, Part C of the Scudder 403(b)
     Agreement shall be determined by the Employer.

XIII. ADOPTION OF AGREEMENT BY EMPLOYER AND CUSTODIAN

     By this Employer Adoption Agreement, the Employer, duly qualified as an
     organization described in section 403(b)(1)(A) of the Code, hereby agrees
     with the Custodian, duly qualified as a bank described in Section 401(d)(1)
     of the Code, to open a separate Custodial Investment Account (the
     "Account"), for the benefit of each Employee of the Employer who signs a
     Scudder 403(b) Plan Employee Application which is accepted by the
     Custodian, pursuant to the Scudder 403(b) Agreement (the "Agreement")
     hereby adopted by the Employer and the Custodian, and the Employer and the
     Custodian further agree to the provisions contained in this Employer
     Adoption Agreement.
     
                                             STATE STREET BANK AND TRUST COMPANY


- -------------------------------------   By -------------------------------------
Signature of Employer                                  Custodian


Sample Organization
- -------------------------------------   By -------------------------------------
Employer                                               Date


Anytown, USA                            IMPORTANT: The Scudder 403(b) Agreement,
- -------------------------------------   including this Employer Adoption
Address of Employer                     Agreement, becomes effective upon the
                                        date this Employer Adoption Agreement is
                                        signed by the Employer and the
                                        Custodian.


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


                                                                              11
<PAGE>

Sample
Employee Application

- --------------------------------------------------------------------------------
     The employee application appearing below reflects the selections set forth
in the sample adoption agreement on pages 10-11.

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

                              Employee Application
                                        
                                                       Return this form to:
                                                       Employee Benefits Dept.

1.   NAME AND ADDRESS OF EMPLOYEE

     Name ______________________________________________________________________

     Address ___________________________________________________________________

     City ___________________ State _______ Zip _______ Date of Birth __________

     Social Security Number __________ Employee Identification Number __________

2.   NAME AND ADDRESS OF EMPLOYER

     Name ______________________________________________________________________

     Address ___________________________________________________________________

     City ____________________________ State _______________ Zip _______________

     Employer Group Number ______________ Tax Identification Number ____________

3.   INVESTMENT INSTRUCTIONS BY EMPLOYEE

   A.Initial contribution to come                  B.Fund selection for initial
     from (check one):                               contribution listed in
       [] Employer check for                         Item 3A and for subsequent
            $____________________                    contributions (make your
            or                                       Fund selection below,
       [] transfer or rollover                       choosing only among the
            check from existing                      Funds which are permitted
        plan                                         for investment under
            for $________________                    Section VII of the Scudder
                                                     403(b) Plan Employer
                                                     Adoption Agreement)

                                                                 Amount
                                                            $             %
                               Scudder Fund             ----------    ---------
                          [] Government Money Fund      __________ or _________
                          [] Income Fund                __________ or _________
                          [] Capital Growth Fund        __________ or _________
                          [] Common Stock Fund          __________ or _________
                                                        
                                           Total                         100%
                                                        ----------    ---------
                                                        (amount
                                                         from 3A)

4.   DESIGNATION OF BENEFICIARY BY EMPLOYEE (see form on reverse side of this
     page)

     []   If this box is checked, I have completed the Designation of
          Beneficiary form on the reverse side.

5.   ADOPTION OF AGREEMENT BY EMPLOYEE

          By this Employee Application, I hereby agree to the establishment of a
     separate Custodial Investment Account (the "Account") for my benefit,
     pursuant to the Scudder 403(b) Agreement (the "Agreement") adopted by my
     Employer and by State Street Bank and Trust Company as Custodian and hereby
     adopted by me, and I hereby agree to the terms and conditions of that
     Agreement and the completed Employer Adoption Agreement therefor, and to
     the provisions contained above in this Employee Application.  I also
     acknowledge receipt of the prospectus for each Fund selected by me.
     
     ----------------------------------    ----------------------------------
                    Date                          Signature of Employee

     IMPORTANT: Once acknowledgment of the receipt of this Employee Application
     has been mailed by the Custodian to the Employee, this Employee Application
     shall be deemed accepted by the Custodian, and, therefore, effective, as of
     the date this Employee Application was signed by the Employee.
     

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


12
<PAGE>

Sample designation
of beneficiary form

- --------------------------------------------------------------------------------
     The designation of beneficiary form appearing below reflects the worksheet
selections made by a sample employer.  Normally this form would be printed on
the reverse side of the employee application form.

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

                         Designation of Beneficiary Form
                                        
                              IMPORTANT INFORMATION
                                        
     Before executing this Designation form you may wish to consult an attorney
or tax advisor to determine whether use of the form, or another written
instrument acceptable to the Custodian, will accomplish your goals.  Please also
review the applicable provisions of the Agreement.  This form may be used as a
Designation form.  It is effective if filed with the Custodian, State Street
Bank and Trust Company, during your lifetime.

     This Designation form is for your use, if desired, in naming the
Beneficiary or Beneficiaries who are to receive the amounts in your Account at
your death; also, if desired, in electing the method of distribution of such
amounts; and, also, if desired, in permitting your designated Beneficiary or
Beneficiaries to change the method of distribution to such Beneficiary or
Beneficiaries.  The Agreement (in Article IX, Part D) contains provisions which
govern as to death benefits if no surviving Beneficiary is designated by you, or
if no method of distribution is elected by you, in a valid Designation form.

     You should, if desired, complete, date and sign this Designation form and
forward it to State Street Bank and Trust Company, P.O. Box 1912, Boston, MA
02105.  We suggest you retain a copy for your records and review it
periodically.  Additional copies can be obtained from any office of Scudder Fund
Distributors, Inc.

- --------------------------------------------------------------------------------
Designation of Beneficiary and Election of Method of Distribution
(under Article II, Part C, and Article IX, Part D, of Agreement).

Print Name of Employee: ________________________________________________________

Print Name of Employer: ________________________________________________________

Upon my death, the following person or persons shall receive the undistributed
amount in my Account under Article IX, Part D, of the Agreement.  If a
Beneficiary or Beneficiaries fail to survive me, their interests shall lapse and
the surviving Beneficiaries shall take such interest proportionately.  If more
than one named Beneficiary shall survive me, such Beneficiaries shall receive
equal portions unless otherwise indicated by me below.  All previous Designation
forms of any kind of mine are hereby revoked.  I reserve the right to change
this Designation form by executing a new Designation form or other written
instrument acceptable to the Custodian and filing it with the Custodian during
my lifetime.

Beneficiary: __________________________ Social Security Number _________________
                                   (%)

Beneficiary: __________________________ Social Security Number _________________
                                   (%)

Address of each Beneficiary specifically named above:

________________________________________________________________________________

The undistributed amount in my Account under Article IX, Part D of the Agreement
shall be paid to the appropriate Beneficiary or Beneficiaries in one of the
following methods (if desired, check and, where applicable, complete one -- the
selected method of distribution must be acceptable to the Custodian):

     []        1.   _____ monthly installments consisting of the dollar value of
               the Account divided by the remaining number of monthly
               installments.

     []        2.   _____ annual installments consisting of the dollar value of
               the Account divided by the remaining number of annual
               installments.
     
     []        3.   A single lump sum.

Any undistributed balance in the Account which becomes payable to an estate of a
deceased Beneficiary shall be paid, as soon as practical, in a lump sum to such
estate, unless a valid direction as to a method of distribution to such estate
is made in accordance with Article IX, Part D, and Article II, Part C, of the
Agreement.

Option Right Of Beneficiary To Change Method Of Distribution

     []   Check if this option is desired.

I agree that my designated Beneficiary or Beneficiaries surviving me may direct
the Custodian in writing (by unanimous agreement if there is more than one
Beneficiary) to change the method of distribution to such Beneficiary or
Beneficiaries (that is, the method either selected in my Designation or provided
for in Article IX, Part D, of the Agreement, as the case may be), but only
within sixty (60) days after the day on which such Beneficiary or Beneficiaries
first became entitled to any distribution from the Account and only if such
change is acceptable to the Custodian.

Date: _______________________ Signature of Employee: _______________________

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


                                                                              13
<PAGE>

Sample salary
reduction agreement

- --------------------------------------------------------------------------------
     This sample salary reduction agreement may be used with the Scudder
Employer-Select 403(b) plan.  It contains language suitable for each eligible
contribution type.  An Employer may reproduce the agreement using the portions
relevant to the options selected on the worksheet or may substitute its own
salary reduction agreement which is consistent with the plan.

- --------------------------------------------------------------------------------
                    Salary Reduction Agreement         Return this form to:
                                                       Employee Benefits Dept.

Check one:

          ()  This is an original Salary Reduction Agreement
          ()  This is a subsequent Salary Reduction Agreement.

     By this Salary Reduction Agreement, made between

_____________________________ and ___________________________, the Employer
  (insert name of Employer)        (insert name of Employee)

and the Employee hereby make the following agreement as to the adjustment of the
Employee's Compensation.

     1.   As of the ______________________________________ payroll period ending
                    (weekly, monthly, semi-monthly, etc.)
on _________________________________________________ the Employee's Compensation
                         (date)
(the first day of this period must be after the effective date of this Salary
Reduction Agreement)
shall be reduced by the Employer for each such payroll period by the amount(s)
or by the percentage(s) selected below in subparagraphs (a) or (b) and (c), or
by the amount or by the percentage selected below in subparagraph (d), as the
case may be (if more than one selection is made, all selections must be made in
the same manner, that is, either by selecting an amount or by selecting a
percentage; if neither Mandatory nor Thrift Contributions are selected below in
subparagraph (a) or subparagraph (b), then only subparagraph (d) may be
completed):

     (a)  Mandatory Contributions (Complete only if (1) Mandatory Contributions
          are provided for under Section IV of the Scudder 403(b) Plan Employer
          Adoption Agreement ["the Adoption Agreement"], (2) Mandatory
          Contributions are desired by the Employee, and (3) Thrift
          Contributions are not selected below in subparagraph (b).)
     
          The Employee's Compensation shall be reduced by the Employer for each
          such payroll period by $____________ or by ____________%, and the
          amount of each such reduction shall be treated, under the Scudder
          403(b) Agreement adopted by the Employer, the Custodian, and the
          Employee (the "Scudder 403(b) Agreement"), as a Mandatory Contribution
          made to the Employee's Mandatory Contribution Account.
     
     (b)  Thrift Contributions (Complete only if (1) Thrift Contributions are
          permitted under Section V of the Adoption Agreement, (2) Thrift
          Contributions are desired by the Employee, and (3) Mandatory
          Contributions are not selection above in subparagraph (a).)
     
          The Employee's Compensation shall be reduced by the Employer for each
          such payroll period by $____________ or by ____________%, and the
          amount of each such reduction shall be treated under the Scudder
          403(b) Agreement as a Thrift Contribution made to the Employee's
          Thrift Contribution Account.
     
     (c)  Contributions in Addition to Mandatory or Thrift Contributions
          (Complete only if (1) either Mandatory Contributions or Thrift
          Contributions are selected above, in either subparagraph (a) or
          subparagraph (b), and (2) additional Contributions are desired by the
          Employee.)
     
          In addition to the reduction of Compensation provided for above under
          either subparagraph (a) or subparagraph (b), the Employee's
          Compensation shall be reduced by the Employer for each such payroll
          period by $____________ or by ____________%, and the amount of each
          such reduction shall be treated under the Scudder 403(b) Agreement as
          a Contribution made to the Employee's Employer Contribution Account.
     
     (d)  Other Contributions (Complete only if (1) neither Mandatory
          Contributions nor Thrift Contributions are selected above in either
          subparagraph (a) or subparagraph (b) and (2) Contributions by means of
          a Salary Reduction Agreement are desired by the Employee.)
     
          The Employee's Compensation shall be reduced by the Employer for each
          such payroll period by $____________ or by ____________%, and the
          amount of each such reduction shall be treated under the Scudder
          403(b) Agreement as a Contribution made by means of a Salary Reduction
          Agreement to the Employee's Employer Contribution Account.
     
     2.   The amount(s) of such reduction(s) shall be transmitted by the
Employer to State Street Bank and Trust Company as Custodian under the Scudder
403(b) Agreement to be held in a separate Custodial Investment Account for the
benefit of the Employee pursuant to the terms and conditions of the Scudder
403(b) Agreement.

     3.   This Salary Reduction Agreement shall be irrevocable as to both the
Employer and the Employee except that either of them may terminate this Salary
Reduction Agreement as of the end of any pay period so that it will not apply to
Compensation subsequently earned.  Subject to the preceding sentence, the
Employee may change tis agreement as to the adjustment of the Employee's
Compensation by the execution of a subsequent written Salary Reduction Agreement
between the Employer and the Employee, but such change may be made no more than
once in each taxable year of the Employee.

     4.   If Section V of the Employer Adoption Agreement provides for a written
formula to be used with respect to Employer Matching Thrift Contributions, the
Employee acknowledges having received and read a copy of that formula.

     5.   The Employee is responsible for determining that the total amount of
the salary reduction or reductions in Paragraph I above does not exceed the
Employee's "exclusion allowance" as defined in section 403(b)(2) of the Internal
Revenue Code of 1954, as amended (the "Code"), and for determining the
applicable limitation(s) on Contributions under section 415 of the Code, all as
provided in Article III, Part C of the Scudder 403(b) Agreement.

___________________________________     ___________________________________
     Signature of Employer                   Signature of Employee

___________________________________     IMPORTANT: This Salary Reduction
          Date                          Agreement becomes effective upon the
                                        date it is signed by the Employer and
                                        the Employee.  Such signature date must
                                        be a date which is on or after the date
                                        upon which the Employee signs the
                                        Scudder 403(b) Plan Employee
                                        Application.

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


14
<PAGE>

Scudder 403(b) Agreement

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

INTRODUCTION

     This Scudder 403(b) Agreement (the "Agreement") is entered into by and
among (i) each employer who executes a Scudder 403(b) Plan Employer Adoption
Agreement (the "Employer") and thereby certifies that the Employer is duly
qualified as an organization described in section 403(b)(1)(A) of the Internal
Revenue Code of 1954, as amended (the "Code"), (ii) the Custodian which executes
a Scudder 403(b) Plan Employer Adoption Agreement and thereby certifies that it
is duly qualified as a bank described in section 401(d)(1) of the Code (the
"Custodian"), and (iii) each employee who is eligible to participate in this
Agreement and who executes a Scudder 403(b) Plan Employee Application which is
accepted by the Custodian (the "Employee") and thereby certifies that the
Employee is an employee of the Employer.  Any person employed by the Employer is
eligible to participate in this Agreement unless the Employer specifies in a
writing pertaining to eligibility, a copy of which writing is attached to the
Scudder 403(b) Plan Employer Adoption Agreement prior to execution thereof by
the Employer and the Custodian, that only Employees of a certain class or
classes are eligible to participate in this Agreement, in which event only such
Employees shall be eligible to participate in this Agreement.  This Agreement,
including the Scudder 403(b) Plan Employer Adoption Agreement, becomes effective
upon the date such Employer Adoption Agreement is properly executed by the
Employer and the Custodian.  Once acknowledgment of the receipt of the Scudder
403(b) Plan Employee Application has been mailed by the Custodian to the
Employee, such Employee Application shall be deemed accepted by the Custodian,
and, therefore, effective, as of the date such Employee Application was executed
by the Employee.

ARTICLE I.  DEFINITIONS

     A.   Act means the Employee Retirement Income Security Act of 1974, as
amended.

     B.   Administrator or Plan Administrator means the person or persons
appointed under Article X, Part A.

     C.   Agreement or Scudder 403(b) Agreements means this document,
incorporating by reference the Scudder 403(b) Plan Employer Adoption Agreement,
the Scudder 403(b) Plan Employee Application, the Designation of Beneficiary,
the Salary Reduction Agreement, if Section V of the Employer Adoption Agreement
provides for a written formula to be used with respect to Employer Matching
Thrift Contributions any such written formula which is attached to the Employer
Adoption Agreement as required by said Section V thereof, and, if a writing
pertaining to eligibility is attached to the Employer Adoption Agreement under
the provisions of Section XIII thereof, any such writing pertaining to
eligibility.

     D.   Code means the Internal Revenue Code of 1954, as amended.  Reference
to a section of the Code shall include any comparable section or sections of
future legislation amending, supplementing, or superseding such section.

     E.   Compensation means, unless provided otherwise in a separate written
agreement between the Employer and the Employee, the total amount for services
received by the Employee from the Employer for the taxable year or portion
thereof involved which is includible in the gross income of the Employee,
including, without limitation, basic salary or wages, bonuses, commissions, and
overtime payments, without regard to any adjustment in compensation provided for
under the Agreement.

     F.   Contribution means the amount to be transmitted to the Custodian for
addition to the Employee's Custodial Investment Account.

     G.   Custodial Investment Account or Account means the cash and securities
held by the Custodian for the benefit of an Employee pursuant to this Agreement,
which shall be the sum of the Employee's Employer Contribution Account, Employer
Matching Thrift Contribution Account, Thrift Contribution Account, Mandatory
Contribution Account, Employee Non-deductible Voluntary Contribution Account,
Employee Deductible Voluntary Contribution Account, and Rollover Contribution
Account.

     H.   Custodian means the bank or any successor thereto, set forth in the
Scudder 403(b) Employer Adoption Agreement.

     I.   Designation of Beneficiary or Designation means the document executed
by the Employee pursuant to Article II, Part C.

     J.   Employee means each person employed by the Employer who is eligible to
participate in this Agreement and who has properly executed an Employee
Application.

     K.   Employee Application or Scudder 403(b) Plan Employee Application means
the document executed by the Employee pursuant to Article II, Part A.

     L.   Employee Non-deductible Voluntary Contributions means the
Contributions made to the Custodial Investment Account by the Employee in
accordance with Article III, Part A(e).  These after-tax Contributions are
intended not to be "qualified voluntary employee contributions" within the
meaning of Code Section 219(e)(2).

     M.   Employee Non-deductible Voluntary Contribution Account means the
separate account maintained pursuant to Article II, Part B for Employee Non-
deductible Voluntary Contributions made by the Employee and the income,
expenses, gains, and losses attributable thereto.

     N.   Employee Deductible Voluntary Contributions means the Contributions
made to the Custodial Investment Account by the Employee in accordance with
Article III, Part A(f).  Such Contributions are intended to be "qualified
voluntary employee contributions" within the meaning of Code Section 219(e)(2).

     O.   Employee Deductible Voluntary Contribution Account means the separate
Account maintained pursuant to Article II. Part B for Employee Deductible
Voluntary Contributions made by the Employee and the income, expenses, gains,
and losses attributable thereto.

     P.   Employer means the organization, state, political subdivision of a
state, or agency or instrumentality of such state or political subdivision named
in the Employer Adoption Agreement.

     Q.   Employer Adoption Agreement or Scudder 403(b) Plan Employer Adoption
Agreement means the agreement executed by the Employer and the Custodian
providing for the establishment of the Custodial Investment Account in
accordance with the terms and conditions of this Agreement.

     R.   Employer Contributions means the Contributions made to the Custodial
Investment Account in accordance with Article III, Part A(a).

     S.   Employer Contribution Account means the separate Account maintained
pursuant to Article II, Part B for Employer Contributions made and the income,
expenses, gains, and losses attributable thereto.

     T.   Employer Matching Thrift Contributions means the Contributions made to
the Custodial Investment Account by the Employer in accordance with Article III,
Part A(b).

     U.   Employer Matching Thrift Contribution Account means the separate
Account maintained pursuant to Article II, Part B for Employer Matching Thrift
Contributions made by the Employer and the income, expenses, gains, and losses
attributable thereto.

     V.   Mandatory Contributions means the Contributions made to the Custodial
Investment Account by the Employer in accordance with Article III, Part A(d).

     W.   Mandatory Contribution Account means the separate Account maintained
pursuant to Article II, Part B for Mandatory Contributions made and the income,
expenses, gains, and losses attributable thereto.

     X.   Normal Retirement Age means age 65 unless another age is properly
indicated by the Employer in Section II of the Employer Adoption Agreement, or,
if the Employee is permitted by the Employer by Section II of the Employer
Adoption Agreement to indicate another age, unless another age is properly
indicated by the Employee in the Employee Application.  In any event, Normal
Retirement Age cannot be less than 59 1/2.

     Y.   Plan means the Agreement, the Employer Adoption Agreement, the
Employee Application, the Designation of Beneficiary, the Salary Reduction
Agreement, if Section V of the Employer Adoption Agreement provides for a
written formula to be used with respect to Employer Match Thrift Contributions,
any such written formula which is attached to the Employer Adoption Agreement as
required by said Section V thereof, and, if a writing pertaining to eligibility
is attached to the Employer Adoption Agreement under the provisions of Section
XIII thereof, any such writing pertaining to eligibility.

     Z.   Regulated Investment Company or Company means a domestic corporation
which is a regulated investment company within the meaning of Section 851(a) of
the Code and which issues only redeemable stock for which Scudder, Stevens &
Clark (or its successor) is acting as the investment adviser and which has been
designated by Scudder Fund Distributors, Inc. (or its successor) as appropriate
for investment hereunder.

     AA.  Rollover Contributions means the Contributions made to the Custodial
Investment Account by the Employee in accordance with Article III, Part D(b).

     BB.  Rollover Contribution Account means the separate Account maintained
pursuant to Article II, Part B for Rollover Contributions made by the Employee
and the income, expenses, gains, and losses attributable thereto.

     CC.  Salary Reduction Agreement or Scudder 403(b) Plan Salary Reduction
Agreement means the document executed by the Employer and the Employee and
referred to in Article III, Part B.

     DD.  Thrift Contributions means the Contributions made to the Custodial
Investment Account in accordance with Article III, Part A(c).


                                                                              15
<PAGE>

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

     EE.  Thrift Contribution Account means the separate Account maintained
pursuant to Article II, Part B for Thrift Contributions made and the income,
expenses, gains, and losses attributable thereto.


ARTICLE II.  ESTABLISHMENT OF CUSTODIAL INVESTMENT ACCOUNTS

     A.   Request for participation.  Each Employee who is eligible to
participate in this Agreement and properly executes an Employee Application
which is accepted by the Custodian thereby becomes a party to this Agreement
with the right to enforce its terms against any other party.  Such executed
Employee Application is hereby specifically incorporated herein by reference.
An Employee Application is properly executed when completed and signed by the
Employee.  The Custodian may rely on the validity of the signature thereon, on
the existence of the employment relation thereby affirmed, and on the
irrevocable subscription to the provisions of this Agreement therein contained.

     B.   Opening and administration of Account.  The Custodian shall open a
separate Custodial Investment Account (the "Account") for the benefit of each
Employee whose Employee Application has been accepted by the Custodian.  The
Account shall be maintained pursuant to the terms of this Agreement, including
the documents incorporated herein by reference.  For each Employee, the
Custodian shall maintain a separate Account for each of the following types of
Contributions and the income, expenses, gains, and losses attributable thereto:

          (a)  Employer Contributions, involving, without limitation, the
following: (1) those types of Employer Contributions made in accordance with a
separate Salary Reduction Agreement made between the Employer and the Employee,
including, without limitation, Contributions exceeding the amount of Mandatory
Contributions made, or exceeding the amount of Thrift Contributions made, and
which are neither Employee Non-deductible Voluntary Contributions nor Employee
Deductible Voluntary Contributions; and (2) those types of Employer
Contributions made by the Employer directly to the Employee's Account,
including, without limitation, Employer Contributions made for Employees who
have made Mandatory Contributions, Employer Contributions made in addition to
Employer Matching Thrift Contributions, and Employer Contributions made in
addition to any made in accordance with a Salary Reduction Agreement.  The
various types of Employer Contributions may be accounted for in separate sub-
accounts by the Custodian;

          (b)  Employer Matching Thrift Contributions, if such Contributions are
required by Section V of the Employer Adoption Agreement;

          (c)  Thrift Contributions, if such Contributions are permitted by
Section V of the Employer Adoption Agreement;

          (d)  Mandatory Contributions, if such Contributions are provided for
by Section IV of the Employer Adoption Agreement;

          (e)  Employee Non-deductible Voluntary Contributions, if such
Contributions are permitted by Section VI-A of the Employer Adoption Agreement;

          (f)  Employee Deductible Voluntary Contributions, if such
Contributions are permitted by Section VI-B of the Employer Adoption Agreement;
and

          (g)  Rollover Contributions, if the Custodian accepts such
Contributions pursuant to Article III, Part D(b).

