BRINSON FUNDS INC, N-14, 1998-09-21

BRINSON FUNDS INC
N-14, 1998-09-21

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File No. 33-_______

As filed with the SEC on September 21, 1998

U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
-----
Pre-Effective Amendment No. ___
Post-Effective Amendment No. __
(Check appropriate box or boxes)

THE BRINSON FUNDS
(Exact Name of Registrant as Specified in Charter)

(312) 220-7100
(Area Code and Telephone Number)

209 South LaSalle Street, Chicago, IL 60604
(Address of Principal Executive Offices --
Number, Street, City, State, Zip Code)

Carolyn M. Burke
209 South LaSalle Street
Chicago, IL 60604-1295
(Name and Address of Agent for Service --
Number, Street, City, State, Zip Code)

Copies to:

Bruce G. Leto, Esquire
Stradley, Ronon, Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103

Approximate Date of Proposed Public Offering: As soon as
practicable after this Registration Statement becomes effective
under the Securities Act of 1933.

Title Of Securities Being Registered - Brinson U.S. Large Capitalization Growth
Fund Class I shares
of beneficial interest, $0.001 par value per share, of the U.S. Large
Capitalization Growth Fund series

________________________________________________________________________________

No filing fee is due because Registrant is relying on Section 24(f) of the
Investment Company Act of 1940, as amended.

It is proposed that this filing will become effective on October 21, 1998,
pursuant to Rule 488.

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THE BRINSON FUNDS

CROSS REFERENCE SHEET
(Pursuant to Rule 481(a) under the
Securities Act of 1933)

<TABLE>
<CAPTION>
N-14 Item No. and Caption Location in Prospectus
- ------------------------- ----------------------

PART A
<S> <C>
1. Beginning of Registration Statement and Cover Page of Registration Statement; Front Cover Page of
outside Front Cover Page of Prospectus Prospectus

2. Beginning and outside Back Cover Page of Table of Contents
Prospectus

3. Fee Table, Synopsis Information and Risk Summary; Risk Factors; Comparisons of Some Important
Factors Features

4. Information About the Transaction Summary; Reasons for the Reorganization; Information About
the Reorganization

5. Information About the Registrant Prospectus Cover Page; Summary; Comparison of Investment
Policies and Risks; Information About the Brinson Fund;
Additional Information Regarding the Brinson Fund

6. Information About the Company Being Prospectus Cover Page; Comparison of Investment Policies
Acquired and Risks; Information About the UBS Fund

7. Voting Information Prospectus Cover Page; Notice of Special Meeting of
Shareholders; Solicitation and Revocation of Proxies and
Voting Information; Principal Shareholders; Summary-Voting
Information; Voting Information

8. Interest of Certain Persons and Experts None

9. Additional Information Required for Not Applicable
Reoffering by Persons Deemed to be
Underwriters

N-14 Item No. and Caption Location in Statement of Additional Information
- ------------------------- -----------------------------------------------

PART B

10. Cover Page Cover Page of Statement of Additional Information

11. Table of Contents Table of Contents

12. Additional Information about the The Brinson Funds; Investment Strategies; Investment
Registrant Restrictions; Management of the Trust; Control Persons and
Principal Holders of Securities; Investment Advisory and
Other Services; Portfolio Transactions and Brokerage
Commissions; Shares of Beneficial Interest; Purchases;
Redemptions; Performance Calculations; Financial
Statements; Corporate Debt Ratings

13. Additional Information about the Company Incorporation of Documents by Reference in the Statement of
being Acquired Additional Information

14. Financial Statements Incorporation of Documents by Reference in the Statement of
Additional Information
</TABLE>

PART C-OTHER INFORMATION

Part C contains the information required by Items 15-17 under the items set
forth in the Form.

2
<PAGE>

Dear Shareholder:

Enclosed is a Notice of Meeting for a Special Shareholders Meeting
which has been called for December 15, 1998 at _____ a.m., at
____________________. The accompanying Prospectus/Proxy Statement details a
proposal being presented for your consideration and requests your prompt
attention and vote via the enclosed proxy card.

PLEASE TAKE A MOMENT TO FILL OUT, SIGN AND RETURN THE ENCLOSED PROXY CARD!

This meeting is critically important as you are being asked to
consider and approve an Agreement and Plan of Reorganization which would result
in an exchange of shares in your fund, the UBS Large Cap Growth Fund (the "UBS
Fund") of UBS Private Investor Funds, Inc. (the "Corporation") for the Brinson
U.S. Large Capitalization Growth Fund Class I shares ("Class I Shares") of
beneficial interest of the U.S. Large Capitalization Growth Fund (the "Brinson
Fund"), a newly created, comparable fund managed by Brinson Partners, Inc.
("Brinson" or the "Advisor") that is a series of The Brinson Funds. On the date
of the exchange, you will receive Class I Shares in the Brinson Fund equal in
value to your investment in the UBS Fund of the Corporation. Thereafter, the
value of your investment will fluctuate with market conditions and the
investment performance of the Class I Shares of the Brinson Fund.

The proposed reorganization is intended to be a tax-free
reorganization under the Internal Revenue Code of 1986, as amended, as further
described in the accompanying Prospectus/Proxy Statement.

This transaction is being proposed because of the recent merger of
Union Bank of Switzerland, the corporate parent of the UBS Fund's investment
adviser and sub-investment adviser, and Swiss Bank Corporation, the corporate
parent of the Brinson Fund's investment adviser, to form UBS A.G. In an effort
to promote more efficient operations, to eliminate duplicate costs and to
enhance the distribution of shares, UBS A.G. and Brinson proposed that the UBS
Fund be reorganized into the Brinson Fund. The Brinson Fund has an identical
investment objective and similar investment policies to the UBS Fund. In
addition, the Trust possesses certain operating economies of scale which allow
shareholders to enjoy a relatively low cost investment program while receiving a
high level of service and communications.

Please take the time to review this document and vote now! To ensure
---
that your vote is counted, indicate your position on the enclosed proxy card(s).
Sign and return your card(s) promptly. If you determine at a later date that
you wish to attend the meeting, you may revoke your proxy and vote in person.

Thank you for your attention to this matter.

Sincerely,

Paul J. Jasinski
President

4
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PRELIMINARY COPY

UBS PRIVATE INVESTOR FUNDS, INC.
UBS LARGE CAP GROWTH FUND
200 Clarendon Street
Boston, Massachusetts 02116

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

To Be Held on December 15, 1998

To the Shareholders:

NOTICE IS HEREBY GIVEN that a Special Meeting of the Shareholders of
the UBS Large Cap Growth Fund (the "UBS Fund") of the UBS Private Investor
Funds, Inc. (the "Corporation") will be held at __________________________ on
December 15, 1998, at ______ a.m., Eastern time, for the following purposes:

1. To approve or disapprove an Agreement and Plan of Reorganization
between the Corporation, on behalf of the UBS Fund, and The Brinson Funds (the
"Trust"), on behalf of the U.S. Large Capitalization Growth Fund (the "Brinson
Fund"), that provides for the acquisition of substantially all of the assets and
liabilities of the UBS Fund in exchange for the Brinson U.S. Large
Capitalization Growth Fund Class I shares ("Class I Shares") of beneficial
interest of the Brinson Fund, a series of the Trust, the distribution of such
shares to the shareholders of the UBS Fund, and the dissolution of the UBS Fund.