          Each Contribution shall be accompanied or preceded by clear
instructions specifying the Account to which it is to be credited.  If such
clear instructions are not received by the Custodian, the Custodian may hold
such Contributions in a separate suspense account until it receives the proper
clear instructions.  Such suspense account may be invested or left uninvested by
the Custodian as it deems fit.

     C.   Employee's Designation of Beneficiary.  Each Employee may submit to
the Custodian a properly executed Employee's Designation of Beneficiary form or
other written instrument acceptable to the Custodian for use in connection with
this Agreement (which is referred to hereinafter interchangeably as a
"Designation") which shall not become effective until it is filed with the
Custodian during the lifetime of the Employee.  The last effective Designation
accepted by the Custodian shall be controlling, and whether or not fully
dispositive of the Account, thereupon shall revoke all other such Designations
previously filed by the Employee.  Each such executed Designation is hereby
specifically incorporated herein by reference and shall be construed, enforced
and administered according to the laws of the state in which the home office of
the Custodian is located.


ARTICLE III.  CONTRIBUTIONS

     A.   Types of Contributions

          (a)  Employer Contributions.  The Employer may make Employer
Contributions in cash to be held by the Custodian in a separate Employer
Contribution Account for the benefit of the Employee.

          Such Employer Contributions may be made by the Employer to the
Employer Contribution Account in accordance with a separate Salary Reduction
Agreement made between the Employer and the Employee, if Employer Contributions
by means of a Salary Reduction Agreement are permitted by Section III of the
Employer Adoption Agreement.  Such Employer Contributions made by means of a
Salary Reduction Agreement may include, without limitation, contributions which
exceed the amount of Mandatory Contributions made (if Mandatory Contributions
are provided for by Section IV of the Employer Adoption Agreement), or which
exceed the amount of the Thrift Contributions made (if Thrift Contributions are
permitted by Section V of the Employer Adoption Agreement) and which are neither
Employee Non-deductible Voluntary Contributions nor Employee Deductible
Voluntary Contributions.

          Such Employer Contributions may also be made by the Employer directly
to the Employer Contribution Account and they may include, without limitation,
the following: Employer Contributions made for Employees who have made Mandatory
Contributions (if Mandatory Contributions are provided for by Section IV of the
Employer Adoption Agreement); Employer Contributions made in addition to
Employer Matching Thrift Contributions (if Employer Matching Thrift
Contributions are permitted by Section V of the Employer Adoption Agreement);
and Employer Contributions made in addition to any Contributions made in
accordance with a Salary Reduction Agreement made between the Employer and the
Employee.

          (b)  Employer Matching Thrift Contributions.  If Employer Matching
Thrift Contributions are required by Section V of the Employer Adoption
Agreement, the Employer shall make to the Employee's Account the Employer
Matching Thrift Contributions required by that Section, including, without
limitation, if Section V of the Employer Adoption Agreement provides for a
written formula to be used with respect to Employer matching Thrift
Contributions, such Matching Thrift Contributions made in accordance with such
written formula.  All Employer Matching Thrift Contributions shall be maintained
in the Employee's Employer Matching Thrift Contribution Account pursuant to
Article II, Part B.

          (c)  Thrift Contributions.  If Thrift Contributions are permitted by
Section V of the Employer Adoption Agreement, they may be made to the Employee's
Account.  All Thrift Contributions shall be maintained in the Employee's Thrift
Contribution Account pursuant to Article II, Part B.

          (d)  Mandatory Contributions.  If Mandatory Contributions are provided
for by Section IV of the Employer Adoption Agreement, they may be made to the
Employee's Account.  All Mandatory Contributions shall be maintained in the
Employee's Mandatory Contribution Account pursuant to Article II, Part B.

          (e)  Employee Non-deductible Voluntary Contributions. If Employee Non-
deductible Voluntary Contributions are permitted by Section VI-A of the Employer
Adoption Agreement, an Employee may make Employee Non-deductible Voluntary
Contributions to the Employee's Account; provided, however, that the aggregate
amount of such Employee Non-deductible Voluntary Contributions, plus any Non-
deductible Voluntary Contributions made by the Employee under any other plan
maintained by the Employer and intended to meet the requirements of Code section
401, shall not exceed ten percent (10%) of the Employee's total Compensation for
the period in which the Employee has been a party to this Agreement and,
therefore, a covered participant in this Plan.  An Employee's Employee Non-
deductible Voluntary Contributions shall be maintained in the Employee's
Employee Non-deductible Voluntary Contribution Account pursuant to Article II,
Part B.  An Employee may withdraw all or a portion of the Employee's Employee
Non-deductible Voluntary Contribution Account (but not including any earnings
thereon) upon at least thirty (30) days' written notice to the Custodian.

          (f)  Employee Deductible Voluntary Contributions.  If Employee
Deductible Voluntary Contributions are permitted by Section VI-B of the Employer
Adoption Agreement, an Employee may make Employee Deductible Voluntary
Contributions to the Employee's Account; provided, however that with respect to
each taxable year of the Employee, the aggregate amount of such Employee
Deductible Voluntary Contributions, plus any other "qualified retirement
contributions" as that term is defined in Code section 219(e)(1) made by the
Employee, shall not exceed the lesser of $2,000 or 100% of the Employee's total
Compensation includible in the Employee's gross income for such taxable year (or
such higher limitation as permitted under Code section 219).  An Employee's
Employee Deductible Voluntary Contributions shall be maintained in the
Employee's Employee Deductible Voluntary Contribution Account pursuant to
Article II, Part B.  An Employee may withdraw all or a portion of his Employee
Deductible Voluntary Contribution Account (including the earnings thereon) upon
at least thirty (30) days' written notice to the Custodian.  All such Employee
Deductible Voluntary Contributions received by the Custodian under this
Agreement shall be held and administered by it in accordance with all applicable
law with respect to "qualified voluntary employee contributions" as that


16
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term is defined in Code Section 219(e)(2) including, without limitation, any law
with respect to the redesignation thereof as non-deductible contributions in
connection with any withdrawal thereof by the Employee from the Employee's
Employee Deductible Voluntary Contribution Account.

     B.   Salary Reduction Agreements.  If Employer Contributions by means of a
Salary Reduction Agreement are permitted by Section III of the Employer Adoption
Agreement, Employer Contributions may be made in accordance with a separate
written Salary Reduction Agreement made between the Employer and the Employee
providing for an adjustment of the Employee's Compensation and for transmittal
of the resultant Employer Contribution to the Custodian, which such Salary
Reduction Agreement shall become effective upon the date it is signed by the
Employer and the Employee.  Such Salary Reduction Agreement may provide for an
adjustment of the Employee's Compensation with respect to either Mandatory
Contributions (if Mandatory Contributions are provided for by Section IV of the
Employer Adoption Agreement) or Thrift Contributions (if Thrift Contributions
are permitted by Section V of the Employer Adoption Agreement) and/or other
Contributions which the Employee may wish to have made by means of the Salary
Reduction Agreement.

     Each such Salary Reduction Agreement between the Employer and the Employee
as to the adjustment of the Employee's Compensation shall be effective only as
to amounts earned by the Employee after such Salary Reduction Agreement becomes
effective.  Each such Salary Reduction Agreement between the Employer and the
Employee as to the adjustment of the Employee's Compensation shall be
irrevocable as to both the Employer and the Employee except that either of them
may terminate such Salary Reduction Agreement as of the end of any payroll
period so that it will not apply to Compensation subsequently earned.  Subject
to the immediately preceding sentence, the Employee may, in the manner provided
for in subpart (a) of Part B of Article VIII, change such Salary Reduction
Agreement between the Employer and the Employee as to the adjustment of the
Employee's Compensation, but such change may be made no more than once in each
taxable year of the Employee.

     C.   Transmittal of Contributions and Employee's responsibility regarding
Contributions.  All Contributions shall be transmitted to the Custodian.  The
Employee shall be responsible for the computation and the proper making of
Employee Contributions provided for under the terms of the Plan including, if
desired, Mandatory Contributions, Thrift Contributions, Employee Non-deductible
Contributions, and Employee Deductible Voluntary Contributions.  The Employee
shall be responsible for computing the maximum amount that may be contributed on
the Employee's behalf for each tax year in accordance with the Employee's
"exclusion allowance" as that term is defined in section 403(b)(2) of the Code.
The Employee shall determine the applicable limitation(s) on Contributions under
section 415 of the Code, and the Employee shall have the right to make any of
the elections provided under said section 415.  Such computations and
determinations shall be made at least annually, and the Employee shall
communicate the results to the Employer no later than thirty (30) days before
the last day on which the Employee can execute a new Salary Reduction Agreement
with the Employer for the taxable year without violating the pertinent rules and
regulations promulgated by the Treasury Department.  Neither the Custodian,
Scudder Fund Distributors, Inc., any Regulated Investment Company, nor the
Employer shall have any obligation to verify the correctness of the Employee's
computations with respect to Contributions or the correctness of the Employee's
computation of the Employee's exclusion allowance or limitations on
Contributions under section 415 of the Code or any responsibility with respect
to any election available to the Employee under said section 415 or any matters
relating to any tax consequences with respect to any Contributions made to the
Custodial Account for the benefit of the Employee, including, without
limitation, the identification and correction of an "excess contribution" as
that term is defined in section 4973 of the Code, all of which foregoing matters
shall be solely the responsibility of the Employee.

     D.   Transfers and rollovers.

          (a)  Transfers from and to other Accounts.  The Employer or the
Employee may cause the transfer of assets acceptable to the Custodian and
available from an existing custodial account qualified under section 403(b)(7)
of the Code and/or from an existing annuity contract qualified under section
403(b) of the Code to the Employee's Custodial Investment Account.  Once
transferred into the Employee's Custodial Investment Account, such assets shall
be treated as a Contribution for purposes of this Agreement and shall be
invested, distributed and otherwise dealt with as such.  The Employer or the
Employee may cause the transfer of assets agreed to by the Custodian from the
Employee's Custodial Investment Account to a custodial account established under
section 403(b)(7) of the Code and/or to an annuity qualified under section
403(b) of the Code.

          (b)  Rollover Contributions.  The Custodian may in its discretion
accept contributions in the form of assets acceptable to the Custodian received
from an annuity contract or a custodial account described in section 401(b) of
the Code, an individual retirement account described in section 408(a) of the
Code, and individual retirement annuity described in section 408(b) of the Code,
or a retirement bond described in section 409(a) of the Code, provided that such
Contribution qualifies in all respects as a Rollover Contribution in accordance
with the requirements of section 403(b)(8), section 408(d)(3) or section
409(b)(3)(C) of the Code (including the requirement that no part of the amount
received from an individual retirement account, individual retirement annuity or
retirement bond be attributable to any source other than a rollover contribution
from any annuity contract or custodial account described in section 403(b) of
the Code) or other applicable provisions of the Code in effect from time to
time.  Such rollover contribution shall be held by the Custodian in a separate
Rollover Account for the benefit of the Employee which consists only of such
rollover contributions and the earnings thereon.  Once transferred into the
Employee's Custodial Account, such assets shall be treated as a Contribution for
purposes of this Agreement and shall be invested, distributed and otherwise
dealt with as such.  The right is reserved to transfer the assets of the
Custodial Investment Account to another form of annuity contract or custodial
account described in section 403(b) of the Code or to an individual retirement
account, individual retirement annuity, or retirement bond plan established
pursuant to section 408 or 409 of the Code.

          If permitted by Scudder Fund Distributors, Inc. in accordance with
applicable law, rollover contributions with respect to "qualified voluntary
employee contributions" as that term is defined in section 219(e)(2) of the Code
may be received under this Agreement with respect to taxable years beginning
after December 31, 1981, and such contributions shall thereafter be held and
administered hereunder by the Custodian in accordance with all applicable law
with respect to "accumulated deductible employee contributions" as that term is
defined in section 72(o)(5)(B) of the Code.

          (c)  Limitation of liabilities.  Neither the Custodian nor Scudder
Fund Distributors, Inc. shall have any responsibility with respect to any
matters relating to the tax consequences with respect to any transfer or
rollover made under this part D of Article III.


ARTICLE IV.  INVESTMENT

     A.   Purchase.  The Custodian shall receive and, as soon as practical,
shall invest all Contributions in accordance with the investment instructions
which are then in effect for the Employee.

     B.   Registration and safekeeping.  Any stock of a Regulated Investment
Company held under this Agreement shall be held by the Custodian.  Such stock
may be registered in the name of the Custodian or its nominee, but the Custodian
need not require issuance of certificates for such stock.

     C.   Eligibility.  The Custodian shall invest only in stock of a Regulated
Investment Company.

     A Custodial Investment Account shall be limited to investment in stock of
one Regulated Investment Company, except that the investment may be divided
between the stock of more than one Regulated Investment Company if the value of
the stock of each Company in which an investment is being made is, upon
completion of the investment, equal to a minimum value established from time to
time by a designation by Scudder Fund Distributors, Inc. (including a
designation that there shall be no such minimum investment limitation).

     If a Company in whose stock investments have been made is no longer
designated by Scudder Fund Distributors, Inc. as appropriate for investment
hereunder, Scudder Fund Distributors, Inc. shall advise the Employee for whose
Account the investments were made and shall give a current list of Companies
available for investment to the Employee or, if the Employer pursuant to Article
IV, Part G wishes to make the investment determination, to the Employer.  If,
within 30 days of providing of such current list, the Employee, or the Employer
as the case may be, does not submit new investment instructions, the Employee's
investment in the deleted Company shall be changed to an investment for the
Employee's Account in stock of Scudder Cash Investment Trust or in stock of
another Regulated Investment Company or Companies designated by Scudder Fund
Distributors, Inc. and no additional investments shall be made in said deleted
Company.

     D.   Reports and voting of securities.  The Custodian shall deliver to the
Employee or to the Employee's designated beneficiary all notices, reports,
prospectuses, financial statements, proxies and proxy-soliciting materials
received by it as to investments made for the Employee's Account.  The Custodian
shall vote all shares only in accordance with the written instructions of the
Employee or the Employee's designated beneficiary.  If the Employee desires to
attend a meeting at which securities held in his Account may be voted, the
Custodian shall furnish a proxy at the Employee's request.


                                                                              17
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     E.   Dividends.  All capital gain distributions and dividends received on
the stock of a Regulated Investment Company shall be reinvested in the stock of
that Regulated Investment Company.  The Custodian shall elect to receive any
such distribution in the stock of the distributing Company whenever possible.

     F.   Change of investments.  An Employee or his designated beneficiary or
beneficiaries who has (have) survived the Employee and to whom distributions are
being made (by unanimous agreement if there is more than one beneficiary) may
direct that the investment medium of the Account or any portion thereof be
changed to stock of another Regulated Investment Company or Companies which have
been selected by the Employer as permitted investments under Section VII of the
Employer Adoption Agreement.  If the Employer determines in Section VIII of the
Employer Adoption Agreement that such changes in the investment medium of the
Account are to be made by such directions given to the Plan Administrator, such
directions shall be given in writing by the Employee or by the Employee's said
designated beneficiary or beneficiaries to the Administrator who shall instruct
the Custodian in writing as to any such directed changes, and any such
investment changes may be made at such times as are determined from time to time
by the Employer in a uniform and nondiscriminatory manner with respect to all
Employees.  If the Employer determines in Section VIII of the Employer Adoption
Agreement that such changes in the investment medium of the Account are to be
made by such directions to be given directly to the Custodian, such directions
shall be given by the Employee or by the Employee's said designated beneficiary
or beneficiaries directly to the Custodian, either in writing or by any other
manner of direction designated from time to time by the Employer in a uniform
and nondiscriminatory manner with respect to all Employees, and such investment
changes may be made at any time or times.  However, if Scudder Fund
Distributors, Inc. determines in its own judgment that there has been trading
within the Account, any Regulated Investment Company may refuse to sell its
shares to such Account.  If the Employee's Account invested in stock of more
than one Regulated Investment Company, a separate account shall be kept with
respect to the stock of each such Company, and he or they may designate the
portion of any new Contribution, withdrawal, or change of investment which is to
be allocated to each such separate account.  The provisions of this Part F of
Article IV are subject to the provisions of Part G of this Article IV.

     G.   Employer determinations as to investments.  Anything in this Agreement
to the contrary notwithstanding, the Employer may, if permitted by Scudder Fund
Distributors, Inc., decide from time to time to make any or all determinations
with respect to the investment of an Employee's Account or any portion thereof
in stock of a Regulated Investment Company or Companies, including without
limitation determinations as to initial investments, subsequent investments, and
changes in the investment medium of an Account or portion thereof, as to the
frequency and manner of direction of any changes in the investment medium of an
Account or portion thereof, and as to whether the Employer or the Employee shall
make any determinations with respect to the investment of an Employee's Account
or any portion thereof.  Any such determination by the Employer shall be
communicated by the Employer to the Employee, shall be made in a uniform and
nondiscriminatory manner with respect to all Employees, and shall be subject to
the further requirement that if Scudder Fund Distributors, Inc. determines in
its own judgment that there has been trading within an Account, any Regulated
Investment Company may refuse to sell its shares to such Account.


ARTICLE V.  CUSTODIAN.

     A.   Duties.  The Custodian shall:

          (1)  Receive Contributions transmitted by the Employer or the
Employee;

          (2)  Provide safekeeping for the securities and other assets in the
Custodial Investment Account;

          (3)  Collect income;

          (4)  Execute orders for purchase, sale or exchange of securities and
make settlement in accordance with general practice;

          (5)  Maintain records of all transactions in the Account;

          (6)  Transmit to each Employee, not less frequently than annually,
appropriate statements of the amount of the Custodian's compensation, if any,
charged to the Account;

          (7)  File with the Internal Revenue Service and/or any other
government agency such returns, reports, forms, and other information as may be
required of it as Custodian;

          (8)  Perform all other duties and services consistent with the
purposes and intentions of this Agreement.  The Custodian may perform any of its
administrative duties through persons designated by the Custodian from time to
time, except that all assets in the Account shall be held by the Custodian; and
if State Street Bank and Trust Company is the Custodian, it intends initially to
delegate all such duties to Boston Financial Data Services, Inc., which is
partially owned by the Custodian's parent company; but no such delegation or
future change therein shall be considered as an amendment of this Agreement.

     B.   Cash requirements.  If cash funds are required to pay taxes, fees, or
other expenses pursuant to Article VI or to make payments to the Employee or his
beneficiaries (other than withdrawals under Article VII, Part C), the Employee
shall instruct the Custodian in writing which Regulated Investment Company
shares shall be redeemed or sold if there is more than one account, unless the
item for which cash is required is clearly allocable to an investment in a
specific Regulated Investment Company.  In the absence of such written
instructions, the Custodian shall exercise its own discretion.  However, the
Custodian's fee, if any, for each Account within a Custodial Investment Account
shall be charged to such Account.

     C.   Limitation of liabilities and duties.

          (1)  The Custodian shall be fully protected in acting or omitting to
take any action in reliance upon any order or other direction believed by the
Custodian to be genuine and properly given.

          (2)  To the extent permitted by law, upon the expiration of a 30-day
period after providing to the Employee the statements required under Article V,
Part A(6), the Custodian shall be released and discharged from all liability to
the Employee or any third party as to the matters contained in such statement
unless the Employee files written objections with the Custodian within such 30-
day period.

          (3)  In no event shall the Custodian be under a fiduciary duty to the
Employee in regard to the selection of investments or be liable for any loss so
incurred.

          (4)  The Custodian shall have no responsibility to see to the initial
or continued qualification of the Custodial Investment Account under section
403(b)(7) of the Code.

          (5)  The Custodian shall not be obligated to determine the amount or
type of any contribution due or to collect any Contribution from the Employer.

          (6)  The Custodian shall not be held responsible for determining the
amount, character, or timing of any distribution to the Employee except as
provided in Article IX.

          (7)  The Custodian shall have no responsibility with respect to the
computation of the Employee's "exclusion allowance" as defined in section
403(b)(2) of the Code, any applicable limitation(s) on Contributions under
section 415 of the Code, any election available to the Employee under said
section 415, or any matters including the identification and correction of an
"excess contribution" as that term is defined in section 4973 of the Code, all
of which foregoing matters shall be solely the responsibility of the Employee.

          (8)  The Custodian shall not be required to carry out any instructions
not given in accordance with this Agreement and the various documents
incorporated herein by reference.  If such instructions are not received as
required or if received, are in the opinion of the Custodian unclear, the
Custodian shall not be liable for loss of income or appreciation or depreciation
and shall not be liable for interest, pending receipt of written instructions or
other clarification.  Furthermore, the Custodian assumes (and shall have) no
responsibility to make any distribution (or process a withdrawal) by order of
the Employer, the Employee or a Beneficiary unless and until the requisite
instructions specify the occasion for such action and the Custodian is furnished
with any and all applications, certificates, tax waivers, signature guarantees
and other documents (including proof of any legal representative's authority)
deemed necessary or advisable to the Custodian.  The Custodian shall not be
responsible for complying with any instructions or acting in accordance with any
other documents which appear on their face to be genuine, or for refusing to
comply or so act if not satisfied to that effect, and assumes no further duty of
inquiry.  The Custodian shall have no liability to the Employee (or the
Employee's beneficiary) for any tax penalty or other damages resulting from any
inadvertent failure by the Custodian to make a distribution under the Agreement.

          (9)  The Custodian shall not be liable (and assumes no responsibility)
for the collection of Contributions or the making or the deductibility of any
Contribution, or its purpose or propriety under this Agreement, or the purpose
or propriety of any distribution made pursuant to this Agreement, which matters
are the responsibility of the Employer and the Employee.

          (10) The Custodian shall not be liable for interest on temporary cash
balances, if any, maintained in the Account.

          (11) To the extent permitted by law, the Employee shall always fully
indemnify the Custodian and save it harmless from any and all liability
whatsoever which may arise either (i) in connection with this Agreement and
matters which it contemplates, except that which arises due to the Custodian's
negligence or willful misconduct, or (ii) with respect to making or failing to
make any distribution, other


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than for failure to make distribution in accordance with an order therefor which
is in full compliance with Article IX or Article VII, Part C or this Part C of
Article V.  Except as required by law, the Custodian shall not be obligated or
expected to commence or defend any legal action or proceeding in connection with
this Agreement or such matters unless agreed upon by the Custodian and the
Employee, and unless fully indemnified for so doing to the Custodian's
satisfaction.

          (12) The Employer assumes neither any responsibility nor any liability
for any acts or omissions of the Custodian hereunder.

     D.   Compensation.  In consideration for its services hereunder, the
Custodian may be entitled to receive the fees specified in its then current fee
schedule for the services specified on the schedule.  The Custodian may
substitute a revised fee schedule from time to time upon thirty (30) days'
written notice to the Employer or Employee.  A Custodian may be entitled to such
reasonable additional fees as it may from time to time determine for additional
services required of it, if such additional services are not clearly defined on
the fee schedule.

     E.   Resignation and removal.  The Custodian may resign by giving at least
30 days' written notice to the Employer.  The Employer or Scudder Fund
Distributors, Inc. may remove the Custodian hereunder by giving at least 30
days' written notice to the Custodian.  In each case, the Employer or Scudder
Fund Distributors, Inc. shall designate a successor custodian qualified under
section 403(b)(7) of the Code, which successor custodian shall accept such
appointment by a writing to be submitted to the Employer and the Custodian.

     If, within 30 days after the giving of notice of resignation or removal,
neither the Employer nor Scudder Fund Distributors, Inc. designates a successor
custodian which accepts the appointment, this Agreement shall terminate, and all
assets in the Account shall be distributed in kind to the Employee, or in the
event of his death, to his designated beneficiary or beneficiaries subject to
the Custodian's right to reserve funds as provided in this Part E of Article V.

     On the effective date of its resignation or removal, the Custodian shall
transfer to the designated successor the assets and records (or copies thereof)
of the Custodial Investment Accounts provided, however, that the Custodian may
retain whatever assets it deems necessary for payment of its fees, costs and
expenses, compensation, and any other liabilities which constitute a charge on
or against the assets of the Accounts or on or against the Custodian.