2. To transact such other business as may properly come before the
Special Meeting or any adjournment thereof.

The attached Prospectus/Proxy Statement provides more information
concerning each of the foregoing matters, including the transaction contemplated
by the Agreement and Plan of Reorganization. A copy of the Agreement and Plan
of Reorganization is attached as Exhibit A.

Shareholders of record as of the close of business on ____________,
1998, are entitled to notice of, and to vote at, the Special Meeting or any
adjournment thereof.

By Order of the
Board of Directors,

Susan C. Mosher
Secretary
______________, 1998

IF YOU ATTEND THE MEETING, YOU MAY VOTE YOUR SHARES IN PERSON. IF YOU
DO NOT EXPECT TO ATTEND THE MEETING, THE BOARD OF DIRECTORS URGES YOU TO
COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD(S) IN THE ENCLOSED
POSTAGE-PAID RETURN ENVELOPE. IT IS IMPORTANT THAT YOU RETURN YOUR SIGNED PROXY
PROMPTLY SO THAT A QUORUM MAY BE ENSURED.

5
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Combined Prospectus and Proxy Statement

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
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<S> <C>
COVER PAGE.................................................................Cover
SOLICITATION AND REVOCATION OF PROXIES AND VOTING INFORMATION...................
PRINCIPAL SHAREHOLDERS..........................................................
PROPOSAL 1: TO APPROVE THE AGREEMENT AND PLAN..................................
OF REORGANIZATION.............................................................
SUMMARY.........................................................................
Proposed Transaction..........................................................
Voting Information............................................................
Federal Income Tax Consequences...............................................
COMPARISONS OF SOME IMPORTANT FEATURES..........................................
Investment Objectives and Policies............................................
Management of the Corporation and the Trust...................................
Fees and Expenses.............................................................
Distribution Services.........................................................
Pro Forma Fee Table for the UBS Fund and the Brinson Fund.....................
Purchase Price, Redemption Price, Exchanges, Dividends and Distributions......
Special Information Regarding the UBS Fund's Two-Tier Structure...............
Risk Factors and Comparison of Policies.......................................
REASONS FOR THE REORGANIZATION..................................................
The Merger of Union Bank of Switzerland and Swiss Bank Corporation............
Reorganization................................................................
INFORMATION ABOUT THE REORGANIZATION............................................
Method of Carrying Out the Reorganization.....................................
Conditions Precedent to Closing...............................................
Expenses of the Transaction...................................................
Federal Income Tax Consequences...............................................
Description of the Class I Shares of the Brinson Fund.........................
Capitalization................................................................
COMPARISON OF INVESTMENT POLICIES AND RISKS.....................................
The Brinson Fund and the UBS Fund.............................................
Investment Policies...........................................................
Investment Restrictions.......................................................
Risk Factors..................................................................
INFORMATION ABOUT THE BRINSON FUND..............................................
INFORMATION ABOUT THE UBS FUND..................................................
TRANSFER AGENT AND CUSTODIAN....................................................
SHAREHOLDER INQUIRIES...........................................................
EXHIBIT A - Agreement and Plan of Reorganization.............................A-1
EXHIBIT B - Additional Information Regarding the Brinson Fund................B-1
</TABLE>

6
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PRELIMINARY COPY

COMBINED PROSPECTUS AND PROXY STATEMENT

Dated_______, 1998

Acquisition of the Assets of the
UBS Large Cap Growth Fund of
UBS PRIVATE INVESTOR FUNDS, INC.

By and in exchange for the Brinson U.S. Large Capitalization Growth Fund Class I
shares of the U.S. Large Capitalization Growth Fund of
THE BRINSON FUNDS

This Prospectus/Proxy Statement is being furnished to you in
connection with the solicitation of proxies by the Board of Directors of the UBS
Private Investor Funds, Inc. (the "Corporation"). The Corporation is a series
investment company with six series of shares. Each such series represents an
interest in a separate investment portfolio, designated as the UBS Bond Fund,
UBS High Yield Bond Fund, UBS Value Equity Fund (formerly UBS U.S. Equity Fund),
UBS Large Cap Growth Fund, UBS Small Cap Fund and UBS International Equity Fund.
This Prospectus/Proxy Statement relates solely to the UBS Large Cap Growth Fund
(the "UBS Fund"). The remaining five series of the Corporation, other than the
UBS Fund, are referred to in this Prospectus/Proxy Statement as the "UBS
Series," and the UBS Fund and the UBS Series are collectively referred to as the
"UBS Funds."

Proxies solicited will be voted at a Special Meeting of Shareholders
to approve or disapprove an Agreement and Plan of Reorganization (the "Agreement
and Plan"). The Agreement and Plan provides for the acquisition of substantially
all of the assets and liabilities of the UBS Fund of the Corporation by the U.S.
Large Capitalization Growth Fund (the "Brinson Fund") of The Brinson Funds (the
"Trust"), a newly created series of the Trust which is managed by Brinson
Partners, Inc. ("Brinson" or the "Advisor") and which has an investment
objective that is identical and investment policies that are substantially
similar to the UBS Fund, in exchange solely for the Brinson U.S. Large
Capitalization Growth Fund Class I shares ("Class I Shares") of beneficial
interest of the Brinson Fund. Concurrently with the transaction proposed with
respect to the UBS Fund, shareholders of each UBS Series will be approving an
agreement and plan of reorganization relating to the sale of each UBS Series'
assets and liabilities to another Trust series managed by Brinson with similar
investment objectives and policies. A separate vote will be conducted for each
of the UBS Funds, and the six reorganizations of the UBS Funds are independent
of each other.

Following such transfer, the Class I Shares of the Brinson Fund will
be distributed to shareholders of the UBS Fund in liquidation of such Fund and
individual shareholders of the UBS Fund will receive that number of the Class I
Shares of the Brinson Fund having an aggregate net asset value equal to the
aggregate net asset value of such shareholder's shares of the UBS Fund.
Thereafter, the Corporation will file an application pursuant to Section 8(f) of
the Investment Company Act of 1940, as amended (the "1940 Act"), for an order
declaring that it has ceased to be an investment company; provided that the
shareholders of each UBS Series also approve the sale of each UBS Series' assets
to a corresponding Trust series.

The Trust consists of thirteen separate investment series: Global
Fund, Global Equity Fund, Global Bond Fund, Emerging Markets Debt Fund, Emerging
Markets Equity Fund, U.S. Balanced Fund, U.S. Large Capitalization Equity Fund,
U.S. Equity Fund, U.S. Bond Fund, Non-U.S. Equity Fund, U.S. Large
Capitalization Growth Fund, U.S. Small Capitalization Fund and High Yield Bond
Fund (individually, a "Trust Series" and collectively, the "Trust Series"). Each
Trust Series offers three separate classes of shares, the Class N shares, the
UBS Investment Fund class shares, and the Class I shares.

The Brinson Fund is a diversified series of the Trust, with its
principal offices located at 209 South LaSalle Street, Chicago, Illinois 60604-
1295, (800) 448-2430. The Brinson Fund has an investment objective that is
identical to that of the UBS Fund. The Brinson Fund's investment objective is
to provide long-term capital

7
<PAGE>

appreciation. The Brinson Fund attempts to achieve its investment objective by
investing primarily in the equity securities of large capital growth companies.

The UBS Fund is a diversified series of the Corporation, with its
principal offices located at 200 Clarendon Street, Boston, Massachusetts 02116,
(888) 827-3863. The UBS Fund's investment objective is to provide long-term
capital appreciation. The UBS Fund seeks to achieve its investment objective by
investing all of its investable assets in the UBS Large Cap Growth Portfolio
(the "UBS Portfolio"), a series of UBS Investor Portfolios Trust (the "UBS
Trust"), a registered management investment company. The investment policies and
restrictions and, consequently, the risks of investing in the Brinson Fund are
substantially similar to those of the UBS Fund, but differ in certain respects
as described more fully under "COMPARISON OF INVESTMENT POLICIES" in this
Prospectus/Proxy Statement.

This Prospectus/Proxy Statement, which should be retained for future
reference, sets forth concisely the information about the Brinson Fund and the
Trust that a prospective investor should know before investing. A Statement of
Additional Information dated ______________, 1998, relating to this
Prospectus/Proxy Statement, the transaction described herein and the parties
thereto, has been filed with the U.S. Securities and Exchange Commission ("SEC"
or the "Commission") and is incorporated by reference into this Prospectus/Proxy
Statement. A copy of that Statement may be obtained without charge by writing
to the address noted above or by calling (800) 448-2430. The Trust will
furnish, without charge, a copy of its annual and semi-annual reports to a
shareholder upon request by writing to the Trust at the address noted above or
by calling (800) 448-2430.

A prospectus, statement of additional information, and annual report
to shareholders, dated December 31, 1997, relating to the UBS Fund of the
Corporation are also on file with the SEC (File nos. 33-64401; 811-07431), each
of which is incorporated by reference herein and is available without charge
upon request to the Corporation. This Prospectus/Proxy Statement will first be
sent to shareholders on or about ________, 1998.

THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR
DISAPPROVED THESE SECURITIES OR PASSED UPON THE ADEQUACY OF THIS
PROSPECTUS/PROXY STATEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS/PROXY STATEMENT
AND IN THE MATERIALS EXPRESSLY INCORPORATED HEREIN BY REFERENCE AND, IF GIVEN OR
MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE CORPORATION OR THE TRUST.

SHARES OF THE UBS FUND AND THE BRINSON FUND ARE NOT DEPOSITS OR
OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY, ANY BANK, AND THE SHARES ARE NOT
FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD, OR ANY OTHER GOVERNMENTAL AGENCY. AN INVESTMENT IN THE UBS FUND
AND THE BRINSON FUND IS SUBJECT TO RISK THAT MAY CAUSE THE VALUE OF THE
INVESTMENT TO FLUCTUATE, AND WHEN THE INVESTMENT IS REDEEMED, THE VALUE MAY BE
HIGHER OR LOWER THAN THE AMOUNT ORIGINALLY INVESTED BY THE INVESTOR.

8
<PAGE>

SOLICITATION AND REVOCATION OF PROXIES AND VOTING INFORMATION

The enclosed proxy is solicited by and on behalf of the Board of
Directors of the Corporation in connection with the Special Meeting of
Shareholders of the UBS Fund to be held at __________________, on December 15,
1998 at _____ a.m. Eastern time (the "Meeting"), and at any or all adjournments
thereof. You may revoke your proxy at any time before it is exercised by
delivering a written notice to the Corporation expressly revoking your proxy, by
signing and forwarding to the Corporation a later-dated proxy, or by attending
the Meeting and casting your votes in person.

The Corporation will request broker-dealer firms, custodians, nominees
and fiduciaries to forward proxy material to the beneficial owners of the shares
of record by such persons. Such broker-dealer firms, custodians, nominees and
fiduciaries may be reimbursed for their reasonable expenses incurred in
connection with such proxy solicitation. The cost of soliciting these proxies
will not be borne by the Trust or the Corporation. In addition to solicitations
by mail, some of the officers and employees of UBS A.G., without additional
remuneration, may conduct additional solicitations by telephone, telegraph and
personal interviews.

Shareholders of record of the UBS Fund at the close of business on
[________, 1998] (the "Record Date") will be entitled to vote at the Meeting or
any adjournment thereof. On the Record Date, there were __________ outstanding
shares of the UBS Fund. Each shareholder will be entitled to one vote for each
full share, and a fractional vote for each fractional share, of the UBS Fund
held on the Record Date.

The Board of Directors does not intend to bring any matters before the
Meeting other than the proposal described below and is not aware of any other
matters to be brought before the Meeting by others. If any other matter legally
comes before the Meeting, proxyholders for which discretion has been granted
will vote shares in accordance with the views of management.

In the event that a quorum is present at the Meeting but sufficient
votes to approve the proposal set forth in the Notice of Special Meeting of
Shareholders are not received by the date of the Meeting, the persons named as
proxies may propose one or more adjournments of the Meeting to permit further
solicitation of proxies. Any such adjournment will require the affirmative vote
of a majority of those shares represented at the Meeting in person or by proxy.
If a quorum is present, the persons named as proxies will vote those proxies
that they are entitled to vote "FOR" any proposal in favor of adjournment and
will vote those proxies required to be voted "AGAINST" any such proposal against
any adjournment.

For purposes of determining the presence of a quorum for transacting
business at the Meeting, abstentions and broker "non-votes" (that is, proxies
from brokers or nominees indicating that such persons have not received
instructions from the beneficial owner or other persons entitled to vote shares
on a particular matter with respect to which brokers or nominees do not have
discretionary power) will be treated as shares that are present but which have
not been voted. Abstentions and broker non-votes would be treated in the same
manner with respect to the Trust.

The proxyholders will vote all proxies received. It is the present
intention that, absent contrary instructions, the enclosed proxy will be voted
for the approval of the Agreement and Plan; and in the discretion of the
proxyholders, upon such other matters not now known or determined as may legally
come before the Meeting.

PRINCIPAL SHAREHOLDERS

As of the Record Date, the following person(s) owned beneficially more
than 5% of the outstanding voting shares of the UBS Fund: ___________ at
[address] owned _______ shares (___%).
- ---------

All of the respective officers and directors of the Corporation and
the officers and trustees of the Trust, as a group, owned less than 1% of the
outstanding voting securities of the UBS Fund and the Brinson Fund, as relevant.

<PAGE>

PROPOSAL 1: TO APPROVE THE AGREEMENT AND PLAN OF REORGANIZATION

SUMMARY

This summary of certain information contained in this Prospectus/Proxy
Statement is qualified by reference to the more complete information contained
elsewhere in this Prospectus/Proxy Statement, the Prospectus of the UBS Fund and
the Agreement and Plan of Reorganization (the "Agreement and Plan") attached to
this Prospectus/Proxy Statement as Exhibit A.