ARTICLE VI.  FEES, TAXES, AND OTHER EXPENSES

     A.   Fees, taxes, and other expenses.  Any income taxes or other taxes of
any kind whatsoever that may be levied or assessed upon or in respect of a
Custodial Investment Account created hereunder (including any transfer taxes
incurred in connection with the investment and reinvestment of the assets), and
all expenses, fees and administrative costs incurred by the Custodian in the
performance of its duties, including fees for legal services rendered to the
Custodian, and the compensation to the Custodian as determined under Article V,
Part D of this Agreement shall constitute a charge upon the assets of the
Custodial Investment Account and be paid from the assets held in such Account,
or (at the Custodian's option) be paid by the Employee.


ARTICLE VII.  PROTECTION OF EMPLOYEE BENEFITS AND WITHDRAWALS BY EMPLOYEES

     A.   Non-forfeitable.  At no time shall it be possible for any part of the
assets held by the Custodian in the Employee's Account be used for or diverted
to purposes other than for the exclusive benefit of the Employee.  The
Employee's rights to or derived from all Contributions to the Custodian for
addition to the Employee's Account shall be non-forfeitable at all times after
such payments are made to the Custodian.

     B.   Non-alienable.  Any right or benefit which shall be payable under the
terms of this Agreement shall not be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and any
attempt at such shall be void, and any such right or benefit shall not in any
way be subject to the debts, contracts, liabilities, engagements or torts of the
person who is entitled to such right or benefit, nor shall such right or benefit
be subject to attachment or legal process for or against such person, except as
provided in Part C of this Article VII and in subparts (e) and (f) of Part A of
Article III.

     C.   Employee withdrawals.

          (a)  If withdrawals from an Account by an Employee, pursuant to this
subpart (a) of this Part C of Article VII, are permitted by Section IX of the
Employer Adoption Agreement, then at any time or times prior to the completion
of distributions pursuant to Article IX, an Employee who has attained age 59
1/2, or who has attained the age indicated by the Employer in Section IX of the
Employer Adoption Agreement if an age other than 59 1/2 is so indicated by the
Employer, may withdraw amounts of cash from his Account, including the entire
balance thereof, if the Employee submits to the Custodian written proof
satisfactory to the Custodian of the attainment of such age and, also, written
instructions to the Custodian as to the amounts to be so withdrawn.  If the
Employee makes any withdrawal at any time pursuant to the provisions of this
subpart (a) of this Part C of Article VII, no additional contributions may be
made to the Employee's Account for a period of one (1) year after such
withdrawal and the Employee may not participate in any other custodial account
for regulated investment company stock involving the Employer under section
403(b) of the Code for a period of one (1) year after such withdrawal.

          (b)  In addition to the foregoing, if withdrawals from an Account by
an Employee who has encountered financial hardship, pursuant to this subpart (b)
of this Part C of Article VII, are permitted by Section X of the Employer
Adoption Agreement, at any time or times prior to the completion of
distributions pursuant to Article IX, an Employee may withdraw amounts of cash
from the Employee's Account, including the entire balance thereof, if the
Employee encounters financial hardship, as determined in a uniform and
nondiscriminatory manner with respect to all Employees and in accordance with
applicable law, governmental regulations or rulings, by a person designated by
the Employer in accordance with applicable legal authority, and if the Employee
submits to the Custodian written proof satisfactory to the Custodian of such
determination of hardship and, also, written instructions to the Custodian as
the amounts to be so withdrawn.

          (c)  Any withdrawal made pursuant to the provisions of either subparts
(a) or (b) of this Part C may not be in kind but may only be in the cash
proceeds received by the Custodian from redemptions or sales of shares of the
Regulated Investment Companies held in the Employee's Account.  If there is more
than one account, the Employee shall instruct the Custodian in writing as to
which Regulated Investment Company shares shall be redeemed or sold before any
distribution is made under either subparts (a) or (b) of this Part C of Article
VII.


ARTICLE VIII.  AMENDMENT OR MODIFICATION

     A.   By Employer.  This Agreement and/or the various documents incorporated
herein may be modified or amended by the Employer by delivering to the Employee
and to the Custodian a written copy of such modification or amendment signed by
the Employer.

     B.   By Employee.  The Employee may modify this Agreement by making any of
the following changes:

          (a)  If Employer Contributions by means of a Salary Reduction
Agreement are permitted by Section III of the Employer Adoption Agreement, and
subject to other applicable provisions of Part B of Article III, then no more
than once in each taxable year of the Employee, the Employee may change the
Salary Reduction Agreement between the Employer and the Employee as to the
adjustment of the Employee's Compensation by the execution of a subsequent
written Salary Reduction Agreement between the Employer and the Employee;

          (b)  The Employee may change investments pursuant to Article IV, Part
F; or

          (c)  The Employee may change the Employee's designated beneficiary or
beneficiaries by submitting to the Custodian at any time a revised Designation
of Beneficiary pursuant to Article II, Part C.

     C.   By Scudder Fund Distributors, Inc.  The Employer hereby delegates
authority to Scudder Fund Distributors, Inc. to modify or amend this Agreement
and/or various documents incorporated herein, including authority to adopt a
prototype or master plan (if one becomes available) for investment in shares of
Regulated Investment Companies, and the Employer shall be deemed to have
consented to any such modification or amendment.  Scudder Fund Distributors,
Inc. shall provide copies of such modification or amendment to the Employer or
the Employee, and the Custodian.  However, Scudder Fund Distributors, Inc. has
no affirmative obligation to amend any of the foregoing documents pursuant to
this portion of the Agreement.

     D.   Limitations.  Notwithstanding the powers granted in Parts A, B, and C
above, no amendment shall be made which would:

          (a)   Cause or permit any part of the assets in the Account to be
diverted to purposes other than for the exclusive benefit of the Employee and/or
the Employee's beneficiaries, or cause to permit any portion of such assets to
revert to or become the property of the Employer,

          (b)  Place any greater burden on a Custodian without its written
consent, or

          (c)  Retroactively deprive any Employee of any benefit to which the
Employee was entitled under the Agreement by reason of Contributions made by the
Employer or the Employee, unless such modification or amendment is necessary to
conform the Agreement to, or satisfy the conditions of any law, governmental
regulation or ruling, and to permit the Agreement and Account to meet the
requirements


                                                                              19
<PAGE>

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

of Section 403(b) of the Code, or any similar statute enacted in lieu thereof,
and any such retroactive modification or amendment must be pursuant to an
opinion of counsel that it is necessary or advisable to conform the Agreement to
the requirements for qualification under Section 403(b) of the Code and
Regulations prescribed thereunder.


ARTICLE IX.  DISTRIBUTIONS

     A.   Time of distribution.

          (a)  Subject to the remaining provisions of this Article IX, and to
the provisions of Part C of Article VII and to the provisions of subparts (e)
and (f) of Part A of Article III, distribution of assets held in the Employee's
Investment account shall be made or shall commence at the earliest time of the
occurrence of one of the following events:

               (1)  The disability of the Employee within the meaning of Section
72(m)(7) of the Code.  An Employee shall be considered to be so disabled if the
Employee is unable to engage in any substantial gainful activity because of any
medically determinable physical or mental impairment which can be expected to
result in death or to be of long-continued and indefinite duration and an
individual shall not be considered to be disabled, and, therefore, the Custodian
shall not be required to make distribution on account of the Employee's
disability, unless and until the Custodian has received a physician's
certificate to that effect;

               (2)  The Employee's actual retirement or attainment of the Normal
Retirement Age, whichever is later; or

               (3)  The Employee's death.

          (b)  In addition to the foregoing, distribution shall be made or shall
commence upon the Employee's separation from the service of the Employer, prior
to the occurrence of any of the events listed in subpart (a) of this Part A of
Article IX, subject to whichever one of the following two provisions of this
subpart (b) of this Part A of Article IX is applicable:

               (1)  If Section XI of the Employer Adoption Agreement provides
for a determination by the Employer with respect to such distribution upon the
Employee's separation from the service of the Employer, such distribution upon
the Employee's separation from the service of the Employer shall be made or
shall commence if so determined by the Employer in a uniform and
nondiscriminatory manner with respect to all Employees; or

               (2)  If Section XI of the Employer Adoption Agreement provides
for an election by the Employee with respect to such distribution upon the
Employee's separation from the service of the Employer, such distribution upon
the Employee's separation from the service of the Employer shall be made or
shall commence only if the Employee, either at any time prior to or upon the
Employee's separation from the service of the Employer, files with the Custodian
a written irrevocable election to have distribution commence upon such
separation from service.

          (c)  The Custodian shall not be responsible for making any
distributions until such time as it has been notified in writing by either the
Employer or the Employee of the occurrence of one of the events set forth in
subparts (a)(1), (a)(2), or (b) of this Part A, or by the designated beneficiary
or beneficiaries (or by the Employee's Executor or other personal representative
if no such beneficiary survives the Employee) of the occurrence of the event set
forth in subpart (a)(3) of this Part A.

     B.   Method of distribution to Employee.  Distributions to the Employee of
amounts held by the Custodian in the Employee's Custodial Investment Account
shall normally be made in the form of annual, quarterly or monthly installments
in cash or in kind or in the form of a lump sum, provided that:

          (a)  Installment payments in cash or in kind shall be made in
approximately equal amounts or approximately equal fractions of the Employee's
Custodial Investment Account;

          (b)  If payments to the Employee are made in the form of installments,
there shall be credited to such Employee's Custodial Investment Account all
earnings thereon during the period of such installments; and

          (c)  Except in the case where the distribution is made for a period
measured by the life of the Employee and the Employee's spouse (regardless of
whether the Employee's beneficiary is someone other than the Employee's spouse),
the present value of the payments to be made to the Employee must be more than
50 percent of the present value of total payments to be made to the Employee and
the Employee's beneficiaries.

     Stock of a Regulated Investment Company shall not be distributed in kind
unless at the time distribution is made or, if it is to be made in installments,
at the time it commences, the value of such stock held in the Custodial
Investment Account is five hundred ($500) dollars or more.

     C.   Election.  The method of distribution of the Employee's Account to the
Employee shall be determined as follows:

          (a)  In the event that Section XII of the Employer Adoption Agreement
provides that the method of distribution of the Employee's Account to the
Employee shall be determined by the Employer, the Employer may, in such event,
at any time prior to thirty (30) days after the time of distribution determined
under Part A of this Article IX, file with the Custodian a written election of a
method of distribution to the Employee which is consistent with the provisions
of Part B of this Article IX, which election may be changed at any time prior to
the end of said thirty (30)-day period; or

          (b)  In the event that Section XII of the Employer Adoption Agreement
provides that the method of distribution of the Employee's Account to the
Employee shall be determined by the Employee, the Employee may, in such event,
elect or alter the Employee's election of the method of distribution to the
Employee by filing with the Custodian a written election of a method of
distribution to the Employee which is consistent with the provisions of Part B
of this Article IX at any time prior to seven (7) days before the time of
distribution determined under Part A of this Article IX, which election may be
changed at any time prior to the beginning of said seven (7)-day period.

     In the event that the Employer or the Employee, as the case may be, fails
to properly elect a method of distribution of the Employee's Account, unless the
Custodian in its absolute discretion chooses another method of distribution
consistent with the provisions of Part B of this Article IX, installment
payments pursuant to said Part B will be made in cash or in kind to the Employee
on a monthly basis over a 10-year period, if a systematic withdrawal plan is
available for the Regulated Investment Company stock held in the Account and if
the assets in such Account are determined to be sufficient by Scudder Fund
Distributors, Inc.  If such a plan is unavailable or if such assets are deemed
to be insufficient by Scudder Fund Distributors, Inc., the shares of the
Regulated Investment Company stock held in the Account will be distributed in
cash or in kind promptly to the Employee, unless the Custodian in its absolute
discretion chooses another method of distribution consistent with the provisions
of said Part B of this Article IX.

     D.   Method of distribution to beneficiaries.  In the event of the death of
the Employee either before or after the occurrence of any of the times for
distribution listed in Part A of this Article IX, any amounts held by the
Custodian in the Employee's Account shall be distributed to the beneficiary or
beneficiaries named in the Employee's Designation by the method acceptable to
the Custodian and stipulated in such form, but only after such beneficiary or
beneficiaries have notified the Custodian in writing of the Employee's death and
provided the Custodian with adequate verification of such Death, as provided in
subpart (8) of Part C of Article V.  Until such distributions commence to such
beneficiary or beneficiaries, the Custodian shall not be responsible for
treating such person's predecessor to such rights and obligations as still
possessing the same.

     In the event that the Employee fails to properly elect a method of
distribution of the Employee's Account to such beneficiary or beneficiaries,
unless the Custodian in its absolute discretion chooses another method of
distribution, installment payments will be made in cash or in kind to such
beneficiary or beneficiaries on a monthly basis over a 10-year period from the
date of the Employee's death, if a systematic withdrawal plan is available for
the Regulated Investment Company stock held in the Account and if the assets in
such Account are determined to be sufficient by Scudder Fund Distributors, Inc.
If such a plan is unavailable or if such assets are deemed to be insufficient by
Scudder Fund Distributors, Inc., the shares of the Regulated Investment Company
stock held in the Account will be distributed in cash or in kind promptly to
such beneficiary or beneficiaries, unless the Custodian in its absolute
discretion chooses another method of distribution.

     In the event the Employee so elects in the Designation of Beneficiary form
in effect at the time of his death, his designated beneficiary or beneficiaries
who has (have) survived him an to whom distributions are to be made, may direct
the Custodian in writing (by unanimous agreement if there is more than one
beneficiary) to change the method of distribution to such beneficiary or
beneficiaries (that is, the method either selected in the Employee's Designation
or provided for in this Part D of Article IX, as the case may be), but only
within sixty (60) days after the day on which such beneficiary or beneficiaries
first became entitled to any distribution from the Account and only if such
change is acceptable to the Custodian.

     If a distribution is payable to a person known by the Custodian to be a
minor or a person under a legal disability, the Custodian may in its absolute
discretion made the whole or any part of the distribution to (i) a parent of
such person, (ii) the guardian, committee or other legal representative,
wherever appointed, of such person, including a custodian for such person under
a Uniform Gifts to Minors Act or similar act, (iii) any person having the
control and custody of such person, or (iv) to such person directly, the receipt
of the distributee to whom any such payment or distribution is so made being a
sufficient discharge therefor.


20
<PAGE>

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

     Insofar as the disposition of the Account of a deceased Employee is not
governed by a valid Designation which names at least one beneficiary who
survives the Employee, the Account shall be distributed to the estate of the
deceased Employee.  Any portion of an Account of a deceased Employee remaining
undisposed of after the death of an Employee's designated beneficiary who has
survived the Employee, shall be distributed to the estate of such deceased
beneficiary.


ARTICLE X.  ADMINISTRATION

     A.   Appointment of Administrator.  The Employer may from time to time in
writing appoint one or more individuals as Administrator (hereinafter referred
to in the singular) who shall have all power and authority necessary to carry
out the terms of the Plan.  The Administrator may resign upon fifteen (15) days
advance written notice to the Employer, and the Employer may at any time revoke
the appointment of the Administrator with or without cause.  The Employer shall
exercise the power and fulfill the duties of the Administrator if at any time
the position is vacant.

     B.   Named Fiduciary.  The "Named Fiduciary" within the meaning of the Act
shall be the Administrator.

     C.   Allocations of responsibilities.  Responsibilities under the Plan
shall be allocated among the Custodian, the Administrator, and the Employer as
follows:

          (a)  Custodian: The Custodian shall have exclusive responsibility to
hold, manage, and invest, pursuant to instructions communicated to it under
parts A and F of Article IV by the Administrator or by the Employee as the case
may be, the funds received by it subject to the terms of the Agreement under
which it serves, and the Custodian shall also have all functions otherwise
assigned to it under the terms of the Plan.

          (b)  Administrator: The Administrator shall have the responsibility
and authority to control the operation and administration of the Plan in
accordance with its terms including, without limiting the generality of the
foregoing: (1) the transmission to the Custodian of any Employee or beneficiary
investment decision under Part F of Article IV; (2) interpretation of the Plan
and conclusive determination of all questions of eligibility and status under
the Plan; (3) hiring of persons to provide necessary services to the Plan not
provided by Employees; (4) preparation and filing of all statements, returns and
reports required to be filed by the Plan with any agency of Government; (5)
compliance with all disclosure requirements of all state or federal law; (6)
maintenance and retention of all Plan records as required by law, except those
required to be maintained by the Custodian; and (7) all functions otherwise
assigned to it under the terms of the Plan.

          (c)  Employer: The Employer shall be responsible for the design of the
Plan, as adopted or amended, the selection of the Custodian and the designation
of the Administrator as provided in the Plan, the delivery to the Administrator
and the Custodian of Employee information necessary for operation of the Plan,
the computation and the proper making of Employer Contributions and Employer
Matching Thrift Contributions, if any, provided for under the terms of the Plan
(including without limitation, if Section V of the Employer Adoption Agreement
provides for a written formula to be used with respect to Employer Matching
Thrift Contributions, the establishment and application of such written formula
in accordance with applicable law), the selection in a writing pertaining to
eligibility under Section XIII of the Employer Adoption Agreement of Employees
eligible to participate in this Agreement if such selection is made by the
Employer, any determinations as to investments made by the Employer under the
provisions of Part G of Article IV, and the exercise of all functions provided
in or necessary to the Plan except those assigned in the Plan to others.

          (d)  This part C of Article X is intended to allocate individual
responsibility for the prudent execution of the functions assigned to each of
the Custodian, the Administrator, and the Employer and none of such
responsibilities or any other responsibility shall be shared among them unless
specifically provided in the Plan.  Whenever one such person is required by the
Plan to follow the directions of another, the two shall not be deemed to share
responsibility, but the person who gives the direction shall be responsible for
giving it and the responsibility of the person receiving the direction shall be
to follow it insofar is it is on its face proper under applicable law.

     D.   More than one Administrator.  If more than one individual is appointed
as Administrator under Part A of this Article X, such individuals shall either
exercise the duties of the Administrator in concert, acting by a majority vote
or allocate such duties among themselves by written agreement delivered to the
Employer and the Custodian.  In such case, the Custodian may rely upon the
instruction of any one of the individuals appointed as Administrator regardless
of the allocation of duties among them.

     E.   No compensation.  The Administrator shall not be entitled to receive
any compensation from the funds held under the Plan for its services in that
capacity unless so determined by the Employer or required by law.

     F.   Record of acts.  The Administrator shall keep a record of all
proceedings, acts and all such records and instruments pertaining to the Plan
administration and shall be subject to inspection by the Employer at any time.
The Employer shall supply, and the Administrator may rely on the accuracy of,
all Employee data and other information needed to administer the Plan.

     G.   Bond.  The Administrator shall be required to give bond for the
faithful performance of his duties to the extent, if any, required by the Act,
the expense to be borne by the Employer.

     H.   Agent for service of process.  The Administrator shall be agent for
service of legal process on the Plan.

     I.   Rules.  The Administrator may adopt or amend and shall publish to the
Employees such rules and forms for the administration of the Plan, and may
employ or retain such attorneys, accountants, physicians, investment advisors,
consultants and other persons to assist in the administration of the Plan as it
deems necessary or advisable.

     J.   Delegation.  To the extent permitted by applicable law, the
Administrator may delegate all or part of his responsibilities hereunder and at
any time revoke such delegation, by written statement communicated to the
delegate and the Employer.  The Custodian may, but need not, act on the
instructions of such a delegate.  The Administrator shall annually review the
performance of such delegate.

     K.   Claims procedure.  It is anticipated that the Administrator will
administer the Plan to provide Plan benefits without waiting for them to be
claimed, but the following procedure is established to provide additional
protection to govern unless and until a different procedure is established by
the Administrator and published to the Employees and Employees' beneficiaries.

          (a)  Manner of making claim.  A Claim for benefits by an Employee or
beneficiary to be effective under this procedure must be made to the
Administrator and must be in writing unless the Administrator formally or by
course of conduct waives such requirements.

          (b)  Notice of reason for denial.  If an effective claim is wholly or
partially denied, the Administrator shall furnish such Employee or beneficiary
with written notice of the denial within sixty (60) days after the original
claim was filed.  This notice of denial shall set forth in a manner calculated
to be understood by the claimant (1) the reason or reasons for denial, (2)
specific reference to pertinent plan provisions on which the denial is based,
(3) a description of any additional information needed to perfect the claim and
an explanation of why such information is necessary, and (4) an explanation of
the Plan's claim procedure.

          (c)  Application for review.  The Employee or beneficiary shall have
sixty (60) days from receipt of the denial notice in which to make written
application for review by the Administrator.  The Employee or beneficiary may
request that the review be in the nature of a hearing.  The Employee or
beneficiary shall have the rights (1) to have representation, (2) to review
pertinent documents, and (3) to submit comments in writing.

          (d)  Decision on review.  The Administrator shall issue a decision on
such review within sixty (60) days after receipt of an application for review,
except that such period may be extended for a period of time not to exceed an
additional sixty (60) days if the Administrator determines that special
circumstances (such as the need to hold a hearing) requires such extension.  The
decision on review shall be in writing and shall include specific reasons for
the decision, written in a manner calculated to be understood by the claimant,
and specific references to the pertinent Plan provisions on which the decision
is based.

     L.   Fees and expenses of Administrator.  All reasonable expenses, fees,
and administrative costs incurred by the Administrator in the performance of its
duties hereunder, including fees for legal services rendered to the
Administrator, shall be paid by the Employer; and to the extent not so paid by
the Employer, said fees and expenses shall be deemed to be an expense of the
Custodial Investment Account and the Custodian is authorized to charge the same
to the Accounts of the Employees, and unless allocable to the Accounts of
specific Employees, they shall be charged against the respective Accounts of all
or a reasonable group of Employees in such reasonable manner as the Custodian
shall determine.


ARTICLE XI.  TERMINATION

     A.   Voluntary termination.  With respect to amounts not yet earned by an
Employee, this Agreement may be terminated by either such Employee or the
Employer by giving written notice to the other.  Copies of such notice shall be
sent forthwith tot he Custodian.  Unless otherwise mutually agreed upon by the
Employer and the Employee, any such termination shall take effect as of the last
day of the


                                                                              21
<PAGE>

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

month next following the month in which such written notice shall have been
given, the Employee's compensation level shall be increased by the amount by
which it otherwise would be reduced pursuant to any applicable Salary Reduction
Agreement, and the obligations under this Agreement of the Employer with respect
to future pay periods shall cease.

     B.   Termination on distribution.  This Agreement shall terminate as to an
Employee when the assets held in the Custodial Investment Account established
for the Employee hereunder have been distributed.

     C.   Termination on disqualification.  This Agreement shall terminate as to
an Employee if, after notification by the Internal Revenue Service that the
Employee's Account does not qualify under section 403(b)(7) of the Code, Scudder
Fund Distributors, Inc. fails to or is unable to make the amendments necessary
to so qualify the Account.  On such termination of this Agreement, all assets in
an Account shall be distributed in kind by the Custodian to the Employee or, in
the event of his death, to his designated beneficiaries, subject to the
Custodian's right to reserve funds as provided in Article V, Part E, except that
where the value of such assets is less than five hundred ($500) dollars, the
distribution shall be in cash.


ARTICLE XII.  MISCELLANEOUS

     A.   Adjustment regarding other employee benefits.  Unless provided
otherwise in a separate written agreement between the Employer and the Employee,
all employee benefits furnished (either wholly or in part) by the Employer for
the benefit of the Employee (other than those provided for under this Agreement)
which are based on the amount payable to an employee, and which would ordinarily
be subject to reduction in the event of any salary adjustment other than that
provided for under this Agreement, shall continue to be based on the Employee's
compensation level without regard to any adjustment in Compensation provided for
under this Agreement, if such employee benefits arrangements themselves are
consistent with this Part A of Article XII.

     B.   No release from liability.  Nothing in this Plan shall relieve any
person from liability for any responsibility under Part 4 of Title I of the Act.
Subject thereto neither the Custodian, the Administrator nor any other person
shall have any liability under the Plan, except as a result of his negligence or
willful misconduct, and in any event the Employer shall fully indemnify and save
harmless all person from any such liability except that resulting from their
negligence or willful misconduct.

     C.   Applicable law.  This Agreement and all documents incorporated herein
by reference shall be construed and administered in accordance with the laws of
the state in which the home office of the Custodian is located.

     D.   Terminology.  Any masculine terminology in this Agreement shall
include the feminine.

     E.   Headings.  Headings herein are primarily for convenience of reference,
and if they conflict with the text, the text shall control.

     F.   Counterparts.  This Agreement may be executed in any number of
counterparts, each of which, when executed and delivered, shall be an original,
but such counterparts shall together constitute one and the same instrument.

     G.   Change of address.  The Employer shall notify the Custodian in writing
of any change of address within 30 days of such change.

     H.   Notice.  Notice from the Custodian to the Employee pursuant to this
Agreement shall be effective if sent by first class mail to the business address
of the Employer until the Employer specifies a different address acceptable to
the Custodian.  Any notice to the Custodian pursuant to this Agreement shall be
by first class mail addressed to its home office.

     I.   Successors.  This Agreement shall be binding upon and shall inure to
the benefit of the successors in interest of the parties hereto.

     J.   Not employment contract.  This Agreement shall not be deemed to
constitute a contract of employment between the parties hereto, nor shall any
provision hereof restrict the right of the Employer to discharge the Employee or
of the Employee to terminate his employment.

     K.   Discretionary actions.  Any discretionary action to be taken by the
Employer or the Administrator under this Plan shall be nondiscriminatory in
nature and all Employees similarly situated shall be treated in a uniform
manner.

     L.   Department of Labor requirements.  If the Custodial Investment Account
and this Agreement constitutes a plan subject to Title I of the Act, then the
Employer, Administrator, Employee, and Custodian shall comply with the
applicable requirements of Title I and shall furnish to each other such
information as may be required in that respect.

     M.   Construction.  No provision of this Agreement, including the documents
incorporated herein by reference, shall be construed to conflict with any
provision of a Labor Department, Treasury Department or Internal Revenue Service
regulation, ruling, release or other order which affects the terms of this
Agreement or its qualification under section 403(b)(7) of the Code.  It is
intended that this Agreement, including the documents incorporated herein by
reference, qualify as a custodial account under said section 403(b)(7) and this
Agreement, including said documents, shall be construed and limited and the
powers and discretions conferred hereunder and by applicable laws shall be
exercised in a manner consistent with that purpose.  Subject to the foregoing
provisions of this Part M of Article XII, the following constructional
principles shall govern: (1) in the event of any conflict between the Employer
Adoption Agreement and the Employee Application, the provisions of the Employer
Adoption Agreement shall prevail; and (2) in the event of any conflict between
this Agreement and the documents incorporated herein by reference, the
provisions of this Agreement shall prevail.

     N.   Tax treatment.  The tax treatment of any contributions to the Account
and of any earnings of the Account depends, among other things, upon the nature
of the Employer, and the amount and nature of contributions made in any year to
the Account (and to other plans, accounts or contracts with the benefit of
special tax treatment) for the benefit of the Employee.  The Custodian and
Scudder Fund Distributors, Inc. assume no responsibility with respect to such
matters, nor shall any term or provision of this Agreement be construed so as to
place any such responsibility upon any one of them.  Furthermore, the Employer,
the Employee, and the Administrator shall file and shall have sole
responsibility for filing with the Internal Revenue Service and/or any other
governmental agency such returns, reports, forms, and other information as may
be required of them.

     O.   Separability.  If any provision of this Agreement shall beheld invalid
or illegal for any reason, such determination shall not affect any remaining
provisions of this Agreement, but this Agreement shall be construed and enforced
as if such invalid or illegal provision had never been included in this
Agreement.


22
<PAGE>

Telephone
numbers and
addresses
- --------------------------------------------------------------------------------
National toll free
telephone numbers
and addresses

     For information about the Scudder Employer-Select 403(b) program,

          CALL (toll-free) 1-800-225-2471
               (within Massachusetts, call collect 617-482-3990)
                              or
          WRITE to:  Scudder Funds Group Retirement Plans
                     175 Federal Street
                     Boston, MA 02110

     A Group Retirement Specialist from Scudder Fund Distributors, Inc.,
     underwriter for the Scudder funds, will answer your calls and letters.

- --------------------------------------------------------------------------------
Local addresses               Boca Raton
of Scudder Fund               150 East Palmetto Park Road
Distributors, Inc.            Boca Raton, Florida 33432
                              305-395-0040

                              Boston
                              175 Federal Street
                              Boston, Massachusetts 02110
                              617-426-8300

                              Chicago
                              Suite 2200, 111 East Wacker Drive
                              Chicago, Illinois  60601
                              312-861-2700

                              Cincinnati
                              540 Carew Tower
                              Cincinnati, Ohio  45202
                              513-621-2733

                              Cleveland
                              Suite 700, 1801 East Ninth Street
                              Cleveland, Ohio  44114
                              216-241-7744

                              Dallas
                              Suite 2124, Plaza of the Americas
                              700 North Pearl
                              Dallas, Texas  75201
                              214-742-1465

                              Houston
                              1530 Bank of the Southwest Building
                              Houston, Texas  77002
                              713-659-3838

                              Los Angeles
                              333 South Hope Street
                              Los Angeles, California  90071
                              213-628-1144

                              New York
                              345 Park Avenue
                              New York, New York  10154
                              212-350-8200

                              Philadelphia
                              Three Girard Plaza
                              Philadelphia, Pennsylvania  19102
                              215-864-7200

                              Portland, Oregon
                              Benjamin Franklin Plaza
                              1 S.W. Columbia St.
                              Portland, Oregon  97258
                              503-224-3999

                              San Francisco
                              Suite 4100, 101 California Street
                              San Francisco, California  94111
                              415-981-8191


                                                                              23
<PAGE>

Scudder
- ---------------------------------------------
This booklet is not to be used in connection
with the offering of any of the Scudder funds
unless preceded or accompanied by the
appropriate current prospectuses.  Scudder
Fund Distributors, Inc. is the underwriter
of the Scudder no-load mutual funds.











BES-23    (C)Scudder Fund Distributors, Inc.



                                     THE
                                     SCUDDER
                                     FUNDS


Employer Adoption Agreement,         Cash or Deferred    
Prototype Plan, and                  Profit Sharing Plan 
Trust Agreement                      under Section 401(k)


                                     SCUDDER
                                     SCUDDER, STEVENS & CLARK INVESTMENT COUNSEL

<PAGE>

Contents
- --------------------------------------------------------------------------------
Advantages of a 401(k) plan                  3
- ----------------------------------------------
Features of the Scudder
prototype 401(k) plan                        4
- ----------------------------------------------
How to establish a Scudder
401(k)plan                                   6
- ----------------------------------------------
Instructions for completing
the Adoption Agreement                       7
- ----------------------------------------------
Adoption Agreement                           9
- ----------------------------------------------
Prototype Plan                              13
- ----------------------------------------------
Trust Agreement                             21
- ----------------------------------------------

Introduction
- --------------------------------------------------------------------------------
The Scudder Funds booklet "Cash or Deferred Arrangements under Section 401(k)"
describes Scudder's 401(k) program. This program consists of eight Scudder
no-load mutual funds, a specially-designed administrative system, and a flexible
prototype plan that can be tailored to fit the needs of corporations not
requiring an individually designed plan.

     The Scudder prototype 401(k) plan has not received a determination with
respect to its qualified status from the National Office of the IRS. The IRS
will not consider prototype 401(k) plans at the present time. Scudder believes
its prototype qualifies under Section 401(k) and the proposed IRS regulations
and will apply for a determination letter as soon as the IRS National Office
will accept it. Scudder will revise the prototype plan as necessary to meet IRS
requirements.

     This booklet contains the Scudder prototype 401(k) plan, the Adoption
Agreement to be completed by the employer, and the Trust Agreement which sets
forth the responsibilities of the trustee of the plan.


2

<PAGE>

Advantages of a 401(k) profit sharing plan
- --------------------------------------------------------------------------------
Advantages over traditional
profit sharing plans

     Section 401(k) profit sharing plans offer many advantages over traditional
profit sharing plans, as described in more detail in our general information
booklet. Four of the most important advantages for employers and participants
are listed below.

- --------------------------------------------------------------------------------
Tax savings for participants
and employers

     Contributions to a 401(k) plan are made before taxes, so participants pay
no federal income taxes on contributions. Earnings accumulate tax-free until
withdrawal. Lump-sum distributions from a 401(k) plan are eligible for 10-year
averaging, which substantially reduces the taxes paid upon distribution. If
contributions are made through salary reduction, employers also save Social
Security taxes, unemployment insurance, and workmen's compensation payments.

- --------------------------------------------------------------------------------
High ceiling on contributions

     401(k) contributions are subject to the same limitations imposed on any
profit sharing plan. There is no $2,000 annual maximum, as with Individual
Retirement Account contributions.

     Participants in a 401(k) plan may also make a tax-deductible contribution
of up to $2,000 per year to an Individual Retirement Account.

- --------------------------------------------------------------------------------
Employee contributions to
thrift plans with pre-tax
dollars

     Employers may make matching contributions to a 401(k) plan. This feature
allows employers to use a 401(k) plan in place of a traditional thrift plan, so
that employees contribute pre-tax dollars to the plan.

- --------------------------------------------------------------------------------
No penalty for distributions

     Distributions from a 401(k) plan can be made without penalty upon
retirement, separation from service, death, disability, or attainment of age
59 1/2. In addition, distributions may be made in cases of hardship, subject to
restrictions required by law.


3

<PAGE>

The Scudder prototype 401(k) plan -
summary of features
- --------------------------------------------------------------------------------
The Scudder family of no-load
mutual funds              

     The Scudder prototype 401(k) plan is used with eight Scudder no-load
(commission-free) mutual funds. These funds offer a wide range of investment
choice, and include money market, growth, income, and international funds.
Transfers among the funds may easily be made, so, if the employer permits,
participants can tailor their 401(k) portfolios to meet changes in investment
requirements and the economic environment.

- --------------------------------------------------------------------------------
Flexible administrative
system

     Scudder offers a flexible administrative system for use with the prototype
plan. Some companies may choose to use the Scudder processing system, which was
specially designed to facilitate the administrative work involved in operating a
401(k) plan. It maintains separate files for each participant and segregates
contributions by type, allowing each type of contribution to be invested
separately. Other companies may require more detailed benefit plan
administrative services which may be arranged through Scudder. These services
include consolidated statements to participants, information for government
reports and discrimination testing.

- --------------------------------------------------------------------------------
Eligibility 

     The employer may choose to have all employees eligible to participate in
the plan, or participation may be limited by age, years of service, or class of
service (e.g., salaried or piece-rate employees).

- --------------------------------------------------------------------------------
Contribution options
     Salary reduction

          An employer may make contributions to the plan on behalf of an
     employee instead of paying salary, based on a salary reduction agreement
     between the employer and the employee.

     Cash deferred
     profit sharing

          An employer may make a profit sharing contribution to the plan and
     permit an employee to elect to receive some or all of that contribution in
     cash. The employer may use this option to meet the IRS "fail-safe" test.

     Social Security
     integration

          The plan may be integrated with Social Security.

     Non-deductible voluntary
     contributions

          If the employer chooses, the employee may make non-deductible
     voluntary contributions of up to 10% of total compensation. These
     contributions may be withdrawn by the employee for any reason upon 30 days'
     notice.


4
<PAGE>

- --------------------------------------------------------------------------------
     Deductible voluntary
     contributions (QVECs)

          Employees may also make deductible voluntary contributions (QVECs) to
     the plan of up to $2,000. These contributions may also be withdrawn upon 30
     days' notice, subject to the same penalties for premature distribution as
     apply to IRAs.

     Matching contributions

          Employers may choose to make matching contributions in proportion to
     any or all of these contributions (except QVECs).

     Rollover contributions
           
          Under certain circumstances, distributions from other qualified plans
     may be rolled over into this plan.

     Vesting

          All contributions including Employer Matching Contributions, are 100%
     vested immediately.

- --------------------------------------------------------------------------------
Investment decisions

     Employers may choose to give the plan administrator control over how
contributions and subsequent earnings on these contributions are to be invested,
or they may allow participants to make their own investment decisions.

- --------------------------------------------------------------------------------
Loans and hardship distributions

     If selected as an option by the employer, loans may be made to participants
from the plan.

     The employer may also choose to make distributions to participants in cases
of hardship. These distributions are made without penalty upon determination of
hardship by the administrator of the plan.

- --------------------------------------------------------------------------------
Appointment of trustee

     The employer may designate one or more individuals, a bank, or trust
company as trustee. The Trust Agreement (p.21) is the document under which the
trustee accepts appointment, and it details the responsibilities of the trustee.

- --------------------------------------------------------------------------------
No separate charges

     Employers pay no charges for using the Scudder processing system.

     Participants are not charged any fees for opening or maintaining 401(k)
plan investments in the Scudder funds. These and other fund expenses are paid
out of the gross investment income of each fund, as detailed in each fund
prospectus.


                                                                               5
<PAGE>

How to establish a Scudder 401(k) plan
- --------------------------------------------------------------------------------
Scudder Group Representative

     A Scudder Group Representative, a retirement plan specialist familiar with
the issues involved in adopting a plan under Section 401(k), will help you
complete the Adoption Agreement (p.9) and determine the appropriate
administrative and information processing procedures. These representatives are
located in most of the twelve Scudder offices throughout the country.

- --------------------------------------------------------------------------------
Adopting the plan

     The first step in adopting the plan is to complete the Adoption Agreement
(instructions are found on pages 7-8), sign it, and send it to Scudder Fund
Distributors, Inc. Scudder will execute the Adoption Agreement to acknowledge
its acceptance and return it to you.

     Scudder will also provide various forms which may be required once the plan
is in effect, including Designation of Beneficiary, a Summary Plan Description,
and sample agreements whereby participants may elect to defer portions of their
salaries or profit sharing bonuses.

- --------------------------------------------------------------------------------
IRS determination letter

     The Scudder prototype 401(k) plan has not yet received a determination with
respect to its qualified status from the National Office of the IRS. If you wish
to apply for a determination with respect to your plan before the Scudder
prototype 401(k) plan becomes qualified, you should submit your plan to the
appropriate Key District Director of the IRS as if it were an
individually-designed plan rather than a prototype plan. Your Scudder Group
Representative will provide you with the necessary forms and instructions.

- --------------------------------------------------------------------------------
Advice of attorney

     It is important that an employer adopting this plan first consult with its
attorney for advice in connection with the adoption and operation of the plan
and in selecting the options available.

- --------------------------------------------------------------------------------
Establishing administrative processing procedures

     A 401(k) plan requires that separate accounts be maintained for each
participant. The Scudder processing system, which maintains participant
subaccounts, is available for this purpose. Other administrative options include
an employer's in-house processing system and a benefit plan administrative
service, which may be arranged through Scudder.

     The appropriate administrative and processing procedures for your plan
depend on a number of factors, such as the number of participants, the number of
different types of contributions your plan permits, and your company's
processing capabilities. Your Scudder Group Representative will discuss the
options with you and help you determine which is best suited to your needs.


6

<PAGE>

Instructions for completing the Adoption Agreement
- --------------------------------------------------------------------------------

     Before completing the Adoption Agreement, please carefully read it and the
following comments about the various options you may select.

I.   Eligibility

     This option determines who will be covered by the plan. You may select a
waiting period of up to 3 years and a minimum age requirement up to 25 years.
You may also elect to exclude certain classes of employees, such as hourly paid
employees, so long as such exclusion does not discriminate in favor of officers,
shareholders or highly compensated employees.

II.  Normal retirement date

     Indicate the normal retirement date under the plan by completing this
section.

III. Definition of compensation

     This option limits the definition of "compensation" under the plan. Under
part A, you determine whether compensation includes amounts paid during the
entire year in which the employee first becomes eligible to participate in the
plan, or only amounts paid after the employee becomes eligible to participate.
Under part B, you may exclude certain amounts paid, such as commissions, from
the definition of compensation so long as such exclusion does not result in
discrimination in favor of officers, shareholders or highly-paid employees.

IV.  Employer salary deferral and profit sharing deferral contributions

     This option determines the type of employer contribution that will be made
to the plan. You may select either "Employer Salary Deferral Contributions" or
"Employer Profit Sharing Deferral Contributions," or both.

     Employer Salary Deferral Contributions. If you select this option,
participants will be able to elect to reduce their compensation and have a
portion of it contributed to the plan. You must specify under Part 1 the maximum
percentage by which participants may reduce their compensation by selecting and
completing option (a) or (b):

          Option (a) permits a participant to elect a percentage reduction of
     his entire compensation.

          Option (b) only permits a participant to elect a percentage reduction
     of that portion of his compensation in excess of the social security
     taxable wage base.

     In completing Part 1, keep in mind the limitations under Code Section 415
(as described in Section 5 of the plan) which generally limit contributions on
behalf of any participant to 25% of compensation, as well as the limitations
under Code Section 404(a)(3) which limit an employer's deduction for employer
contributions to 15% of the aggregate compensation paid or accrued during its
taxable year to all participants as shown on the W-2 forms. Compensation for
these purposes is calculated after salary reductions under the plan. For this
reason, although you may elect a percentage limitation greater than 15% (because
it is unlikely that all participants will elect the maximum reduction),
employers may want to select a limit less than 15% to be safe. Furthermore, if
an employer maintains another qualified plan, consideration must be given to the
effect of that plan on the contribution and allocation limitations of Code
Section 415 and the deductibility limitations of code Section 404.

     Employer Profit Sharing Deferral Contributions. If you select this option,
a profit sharing contribution will be made to the plan except to the extent that
you permit participants to elect to receive a portion of their profit sharing
allocation in cash. You must specify under Part 2 how profit sharing allocations
will be determined each year:

          Option (a) specifies that the profit sharing allocation will be a
     fixed percentage of compensation.

          Option (b) specifies that the profit sharing allocation will be a
     percentage of compensation determined each year by your Board of Directors.
     Furthermore, you must specify under Part 2 the extent to which participants
     may elect to receive cash instead of having their profit sharing
     contributions deferred and contributed to the plan:

          Option (c) does not permit participants to receive any cash.

          Option (d) permits participants to receive in cash only that portion
     of their profit sharing allocation which exceeds the percentage of
     compensation you specify (thus requiring participants to defer part of
     their profit sharing allocations).

          Option (e) permits participants to receive in cash up to the
     percentage of their profit sharing allocations that you specify.

The comments above about the limitations under Code Section 404 and 415 as
discussed above for Employer Salary Deferral contributions also apply to
Employer Profit Sharing Contributions.

     Anti-Discrimination Rules. In completing Part IV, you should also keep in
mind that the anti-discrimination requirements of Code Section 401(k) may limit
the percentage of compensation highly-paid participants may elect to defer
through Employer Salary Deferral Contributions or Employer Profit Sharing
Deferral Contributions. These anti-discrimination rules are described in Section
6 of the prototype plan and you should review them carefully before completing
Section IV of the Adoption Agreement. The following are examples of some of the
ways to meet these anti-discrimination requirements:

          Fail-Safe. You can meet the so-called "fail-safe" rule of the proposed
     regulations by completing Part 2 so that the profit sharing allocation is a
     fixed percentage of compensation which the participant cannot receive in
     cash. If you then complete Part 1 so that the maximum salary reduction a
     participant can elect will be a percentage of compensation not greater,
     when compared to the percentage of compensation represented by the profit
     sharing allocation under Part 2, than permitted under the special
     anti-discrimination requirements of Code Section 401(k), the fail-safe rule
     will be satisfied. For example, you could complete Part 2 so that the
     Employer Profit Sharing Deferral Contributions will be 5% and Part 1 so
     that the maximum salary reduction can be no more than 3% of compensation.

          Social Security Integration. Some employers will be able to meet the
     general anti-discrimination rules of Code Section 401(k) by selecting
     option (b) of Part 1 so that the maximum salary reduction a participant can
     elect will be limited to not more than 7% in excess of the taxable wage
     base.

          Other Alternatives. You may want to limit the percentage of
     compensation which participants may defer through Employer Salary Deferral
     contributions to a modest amount, such as 5%. So long as the actual
     deferral percentage for the lower 2/3 is 2% or more, your plan will meet
     the anti-discrimination rule under code Section 401(k). Alternatively, you
     may decide to hold Employer Salary Deferral contributions or Employer
     Profit Sharing Deferral contributions for the highest paid one-third (top
     1/3) of your employees in suspense outside the plan before contributing
     them to the plan to first verify that the anti-discrimination rules not be
     violated. The IRS does not permit a refund of such contributions after they
     have been contributed to the plan in order to meet the anti-discrimination
     rules. Or you may decide to permit only the lower paid two-thirds (lower
     2/3) of your employees to have Employer Salary Deferral contributions made
     for them through payroll deduction during the year and limit the Employer
     Salary Deferral contributions for the top 1/3 to a one-time only
     contribution at the end of the year after the maximum permissible
     contributions have been determined. Another alternative might be to permit
     the top 1/3 to withdraw a portion of their Participant Non-Deductible
     Voluntary Contributions and then use those amounts to have Employer Salary
     Deferral Contributions made on their behalf once the maximum contributions
     for the top 1/3 have been determined at the end of the year on the basis of
     the percentage actually contributed for the lower 2/3 of your employees.

     The flexibility of the Scudder prototype plan and processing system permits
these as well as other possible solutions to the anti-discrimination rules.


                                                                               7
<PAGE>

V.   Employer thrift contributions

     This option permits you to make Employer Thrift Contributions that will
match the percentage you select of either Employer Salary Deferral
contributions, Employer Profit Sharing Deferral contributions or Participant
Non-Deductible Voluntary contributions, or any combination of these types of
contributions. For example, you might elect to make an Employer Thrift
contribution equal to 50% of each participant's Employer Salary Deferral
Contribution and Employer Profit Sharing Deferral Contribution.

VI. Participant non-deductible and deductible voluntary contributions

     Under this option, you may permit participants to make either Participant
Non-Deductible Voluntary contributions or Participant Deductible Voluntary
contributions. If you select Participant Non-Deductible Voluntary contributions,
participants will be permitted to make voluntary contributions each year in an
amount not greater than 10% of their total compensation. These contributions
will be nondeductible. If you select Participant Deductible Voluntary
Contributions, participants will be permitted to make voluntary contributions
each year up to $2,000. These contributions will be deductible but are subject
to the special rules under the Code relating to "qualified voluntary employee
contributions" (QVECs) which are generally similar to the rules applicable to
individual retirement accounts (IRAs).

VII. Determination of investment

     Indicate in this section whether investment decisions will be made by the
Administrator (whom you appoint) or by participants themselves.

VIII. Tax-option corporations (Subchapter S)

     This option pertains to Subchapter S corporations. Indicate in part A
whether or not the employer is a Subchapter S corporation. If so, also complete
part B to indicate how the limitations of Code Section 1379(b) on Subchapter S
corporations are to apply.

IX.  Loans to participants

     By this Option you may permit participants to borrow out of their accounts,
subject to the limitations of Section 12 of the prototype plan.

X.   Hardship distributions

     By this option you may permit participants to receive early distribution of
their account in case of hardship, subject to the limitations of Section 9 of
the prototype plan (which describes special rules attributable to such
distributions under Code Section 401(k)).

XI.  Effective date of plan

     Insert the effective date of the plan in this section.

XII. Plan year

     Indicate in this section either that the plan year is the same as the
fiscal year of the employer or insert another date if you prefer.

XIII. Amendment

     Indicate in this section whether this is a new plan or an amendment of an
existing plan.

XIV. Appointment of trustee

     Insert the name or names of the Trustee(s) in this Section. One or more
individuals, a bank, or a trust company may be designated.

XV.  Statement of Employer

     Please read this section of the Adoption Agreement carefully.

XVI. Limitation on allocations

     If this plan is the only retirement plan which you maintain, do not
complete this section of the Adoption Agreement; it applies only in certain
cases where employees participate in more than one plan maintained by the same
employer. Complete this section only it you maintain another plan which is a
qualified defined contribution plan other than a model, master or prototype
plan; and you may prefer not to complete it, which is permitted, in which case
the provisions of Section 5.2 of the prototype plan will automatically apply to
this plan.

     THE ADOPTION AGREEMENT SHOULD BE SIGNED BY THE EMPLOYER AND THE TRUSTEE(S).

     Under the Employer's signature, insert the Federal Employer Identification
Number, the Plan Serial Number (001 if you maintain no other plan), the
employer's fiscal year and the employer's telephone number.


8

<PAGE>

                  SCUDDER CASH OR DEFERRED PROFIT-SHARING PLAN
                               ADOPTION AGREEMENT

The undersigned (the "Employer") hereby establishes, or amends the
______________________ [insert name of Employer] CASH OR DEFERRED PROFIT-SHARING
PLAN, by completing this Adoption Agreement adopting or amending the
profit-sharing plan and trust agreement in the form of the Prototype Plan and
the Trust Agreement attached. (For definition of terms, see Section 2 of the
Prototype Plan.)