PROPOSED TRANSACTION. At meetings of the Board of Directors of the Corporation,
- --------------------
the directors of the Corporation, including a majority of the directors who are
not "interested persons" of the Corporation, as defined in the 1940 Act (the
"Independent Directors"), considered and subsequently approved the Agreement and
Plan providing for the transfer of substantially all of the assets and
liabilities of the UBS Fund of the Corporation in exchange solely for the Class
I Shares of beneficial interest of the Brinson Fund. (This proposed transaction
is referred to in this Prospectus/Proxy Statement as the "Reorganization.") The
value of Class I Shares issued by the Brinson Fund in connection with the
Reorganization will equal the value of the net assets of the UBS Fund acquired
by the Brinson Fund.

Pursuant to the Agreement and the Plan, the Class I Shares issued by
the Brinson Fund to the UBS Fund will be distributed to the shareholders of the
UBS Fund in liquidation of the UBS Fund. As a result, shareholders of the UBS
Fund will cease to be shareholders of such Fund and will instead be the owners
of that number of full and fractional Class I Shares of the Brinson Fund having
an aggregate net asset value equal to the aggregate net asset value of the
shares of the UBS Fund on the closing date of the Reorganization.

After presentations by representatives of Brinson and UBS A.G., the
investment adviser to the UBS Portfolio of UBS Trust, discussing why, in their
views, the proposal should be approved, the Board of Directors of the
Corporation, including all of the Independent Directors present at the meetings
at which the Reorganization was approved, concluded that the Reorganization is
in the best interests of the shareholders of the UBS Fund and, therefore,
recommended approval of the Agreement and Plan. The Board of Directors of the
Corporation and the Board of Trustees of the Trust, respectively, also concluded
that no dilution would result to the shareholders of the Corporation or the
Trust as a result of the Reorganization.

VOTING INFORMATION. Approval of the Agreement and Plan requires the favorable
- ------------------
vote of a majority of the holders of the outstanding shares of the UBS Fund
entitled to vote.

Each shareholder will be entitled to one vote for each full share, and
a fractional vote for each fractional share, of the UBS Fund held on the Record
Date. IF YOU GIVE NO VOTING INSTRUCTIONS, YOUR SHARES WILL BE VOTED IN FAVOR OF
THE AGREEMENT AND PLAN.

FEDERAL INCOME TAX CONSEQUENCES. Consummation of the Reorganization is subject
- -------------------------------
to the receipt of a tax opinion by counsel to the Trust substantially to the
effect that, among other things, no gain or loss will be recognized by the UBS
Fund or its shareholders for federal income tax purposes as a result of such
Reorganization; the holding period and aggregate tax basis of Class I Shares of
the Brinson Fund received by a shareholder of the UBS Fund will be the same as
the holding period and aggregate tax basis of the shareholder's shares of the
UBS Fund; and the holding period and tax basis of the assets of the UBS Fund in
the hands of the Brinson Fund as a result of the Reorganization generally will
be the holding period and tax basis of those assets in the hands of the UBS Fund
from which they were acquired immediately prior to the Reorganization. It is
anticipated that the Brinson Fund will continue to hold the investable assets of
the UBS Fund with disposition of such assets only in the normal course of
business.

COMPARISONS OF SOME IMPORTANT FEATURES

INVESTMENT OBJECTIVES AND POLICIES. The Brinson Fund and the UBS Fund have an
- ----------------------------------
identical investment objective: to provide long-term capital appreciation. The
Brinson Fund seeks to achieve its investment objective by investing in the
equity securities of small capital growth companies. Unlike the Brinson Fund,
however, the UBS Fund seeks to achieve its investment objective by investing all
of its investable assets in the corresponding UBS Portfolio, a series of the UBS
Trust, a separate registered investment company, which UBS Portfolio has the
same investment
10
<PAGE>

objective and policies as the UBS Fund. The UBS Portfolio seeks to achieve its
investment objective by investing in common stocks and other equity securities
of small capital growth companies.

MANAGEMENT OF THE CORPORATION AND THE TRUST. Similar to the Corporation and its
- -------------------------------------------
Board of Directors, the management of the business and affairs of the Trust is
the responsibility of its Board of Trustees. The Corporation is organized as a
corporation under the laws of the State of Maryland, and the Trust is organized
as a business trust under the laws of the State of Delaware. The Trust was
originally organized as a Maryland corporation on April 14, 1992. On December
1, 1993, the Trust reorganized as a Delaware business trust through a merger of
the Maryland corporation into the Trust.

The Corporation, on behalf of the UBS Fund, has not retained the
services of an investment adviser since the UBS Fund seeks to achieve its
investment objective by investing all of its investable assets in the UBS
Portfolio. UBS A.G., a universal bank organized under the laws of and having
its principal executive offices in Switzerland, through its New York office,
located at 10 East 50/th/ Street, New York, New York 10022 (the "UBS Adviser"),
serves as the investment adviser of the UBS Portfolio pursuant to an investment
advisory agreement. UBS Brinson Inc., a wholly-owned subsidiary of UBS A.G.,
located at 10 East 50/th/ Street, New York, New York 10022 (the "UBS Sub-
Adviser"), serves as the sub-investment adviser to the UBS Portfolio.

The Brinson Fund invests its assets directly in portfolio securities
and is advised and managed by Brinson, 209 South LaSalle Street, Chicago,
Illinois 60604-1295. Brinson is a wholly-owned subsidiary of UBS A.G.

FEES AND EXPENSES. Pursuant to the UBS Trust's investment advisory agreement,
- -----------------
the UBS Portfolio pays the UBS Adviser a fee for its services, calculated daily
and paid monthly, equal on an annual basis to a rate of 0.60% of the UBS
Portfolio's average daily net assets. Pursuant to a sub-advisory agreement
between the UBS Adviser and the UBS Sub-Adviser, the UBS Adviser pays the UBS
Sub-Adviser a fee, calculated daily and payable monthly, at an annual rate equal
to 0.30% of the UBS Portfolio's first $25 million of average net assets, 0.25%
of the next $25 million of average net assets, and 0.20% of the UBS Portfolio's
average net assets in excess of $50 million. The UBS Adviser has voluntarily
agreed to waive its fees and reimburse the UBS Fund and the UBS Portfolio for
any of their respective operating expenses to the extent that the UBS Fund's
total operating expenses (including its share of the UBS Portfolio's expenses)
exceed, on an annual basis, 1.00% of the UBS Fund's average daily net assets.

Pursuant to its investment advisory agreement with the Advisor, the
Trust, on behalf of the Brinson Fund, is obligated to pay to Brinson a monthly
fee at the annual rate of 0.70% of the Brinson Fund's average daily net assets,
subject to certain fee waivers and expense reimbursements as further described
below.

The UBS Portfolio employs IBT Trust and Custodial Services (Ireland)
LMTD ("IBT Ireland"), a subsidiary of Investors Bank and Trust Company
("Investors Bank"), and the UBS Fund employs Investors Bank, as administrators,
respectively, under administration agreements (collectively, the "UBS
Administration Agreements") to provide certain administrative services to the
UBS Portfolio and the UBS Fund. The services provided by IBT Ireland and
Investors Bank under the UBS Administration Agreements include certain
accounting, clerical, and bookkeeping services, blue sky (for the UBS Fund
only), corporate secretarial services and assistance in the preparation and
filing of tax returns and reports to shareholders and the SEC. For the services
Investors Bank provides under the administration agreement with the UBS Fund,
the UBS Fund pays Investor Bank a fee which is calculated daily and paid
monthly, equal, on an annual basis, to 0.065% of the UBS Fund's first $100
million average daily net assets and the 0.025% of the next $100 million average
daily net assets. Investors Bank does not receive a fee from the UBS Fund on
average daily net assets in excess of $200 million. For the services IBT
Ireland provides under the administration agreement with the UBS Portfolio, the
UBS Portfolio pays IBT Ireland a fee which is calculated daily and paid monthly,
equal, on an annual basis, to 0.07% of the UBS Portfolio's first $100 million
average daily net assets and 0.05% of the average daily net assets in excess of
$100 million.