I.   ELIGIBILITY

     A.   To become a Participant an Employee:
Select One

     (_)  (1) Need not complete any waiting period.
     (_)  (2) Must complete [insert no more than 3] Years of Service.

     B.   To become a Participant an Employee:

Select One

     (_)  (1) Need not attain any minimum age.
     (_)  (2) Must be at least ________[insert 25 or less] years of age.

     C.   Employees in all classes are entitled to be Participants except:
          [NOTE: If Employees are excluded from the Plan under one or more of
          the classifications below (not including the last two
          classifications), the exclusion must NOT result in discrimination in
          favor of officers, shareholders or highly-paid Employees.]

One or More May be Selected

     (_)  (1) Salaried Employees
     (_)  (2) Hourly-paid Employees
     (_)  (3) Piece-rate Employees
     (_)  (4) Employees paid by commission
     (_)  (5) Employees covered by another retirement plan to which the Employer
              is required to contribute
     (_)  (6) Employees in the following classification [must be
              nondiscriminatory] ______________________________________________
              _________________________________________________________________

     (_)  (7) Non-resident aliens who receive no earned income from United
              States sources (as permitted under Code Section 410(b)(3)(c).)

     (_)  (8) Employees covered by a collective bargaining contract between the
              Employer and a recognized bargaining agent, if contract
              negotiations considered retirement benefits in good faith, unless
              such contract specifically provides for participation in the
              Plan.

This must be Completed

     D.   A Year of Service shall mean a 12-month period beginning on an
          Employee's initial date of Employment or an anniversary thereof during
          which the Employee has __ [insert 1,000 or less] Hours of Service.

     E.   The Participants eligible for Profit Sharing Allocations under Section
          IV below or Employer Thrift Contributions under Section V below for
          any Plan Year shall be:

Select One

          (_)  (1) All Participants

          (_)  (2) All Participants except those who have not completed the
                   number of Hours of Service required under D above during
                   such Plan Year.


II.  NORMAL RETIREMENT DATE

                A Participant's Normal Retirement Date shall be:

Select and Complete One

          (_)  (1) The first day of the month preceding his ___th [insert not
                   less than 55 nor more than 65] birthday.

               (2) The first day of the month preceding his ___th [insert not
                   less than 55 nor more than 65] birthday or the ___th
                   [insert 10 or less] anniversary of the date he became a
                   Participant, whichever is later.

III. COMPENSATION

          A.   "Compensation" shall include amounts paid as described in B
               below:

Select One

          (_)  (1)  For the entire Plan Year in which the Employee became a
                    Participant whether or not he was a Participant for the
                    entire Plan Year.

          (_)  (2)  For the portion of the Plan Year after the Employee became a
                    Participant.

          B.   "Compensation" shall mean the amount paid by the Employer to the
               Employee for his services as reportable to the Federal Government
               for the purposes of withholding Federal income taxes, or which
               would be reportable if it were not deferred by the Employee's
               election hereunder to have it contributed to the Plan as an
               Employer Salary Deferral Contribution described in Section IV
               below, but excluding any portion of the Profit Sharing Allocation
               described in Section IV below which the Participant has elected
               to receive in cash and also excluding the following:

Select One or More Desired

          (_)  (1)  Bonuses
          (_)  (2)  Commissions
          (_)  (3)  Overtime Payments
          (_)  (4)  Other(specify) ________________________________

               [NOTE: If one or more of the above are chosen the exclusion must
               NOT result in discrimination in favor of officers, shareholders
               or highly-paid Employees.]


                                                                               9

<PAGE>

IV.  EMPLOYER CONTRIBUTIONS

          For each Year the Employer will make the following contribution to the
          Trust established pursuant to the Plan on behalf of each Participant:

Select and Complete
if Desired

          (_)  (1)  Subject to Section 4.1 of the Prototype Plan, an Employer
                    Salary Deferral Contribution equal to the portion of the
                    Compensation otherwise payable by the Employer for the Plan
                    Year that the Participant has elected to be deferred and
                    contributed to the Trust. Such election shall specify the
                    amount of the Compensation to be deferred, which amount
                    shall be:

Select and Complete
One if Salary Deferral
Contribution has been
Selected

                    (_)(a)  not less than ___% nor more than __% of the
                            Participant's Compensation.

                    (_)(b)  not more than ____ % [insert 7% or less] of that
                            portion of the Participant's Compensation which
                            exceeds the Taxable Wage Base.

Select and
Complete if
Desired

           (_) (2)  Subject to Section 4.2 of the Prototype Plan, an Employer
                    Profit Sharing Deferral Contribution equal to that portion
                    of the Profit Sharing Allocation for the Plan Year which the
                    Participant has not elected to receive in cash, if permitted
                    below, instead of having it deferred and contributed to the
                    Trust. The Profit Sharing Allocation for this purpose shall
                    be an amount equal to:

Select and Complete
One if Profit Sharing
Deferral Contribution
has been Selected

                    (_)  (a) __ % of the Participant's Compensation, or
                    (_)  (b) the percentage of the Participant's Compensation as
                             is determined by a vote of the Board of Directors
                             of the Employer for each Year (which percentage
                             shall be the same for each Participant), but in no
                             event more than _____%.

Select and Complete
One if Profit Sharing
Deferral Contribution
has been Selected

                    A Participant:

                    (_)  (c) may not elect to receive any portion of his Profit
                             Sharing Allocation in cash instead of having it
                             deferred and contributed to the Trust.

                    (_)  (d) may elect to receive that portion of his Profit
                             Sharing Allocation which exceeds ________ % of his
                             Compensation in cash instead of having it deferred
                             and contributed to the Trust.

                    (_)  (e) may elect to receive not more than __% of his
                             Profit Sharing Allocation in cash instead of having
                             it deferred and contributed to the Trust.

                    [NOTE: Code Section 404(a)(3) generally limits the
                    Employer's deduction for Employer Contributions to 15% of
                    the aggregate compensation otherwise paid or accrued during
                    its taxable year to all Participants as shown on the W-2
                    forms. Employers should not complete Section IV in such a
                    way that this limitation will likely be exceeded.]

V.   EMPLOYER THRIFT CONTRIBUTION

Select and
Complete if
Desired

     (_)  In addition to the Employer Salary Deferral or Profit Sharing Deferral
          Contributions in Section IV above, the Employer shall make an Employer
          Thrift Contribution pursuant to Section 4.5 of the Prototype Plan on
          behalf of each Participant equal to __% of the aggregate:

Select One or more if
Thrift Contribution
has been Selected

     (_)  (1) Employer Salary Deferral Contribution
     (_)  (2) Employer Profit Sharing Deferral Contribution
     (_)  (3) Participant Non-Deductible Voluntary Contribution allocated to
          such Participant's Account for the Plan Year, but only to the extent
          that the aggregate amount of the Contributions designated in (1), (2)
          or (3) above which are allocated to the Participant's Account for such
          Plan Year does not exceed __% [insert 6% or less] of the Participant's
          Compensation.
          [NOTE: Code Section 404(a)(3) generally limits the Employer's
          deduction for Employer Contributions to 15% of the aggregate
          compensation otherwise paid or accrued during its taxable year to all
          Participants as shown on the W-2 forms. Employers should not complete
          Section V in such a way that this limitation will likely be exceeded.]

VI.  PARTICIPANT CONTRIBUTIONS

     A.   Participant Non-Deductible Voluntary Contributions:

Select One

     (_)(1) Participant Non-Deductible Voluntary contributions pursuant to
            Section 4.3 of the Prototype Plan are permitted.
     (_)(2) Participant Non-Deductible Voluntary contributions are not
            permitted.

     B.   Participant Deductible Voluntary Contributions:

Select One

     (_)  (1) Participant Deductible Voluntary Contributions pursuant to Section
              4.4 of the Prototype Plan are permitted.
     (_)  (2) Participant Deductible Voluntary Contributions are not permitted.
              [NOTE: Participant Non-Deductible Contributions made hereunder
              shall not be allowed to the extent they would otherwise exceed
              the limitations of Section 5 of the Prototype Plan.]


10

<PAGE>

VII. INVESTMENT

            Pursuant to Section 11 of the Prototype Plan, all contributions
            under this Plan and any earnings thereon shall be invested as
            determined by:

Select One

     (_)  (1) the Administrator.
     (_)  (2) the Participant.

VIII. TAX-OPTION CORPORATIONS (Subchapter S)

     A.   The Employer:

Select One

     (_)  (1) is an electing small business corporation under Code Section 1371.
     (_)  (2) is not an electing small business corporation under Code Section
              1371.

Complete ONLY if the Employer is an Electing Small Business Corporation

     B.   With respect to any Year in which the Employer is an electing small
          business corporation, the Employer Contributions for each
          shareholder-employee (as defined in Code Section 1379(d)) otherwise
          payable under the Plan for such Year shall be limited as follows:

Select One

     (_)  (1) No limitation on the amount to be allocated to a
              shareholder-employee.
     (_)  (2) No allocations to any shareholder-employee.
     (_)  (3) The statutory limit permitted under Code Section 1379(b) which may
              be deducted by the Employer without inclusion in the gross income
              of the shareholder-employee.

IX.  LOANS

     Loans to a Participant pursuant to Section 12 of the Prototype Plan:

Select One

     (_)  (1) are permitted.
     (_)  (2) are not permitted.

X.   EARLY DISTRIBUTION IN CASES OF HARDSHIP

     Early distributions to Participants in cases of hardship pursuant to
     Section 9 of the Prototype Plan:

Select One

     (_)  (1) are permitted.
     (_)  (2) are not permitted.

XI.  EFFECTIVE DATE

Complete

     The Effective Date of this Plan or amendment shall be ___.

XII.  PLAN YEAR

     The Plan year shall:

Select One and, if Applicable, Complete

     (_)  (1) be the same as the fiscal year of the Employer.
     (_)  (2) end on the last day of the month of _________.

XIII. AMENDMENT

     Execution of this Adoption Agreement:

Select One

     (_)  (1) is an amendment to an existing plan.

     (_)  (2) is not an amendment to an existing plan.

XIV. APPOINTMENT OF TRUSTEES

     The Employer hereby designates the following person or persons as
     Trustee(s) under the Trust:

Complete:_____________________________________________________________________
         _____________________________________________________________________
         _____________________________________________________________________
         _____________________________________________________________________
         _____________________________________________________________________

XV.  STATEMENT OF EMPLOYER

     The Employer (i) covenants and agrees that whenever a Participant makes a
contribution the Employer shall ascertain that the Participant has received a
copy of the current prospectus relating to the shares of any Designated
Investment Company in which such contribution is to be invested plus, where
required by any state or federal law, the current prospectus relating to any
other investment in which contributions are to be invested, and (ii) by
remitting such a contribution to the Trustee the Employer shall be deemed to
represent that the Participant has received such a prospectus, and (iii) by
remitting any other contribution to the Trustee the Employer shall be deemed
to represent that the Employer has received a current prospectus of any
Designated Investment Company in which it is to be invested, plus, where
required by any state or federal law, the current prospectus relating to any
other investment in which contributions are to be invested.


                                                                              11
<PAGE>

XVI. LIMITATION ON ALLOCATIONS

     [NOTE: Complete this Section only if the Employer maintains either (i)
another plan which is a qualified defined contribution plan other than a Model,
Master or Prototype plan, or (ii) a qualified defined benefit Plan. If the
Employer maintains such a plan, failure to complete this Section may adversely
affect the qualification of the plans the Employer maintains. If the Employer
does not complete this Section, the provisions of Section 5.2 of the Prototype
Plan will automatically apply to this Plan.]

     The amount of Annual Additions allocated to any Participant's Account under
this Plan shall be limited as follows: [Use a Rider to provide appropriate
provisions to comply with the Code.]

     IN WITNESS WHEREOF, the Employer has hereunto executed this Adoption
Agreement as of the __ day of ______, 19__.


____________________________________
          Name of Employer


By____________________________________
          Authorized Signature


Address ____________________________________
        ____________________________________


Employer Identification   ____________________________
Plan Serial Number        ____________________________
Employer Fiscal Year      ____________________________
Employer Telephone Number ____________________________

TRUSTEE ACCEPTANCE

     The undersigned accept(s) appointment as Trustee(s) under the Trust
Agreement.

                                            ____________________________________

                                            ____________________________________

                                            ____________________________________

DESIGNATED INVESTMENT COMPANY ACKNOWLEDGEMENT

     Scudder Fund Distributors, Inc. acknowledges receipt of a copy of the
executed Adoption Agreement and agrees to accept, on behalf of the Designated
Investment Company or Companies, contributions under the Plan for investment in
accordance with Section VII of the Adoption Agreement.


                                            ____________________________________
                                                 Scudder Fund Distributors, Inc.

Return this form to:

      Scudder Fund Distributors, Inc.
      Group Representatives
      175 Federal Street
      Boston, Massachusetts 02110


12
<PAGE>

                  SCUDDER CASH OR DEFERRED PROFIT-SHARING PLAN

SECTION 1. INTRODUCTION

     The Employer has established this Plan (the "Plan"), consisting of the
Adoption Agreement, the following provisions (the "Prototype Plan") and the
Trust Agreement for the exclusive benefit of its Employees and their
Beneficiaries.

SECTION 2. DEFINITIONS

     Where the following words and phrases appear in the Plan, they shall have
the respective meanings set forth below, unless their context clearly indicates
a contrary meaning. The singular herein shall include the plural, and vice
versa, and the masculine gender shall include the feminine gender, and vice
versa, where the context requires.

     2.1 "Account" shall mean the cash and securities held by the Trustee for
the benefit of a Participant, which shall be the sum of his Employer Salary
Deferral Account, Employer Profit Sharing Deferral Account, Employer Thrift
Account, Participant Non-Deductible Voluntary Account, Participant Deductible
Voluntary Account, and Rollover Account.

     2.2 "Act" shall mean the Employer Retirement Income Security Act of 1974,
as amended.

     2.3 "Administrator" shall mean the person or persons appointed under
Section 13.1.

     2.4 "Adoption Agreement" shall mean the agreement by which the Employer has
most recently adopted or amended the Plan.

     2.5 "Beneficiary" shall mean any person or legal representative entitled to
receive benefits on or after the death of a Participant.

     2.6 "Code" shall mean the Internal Revenue Code of 1954, as amended.
Reference to a section of the Code shall include any comparable section or
sections of future legislation that amends, supplements or supersedes such
section.

     2.7 "Compensation" shall mean the amount paid by the Employer to the
Employee for his services as reportable to the Federal Government for the
purpose of withholding Federal income taxes, or which would be reportable if it
were not deferred by the Employee's election to have it contributed to the Plan
as an Employer Salary Deferral Contribution, but excluding any portion of the
Profit Sharing Allocation which a Participant elects to receive in cash and (i)
amounts attributable to services rendered by an Employee when he was not a
Participant, except to the extent specified in Section III-A of the Adoption
Agreement, (ii) the amounts attributable to any category specified by the
Employer to be excluded in Section III-B of the Adoption Agreement, and (iii),
in the case of an Employer who has one or more shareholder-employees within the
meaning of Section 1379(b) of the Code as Participants, amounts paid to any
Employee in excess of $200,000.

     2.8 "Current or Accumulated Earnings and Profits" of the Employer, shall
mean the Employer's current or accumulated earnings and profits, as determined
on the basis of the Employer's books of account in accordance with generally
accepted accounting practices, without any deductions for Employer Contributions
under the Plan for the current Year or for Federal income taxes for the current
Year and without regard to the Employer's election to be taxed as a small
business corporation, if it has so elected.

     2.9 "Designated Investment Company" shall mean a regulated investment
company for which Scudder, Stevens & Clark, or its successor or any of its
affiliates, acts as investment adviser and which is designated by Scudder Fund
Distributors, Inc., or its successors, as eligible for investment under the
Plan.

     2.10 "Designation of Beneficiary" or "Designation" shall mean the document
executed by a Participant under Section 16.

     2.11 "Distributee" shall mean the Beneficiary or other person entitled to
receive the undistributed portion of the Participant's Account because of death
under Section 8 or because of his incompetency or the inability to ascertain or
locate him under Section 15.

     2.12 "Distributor" shall mean Scudder Fund Distributors, Inc. or its
successor.

     2.13 "Effective Date" shall mean the date selected by the Employer in
Section XI of the Adoption Agreement.

     2.14 "Employee" shall mean an individual who performs services in the
business of the Employer in any capacity except as a self-employed individual.

     2.15 "Employer" shall mean the organization named as such in the Adoption
Agreement and any successor organization which adopts the Plan. Any two or more
members of a controlled group of corporations as defined in Code Section 414(b)
may adopt and maintain the plan as a single Plan.

     2.16 "Employer Contributions" shall mean the sum of the Employer Profit
Sharing Deferral Contributions, Employer Salary Deferral Contributions and
Employer Thrift Contributions.

     2.17 "Employer Profit Sharing Deferral Account", shall mean the separate
account maintained pursuant to Section 7.3 hereof for the Employer Profit
Sharing Deferral Contributions (as described in Section IV of the Adoption
Agreement) allocated to a Participant and the income, expenses, gains and losses
attributable thereto.

     2.18 "Employer Profit Sharing Deferral Contributions" shall mean
contributions made to the Trust by the Employer in accordance with Section 4.2
as that part of the Profit Sharing Allocations which Participants have not
elected to receive in cash.

     2.19 "Employer Salary Deferral Account" shall mean the separate account
maintained pursuant to Section 7.3 hereof for the Employer Salary Deferral
Contributions allocated to a Participant and the income, expenses, gains and
losses attributable thereto.

     2.20 "Employer Salary Deferral Contributions" shall mean contributions made
to the Trust by the Employer in accordance with Section 4.1 hereof as a result
of the election by Participants to defer part of their Compensation.

     2.21 "Employer Thrift Account" shall mean the separate account maintained
pursuant to Section 7.3 hereof for the Employer Thrift Contributions allocated
to a Participant and the income, expenses, gains and losses attributable
thereto.

     2.22 "Employer Thrift Contributions" shall mean contributions made to the
Trust by the Employer in accordance with Section 4.5 hereof as matching
contributions.

     2.23 "Hour of Service" shall mean:

     (a)  Each hour for which an Employee is paid, or entitled to payment, for
          the performance of duties for the Employer. These hours shall be
          credited to the Employee for the computation period in which the
          duties are performed; and

     (b)  Each hour for which an Employee is paid, or entitled to payment, by
          the Employer on account of a period of time during which no duties are
          performed (irrespective of whether the employment relationship has
          terminated) due to vacation, holiday, illness, incapacity (including
          disability), layoff, jury duty, military duty or leave of absence. No
          more than 501 Hours of Service shall be credited under this paragraph
          for any single continuous period (whether or not such period occurs in
          a single computation period). Hours under this paragraph shall be
          calculated and credited pursuant to section 2530.200b-2 of the
          Department of Labor Regulations which are incorporated herein by this
          reference; and

     (c)  Each hour for which back pay, irrespective of mitigation of damages,
          is either awarded or agreed to by the Employer. The same Hours of
          Service shall not be credited both under paragraph (a) or paragraph
          (b), as the case may be, and under this paragraph (c). These hours
          shall be credited to the Employee for the computation period or
          periods to which the award or agreement pertains rather than the
          computation period in which the award, agreement or payment is made.

     (d)  Where the Employer maintains the plan of a predecessor employer,
          service for such predecessor employer shall be treated as service of
          the Employer. Where the Employer does not maintain the plan of a
          predecessor employer, employment by a predecessor employer, upon the
          written election of the Employer made in a uniform and
          non-discriminatory manner, shall be treated as service for the
          Employer.

     2.24 "Normal Retirement Date" or "Normal Retirement Age" shall mean the
date selected by the Employer in Section II of the Adoption Agreement.

     2.25 "Participant" shall mean an Employee who is eligible to participate in
the Plan under Section 3 and who has not, since becoming a Participant, died,
become disabled, retired or otherwise terminated employment with the Employer.

     2.26 "Participant Contributions" shall mean the sum of the Participant
Non-Deductible Voluntary Contributions and the Participant Deductible Voluntary
Contributions.

     2.27 "Participant Deductible Voluntary Account" shall mean the separate
account maintained pursuant to Section 7.3 hereof for the Participant Deductible
Voluntary Contributions (as described in Section VI-B of the Adoption Agreement)
made by the Participant and the income, expenses, gains and losses attributable
thereto.

     2.28 "Participant Deductible Voluntary Contributions" shall mean
contributions made to the Trust by Participants in accordance with Section 4.4
hereof. Such contributions are intended to be "qualified voluntary employee
contributions" within the meaning of Code Section 219(e)(2).

     2.29 "Participant Non-Deductible Voluntary Account" shall mean the separate
account maintained pursuant to Section 7.3 hereof for the Participant
Non-Deductible Voluntary Contributions (as described in Section VI-A of the
Adoption Agreement) made by the Participant and the income, expenses, gains and
losses attributable thereto.

     2.30 "Participant Non-Deductible Voluntary Contributions" shall mean
contributions made to the Trust by Participants in accordance with Section 4.3
hereof. Such contributions are intended not to be "qualified


                                                                              13
<PAGE>

voluntary employee contributions" within the meaning of Code Section 219(e)(2).

     2.31 "Plan" shall mean the Prototype Plan, the Adoption Agreement and the
Trust Agreement.

     2.32 "Plan Year" shall mean the fiscal year of the Employer or a different
period as specified in Section XIV of the Adoption Agreement.

     2.33 "Profit Sharing Allocation" shall mean the contribution payable by the
Employer to the Trust on behalf of a Participant out of the Employer's Current
or Accumulated Earnings in accordance with Section 4.2 hereof subject to the
Participant's right to elect, if permitted by Section IV of the Adoption
Agreement, to receive all or a portion of such contribution in cash in lieu of
having it deferred and contributed to the Trust on his behalf.

     2.34 "Prototype Plan" shall mean these Sections 1-21.

     2.35 "Rollover Account" shall mean the separate account maintained pursuant
to Section 7.3 hereof for any Rollover Contributions (as described in Section
4.6 hereof) made by the Participant and the income, expenses, gains and losses
attributable thereto.

     2.36 "Rollover Contributions" shall mean contributions made to the Trust by
Participants in accordance with Section 4.6 hereof out of "qualifying rollover
distributions" within the meaning of Code Section 402(a)(5)(D)(i).

     2.37 "Service" generally shall mean Employment by the Employer or, if the
Employer is maintaining the plan of a predecessor employer or has so elected,
employment by such predecessor employer. (See "Hour of Service").

     2.38 "Taxable Wage Base" shall mean, for any Plan Year, the maximum amount
of earnings which may be considered wages for the calendar year ending within or
coincident with such Plan Year for purposes of determining F.I.C.A. tax
liability under Code Section 3121(a)(1).

     2.39 "Trust" shall mean the trust established under the Trust Agreement
entered into pursuant to this Plan for investment as provided in Section VII of
the Adoption Agreement.

     2.40 "Trust Agreement" shall mean the agreement under which the Trustee
accepts appointment to establish a Trust for the investment of contributions
under the Plan.

     2.41 "Trustee" shall mean the person or persons, including any successor or
successors thereto, designated pursuant to Section XIV of the Adoption Agreement
to act as trustee of the Trust.

     2.42 "Valuation Date" shall mean the last day of each Plan Year.

     2.43 "Year" shall mean the fiscal year of the Employer.

     2.44 "Year of Service" shall mean a twelve (12) month period, beginning on
an Employee's initial date of Employment or an anniversary thereof in which the
Employee had the number of Hours of Service specified in Section 1-D of the
Adoption Agreement. The date of initial employment is the first day on which the
Employee performs an Hour of Service.

SECTION 3. ELIGIBILITY

     3.1 Entry. Each Employee of the Employer who on the Effective Date of this
Plan meets the conditions specified in Section I of the Adoption Agreement shall
become eligible to participate in the Plan commencing with that Effective Date,
Each other Employee of the Employer, including future Employees, shall become
eligible to participate in the Plan on the first business day of the month next
following the month in which he meets such conditions.

     3.2 Reentry. A former Participant shall become a Participant immediately
upon his return to the employ of the Employer or his return to an eligible class
of employees, whichever is applicable.

     3.3 Transfer to Eligible Class. In the event an Employee who is not a
member of an eligible class of Employees becomes a member of an eligible class
such Employee shall participate immediately if such Employee has satisfied the
minimum age and service requirements and would have previously become a
Participant had he been in the eligible class.