The Brinson Fund receives administrative services pursuant to a
Multiple Series Agreement (the "Services Agreement") entered into by the Trust,
on behalf of each Trust Series, including the Brinson Fund, and Morgan Stanley
Trust Company ("MSTC"), pursuant to which MSTC is required to provide general
administrative, accounting, portfolio evaluation, transfer agency and custodian
services to the Trust Series, including the coordination and monitoring of any
third party series providers. As authorized under the Services Agreement,

11
<PAGE>

MSTC has entered into a Mutual Funds Service Agreement (the "CGFSC Agreement")
with Chase Global Funds Services Company ("CGFSC"), a corporate affiliate of The
Chase Manhattan Bank, under which CGFSC provides administrative, accounting,
portfolio valuation and transfer agency services to each Trust Series.

For its administrative, accounting, transfer agency and custodian
services, MSTC receives the following as compensation from the Trust on an
annual basis: 0.0025% of the average daily U.S. assets of the Trust; 0.0525% of
the average daily non-U.S. assets of the Trust; 0.3250% of the average daily
emerging markets equity assets of the Trust; and 0.019% of the average daily
emerging markets debt assets of the Trust. MSTC receives an additional fee of
0.075% of the average daily net assets of the Trust for administrative duties,
the latter subject to the expense limitation applicable to the Trust. No fee
(asset based or otherwise) is charged on any investments made by any Trust
Series into any other investment company sponsored or managed by the Advisor and
assets of a Trust Series that are invested in another investment company or
series thereof sponsored or managed by the Advisor will not be counted in
determining the 0.075% administrative duties fee or the applicability of the
expense limitation on such fee. The foregoing fees include all out-of-pocket
expenses or transaction charges incurred by MSTC and any third party service
provider in providing such services. Pursuant to the CGFSC Agreement, MSTC pays
CGFSC for services that CGFSC provides to MSTC in fulfilling MSTC's obligations
under the Services Agreement.

The annualized ratio of operating expenses to average net assets for
the UBS Fund for the period of October 14, 1997 (commencement of operations)
through December 31, 1997 was 1.00%. The annualized ratio of operating expenses
to average net assets for the six month period ended June 30, 1998 was 1.00%.
These ratios (i) include the UBS Fund's share of the UBS Portfolio's expenses,
and (ii) are net of fee waivers and expense reimbursements. Without such fee
waivers and expense reimbursements by the UBS Adviser, the ratios of total
operating expenses to average net assets for the period of October 14, 1997
through December 31, 1997, and for the six months ended June 30, 1998, would
have been 8.54% and 3.27%, respectively. Such fee waivers and expense
reimbursements had the effect of reducing the ratio of expenses to average net
assets and increasing the ratio of net investment income to average net assets
by 7.54% (annualized), for the period October 14, 1997 through December 31,
1997. In addition, prior to December 29, 1997, investment advisory services were
provided to the UBS Portfolio without compensation.

The Brinson Fund and its Class I shares, which have not yet engaged in
any activities, will commence operations at the Closing Date (as hereinafter
defined), currently scheduled for ________, 1998, or such later date as the
parties may determine. For the fiscal year ending June 30, 1999, the estimated
annualized ratio of operating expenses to average net assets for the Class I
Shares of the Brinson Fund is 0.80%. The Advisor has irrevocably agreed to waive
its fees and to reimburse certain expenses of the Brinson Fund so that the
Fund's total operating expenses never exceed 0.80% of the Brinson Fund's average
net assets.

DISTRIBUTION SERVICES. Pursuant to a Distribution Agreement, First Fund
- ---------------------
Distributors, Inc. ("First Fund") serves as the distributor of the UBS Fund's
shares. First Fund does not receive a fee pursuant to the terms of the
distribution agreement, but receives compensation from the Administrator. The
address of First Fund is 4455 East Camelback Road, Phoenix, Arizona 85018.
Pursuant to an underwriting agreement, Funds Distributor, Inc. ("FDI") acts as
underwriter to the Trust to facilitate the filing of notices regarding the sale
of the shares of the Trust. FDI's fees for such services are borne by the
Advisor. The address of FDI is 60 State Street, Suite 1300, Boston,
Massachusetts 02109.

12
<PAGE>

<TABLE>
<CAPTION>
PRO FORMA FEE TABLE FOR THE UBS FUND AND THE BRINSON FUND
AS OF JUNE 30, 1998
(UNAUDITED)
Actual Pro Forma
-------------------------
UBS Fund/1/ Brinson Fund/2/ After Transaction
----------- --------------- -----------------
<S> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
- --------------------------------
Sales Load Imposed on Purchases None None None
Sales Load Imposed on Reinvested None None None
Dividends
Deferred Sales Load None None None
Redemption Fees None None None
Exchange Fee None None None
ANNUAL FUND OPERATING EXPENSES
- ------------------------------
(as percentage of average net assets at
June 30, 1998):
Management Fees (after fee waivers and

reimbursements)........................... 0.00% 0.70% 0.70%
12b-1 Fees.................................... None None None
Other Expenses (after fee waivers and
reimbursements)........................... 1.00% 0.10% 0.10%
Total Operating Expenses (after fee waivers
and reimbursements)....................... 1.00% 0.80%/3/ 0.80%
</TABLE>

____________________________
/1/The UBS Adviser had agreed to waive fees and reimburse the UBS Fund and the
UBS Portfolio for any of their respective operating expenses to the extent
that the UBS Fund's total operating expenses (including its share of the UBS
Portfolio's expenses) exceed, on an annual basis, 1.00% of the UBS Fund's
average daily net assets. If there were no waiver in effect, the UBS
Portfolio's advisory fee would be equal, on an annual basis, to 0.60% of the
UBS Portfolio's average daily net assets and the total operating expenses of
the UBS Fund expected to be incurred by the UBS Fund for the fiscal year
ending December 31, 1998 would be 3.62%.

/2/The Brinson Fund has not yet engaged in activity and has no assets;
therefore, "Other Expenses" for the Brinson Fund is based on estimated
amounts for the current fiscal year.

/3/As reflected in the table above, the Advisor has agreed to irrevocably waive
its fees and to reimburse certain expenses so that total operating expenses
of the Brinson Fund do not exceed 0.80%.

EXAMPLE:

Based on the level of expenses listed above after waivers and
reimbursements, an investor would pay the following expenses on a $1,000
investment, assuming a 5% annual return and redemption at the end of each time
period:

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C> <C>
UBS Fund $10 $32 $55 $122
Brinson Fund $8 $26 $44 $ 99
(After proposed transaction)
</TABLE>

____________________________
The foregoing tables are designed to assist the investor in
understanding the various costs and expenses that a shareholder will bear
directly or indirectly. THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION
OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER OR LESSER THAN
THOSE SHOWN.