     3.4 Determination by Administrator. Eligibility shall be determined by the
Administrator and the Administrator shall notify each Employee upon his
admission as a Participant in the Plan.

     3.5 Related Businesses. If the Employer is a member of (a) a controlled
group of corporations (as defined under Code Section 414(h)), (b) a group of
trades or businesses (whether or not incorporated) which are under common
control (as defined under Code Section 414(c)), or (c) an affiliated service
group (as defined under Code Section 414(m)), all service of an Employee for any
member of such a group shall be treated as if it were service for the Employer
for purposes of the eligibility requirements of Section I of the Adoption
Agreement and this Section 3.

SECTION 4. CONTRIBUTIONS

     4.1 Employer Salary Deferral Contributions. If selected by the Employer in
Section IV of the Adoption Agreement, the Employer will make an Employer Salary
Deferral Contribution to the Trust on behalf of each Participant who has elected
to defer a portion of the Compensation otherwise payable to him for the Plan
Year and have it contributed to the Trust. Such an election may only be made
pursuant to a written salary reduction agreement between the Participant and the
Employer. The agreement shall be in such form and subject to such rules as the
Administrator may prescribe, and the agreement shall specify the amount of
Compensation that the Participant desires to defer (but in no event may such
deferral exceed the percentage of Compensation specified in Section IV (1) of
the Adoption Agreement). A salary reduction agreement may be amended or
terminated prospectively during the Plan Year at such times and in such manner
as permitted by the rules of the Administrator. The Employer Salary Deferral
Contribution made for a Participant shall be in an amount equal to the amount
specified in the Participant's salary reduction agreement; provided, however,
that the Employer Salary Deferral Contribution otherwise to be made for a
Participant shall be reduced to the extent necessary, if any, to comply with the
limitations of Section 4.7, 5 and 6 hereof (and Section VIII of the Adoption
Agreement if applicable). Any amount which cannot be contributed to the Trust
because of those limitations shall be paid to the Participant in cash no later
than the last day that such amount could otherwise have been contributed to the
Trust for the Plan Year in respect to which it has been deferred, and such
payment shall be subject to federal income and other tax withholding by the
Employer. An Employer Salary Deferral Contribution made for a Participant shall
be allocated to his Employer Salary Deferral Account pursuant to Section 7.3
hereof.

     4.2 Employer Profit Sharing Deferral Contributions. If selected by the
Employer in Section IV of the Adoption Agreement, the Employer will make an
Employer Profit Sharing Deferral Contribution to the Trust in an amount equal to
the Profit Sharing Allocation specified in Section IV (2) of the Adoption
Agreement as expressed as a percentage of the Participant's Compensation;
provided, however, that if and to the extent permitted by Section IV (2) of the
Adoption Agreement, each Participant may elect to receives portion of the Profit
Sharing Allocation in cash in lieu of having it deferred and contributed to the
Trust as an Employer Profit Sharing Deferral Contribution. Such an election may
only be made pursuant to a written agreement between the Participant and the
Employer. The agreement shall be in such form and subject to such rules as the
Administrator may prescribe, and the election shall specify the amount of the
Profit Sharing Allocation that the Participant desires to receive in cash. The
amount which a Participant has elected to receive in cash pursuant to such an
election shall be paid to the Participant by the Employer no later than the last
day on which the Employer Profit Sharing Deferral Contributions for the Plan
Year in question must be paid to the Trust under Section 7.2 hereof,
Notwithstanding the above, the Employer Profit Sharing Deferral Contribution
otherwise to be made for a Participant shall be reduced to the extent necessary,
if any, to comply with the limitations of Sections 4.7, 5 and 6 hereof (and
Section VIII of the Adoption Agreement, if applicable). Any amount which cannot
be contributed to the Trust because of those limitations shall be paid to the
Participant in cash no later than the last day that such amount could otherwise
have been contributed to the Trust for the Plan Year in the respect to which it
has been deferred, and such payment shall be subject to federal income and other
tax withholding by the Employer. An Employer Profit Sharing Deferral
Contribution made for a participant shall be allocated to his Employer Profit
Sharing Deferral Account pursuant to Section 7.3 hereof.

     4.3 Participant Non-Deductible Voluntary Contributions. If selected by the
Employer in Section VI A of the Adoption Agreement, a Participant may make
Participant Non-Deductible Voluntary Contributions to his Account in any Plan
Year; provided, however, that the aggregate amount of such Participant
Non-Deductible Voluntary Contributions, plus any Participant Non-Deductible
Voluntary Contributions made by him under any other plan maintained by the
Employer and intended to meet the requirements of Code Section 401, shall not
exceed ten percent (10%) of his total compensation (disregarding any exclusions
from Compensation specified by the Employer in Section III-B of the Adoption
Agreement) for the period in which he has been a Participant in the Plan;
provided, further, that in no event shall a Participant be permitted to makes
Participant Non-Deductible Voluntary Contribution in an amount which would cause
the annual addition to his Account to exceed the limitations set forth in
Section 5 hereof. A Participant's Participant Non-Deductible Voluntary
Contributions shall be allocated to his Participant Non-Deductible Voluntary
Account pursuant to Section 7.3 hereof. A Participant may withdraw all or 5
portion of his Participant Non-Deductible Voluntary Account upon 30 days'
written notice to the Administrator.

     4.4 Participant Deductible Voluntary Contributions. If selected by the
Employer in Section VI-B of the Adoption Agreement, a Participant may make
Participant Deductible Voluntary Contributions to his Account in any Year;
provided, however, that the aggregate amount of such Participant Deductible
Voluntary Contributions, plus any other "qualified retirement contributions" (as
that term is defined in Code Section 219(e)(1)) made by the Participant, shall
not, in any taxable year of the Participant, exceed the lesser of $2,000 or 100%
of the Participant's total compensation includible in his gross income for his
taxable year (or such higher limitation as is permitted under Code Section 219).
A Participant's Participant Deductible Voluntary Contributions shall at no time
be included in the computation of the maximum allocation to a Participant's
Account as set forth


14

<PAGE>

in Section 5 and 6 hereof. A Participant's Participant Deductible Voluntary
Contributions shall be allocated to his Participant Deductible Voluntary Account
pursuant to Section 7.3 hereof. A Participant may withdraw all or a portion of
his Participant Deductible Voluntary Account upon 30 days' written notice to the
Administrator, who may also permit, to the extent allowed by applicable law, the
Participant to redesignate his Participant Deductible Voluntary Account as his
Participant Non-Deductible Voluntary Account prior to the withdrawal thereof.

     4.5 Employer Thrift Contributions. If selected by the Employer in Section V
of the Adoption Agreement, the Employer will make an Employer Thrift
Contribution to the Trust for each Participant for each Plan Year that one or
more of contribution categories selected by the Employer in Section V of the
Adoption Agreement for matching (i.e., Employer Profit Sharing Deferral
Contributions, Employer Salary Deferral Contributions or Participant
Non-Deductible Voluntary Contributions) is allocated to the Participant's
Account. The Employer Thrift Contribution made for a Participant shall be in an
amount equal to the percentage specified in Section V of the Adoption Agreement
of the aggregate of the contributions categories selected by the Employer in
Section V of the Adoption Agreement (i.e., Employer Profit Sharing Deferral
Contributions, Employer Salary Deferral Contributions or Participant
Non-Deductible Voluntary Contributions) allocated to the Participant's Account
for the Year, but only to the extent that such aggregate amount does not exceed
the percentage of the Participant's Compensation specified in Section V of the
Adoption Agreement (not in excess of 6%); provided, however, that the Thrift
Contribution otherwise to be made for a Participant shall be reduced to the
extent necessary to comply with the limitations of Sections 4.7, 5 and 6 hereof
(and Section VIII of the Adoption Agreement, if applicable). Any amount which
cannot be contributed to the Trust because of these limitations will be retained
by the Employer, and the Employer shall have no obligation to contribute such
amount . An Employer Thrift Contribution made for a Participant shall be
allocated to his Employer Thrift Account pursuant to Section 7.3 hereof.

     4.6 Rollover Contributions. The Administrator may, in his discretion,
direct the Trustee to accept a Rollover Contribution upon the express request of
the Participant wishing to make such Rollover Contribution, the same to be held,
administered and distributed by the Trustee in accordance with the terms of this
Plan provided the Trustee consents if the contribution includes property other
than cash. A Rollover Contribution shall only be a contribution, comprised of
money and/or property, which is all or a portion of a lump sum with respect to
which such Participant certifies in writing that all of the following conditions
are met:

     (a)  Such lump sum is such Participant's entire interest (or such lesser
          amount as permitted by applicable law) in all qualified plans of the
          same type of a prior employer of such Participant (within the meaning
          of Code Section 402(e)(4)(C) as modified by Code Section
          402(A)(6)(E)), including qualified annuity plans under Code Section
          403(a), reduced by the amount, if any, considered as contributed by
          him to such other plan or plans (as determined under Code Section
          402(e)(4)(D)(i)) and augmented, if such be the case, by any earnings
          on the aforesaid net amount accrued during any period when such net
          amount was held in an intervening individual retirement account or
          annuity (as defined in Code Sections 408(a) and (b));

     (b)  Such lump sum was received by such Participant as a lump sum
          distribution from such other qualified plan or plans within the
          meaning of Code Section 402(e)(4)(A) or as a payment within one
          taxable year of the Participant on account of a termination of such
          plan(s) or, in the case of a profit-sharing or stock bonus plan, a
          complete discontinuance of contributions under such plan(s) (within
          the meaning of Code Section 402(a)(6));

     (c)  The transfer of all or a portion of such lump sum is being made within
          60 days of its receipt by him from the plan or plans referred to in
          paragraph (a) above or, if the net amount referred to in paragraph (a)
          above had previously been deposited in an intervening individual
          retirement account or annuity (as defined in Code Sections 408 (a) and
          (b)) within 60 days of its prior receipt from such plan or plans, the
          transfer of such lump sum is being made within 60 days of its receipt
          by him from such intervening individual retirement account or annuity;
          and

     (d)  No part of such lump sum represents an amount derived from a plan in
          which such Participant was a self-employed employee (within the
          meaning of Code Section 401(c)(1)) at any time contributions were made
          on his behalf under that plan.

     All Rollover Contributions made under this Section 4.6 must be accepted by
the Trustee within the 60 day period referred to in paragraph (c) above. If the
sum accepted as a Rollover Contribution contains property other than cash, the
Trustee shall promptly sell it, and reinvest the proceeds as set forth in the
paragraph immediately below. However, the Trustee may nevertheless, in his
discretion, retain part or all of such property in kind at the Participant's
express request, provided the Participant reimburses the Trustee for any
additional expenses arising out of such retention. A Participant's Rollover
Contribution shall at no time be included in the computation of the maximum
allocation to a Participant's Account as set forth in Sections 5 and 6 hereof.
Each Rollover Contribution made by a Participant shall be allocated to his
Rollover Account pursuant to Section 7.3 hereof. Such Rollover Account shall be
invested by the Trustee as part of the Trust Fund, pursuant to the provisions of
the Trust Agreement, and shall share in the gains and losses of such fund,
except as it may be held in kind as permitted above. A Participant may withdraw
all or a portion of his Rollover Account upon 30 days' written notice to the
Administrator.

     4.7 Limited by Profits. Notwithstanding anything to the contrary herein,
the total Employer Contributions for a Year shall not exceed the Current or
Accumulated Earnings and Profits of the Employer for the Year, whichever is
greater.

SECTION 5. CODE SECTION 415 LIMITATIONS ON CONTRIBUTIONS AND ALLOCATIONS

     5.1 Employers Maintaining No Other Plan.

     (a)  If an Employer does not maintain any other qualified plan, the amount
          of Annual Addition which may be allocated under this Plan on a
          Participant's behalf for a Limitation Year shall not exceed the
          Maximum Permissible Amount.

     (b)  Prior to the determination of the Participant's actual compensation
          for a Limitation Year, the Maximum Permissible Amount may be
          determined on the basis of the Participant's estimated annual
          compensation for such Limitation Year. Such estimated annual
          compensation shall be determined on a reasonable basis and shall be
          uniformly determined for all Participants similarly situated.

     (c)  As soon as is administratively feasible after the end of the
          Limitation Year, the Maximum Permissible Amount for such Limitation
          Year shall be determined on the basis of the Participant's actual
          compensation for such Limitation Year.

     (d)  If, pursuant to Section 5.1(c) and notwithstanding the provisions of
          Section 4 hereof which require Employer Contributions on behalf of a
          Participant to be reduced so as out to exceed the limitations of this
          Section 5, there is an Excess Amount with respect to a Participant for
          a Limitation Year, such Excess Amount shall be disposed of as follows:

          (i)  First, any Participant Contributions, to the extent that the
               return would reduce the Excess Amount, shall be returned to the
               Participant.

          (ii) Second, such Excess Amount, to the extent attributable to
               Employer Thrift Contributions, must out be distributed to the
               Participant, but shall be applied to reduce Employer Thrift
               Contributions for the Limitation Year. To the extent such Excess
               Amount is attributable to Employer Profit Sharing Deferral
               Contributions or Employer Salary Deferral Contributions, it shall
               be distributed to the Participant in accordance with Sections 4.1
               and 4.2.

     5.2 Employers Maintaining Other Model, Master or Prototype Defined
Contribution Plans.

     (a) If, in addition to this Plan, the Employer maintains any other
     qualified defined contribution plan (all of which are qualified Model,
     Master or Prototype Plans), the amount of Annual Additions which may be
     allocated under this Plan on a Participant's behalf for a Limitation Year,
     shall out exceed the Maximum Permissible Amount, reduced by the sum of any
     Annual Additions allocated to the Participant's account for the same
     Limitation Year under such other defined contribution plan.

     (b) Prior to the determination of the Participant's actual compensation for
     the Limitation Year, the amounts referred to in Section 5.2(a) above may be
     determined on the basis of the Participant's estimated annual compensation
     for such Limitation Year. Such estimated annual compensation shall be
     determined on a reasonable basis and shall be uniformly determined for all
     Participants similarly situated.

     (c) As soon as is administratively feasible after the end of the Limitation
     Year, the amounts referred to in Section 5.2(a) shall be determined on the
     basis of the Participant's actual compensation for such Limitation Year.

     (d) If a Participant's Annual Additions under this Plan and all such other
     plans result in an Excess Amount, such Excess Amount shall be deemed to
     consist of the Amounts last allocated.

     (e) If an Excess Amount was allocated to a Participant on an allocation
     date of this Plan which coincides with an allocation date of another plan,
     the Excess Amount attributed to this Plan will be the product of:

     (i)  the total Excess Amount allocated as of such date (including any
          amount which would have been allocated but for the limitations of Code
          Section 415), times

     (ii) the ratio of (A) the amount allocated to the Participant as of such
          date under this Plan, divided by (B) the total amount allocated as of
          such date under all qualified defined contribution plans (determined
          without regard to the limitations of Code Section 415).

     (f) Any Excess Amounts attributed to this Plan shall be disposed of as
     provided in Section 5.1(d).


                                                                              15

<PAGE>

     5.3 Employers Maintaining Other Defined Contribution Plans, If the Employer
also maintains another plan which is a qualified defined contribution plan other
than a Model, Master or Prototype Plan, Annual Additions allocated under this
Plan on behalf of any Participant shall be limited in accordance with the
provisions of Section 5.2 as though the other plan were a Model, Master or
Prototype Plan, unless the Employer provides other limitations in the Adoption
Agreement.

     5.4 Definitions. For purposes of this Section 5, the following terms shall
be defined as follows:

     (a) "Annual Additions" - The sum of the following amounts allocated on
     behalf of a Participant for a Limitation Year:

     (i)  all employer contributions,

     (ii) all forfeitures, and

    (iii) the lesser of (A) one-half of all employee contributions, and (B) the
          amount of all employee contributions in excess of six percent (6%) of
          such Participant's actual compensation.

     For the purposes of this Section 5, amounts reapplied to reduce employer
contributions shall also be included as Annual Additions.

     (b)"Employer" - The employer that adopts this Plan. In the case of a group
     of employers which constitutes a (i) controlled group of corporations (as
     defined in Code Section 414(b) as modified by Code Section 415(h)), (ii)
     trades or businesses (whether or not incorporated) which are under common
     control (as defined in Code Section 414(c) as modified by Code Section
     415(h)), or (iii) an affiliated service group (as defined in Code Section
     414 (ml), all such employers shall be considered a single employer for
     purposes of applying the limitations of this Section 5.

     (c)"Excess Amount" - The excess of the Participant's Annual Additions for
     the Limitation Year over the Maximum Permissible Amount, less loading and
     other administrative charges allocable to such excess.

     (d)"Limitation Year" - A calendar year (Or any other 12 consecutive month
     period adopted for all plans of the Employer pursuant to a written
     resolution adopted by the Employer).

     (e)"Master or Prototype Plan" - A plan the form of which is the subject of
     a favorable opinion letter from the Internal Revenue Service issued
     pursuant to Rev. Proc. 80-29 or successor procedure.

     (f) "Maximum Permissible Amount" - For a Limitation Year, with respect to
     any Participant shall be the lesser of:

          (1)(A) if the Plan was in existence on July 1, 1982, $25,000 for
     Limitation Years beginning before January 1, 1983 and $30,000 for
     Limitation Years beginning after December 31, 1982, or (B) if the Plan was
     not in existence on July 1, 1982, $30,000; provided, however, that the
     amounts described in (A) and (B) shall be increased to such larger amounts
     as may be prescribed by regulation authorized by the Secretary of the
     Treasury or his delegate; or

          (2) 25% of the Participant's compensation for the Limitation Year.

     (g)"Model Plan" - A plan the form of which has been published by the
     Internal Revenue Service.

SECTION 6. CODE SECTION 401(1;) LIMITATIONS ON CONTRIBUTIONS AND ALLOCATIONS

     6.1 Limitation. In addition to any other limitations set forth in this
Plan, Code Section 401(k) requires that the Employer Contributions and the
allocation thereof must not result in discrimination in favor of the
shareholders, officers or highly compensated employees of the Employer. To meet
this requirement, one or more of the following tests must be met each Plan Year:

     (a) If the Employer has not elected to make Employer Thrift Contributions
     under Section V of the Adoption Agreement, the Employer Profit Sharing
     Deferral Contributions and Employer Salary Deferral Contributions and the
     allocation thereof must either:

     (i)  satisfy the General Cash or Deferred Discrimination Rule (as defined
          below); or

     (ii) satisfy the Special Cash or Deferred Discrimination Rule (as defined
          below).

     (b) If the Employer has elected to make Employer Thrift Contributions under
     Section V of the Adoption Agreement, either:

     (i)  the combined Employer Thrift, Profit Sharing Deferral and Salary
          Deferral Contributions must satisfy the General Cash or Deferred
          Discrimination Rule; or

     (ii) the Employer Thrift Contributions must satisfy the General Cash or
          Deferred Discrimination Rule and the Employer Profit Sharing Deferral
          and Salary Deferral Contributions must meet the Special Cash or
          Deferred Discrimination Rule; or

    (iii) the Employer Thrift Contributions must satisfy the General Cash or
          Deferred Discrimination Rule and the combined Employer Thrift, Profit
          Sharing Deferral and Salary Deferral Contributions must meet the
          Special Cash or Deferred Discrimination Rule,

     6.2 General Cash or Deferred Discrimination Rule Defined. To satisfy the
General Cash or Deferred Discrimination Rule, the Plan must satisfy either the
percentage test or the classification test described in Code Section 410(b)(1),
and the Employer Contributions (or relevant portion thereof) must also satisfy
the requirements of Code Section 401(a)(4). In testing whether the requirements
of Code Section 410(b)(1) are satisfied, the Employees who benefit from the Plan
may be either (a) the Employees eligible to participate in the Plan, or (b) the
Employees who participate in the Plan. In testing for discrimination under Code
Section 401(a)(4), the eligible or covered Employees will be considered
depending on the group used to satisfy Code Section 410(b)(1).

     6.3 Special Cash or Deferred Discrimination Rule Defined. To satisfy the
Special Cash or Deferred Discrimination Rule, the Plan must satisfy either the
percentage test or the classification test described in Code Section 410(b)(1).
For this purpose, all eligible Employees are considered to benefit from the
Plan. In addition, the Employer Contributions (or relevant portion thereof) must
satisfy one of the following tests:

     (a) the actual deferral percentage for the highly compensated Employees
     eligible to participate in the Plan (the top 1/3) must not be more than the
     actual deferral percentage of all other eligible Employees (lower 2/3)
     multiplied by 1.5; or

     (b) the excess of the actual deferral percentage for the top 1/3 over the
     lower 2/3 is not more than 3 percentage points, and the actual deferral
     percentage for the top 1/3 is not more than the actual deferral percentage
     of the lower 2/3 multiplied by 2.5.

     For purposes of the above, the term "highly compensated Employee" means any
eligible Employee who receives, with respect to the Compensation taken into
account for the Plan Year, more Compensation than two-thirds of all other
eligible Employees. Both 1/3 and 2/3 of all the eligible Employees shall be
rounded to the nearest integer. The "actual deferral percentage" for the top 3
and the lower 2/3 for a Plan Year is the average of the ratios, calculated
separately for each Employee in such group, of the amount of Employer
Contributions (or relevant portion thereof) paid under the Plan for such Plan
Year on behalf of each such Employee for such Plan Year, to the Employee's
Compensation for such Plan Year (prior to any deferral hereunder).

     6.4 Responsibilities of Ad7nblistrator. The Administrator shall have the
responsibility of monitoring the Plan's compliance with the limitations of this
Section 6 and shall have the power to take any and all steps it deems necessary
or appropriate to ensure compliance, including, without limitation, restricting
the amount of salary or Profit Sharing Bonus which the highly compensated
Employees may elect to defer, or delaying or holding Employer Contributions in
suspense until it can be determined that no amount in excess of these
limitations will be contributed to the Trust. Any actions taken by the
Administrator under this Section 6.4 shall be pursuant to non-discriminatory
procedures consistently applied.

     SECTION 7. TIME AND MANNER OF MAKING CONTRIBUTIONS

     7.1 Manner. unless otherwise agreed to by the Trustee, contributions to
said Trustee shall be made only in cash. All contributions may be made in one or
more installments.

     7.2 Time. Employer Profit Sharing Deferral or Salary Deferral Contributions
with respect to a Plan Year shall be made no later than 30 days after the end of
that Plan Year (or such later time as is permitted by regulations authorized by
the Secretary of the Treasury or delegate). Employer Thrift Contributions and
Participant Non-Deductible Contributions shall be made before the time limit,
including extensions thereof, for filing the Employer's federal income tax
returns for the Year with or within which the particular Plan Year ends (or such
later time as is permitted by regulations authorized by the Secretary of the
Treasury or delegate). Participant Deductible Voluntary Contributions shall be
made no later than April 15 following the Participant's taxable year for which
such contributions are made. All contributions shall be paid to the
Administrator for transfer to the Trustee. The Administrator shall transfer such
contributions to the Trustee as soon as possible, except to the extent permitted
by Section 6.4 hereof. The Administrator may establish a payroll deduction
system or other procedure to assist the making of Participant Contributions and
Employer Salary Deferral Contributions to the Trust, and the Administrator may
from time to time adopt rules or policies governing the manner in which such
contributions may be made so that the Plan may be conveniently administered.

     7.3 Separate Accounts. For each Participant, a separate account shall be
maintained for each of the following types of contributions and the income,
expenses, gains and losses attributable thereto:

     (a)Participant Non-Deductible Voluntary Contributions, if selected under
     Section VI-A of the Adoption Agreement;

     (b) Participant Deductible Voluntary Contributions, if selected under
     Section VI-B of the Adoption Agreement;

     (c) Employer Profit Sharing Deferral Contributions, if selected under
     Section IV of the Adoption Agreement;

     (d) Employer Salary Deferral Contributions, if selected under Section IV of
     the Adoption Agreement;


16

<PAGE>

     (e) Employer Thrift Contributions, if selected under Section V of the
     Adoption Agreement; and

     (f) Rollover Contributions, if the Administrator accepts such contributions
     pursuant to Section 4.6 hereof.