PURCHASE PRICE, REDEMPTION PRICE, EXCHANGES, DIVIDENDS AND DISTRIBUTIONS.
- ------------------------------------------------------------------------
Shares of the UBS Fund and the Class I Shares of the Brinson Fund are sold on a
continuous basis at their respective net asset values per share. The

<PAGE>

minimum initial investment in the UBS Fund is $25,000, except that the minimum
initial investment is $10,000 for for shareholders of another UBS Series. The
minimum subsequent investment for all investors is $5,000. The minimum initial
investment for employees of UBS A.G. or its affiliates is $5,000, and the
minimum subsequent investment is $1,000. Certain tax deferred retirement plan
programs (including Individual Retirement Accounts ("IRAs")) are subject to a
minimum initial investment of $2,000, and subsequent investments must be $500.

The minimum initial investment for Class I Shares of the Brinson Fund
is $1,000,000. Subsequent investments for Class I Shares will be accepted in
minimum amounts of $2,500. The minimum initial investment pursuant to an
automatic investment plan is $1,000,000, with subsequent minimum investments of
$500. The minimum purchase requirement for IRAs is $2,000. The Brinson Fund has
agreed to waive the minimum initial investment requirement in connection with
the Reorganization. The subsequent minimum investment requirement will be
applied to UBS Fund shareholders who make additional investments after the
Reorganization.

Shares of the UBS Fund, the UBS Portfolio and the Brinson Fund may be
redeemed at their respective net asset values per share. With respect to the
Brinson Fund, redemptions in excess of $250,000 or 1% of net assets in any 90-
day period may be subject to certain conditions.

Shares of the UBS Fund may be exchanged for shares of the UBS Series,
subject to certain limitations, as provided in the UBS Fund's prospectus. Class
I Shares of the Brinson Fund may be exchanged for shares of the same class of
any other Trust Series, subject to certain limitations, as provided in Exhibit B
to this Prospectus/Proxy Statement. While the Corporation has five other series
of shares with which the UBS Fund shareholders may exchange their shares, the
Trust has twelve other series of shares with which the Brinson Fund shareholders
may exchange their shares.

The UBS Fund and the Brinson Fund have policies of distributing
substantially all of their net investment income and net capital gains to their
respective shareholders. The UBS Fund declares and pays dividends annually. The
Brinson Fund distributes its net investment income semi-annually in June and
December, and distributes annually in December substantially all of its net
long-term capital gains and any undistributed net short-term capital gains
realized during the period. Any aggregate net capital gains realized from the
sale of portfolio securities of the UBS Fund and the Brinson Fund are
distributed at least once each year unless they are used to offset capital
losses carried forward from prior years, in which case no capital gains will be
distributed to the extent they offset such capital losses. Dividends and capital
gains distributions are automatically reinvested by the UBS Fund and the Brinson
Fund in additional shares at the then current net asset value, unless and until
the shareholder requests to receive them in cash.

SPECIAL INFORMATION REGARDING THE UBS FUND'S TWO-TIER STRUCTURE. An investment
- ---------------------------------------------------------------
in the UBS Fund is subject to certain special considerations due to the UBS
Fund's two-tier structure, whereby it invests all of its assets in the
corresponding UBS Portfolio of the UBS Trust and the UBS Portfolio invests
directly in securities. The following discussion summarizes the considerations
that are present in a two-tier fund structure. These considerations do not apply
to an investment in the Brinson Fund.

In addition to selling beneficial interests to the UBS Fund, the UBS
Portfolio may sell beneficial interests to other mutual funds or institutional
investors. Such investors will invest in the UBS Portfolio on the same terms and
conditions and will pay a proportionate share of the UBS Portfolio's expenses.
However, the other investors investing in the UBS Portfolio are not required to
sell their shares at the same public offering price as the UBS Fund due to
variations in pricing structures and other operating expenses. These differences
may result in differences in returns experienced by investors in the different
funds that invest in the UBS Portfolio. Such differences in returns, however,
are also present in other mutual fund structures.

Smaller funds investing in the UBS Portfolio may be materially
affected by the actions of larger funds investing in the UBS Portfolio. For
example, if a large fund withdraws from the UBS Portfolio, the remaining funds
may subsequently experience higher pro rata operating expenses, thereby lowering
returns. Additionally, because the UBS Portfolio would become smaller, it may
become less diversified, resulting in potentially increased portfolio risk
(however, those possibilities also exist for traditionally structured funds that
have large or institutional investors who may withdraw from a fund). Also, funds
with a greater pro rata ownership in the UBS Portfolio could have effective
voting control of its operations. Except as permitted by the SEC, whenever the
UBS Fund is

14
<PAGE>
requested to vote on matters pertaining to the UBS Portfolio, the Corporation
will hold a meeting of UBS Fund shareholders and will cast all of its votes
proportionately as instructed by the UBS Fund's shareholders. UBS Fund
shareholders who do not vote will not affect the UBS Fund's votes at the UBS
Portfolio meeting. The percentage of the Corporation's votes representing the
UBS Fund shareholders not voting will be voted by the Corporation in the same
proportion as the UBS Fund shareholders who do, in fact, vote.

Certain changes in the UBS Portfolio's investment objective, policies
or restrictions, or a failure by the UBS Fund's shareholders to approve a change
in the UBS Portfolio's investment objective or restrictions, may require the UBS
Fund to withdraw its investments in the UBS Portfolio. Any such withdrawal could
result in an in-kind distribution of portfolio securities (as opposed to a cash
distribution) by the UBS Portfolio to the UBS Fund. In no event, however, will
securities which are not readily marketable exceed 15% of the total value of
such in-kind distribution. Such a distribution may result in a UBS Fund having a
less diversified portfolio of investments or adversely affect the UBS Fund's
liquidity, and the UBS Fund could incur brokerage, tax or other charges in
converting such securities to cash. Notwithstanding the above, there are other
means for meeting shareholder redemption requests, such as borrowing.

The UBS Fund may withdraw its investment in the UBS Portfolio at any
time if the Board of Directors of the Corporation determines that it is in the
best interests of the UBS Fund to do so. Upon any such withdrawal, the Board of
Directors of the Corporation would consider what action might be taken,
including the investment of all the UBS Fund's assets in another pooled
investment entity having the same investment objective and restrictions as the
UBS Fund or the retaining of an investment adviser to manage the UBS Fund's
assets in accordance with its investment policies.

RISK FACTORS AND COMPARISON OF POLICIES. Because the investment objectives of
- ---------------------------------------
the UBS Fund and the Brinson Fund are identical, and the investment policies are
similar, the investment risks associated with an investment in the UBS Fund are
generally the same as those of the Brinson Fund. There are, however, some
distinctions in the investment program of the UBS Fund and the Brinson Fund.
For example, (i) the UBS Fund seeks to achieve its investment objective by
investing all of its investable assets in the UBS Portfolio, while the Brinson
Fund invests directly in portfolio securities; (ii) the UBS Portfolio is
authorized to invest in swaps and related products, while the Brinson Fund may
not invest in such instruments; and (iii) the UBS Portfolio may invest in
special situations, while the Brinson Fund may not invest in these types of
issuers. See "COMPARISON OF INVESTMENT POLICIES - Risk Factors" below and
Exhibit B to this Prospectus/Proxy Statement.

REASONS FOR THE REORGANIZATION

THE MERGER OF UNION BANK OF SWITZERLAND AND SWISS BANK CORPORATION. On June 29,
- ------------------------------------------------------------------
1998, pursuant to a merger agreement, dated December 5/6, 1997, Union Bank of
Switzerland ("UBS") and Swiss Bank Corporation ("SBC"), each a universal bank
organized under the laws of Switzerland, merged into UBS A.G., a newly-created
entity organized under Swiss law. In conjunction with this transaction, the UBS
Sub-Adviser was created by the merger of UBS Asset Management (New York) Inc.
and SBC Brinson Inc. (These transactions are collectively referred to as the
"Merger.")

As a result of the Merger, and in an effort to promote more efficient
operations, to eliminate duplicate costs and to enhance the distribution of
shares, UBS A.G. and Brinson proposed that the UBS Fund be reorganized into the
Brinson Fund.

The Advisor is an investment management firm managing, as of March 31,
1998, over $158 billion, primarily for pension and profit sharing institutional
accounts. The Advisor was organized in 1989 when it acquired the institutional
asset management business of the First National Bank of Chicago and First
Chicago Investment Advisors N.A. On April 25, 1995, SBC purchased all of the
outstanding stock of the Advisor's former corporate parent, Brinson Holdings,
Inc. The Advisor and its predecessor entities have managed domestic and
international assets since 1974 and global investment assets since 1982.

REORGANIZATION. The Reorganization has been proposed by UBS A.G. and Brinson as
- --------------
a means of combining the UBS Fund with a fund managed by the Advisor with
compatible investment objectives, policies, restrictions and

15
<PAGE>

portfolios. The sale of the assets of the UBS Fund to the Brinson Fund should
enable the combined entity to obtain certain economies of scale with attendant
savings in cost for the UBS Fund as further described below.

At the same time, UBS A.G. presented and recommended for approval to
the Corporation's Board of Directors agreements and plans of reorganization
relating to the sale of assets and liabilities of each of the UBS Series to
another Trust Series with similar investment objectives and policies. Such
agreements and plans are subject to the separate approval by the shareholders of
the respective UBS Series, and each of the six reorganizations is independent of
the other.

During the meetings at which the Agreement and Plan was presented to
the Corporation's Board of Directors, the directors questioned the potential
benefits to be gained by shareholders of the UBS Fund as well as any additional
costs to be borne. In determining whether to recommend approval of the
Reorganization to shareholders, the Board of Directors considered, among other
factors: expense ratios of the Brinson Fund, as well as similar funds; the
compatibility of the investment objectives, policies, restrictions and
portfolios of the Brinson Fund with the UBS Fund; and the tax consequences of
the Reorganization. Inquiry was also made as to fund administration and the
availability of high quality shareholder services.

During the course of its deliberations, the Corporation's Board of
Directors also considered the fact that the expenses of the Reorganization will
not be borne by the UBS Fund, the Corporation, the Brinson Fund or the Trust.

In reaching the decision to recommend that shareholders of the UBS
Fund vote to approve the Reorganization, the Board of Directors concluded that
the Reorganization is in the best interests of the shareholders of the UBS Fund.
The Board's conclusion was based on a number of factors, including that, as part
of the Trust, which has higher aggregate net assets than the Corporation,
shareholders should be able to obtain the benefits of economies of scale,
permitting the reduction or elimination of certain duplicate costs and expenses
which may result in lower overall expense ratios through the spreading of both
fixed and variable costs of fund operations over a larger asset base. As a
general rule, economies can be expected to be realized primarily with respect to
fixed expenses. However, expenses that are based on the value of assets or the
number of shareholder accounts, such as custody fees, would be largely
unaffected by the Reorganization.

In its deliberations, the Directors also considered that, as
shareholders of the Trust, the Reorganization would provide shareholders with
exchange privileges with respect to the Class I shares of the other twelve Trust
Series, each with different investment objectives and policies. In addition,
the Directors also determined that it may be detrimental for the UBS Fund to
compete for the same investor assets as the Brinson Fund, each of which is
either managed by UBS A.G. or indirectly managed by a subsidiary of UBS A.G.

FOR THE REASONS DISCUSSED ABOVE, THE BOARD OF DIRECTORS RECOMMENDS
THAT YOU VOTE FOR THE AGREEMENT AND PLAN. If the Agreement and Plan is not
approved, the Board of Directors will consider other possible courses of action
with respect to the UBS Fund, including dissolution and liquidation.

INFORMATION ABOUT THE REORGANIZATION

The following summary of the Agreement and Plan of Reorganization does
not purport to be complete, and is subject in all respects to the provisions of,
and is qualified in its entirety by reference to, the Agreement and Plan, a copy
of which is attached hereto as Exhibit A.

METHOD OF CARRYING OUT THE REORGANIZATION. Prior to the Reorganization, the UBS
- -----------------------------------------
Portfolio will make a pro rata in-kind liquidating distribution of all of its
assets to the UBS Fund and to each of its other shareholders.

If the shareholders of the UBS Fund approve the Agreement and Plan,
the reorganization of the UBS Fund will be consummated promptly after the
various conditions to the obligations of each of the parties are satisfied. (See
"Conditions Precedent to Closing.") Consummation of the Reorganization (the
"Closing Date") will be on December 16, 1998, or such other date as is agreed to
by the Corporation and the Trust, provided that the

16
<PAGE>

Agreement and Plan may be terminated by either party if the Closing Date does
not occur on or before March 31, 1999.

On the Closing Date, the UBS Fund will transfer substantially all of
its assets and liabilities in exchange for the Class I Shares of the Brinson
Fund having an aggregate net asset value equal to the aggregate value of assets
and liabilities so transferred as of 4:00 p.m. Eastern time on the Closing Date.
The stock transfer books of the Corporation with respect to the UBS Fund will be
permanently closed as of 4:00 p.m. Eastern time on the Closing Date and only
requests for redemption of shares of the UBS Fund received in proper form prior
to 4:00 p.m. Eastern time on the Closing Date will be accepted by the
Corporation. Redemption requests relating to the UBS Fund received by the
Corporation thereafter shall be deemed to be redemption requests for shares of
the Brinson Fund to be distributed to the former shareholders of the UBS Fund.

The UBS Fund will distribute as of the Closing Date such Class I
Shares of the Brinson Fund pro rata to its shareholders of record as of the
close of business on the Closing Date. The number of shares shall be determined
by dividing the net asset value per share of the UBS Fund (computed in
accordance with the policies and procedures set forth in the current prospectus
of the UBS Fund and using market quotations determined by the UBS Fund) by the
net asset value per share of the Class I Shares of the Brinson Fund as of 4:00
p.m. Eastern time on the Closing Date, and multiplying the result by the number
of outstanding shares of the UBS Fund on the Closing Date.