     7.4 Vesting. A Participant's interest in his Account shall always be fully
vested and nonforfeitable.

SECTION 8. DISTRIBUTION UPON DEATH

     8.1 Distribution to Beneficiary. If a Participant's employment terminates
because of his death, the Trustee shall, upon the direction of the
Administrator, distribute the Participant's Account or the undistributed
remainder thereof, as the case may be, in accordance with the provisions of
Section 8.2, to the Beneficiary or Beneficiaries validly named in the most
recent Designation of Beneficiary form filed by the Participant with the
Administrator before his death in compliance with Section 16. The
Administrator's direction shall include notification of the Participant's death,
the identity of the Beneficiary or Beneficiaries so named, and the appropriate
manner of distribution.

     8.2 Manner of Distribution. A distribution made under this Section 8 shall
be made in such manner as the Participant shall in his most recent Designation
have validly elected. In the absence of such an election, such distribution
shall be made in such manner as the Participant's Beneficiary (or Beneficiaries)
may elect, subject to the approval of the Administrator, or in the absence of
such an election, in such manner as the Administrator shall determine.

SECTION 9.  DISTRIBUTION UPON HARDSHIP

     If selected by the Employer in Section x of the Adoption Agreement, the
Trustee shall, upon the direction of the Administrator, distribute all or a
portion of a Participant's Employee Salary Deferral Account, Employer Profit
Sharing Deferral Account and Employer Thrift Account prior to the time such
Accounts are otherwise distributable in accordance with Sections 8 and 10
hereof, subject to the following:

     9.1 Hardship Defined. Any such distribution shall be made only if, and the
amount of such distribution shall be limited to the extent that, the Participant
demonstrates that he is suffering from "hardship," as that term is defined in
proposed or final regulations (whichever are applicable) promulgated pursuant to
Code Section 401(k), or such other standard as may from time to time be
established or authorized by the Secretary of the Treasury or his delegate for
the purpose of determining the circumstances under and the extent to which
elective contributions to a cash or deferred profit-sharing plan may be
withdrawn on account of hardship without adverse effect upon such a plan's
continued qualification. Any determination of the existence of hardship and the
amount to be distributed on account thereof shall be made by the Administrator
(Or such other person as may be required to make such decisions under the
applicable regulations described above) in accordance with the foregoing rule as
applied in a uniform and non-discriminatory manner.

     9.2 Manner of Distribution. A distribution under this Section 9 shall be
made in a lump sum payment to the Participant.

SECTION 10.  OTHER DISTRIBUTIONS

     10.1 Normal Distribution. The Account of any Participant will normally be
distributed in monthly installments which must commence at or within sixty (60)
days after the end of the Plan Year in which occurs his Normal Retirement Date
(as selected by the Employer in Section II of the Adoption Agreement) or in
which his Employment ceases, whichever is later, to continue over a period of
one hundred and twenty (120) months, The monthly amount shall normally be the
balance of the Participant's Account divided by the remaining number of months
in such one hundred and twenty (120) months, all rounded to the nearest cent,
However, the amount of each monthly installment may be recomputed and adjusted
from time to time no more frequently than monthly as the Trustee may reasonably
determine.

     10.2 Optional Distribution. All Participants may request the Administrator
to approve, in its sole discretion, any of the following variations from the
normal pattern of distribution provided that the distribution (i) shall not
commence before the earlier of the Participant's retirement, death, disability,
separation from service, or attainment of age 59 1/2, (ii) extend beyond the
lifetime of the Participant or the joint lifetime of the Participant and his
spouse, as actuarially estimated either at the time of approval or periodically
in a consistent manner, and (iii) the present value of the distributions to be
made to the Participant is more than one-half (1/2) the value of his Account, as
determined at the time this distribution commences:

     (a) Distribution made or commencing before his Normal Retirement Date,

     (b) Distributions made or commencing after the normal time of distribution
     described in Section 10.1.

     (c) Distribution of his entire Account at one time,

     (d) Installment payments of a fixed amount, such payments to be made until
     exhaustion of the Participant's Account,

     (e) Distribution in Kind,

     (f) Any reasonable combination of the foregoing or any reasonable time or
     manner of distribution within the above-stated limitations, including
     purchase and distribution of bonds described in Code Section 405(d).

SECTION 11.  INVESTMENT OF CONTRIBUTIONS

     11.1 Manner of Investment. All contributions to the Account of a
Participant shall be held by the Trustee designated by the Employer in Section
XIV of the Adoption Agreement. The Account of a Participant may only be invested
and reinvested in shares of Designated Investment Companies (in such proportions
as tile Trustee is instructed in accordance with Section VII of the Adoption
Agreement) or such other investments as are permitted by the Distributor, except
to the extent that a Participant's Account is invested in a loan pursuant to
Section 112 hereof. Investment in the shares of more than one Designated
Investment Company is not permitted unless tile value of the Participant's
Account and the value of the investment in the second Designated Investment
Company exceed amounts from time to time determined by the Distributor.

     11.2 Investment Decision.

     (a) The decision as to the investment of an Account shall be made by the
     person designated in Section VII of the Adoption Agreement. If the decision
     is made by the Participant, the Participant shall convey investment
     instructions to the Administrator and the Administrator shall promptly
     transmit those instructions to the Trustee. Further, if the decision is to
     be made by the Participant, the right to make such a decision shall remain
     with the Participant upon his retirement and shall pass to the Distributee
     upon such Participant's death.

     (b) The person designated to make the decision as to the investment of an
     Account may direct that the investment medium of an Account be changed,
     provided that no such change may be made from or to an investment other
     than a Designated Investment Company except to the extent permitted by the
     terms of that other investment vehicle. If the Distributor determines in
     its own judgment that there has been trading of Designated Investment
     Companies in the Accounts of the Participants, any Designated Investment
     Company may refuse to sell its shares to such Accounts. When an investment
     is being made or changed the person designated to do so shall specify the
     type of Account to which the change refers.

     (c) If any decision as to investments is to be made by the Administrator,
     it shall be made on a uniform basis with respect to all Participants.

     (d) The Administrator and the Trustee may adopt procedures permitting
     Participants to convey their investment instructions directly to the
     transfer agent for the Designated Investment Company or Companies or for
     any other investment permitted by the Distributor.

SECTION 12.  LOANS

     If selected by the Employer in Section IX of the Adoption Agreement, the
Trustee shall, upon the direction of the Employer, make one or more loans,
including any renewal thereof, to a Participant. Any such loan shall be subject
to such terms and conditions as the Employer shall determine pursuant to a
uniform policy adopted by the Employer for this purpose, which policy shall be
at least as restrictive as the following:

     12.1 Equivalent Basis. No such loan may be made to a disqualified person
within the meaning of Code Section 4975(e), unless such loans are available to
all Participants on a reasonably equivalent basis and are not made available to
officers, shareholders or highly paid Participants in an amount which, when
stated as a percentage of such Participant's Account, is greater than is
available to other Participants.

     12.2 Limitation on Amount. The amount of any such loan, when added to the
outstanding balance of all other loans from the Plan (and any other plan of the
Employer) to the Participant, shall not exceed the following:

        Participant's                       Maximum Amount
      Account Balance                           of Loan

     $0 - $10,000                           100% of Account balance
     $110,000 - $20,000                     $10,000
     $20,000 - $100,000                     50% of Account balance
     over $100,000                          $50,000

The value of the Participant's Account balance shall be as determined by the
Employer; provided, however, that such determination shall in no event take into
account the portion of the Participant's Account attributable to Participant
Deductible Voluntary Contributions.

     12.3 Maximum Term, The term of any such loan shall not exceed 5 years;
provided, however, that such limitation shall not apply to any loan used to
acquire, construct, reconstruct, or substantially rehabilitate any dwelling unit
which within a reasonable time is to be used (determined at the time the loan is
made) as a principal residence of the Participant or a member of the family
(within the meaning of Code Section 267(c)(4)) of the Participant.

     12.4 Promissory Note, Any such loan shall be evidenced by a promissory note
executed by the Participant and payable to the Trustee, on the earliest of (i) a
fixed maturity date meeting the requirements of Section 12.3 above, but in no
event later than the Participant's Normal Retirement Date,


                                                                              17

<PAGE>

(ii) the Participant's death, or (iii) when distribution hereunder is to be made
to the Participant (other than a withdrawal which will not reduce the Value of
his Account to the extent that the aggregate amount owing could not be made as a
new loan within the limitation set forth in Section 12.2 above). Such promissory
note shall be secured by an assignment of the Participant's Account to the
Trustee. Such promissory note shall evidence such terms as are required by this
Section 12.

     12.5 Interest. Any such loan shall be subject to a reasonable rate of
interest.

     12.6 Repayment. If a note is not paid when the Participant's benefits
hereunder are to be distributed, then any unpaid portion of such loan and unpaid
interest thereon shall be deducted by the Trustee from the Participant's Account
before benefits are paid from or purchased out of the Account. Such deduction
shall, to the extent thereof, cancel the indebtedness of the Participant. If a
note is not paid when it otherwise becomes payable under Section 12.4, or if at
any time the Employer determines that the aggregate amounts owing by a
Participant upon such notes exceed the vested value of the Participant's
Account, the Participant shall be promptly notified in writing that unless such
loan or excess is repaid within 30 days, action will be taken to collect the
same plus any cost of collections.

     12.7 Accounting. Loans shall be made only from the Account of the
Participant (exclusive of that portion of the Account attributable to
Participant Deductible Voluntary Contributions) requesting the loan, and shall
be treated as an investment of his Account. All interest payments made with
respect to such loan shall be credited to the Participant's Account.

     12.8 Precedence. This Section 12 overrides Section 17 below.

SECTION 13.  ADMINISTRATION

     13.1 Appointment of Administrator. The Employer may from time to time in
writing appoint one of more persons as Administrator (hereinafter referred to in
the singular) who shall have all power and authority necessary to carry out the
terms of the Plan. A person appointed as Administrator may also serve in any
other fiduciary capacity, including that of Trustee, with respect to the Plan.
The Administrator may resign upon fifteen (15) days advance written notice to
the Employer, and the Employer may at any time revoke the appointment of the
Administrator with or without cause. The Employer shall exercise the power and
fulfill the duties of the Administrator if at any time the position is vacant.

     13.2 Named Fiduciaries. The "Named Fiduciaries" within the meaning of the
Act shall be the Administrator and the Trustee.

     13.3 Allocation of Responsibilities. Responsibilities upon the Plan shall
be allocated among the Trustee, the Administrator and the Employer as follows:

     (a) Trustee: The Trustee shall have exclusive responsibility to hold,
     manage and invest, pursuant to instructions communicated to it by the
     Administrator under Section VII of the Adoption Agreement and Section 11.2
     above, the foods received by it subject to the Trust Agreement under which
     it serves.

     (b) The Administrator: The Administrator shall have the responsibility sod
     authority to control the operation and administration of the Plan in
     accordance with its terms including, without limiting the generality of the
     foregoing, (1) any investment decisions assigned to it under Section VII of
     the Adoption Agreement or transmission to the Trustee of any Participant
     investment decision under Section 11.2(2) interpretation of the Plan,
     conclusive determination of all questions of eligibility, status, benefits
     and rights under the Plan and certification to the Trustee of all benefit
     payments under the Plan; (3) hiring of persons to provide necessary
     services to the Plan not provided by Employees; (4) preparation and filing
     of all statements, returns and reports required to be filed by the Plan
     with any agency of Government; (5) compliance with all disclosure
     requirements of all state or federal law; (6) maintenance and retention of
     all Plan records as required by law, except those required to be maintained
     by the Trustee; and (7) all functions otherwise assigned to it under the
     terms of the Plan.

     (c) Employer: The Employer shall be responsible for the design of the Plan,
     as adopted or amended, the designation of the Administrator and Trustee as
     provided in the Plan, the delivery to the Administrator and the Trustee of
     Employee information necessary for operation of the Plan, the timely making
     of the Employer Contributions specified in Sections IV or V of the Adoption
     Agreement, and the exercise of all functions provided in or necessary to
     the Plan except those assigned in the Plan to other persons. (d) This
     Section 13.3 is intended to allocate individual responsibility for the
     prudent execution of the functions assigned to each of the Trustee, the
     Administrator and the Employer and none of such responsibilities or any
     other responsibilty shall be shared among them unless specifically provided
     in the Plan, Whenever one such person is required by the Plan to follow the
     directions of another, the two shall not be deemed to share responsibility,
     but the person who gives the direction shall be responsible for giving it
     and the responsibility of the person receiving the direction shall be to
     follow it insofar as it is on its face proper under applicable law.

     13.4 More Than One Administrator, If more than one individual is appointed
as Administrator under Section 13.1, such individuals shall either exercise the
duties of the Administrator in concert, acting by a majority vote or allocate
such duties among themselves by written agreement delivered to the Employer and
the Trustee. In such a case, the Trustee may rely upon the instruction of any
one of the individuals appointed as Administrator regardless of the allocation
of duties among them.

     13.5 No Compensation. The Administrator shall not be entitled to receive
any compensation from the funds held under the Plan for its services in that
capacity unless so determined by the Employer or required by law.

     13.6 Record of Acts. The Administrator shall keep a record of all his
proceedings, acts and decisions, and all such records and all instruments
pertaining to Plan administration shall be subject to inspection by the Employer
at any time. The Employer shall supply, and the Administrator may rely on the
accuracy of, all Employee data and other information needed to administer the
Plan.

     13.7 Bond. The Administrator shall be required to give bond for the
faithful performance of his duties to the extent, if any, required by the Act,
the expense to be borne by the Employer.

     13.8 Agent for Service of Legal Process. The Administrator shall be agent
for service of legal process on the Plan.

     13.9 Rules. The Administrator may adopt or amend and shall publish to the
Employees such rules and forms for the administration of the Plan, and may
employ or retain such attorneys, accountants, physicians, investment advisors,
consultants and other persons to assist in the administration of the Plan as it
deems necessary or advisable.

     13.10 Delegation. To the extent permitted by applicable law, the
Administrator may delegate all or part of his responsibilities hereunder and at
any time revoke such delegation, by written statement communicated to the
delegate and the Employer. The Trustee may, but need not, act on the
instructions of such a delegate. The Administrator shall annually review the
performance of all such delegates.

     13.11 Claims Procedure. It is anticipated that the Administrator will
administer the Plan to provide Plan benefits without waiting for them to be
claimed, but the following procedure is established to provide additional
protection to govern unless and until a different procedure is established by
the Administrator and published to the Participants and Beneficiaries.

     (a) Manner of Making Claims. A claim for benefits by a Participant or
     Beneficiary to be effective under this procedure must be made to the
     Administrator and must be in writing unless the Administrator formally or
     by course of conduct waives such requirements.

     (b) Notice of Reason for Denial. If an effective claim is wholly or
     partially denied, the Administrator shall furnish such Participant or
     Beneficiary with written notice of the denial within sixty (60) days after
     the original claim was filed. This notice of denial shall set forth in a
     manner calculated to be understood by the claimant (1) the reason or
     reasons for denial, (2) specific reference to pertinent plan provisions on
     which the denial is based, (3) a description of any additional information
     needed to perfect the claim and an explanation of why such information is
     necessary, and (4) an explanation of the Plan's claim procedure.

     (c) The Participant or Beneficiary shall have sixty (60) days from receipt
     of the denial notice in which to make written application for review by the
     Administrator, The Participant or Beneficiary may request that the review
     be in the nature of a hearing. The Participant or Beneficiary shall have
     the rights (1) to have representation, (2) to review pertinent documents,
     and (3) to submit comments in writing. (d) The Administrator shall issues
     decision on such review within sixty (60) days after receipt of an
     application for review, except that such period may be extended for a
     period of time not to exceed an additional sixty (60) days if the
     Administrator determines that special circumstances (such as the need to
     hold a hearing) requires such extension. The decision on review shall be in
     writing and shall include specific reasons for the decision, written in a
     manner calculated to be understood by the claimant, and specific references
     to the pertinent Plan provisions on which the decision is based.

SECTION 14  FEES AND EXPENSES

     All reasonable fees and expenses of the Administrator or Trustee incurred
in the performance of their duties hereunder or under the Trust shall be paid by
the Employer; and to the extent not so paid by the Employer, said fees and
expenses shall be deemed to be an expense of the Trust and the Trustee is
authorized to charge the same to the Accounts of the Participants, and unless
allocable to the Accounts of specific Participants, they shall be charged
against the respective accounts of all or a reasonable group of Participants in
such reasonable manner as the Trustee shall determine,

SECTION 15.  BENEFIT RECIPIENT INCOMPETENT
OR DIFFICULT TO ASCERTAIN OR LOCATE

     15.1 Incompetency. If, in the sole judgment of the Administrator a
Participant or Beneficiary is physically or mentally incapable of handling his
financial affairs, payment otherwise due him may be made for his benefit in the
sole discretion of the Administrator either to his legal


18

<PAGE>

representative or to any of his relatives or friends or maybe applied directly
for his support and maintenance, Payment so made in good faith shall completely
discharge the Employer, the Administrator and the Trustee from liability
therefor.

     15.2 Difficulty to Ascertain or Locate, If it is impossible or difficult to
ascertain the person who is entitled to receive any benefit under the Plan, the
Administrator in its discretion may direct that such benefit be (i) paid to
another person in order to carry Out the Plan's purposes; or (ii) retained in
the Trust; or (iii) paid to a court pending judicial determination of the right
thereto.

SECTION 16. DESIGNATION OF BENEFICIARY

     Each Participant may submit to the Administrator a properly-executed
Designation of Beneficiary form. In order to be effective, such Designation must
have been properly executed and submitted to the Administrator at the home
office thereof before the death of the Participant. The last effective
Designation accepted by the Administrator shall be controlling, and whether or
not fully dispositive of his Account, thereupon shall revoke all Designations
previously submitted by the Participant. Each such executed Designation is
hereby specifically incorporated herein by reference and shall be construed and
enforced in accordance with the laws of the state in which the Employer has its
principal place of business. To the extent that any portion of an Account of a
deceased Participant is not governed by a Designation which names at least one
living Beneficiary designated by the Participant, that portion of the Account
shall be distributed to the estate of the deceased Participant.

SECTION 17. SPENDTHRIFT PROVISION

     No interest of any Participant or Beneficiary shall be assigned,
anticipated or alienated in any manner nor shall it be subject to attachment,
bankruptcy proceedings or to any other legal process or to the interference or
control of creditors or others, except to the extent that Participants may
secure loans from the Trust with their Accounts pursuant to Section 12 hereof.

SECTION 18. NECESSITY OF QUALIFICATION

     This Plan is established with the intent that it shall qualify under Code
Section 401 (a) as that Section exists at the time the Plan is established. If
the Employer fails to obtain or retain such a determination that the Plan so
qualifies, the Plan shall cease to have any of the benefits of Revenue Procedure
80-29 or successor procedure which apply to the Plan as a prototype plan. The
Administrator shall promptly notify the Trustee in writing of any determination
made with respect to the qualified status of the Plan. Notwithstanding any other
provision contained in this Plan, if the Internal Revenue Service determines
that the Plan initially fails to so qualify, then the Employer shall promptly
either amend the Plan under Code Section 401(b) 50 that it does qualify, or
direct the Trustee to terminate the Plan and distribute all the assets of the
Trust equitably among the contributors thereto in proportion to their
contributions, and the Plan shall be considered to be rescinded and of no force
and effect.

SECTION 19. AMENDMENT OR TERMINATION

     19.1 Amendment or Termination. The Employer may at any time, and from time
to time amend this Prototype Plan, the Adoption Agreement and the Trust
Agreement (including a change in any election it has made in the Adoption
Agreement), or suspend or terminate this Plan by giving written notice to the
Distributor and to the Trustee, but the Trust may not thereby be diverted from
the exclusive benefit of the Participants, their Beneficiaries, survivors or
estates, or the administrative expenses of the Plan, nor revert to the Employer,
nor may an allocation or contribution theretofore made be changed thereby or an
amendment otherwise operate retroactively except as the same may be deemed
necessary in order to make the Plan qualify under Code Section 401(a). An
amendment shall be deemed necessary for this purpose if counsel for the Employer
certifies that in its opinion the written ruling of the Commissioner of Internal
Revenue that the Plan meets such requirements can be obtained within a
reasonable time only with such retroactive amendment. Any amendment by the
Employer which is other than the amendment of the Employer's prior designation
of an option or provision set forth or referred to in the Adoption Agreement
will constitute a substitution by the Employer of an individually designed plan
for this prototype plan and the general amendment procedure of the Internal
Revenue Service governing individually designed plans will be applicable.
Nothing contained herein shall constitute an agreement or representation by the
Distributor that it will continue to maintain its sponsorship of the Plan
indefinitely.

     19.2 Delegation. The Employer hereby delegates to the Distributor the
authority to amend so much of the Adoption Agreement, this Prototype Plan, and
the Trust Agreement, as is in prototype form and, to the extent to which the'
Employer could effect such amendment, the Employer shall be deemed to have
consented to any amendment so made, When an election within the prototype form
has been made by the Employer, it shall be deemed to continue after amendment of
the prototype form unless and until the Employer expressly further amends the
election, notwithstanding that the provision for the election in the amended
prototype form is in a different form or place; provided, however, that if the
amended form inadvertently fails to provide means to duplicate exactly the
earlier election, such earlier election shall continue until such further
amendment. The immediately preceding sentence is subject to the qualification
that each Employer hereby delegates to the Distributor, in the event of such an
amendment of the prototype form, authority to determine conclusively that such a
continuation of an earlier election by the employer is not advisable and to make
the election for the Employer in the amended prototype form which in the
judgment of the Distributor most nearly corresponds with the election made by
the employer before an amendment of the prototype form, provided the following
procedure is followed: the election for the Employer may be made with respect to
any specified Employers as to whom it may be made applicable singly, or such
election may be made with respect to all Employers as to whom it may be made
applicable as a group; and the election shall be made as of an effective date
which has been specified in a notice mailed or delivered, at the last
address(es) of the Employer(s) on the records of the Distributor, to the
Employer(s) at least twenty (20) days before the effective date of the election.
Such notice may be mailed to Employers to whom it cannot be applicable by reason
of a previous election made by the Employer or otherwise, but it shall be
effective only as to those Employers who have received the notice and have not
themselves made a new election with respect to that item since the amendment of
the prototype form and previous to the effective date of such election by the
Distributor. The foregoing delegations of authority to make elections, or to
make amendments, shall not impose any duty on the Distributor to make them nor
shall it affect the interpretation of the Plan if they are not used.

     19.3 Distribution of Accounts Upon Termination. Upon termination of the
Plan or complete discontinuance of contributions under it, the Administrator
shall determine whether to pay the interests of Participants, former
Participants and Beneficiaries immediately, to retain such interest in the Trust
and pay them in the future according to Section 10, or to use what other methods
the Administrator deems advisable in order to furnish whatever benefits the
Trust will provide, subject to the limitations of Section 10.2 limiting the
length of the period over which an Account can be paid.

SECTION 20. TRANSFERS

     Nothing contained herein or in the Trust shall prevent the merger or
consolidation of the Plan with, or transfer of assets or liabilities of the Plan
to, another plan meeting the requirements of Code Section 401(a) or the transfer
to the Plan of assets or liabilities of another such plan so qualified under the
Code. Any such merger, consolidation or transfer shall be accompanied by the
transfer of such existing records and information as may be necessary to
properly allocate such assets among Participants, including any tax or other
information necessary for the Participants or persons administering the plan
which is receiving the assets. The terms of such merger, consolidation or
transfer must be such that if this Plan then terminated, each Participant would
receive a benefit immediately after the merger, consolidation or transfer equal
to or greater than the benefit be would have received if the Plan had terminated
immediately before the merger, consolidation or transfer.

SECTION 21.  MISCELLANEOUS

     21.1 Misrepresentation. Notwithstanding any other provision herein, if an
Employee misrepresents his age or any other fact, any benefit payable to him
hereunder shall be the smaller of: (i) the amount that would be payable if no
facts had been misrepresented, or (ii) the amount that would be payable if the
facts were as misrepresented.

     21.2 Legal or Equitable Action. If any legal or equitable action with
respect to the Plan is brought by or maintained against any person, and the
results of such action are adverse to that person, attorney's fees and all other
costs to the Employer, the Administrator or the Trust of defending or bringing
such action shall be charged against the interest, if any, of such person under
the Plan.

     21.3 No Enlargement of Plan Rights. It is a condition of the Plan and Trust
Agreement, and each Participant by participating herein expressly agrees, that
he shall look solely to the assets of the Trust for the payment of any benefit
under the Plan.

     21.4 No Enlargement of Employment Rights. Nothing appearing in or done
pursuant to the Plan shall be construed to (a) give any person a legal or
equitable right or interest in the assets of the Trust or distribution
therefrom, nor against the Employer, except as expressly provided herein; (b)
create or modify any contract of employment between the Employer and any
Employee or obligate the Employer to continue the services of any Employee; or
(c) allow service as a sole proprietor or partner, or compensation therefor, to
be taken into account for any purpose of the Plan.

     21.5 Written Orders. In taking or omitting to take any action under this
Plan or under the Trust, the Trustee may conclusively rely upon and shall be
protected in acting upon any written orders from or determinations by the
Employer or the Administrator as appropriate, or upon any other notices,
requests, consents, certificates or other instruments or papers believed by it
to be genuine and to have been properly executed and, so long as it acts in good
faith, in taking or omitting to take any other action.


                                                                              19
<PAGE>

     21.6 No Release from Liability. Nothing in the Plan shall relieve any
person from liability for any responsibility under Part 4 of Title I of the Act,
Subject thereto neither the Trustee, the Administrator nor any other person
shall have any liability under the Plan, except as a result of his negligence or
wilful misconduct, and in any event the Employer shall fully indemnify and save
harmless all persons from any such liability except that resulting from their
negligence or wilful misconduct.

     21.7 Discretionary Actions. Any discretionary action, including the
granting of a loan pursuant to Section 12 hereof, to be taken by the Employer or
the Administrator under this Plan shall be non-discriminatory in nature and all
Employees similarly situated shall be treated in a uniform manner.

     21.8 Headings. Headings herein are primarily for convenience of reference,
and if they conflict with the text, the text shall control.

     21.9 Applicable Law. This Plan shall, to the extent state law is
applicable, be construed and enforced in accordance with, and the rights of the
parties shall be governed by, the laws of the state in which the Employer has
its principal place of business.

     21.10 No Reversion. Notwithstanding any other contrary provision of the
Plan, but subject nevertheless to Sections 5, 6 and 18, no part of the assets in
the Trust shall revert to the Employer, and no part of such assets, other than
that amount required to pay taxes or administrative expenses, shall be used for
any purpose other than exclusive benefit of Employees or their Beneficiaries.

     21.11 Notices. The Employer will provide the notice to other interested
parties contemplated under Code Section 7476 before requesting a determination
by the Secretary of the Treasury or his delegate with respect to the
qualification of the Plan.

     21.12 Conflict. In the event of any conflict between the provisions of this
Plan and the terms of any contract or agreement issued thereunder or with
respect thereto, the provisions of the Plan shall control.


20

<PAGE>

                                TRUST AGREEMENT

                           ESTABLISHED PURSUANT TO THE
                  SCUDDER CASH OR DEFERRED PROFIT SHARING PLAN

     The Employer has established the Scudder Cash or Deferred Profit Sharing
Plan for the benefit of the Participants therein, As part of the Plan the
Employer has designated the person or persons specified in the Adoption
Agreement as Trustee(s) to maintain and administer a Trust upon the following
terms and conditions for the investment of contributions under the Plan, The
definitions in Section 2 of the Prototype Plan apply herein,

1. TRUST FUND

     The Trustee shall open and maintain a Trust account for the Plan, with such
subdivisions as the Employer may specify pursuant to the Plan; provided,
however, that the maintaining of such subdivisions shall not require the
physical separation of assets.

     Whenever a Participant makes a contribution the Administrator shall
ascertain that the Participant has received a copy of the current prospectus
relating to the shares of any Designated Investment Company in which such
contribution is to be invested plus, where required by any state or federal law,
the current prospectus relating to any other investment in which contributions
are to be invested, By remitting such a contribution to the Trustee the
Administrator shall be deemed to warrant to the Trustee that the Participant has
received such a prospectus, and by remitting any other contribution to the
Trustee the Administrator shall be deemed to warrant to the Trustee that the
Administrator has received a current prospectus of any Designated Investment
Company in which it is to be invested, plus, where required by any state or
federal law, the current prospectus relating to any other investment in which
contributions are to be invested.

     All contributions to the Trust, and any assets into which such
contributions shall be invested or reinvested shall be hereinafter referred to
in this Trust Agreement as the "Trust Fund."

2. ADMINISTRATOR

     The Plan shall be administered by the Administrator as provided for in
Section 13 of the Prototype Plan, and the Trustee shall have no duties with
respect to the administration of the Plan, (However an individual who is a
Trustee may also be Administrator.)

3. TRUSTEE: NUMBER, QUALIFICATIONS AND MAJORITY ACTION

     The number of Trustees shall be one, two or three. Any natural person and
any corporation having power to act as a trustee in the premises may be a
Trustee. No person shall be disqualified from being a Trustee by being employed
by the Employer, by being Administrator, by being a trustee under any other plan
of the Employer or by being a Participant in this plan or such other plan.

     A Trustee holding office as sole Trustee hereunder shall have all the
powers and duties herein given the Trustees. When the number of Trustees
hereunder is three, any two of them may act, but the third Trustee shall be
promptly informed of the action. When there are two or more Trustees hereunder,
they may, by written instrument communicated to the Employer and the
Administrator allocate among themselves the powers and duties herein given to
the Trustee. If such an allocation is made, to the extent permitted by
applicable law, no Trustee shall be liable either individually or as a trustee
for loss to the Plan from the acts or omissions of another Trustee with respect
to duties allocated to such other Trustee.

4. CHANGE OF TRUSTEE

     Any Trustee may resign as Trustee upon notice in writing to the Employer
and the Administrator, and the Employer may remove Trustee upon notice in
writing to the Administrator, and to all the Trustees. The removal of a Trustee
shall be effective immediately, except that a corporation serving as a Trustee
shall be entitled to sixty (60) days' notice which it may waive, and the
resignation of a Trustee shall be effective immediately, provided that neither a
removal nor a resignation of a Trustee shall be effective if the Trustee is the
sole Trustee until a successor Trustee has been appointed and has accepted the
appointment. If within sixty (60) days of the delivery of the written
resignation or removal of a sole Trustee another Trustee shall not have been
appointed and have accepted, the resigning or removed Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee or
may terminate the Plan pursuant to Section 19 of the Prototype Plan. The Trustee
shall not be liable for the acts and omissions of such successor.

     At any time when the number of Trustees is one or two the Employer may but
not need appoint one or two additional Trustees, provided that the number of
Trustees shall not be more than three. Such an appointment and the acceptance
thereof shall be in writing, and shall take effect upon the delivery of written
notice thereof to all the Trustees and the Administrator and such acceptance by
the appointed Trustee, provided that if a corporation is a Trustee then in the
absence of its consent such an appointment of an additional or successor Trustee
shall not have become effective until sixty (60) days after its receipt of
notice.

     Although any Employer adopting the Plan may choose any Trustee who is
willing to accept the Trust, the Distributor or its successor, may make or may
have made tentative standard arrangements with any bank or trust company with
the expectation it will be used as the Trustee by a substantial group of
Employers. It is also contemplated that more favorable results can be obtained
with a substantial volume of business, and that it may become advisable to
remove such bank or trust company as Trustee and substitute another Trustee.
Therefore, anything else in the prior two paragraphs of this Section 4
notwithstanding, each Employer adopting this Plan hereby agrees that the
Distributor may, upon a date specified in a notice to the affected Employer of
at least thirty (30) days and in the absence of written objection by the
Employer received by the Distributor before such date, (i) remove any such
Trustee and in that case, or if such a Trustee has resigned to a group of
Employers, (ii) appoint such a successor Trustee, provided such action is taken
with respect to all Employers similarly circumstanced of which the Distributor
has knowledge, and provided such notice is given in writing mailed postage
prepaid to the Employer at the latest address which has been furnished the
Distributor directly or supplied to it by such Trustee which is to be succeeded.
If within sixty (60) days after such Trustee's resignation or removal the
Employer has not appointed a successor which has accepted such appointment,
unless the appointment of a successor Trustee is waiting for action by the
Distributor pursuant to the next-preceding sentence according to notice which
has been given, the Trustee may petition an appropriate court for the
appointment of its successor. The Trustee shall not be liable for the acts and
omissions of such successor.

     Successor Trustees qualifying under this Section 4 shall have all rights
and powers and all duties and obligations of original Trustees.

5. INVESTMENT OF TRUST FUND

     The Trust Fund shall be fully invested and reinvested pursuant to Section
VII of the Adoption Agreement. The Trustee shall have full power and authority
to invest in any property specified in instructions communicated to it by the
Administrator, and the Trustee may invest in property selected by it pursuant to
authority delegated to it and accepted by it, all without regard to the law of
any state regarding proper investment. The Trustee shall have no responsibility
for determining how the Trust Fund is to be invested or to see that investment
instructions communicated to it comply with the terms of the Plan. Annually, on
the Valuation Date or more frequently in the discretion of the Trustee, the
assets of the Trust shall be revalued at fair market value and the accounts of
the Trust shall be proportionately adjusted to reflect income, gains, losses or
expenses, if the system of accounting does not directly accomplish all such
adjustments. The Trust Fund shall be administered separately from, and shall not
include any assets being administered under, any other plan of an employer.
Interim valuations, if any, shall be applied uniformly and in a
non-discriminatory manner for all Employees.

     Any assets in the Trust Fund may be registered in the name of the Trustee
or any nominee designated by the Trustee.

6. DISTRIBUTION FROM THE TRUST FUND

     The Trustee shall make or cause to be made such distribution from the Trust
Fund as the Administrator may in writing direct upon certification by the
Administrator that the same is for the exclusive benefit of Employees or former
Employees of the Employer or their Beneficiaries, or for the payment of expenses
of administering the Plan.

7. CERTIFICATIONS AND INSTRUCTIONS

     Any pertinent vote or resolution of the Board of Directors of the Employer
shall be certified to the Trustee over the signature of the Secretary or an
Assistant Secretary of the Employer and under its corporate seal. The Employer
shall promptly furnish the Trustee from time to time certificates of an officer
of the Employer evidencing the appointment and termination of office of the
individual or individuals appointed as Administrator under Section 13 of the
Prototype Plan.

     The Administrator shall furnish the Trustee certificates signed by the
individual or individuals appointed as Administrator, naming the person or
persons authorized to give notice on behalf of the Administrator and providing
specimens of their signatures; and all requests, directions, requisitions for
moneys and instructions by the Administrator to the Trustee shall be writing,
signed by such person or persons as may be designated from time to time by the
Administrator; they may be standing requests, directions, requisitions or
instructions; and may be made to be contingent upon determination made by the
Trustee.


                                                                              21

<PAGE>

8. ACCOUNTS AND APPROVAL

     The Trustee shall keep accurate and detailed accounts of all investments,
receipts and disbursements and other transactions hereunder, and all books and
records relating thereto shall be open at all reasonable times to inspection and
audit by any person or persons designated by the Administrator or by the
Employer.

     Within ninety (90) days following the close of each of the Plan Years
selected by the Employer in Section XII of the Adoption Agreement the Trustee
may, and upon the request of the Employer or the Administrator shall, file with
the Administrator and the Employer a written report setting forth all securities
or other investments (including insurance contracts) purchased and sold, all
receipts, disbursements and other transactions effected by them during the
period since the date covered by the next prior report, and showing the
securities and other property held at the end of such period, and such other
information about the Trust Fund as the Administrator shall request. Within
ninety (90) days from the date of mailing or delivery of such report the
Employer shall certify in writing to the Trustee that it has carefully reviewed
the contents of the report and has found therein no matter to which it objects
or takes exception other than those which it therewith sets forth accompanied by
the specific ground or grounds for such objections or exceptions.

9. TAXES

     The Trustee may assume that any taxes assessed on or in respect of the
Trust Fund are lawfully assessed unless the Administrator shall in writing
advise the Trustee that in the opinion of counsel for the Employer such taxes
are not lawfully assessed. In the event that the Administrator shall so advise
the Trustee, the Trustee, if so requested by the Administrator and suitable
provision for their indemnity having been made, shall contest the validity of
such taxes in any manner deemed appropriate by the Administrator or counsel for
the Employer. The word "taxes" in this Section 9 shall be deemed to include any
interest or penalties that may be levied or imposed in respect to any taxes
assessed.

10. EMPLOYMENT OF COUNSEL

     The Trustee may employ legal counsel (who may be counsel for the Employer)
and shall be fully protected in acting or refraining from acting, upon such
counsel's advice in respect to any legal questions.

11. REIMBURSEMENT AND COMPENSATION OF TRUSTEE

     The Trustee shall be entitled to be reimbursed for his reasonable expenses.
An individual Trustee who is an Employee of the Employer shall not be
compensated for his services as Trustee, save as his compensation as an Employee
of the Employer may be such compensation. A corporation, or an individual who is
not an Employee of the Employer, which serves as a Trustee shall be entitled to
reasonable compensation for its or his services. Any taxes of any kind
whatsoever, including transfer taxes incurred in connection with the investment
or reinvestment of the assets of the Trust Fund that may be levied or assessed
in respect to such assets shall, if allocable to the Accounts of specific
Participants, be charged to such Accounts, and if not so allocable, they shall
be equitably apportioned among all such Participants' Accounts. All other
administrative expenses incurred by the Trustee in the performance of his duties
including fees for legal services rendered to them shall be paid by the Employer
within a reasonable time specified by the Trustee or at the Trustee's option may
be equitably apportioned among such Accounts.

12. LIMITATION OF TRUSTEE'S LIABILITY; INDEMNIFICATION

     Nothing in this Trust Agreement or the Plan of which it is a part shall
relieve any person from liability for any responsibility under Part 4 of Title I
of the Act. Subject thereto, the Trustee shall have no liability under the Plan,
except as may arise from its negligence or wilful misconduct, and in any event,
the Employer shall fully indemnify the Trustee and save it harmless from any
such liability except that resulting from its negligence or wilful misconduct.
In the application of the foregoing, except as otherwise required by law:

     12.1 The Trustee shall have no duty to take any action other than as herein
specified, unless the Administrator shall furnish it with instructions in proper
form and such instructions shall have been specifically agreed to by it, or to
defend or engage in any suit unless it shall have first agreed in writing to do
so and shall have been fully indemnified to its satisfaction.

     12.2 The Trustee may conclusively rely upon and shall be protected in
acting in good faith upon any written representation or order from the
Administrator or any other notice, request, consent, certificate or other
instrument or paper believed by it to be genuine and properly executed, or any
instrument or paper if it believes the signature thereon to be genuine.

     12.3 The Trustee shall not be liable for interest on any reasonable cash
balances maintained in the Trust.

     12.4 The Trustee shall not be obligated to, but may, in its discretion,
receive a contribution from a Participant unless forwarded by the Administrator.

13. AMENDMENT

     No part of the corpus or income of the Trust Fund shall be used for or
diverted to purposes other than the exclusive benefit of Participants or their
Beneficiaries or the administrative expenses of the Plan, or revert to the
Employer except as specifically permitted by the terms of the Plan. The right of
the Employer to amend or terminate the Trust Agreement and the delegation of
that right are set forth in Section 19 of the Prototype Plan, subject to the
foregoing and other limitations in the Plan.

     The Employer will cause a copy of any amendment of the Adoption Agreement
to be delivered to the Trustee for the Trustee's information.

14. TERMINATION

     Upon certification by the Board of Directors of the Employer that the
Employer has terminated the Plan as therein provided and that the Trust Fund or
part thereof is accordingly to be distributed in accordance with the termination
provisions thereof, the Trustee shall pay such amounts from the Trust Fund as
the Administrator may direct, either directly to the persons entitled to receive
such amounts or to the Administrator for distribution, provided the
Administrator further certifies that all such amounts are payable under the Plan
to Participants or their Beneficiaries or for administrative expenses of the
Plan or for other payments in accordance with the provisions thereof.

15. SUCCESSOR TRUSTEES

     Any corporation into which a corporation acting as a Trustee hereunder may
be merged or with which it may be consolidated, or any corporation resulting
from any merger, reorganization or consolidation to which such Trustee may be a
party, shall be the successor of the Trustee hereunder, without the necessity of
any appointment or other action, provided it does not resign and is not removed.

16. ENFORCEMENT OF PROVISIONS

     To the extent permitted by applicable law, the Employer and the
Administrator shall have the exclusive right to enforce any and all provisions
of this Agreement on behalf of all Employees or former Employees of the Employer
or their Beneficiaries or other persons having or claiming to have an interest
in the Trust Fund or under the Plan. In any action or proceeding affecting the
Trust Fund or any property constituting a part or all thereof, or the
administration thereof or for instructions to the Trustee, the Employer, the
Administrator and the Trustee shall be the only necessary parties; and shall be
solely entitled to any notice of process in connection therewith; and any
judgment that may be entered in such action or proceeding shall be binding and
conclusive on all persons having or claiming to have any interest in the Trust
Fund or under the Plan.

17. VOTING

     The Trustee shall deliver, or cause to be executed and delivered, to the
Administrator all notices, prospectuses, financial statements, proxies and proxy
soliciting materials received by the Trustee relating to securities held by the
Trust, and the Administrator shall deliver these to the appropriate Participant
or the Beneficiary of a deceased Participant. The Trustee shall not vote any
securities held by the Trust except in accordance with the written instructions
of the Participant or the Beneficiary of the Participant, if the Participant is
deceased.

18. GOVERNING LAW

     This instrument shall, to the extent state law is applicable, be governed
by and interpreted under the laws of the state in which the Employer has its
principal place of business.

19. ACCEPTANCE

     The Trustee accepts the trust hereunder.

20. TRANSFER TO EMPLOYER

     Anything contained elsewhere in this Agreement to the contrary
notwithstanding, the Employer reserves the right by action of its Board of
directors to direct the Trustee to transfer the Trust Fund to the Employer
subject to claims against it for administrative expenses if the Plan is properly
terminated in accordance with the terms and conditions of the original Plan upon
the Employer's receipt of a determination letter from the Director of Internal
Revenue determining that the Plan initially fails to qualify under Section 401
(a) of the Internal Revenue Code. The Employer shall direct the Trustee to
transfer to Employees such portion of the Trust Fund as the Plan requires to be
transferred to them on account of their contributions, but the Trustee shall not
be required to see to the application of the Trust Fund for this purpose. If
such termination ceases to be possible this section shall be of no further force
or effect.


22

<PAGE>

Telephone
numbers and
addresses
- --------------------------------------------------------------------------------

National toll free
telephone numbers
and addresses

          ----------------------------------------------------------------------
          For information about the Scudder 401(k) program,
             CALL (toll-free) 1-800-225-2471
                  (within Massachusetts, call collect 617-482-3990)

                                       or

             WRITE to: Scudder Funds Croup Retirement Plans
                       175 Federal Street
                       Boston, MA 02110
          A Group Retirement Specialist from Scudder Fund Distributors, Inc.,
          underwriter for the Scudder funds, will answer your calls and letters.
          ----------------------------------------------------------------------

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

Local addresses
of Scudder Fund
Distributors, Inc.

Boca Raton
150 East Palmetto Park Road
Boca Raton, Florida 33432
305-395-0040

Boston
175 Federal Street
Boston, Massachusetts 02440
617-482-3990

Chicago
Suite 2200, 111 East Wacker Drive
Chicago, Illinois 60604
312-861-2700

Cincinnati
540 Carew Tower
Cincinnati, Ohio 45202
513-621-2733

Cleveland
Suite 700, 1801 East Ninth Street
Cleveland, Ohio 44114
216-241-7744

Dallas
Suite 2124, Plaza of the Americas
700 North Pearl
Dallas, Texas 75201
214-742-1465

1530 Bank of the Southwest Building
Houston, Texas 77002
713-659-3838

Los Angeles
333 South Hope Street
Los Angeles, California 90071
243-6284444

New York
345 Park Avenue
New York, New York 10154
212-350-8200

Philadelphia
Three Girard Plaza
Philadelphia, Pennsylvania 19402
215-864-7200

Portland, Oregon
Benjamin Franklin Plaza
1 S.W. Columbia St.
Portland, Oregon 97258
503-224-3999

San Francisco
Suite 4100, 104 California Street
San Francisco, California 94144
415-981-8191


                                                                              23

<PAGE>

Scudder
- ---------------------------------------------
This booklet is not to be used in connection
with the offering of any of the Scudder funds
unless preceded or accompanied by the
appropriate current prospectuses.  Scudder
Fund Distributors, Inc. is the underwriter
of the Scudder no-load mutual funds.











K-S-33  (C) Scudder Fund Distributors, Inc.


                                                                      Exhibit 16

                         SCUDDER CASH INVESTMENT TRUST

                                                        For 6/30/89

Net income available for distribution = $ 2,588,837.35

Shares outstanding                    =  10,641,082,780

$ 2,588,837.35                = .0017030443 (divided per share)
- --------------
10,641,082,780

      Date                      Dividend Per Share
      ----                      ------------------

      6/24                      .000244226
      6/25                      .000244226
      6/26                      .000244106
      6/27                      .000244222
      6/28                      .000237539
      6/29                      .000244952
      6/30                      .000243774
                                -----------
                                .0017030443

      (.0017030443/7) 36,500 = 8.88 = 7 - DAY CURRENT YIELD




                                   SIGNATURES

      Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this amendment to
its Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Boston and the Commonwealth of
Massachusetts on the 16th day of August, 1991.


                                          SCUDDER CASH INVESTMENT TRUST


                                          By: /s/ David S. Lee
                                              ----------------------------------
                                              David S. Lee, President

      Pursuant to the requirements of the Securities Act of 1933, this amendment
to its Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated. By so signing, each of the
undersigned in his capacity as a trustee or officer, or both, as the case may be
of the Registrant, does hereby appoint David S. Lee, Thomas F. McDonough and
Sheldon A. Jones and each of them, severally, or if more than one acts, a
majority of them, his true and lawful attorney and agent to execute in his name,
place and stead (in such capacity) any and all amendments to the Registration
Statement and any post-effective amendments thereto and all instruments
necessary or desirable in connection therewith, to attest the seal of the
Registrant thereon and to file the same with the Securities and Exchange
Commission. Each of said attorneys and agents shall have power to act with or
without the other and have full power and authority to do and perform in the
name and on behalf of each of the undersigned, in any and all capacities, every
act whatsoever necessary or advisable to be done in the premises as fully and to
all intents and purposes as each of the undersigned might or could do in person,
hereby ratifying and approving the act of said attorneys and agents and each of
them.

       SIGNATURE                        TITLE                        DATE
       ---------                        -----                        ----


/s/ David S. Lee                 President (Principal          August 16, 1991
- --------------------------       Executive Officer)
David S. Lee                     and Trustee


/s/ Henry P. Becton, Jr.
- --------------------------
Henry P. Becton, Jr.             Trustee                       August 16, 1991


/s/ Dawn-Marie Driscoll
- --------------------------
Dawn-Marie Driscoll              Trustee                       August 16, 1991


/s/ Cuyler W. Findlay
- ---------------------------      Vice President                August 16, 1991
Cuyler W. Findlay                and Trustee


/s/ Peter B. Freeman
- ---------------------------
Peter B. Freeman                 Trustee                       August l3, 1991
<PAGE>

       SIGNATURE                        TITLE                        DATE
       ---------                        -----                        ----


/s/ Dudley H. Ladd
- ---------------------------      Vice President                August 13, 1991
Dudley H. Ladd                   and Trustee


/s/ George M. Lovejoy, Jr.
- ---------------------------
George M. Lovejoy, Jr.           Trustee                       August 16, 1991


/s/ Pamela A. McGrath
- ---------------------------
Pamela A. McGrath                Treasurer                     August 16, 1991
                                 (Principal Financial
                                 and Accounting Officer)


                                      -2-



Coopers & Lybrand

                       Consent of Independent Accountants









To the Board of Trustees and Shareholders of Scudder Cash Investment Trust:



We consent to the incorporation by reference in Post-Effective Amendment No. 31
to the Registration Statement of Scudder Cash Investment Trust on Form N-1A, of
our report dated August 5, 1997 on our audit of the financial statements and
financial highlights of Scudder Cash Investment Trust, which report is included
in the Annual Report to Shareholders for the year ended June 30, 1997, which is
incorporated by reference in the Registration Statement.



We also consent to the reference to our Firm under the caption, "Experts."


                                              /s/Coopers & Lybrand L.L.P. 
Boston, Massachusetts                         Coopers & Lybrand L.L.P.
October 16, 1997



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