For example, on June 30, 1998, the net asset value of each share of
the UBS Fund was $112.25. The Brinson Fund had no assets on that date. Each
share of the UBS Fund would have been exchanged for 11.2246 shares of the Class
I Shares of the Brinson Fund if the Closing had taken place on June 30, 1998,
and the net asset value of each share of the Class I Shares of the Brinson Fund
would have been $10.00.

In the event that the shareholders of the UBS Fund do not approve the
Agreement and Plan, the assets and liabilities of the UBS Fund will not be
transferred on the Closing Date and the obligations of the Corporation under the
Agreement and Plan shall not be effective. If the Reorganization is not approved
by the UBS Fund shareholders, the Board of Directors of the Corporation will
consider other alternatives, including dissolution and liquidation.

CONDITIONS PRECEDENT TO CLOSING. The obligation of the Corporation to transfer
- -------------------------------
the assets and liabilities of the UBS Fund to the Brinson Fund pursuant to the
Agreement and Plan is subject to the satisfaction of certain conditions
precedent, including performance by the Trust, in all material respects, of its
agreements and undertakings under the Agreement and Plan, the receipt of certain
documents from the Trust, the receipt of an opinion of counsel to the Trust, and
requisite approval of the Agreement and Plan by the shareholders of the UBS
Fund, as described above. The obligations of the Trust to consummate the
Reorganization are subject to the satisfaction of certain conditions precedent,
including the performance by the Corporation of its agreements and undertakings
under the Agreement and Plan, the receipt of certain documents, financial
statements and certificates from the Corporation, and the receipt of an opinion
of counsel to the Corporation.

EXPENSES OF THE TRANSACTION. The expenses incurred in connection with entering
- ---------------------------
into and consummating the transaction contemplated by the Agreement and Plan
will not be borne by the UBS Fund, the Corporation, the Brinson Fund or the
Trust.

FEDERAL INCOME TAX CONSEQUENCES. Consummation of the Reorganization is subject
- --------------------------------
to the receipt of a tax opinion by counsel to the Trust substantially to the
effect that, on the basis of then current law and certain representations and
assumptions, and subject to certain limitations, for federal income tax
purposes:

(i) the Reorganization will constitute a reorganization within the
meaning of Section 368(a) of the Internal Revenue Code of 1986, as
amended (the "Code"), and that the Brinson Fund and the UBS Fund will
each be a party to a reorganization within the meaning of Section
368(b) of the Code;

<PAGE>
<PAGE>
(ii) no gain or loss will be recognized by the Brinson Fund upon the
receipt of the assets of the UBS Fund solely in exchange for the Class
I Shares of the Brinson Fund and the assumption by the Brinson Fund of
the liabilities of the UBS Fund;

(iii) no gain or loss will be recognized by the UBS Fund upon the
transfer of the UBS Fund's assets to the Brinson Fund in exchange for
the Class I Shares of the Brinson Fund and the assumption by the
Brinson Fund of liabilities of the UBS Fund or upon the distribution
of the Class I Shares of the Brinson Fund to the UBS shareholders;

(iv) no gain or loss will be recognized by the shareholders of the
UBS Fund upon the exchange of their shares for Class I Shares of the
Brinson Fund;

(v) the aggregate tax basis of the shares of the Class I Shares of
the Brinson Fund pursuant to the Reorganization will be the same as
the aggregate tax basis of shares of the UBS Fund held by such
shareholder immediately prior to the Reorganization and the holding
period of the Class I Shares of the Brinson Fund to be received by
each shareholder of the UBS Fund will include the period during which
shares of the UBS Fund exchanged therefor were held by such
shareholder (provided shares of the UBS Fund were held as capital
assets on the date of the Reorganization); and

(vi) the tax basis of the UBS Fund assets and liabilities acquired by
the Brinson Fund will be the same as the tax basis of such assets and
liabilities to the UBS Fund immediately prior to the Reorganization,
and the holding period of the assets and liabilities of the UBS Fund
in the hands of the Brinson Fund will include the period during which
those assets and liabilities were held by the UBS Fund.

Shareholders of the UBS Fund should consult their tax advisers
regarding the effect, if any, of the Reorganization in light of their individual
circumstances. Since the foregoing discussion only relates to the federal
income tax consequences of the Reorganization, shareholders of the UBS Fund
should also consult their tax advisers as to state and local tax consequences,
if any, of the Reorganization.

DESCRIPTION OF THE CLASS I SHARES OF THE BRINSON FUND. The Class I Shares of
- -----------------------------------------------------
the Brinson Fund will be issued to shareholders of the UBS Fund in accordance
with the procedures under the Agreement and Plan as described above. Each share
will be fully paid and nonassessable when issued with no personal liability
attaching to the ownership thereof, will have no pre-emptive or conversion
rights and will be transferable upon the books of the Trust. In accordance with
the Trust's normal procedures, the Brinson Fund will not issue certificates for
shares of its Class I Shares to former shareholders of the UBS Fund, unless a
letter is sent to the transfer agent of the Trust requesting a certificate.
Ownership of the Brinson Fund shares by former shareholders of the UBS Fund will
be recorded electronically and the Trust will issue a confirmation to such
shareholders relating to those Class I Shares acquired as a result of the
Reorganization. No redemption or repurchase of any shares of the Brinson Fund
issued to former shareholders of the UBS Fund represented by unsurrendered share
certificates shall be permitted until such certificates have been surrendered
for cancellation.

As shareholders of the Brinson Fund, former shareholders of the UBS
Fund will have substantially similar voting rights and rights upon dissolution
with respect to the Brinson Fund as they currently have with respect to the UBS
Fund. Shares of the UBS Fund and of the Brinson Fund do not have cumulative
voting rights. Like the Corporation, the Trust does not routinely hold annual
meetings of shareholders.

Both the Corporation and the Trust are multi-series investment
companies that currently issue shares representing interests in six and thirteen
series, respectively, and shareholders of each of the UBS Funds and Trust Series
currently vote in the aggregate with the shareholders of the other relevant
series on certain matters (for example, the election of directors or trustees,
as applicable, and ratification of independent accountants). Unlike the
Corporation, however, the Trust currently offers three classes of shares of each
of the Trust Series: the UBS Investment Funds class shares, the Class N shares
and the Class I shares. Shares of a class represent an equal proportionate
interest in the assets and liabilities of the applicable Trust Series with each
other share, and each class has the same voting and other rights and preferences
as the other classes of that Series, except that only the holders

18
<PAGE>
of Class N shares may vote on matters related to the rule 12b-1 plan associated
with that class, and only the UBS Investment Funds class shareholders may vote
on matters related to the rule 12b-1 plan associated with that class. The Class
I shares are primarily sold to institutional investors and are not subject to
distribution expenses pursuant to a distribution plan under rule 12b-1. The
Class N shares, which are available exclusively to 401(k) participants, and the
UBS Investment Funds class shares, which are sold primarily to retail investors,
do not have a sales load but are subject to annual rule 12b-1 plan expenses.
With respect to the UBS Fund and voting on matters relating to the UBS
Portfolio, see the discussion "Special Information Regarding the UBS Fund's Two-
Tier Structure" under "COMPARISON OF SOME IMPORTANT FEATURES."

The UBS Trust is organized as a master trust under the laws of the
State of New York. The UBS Trust's Declaration of Trust provides that the UBS
Fund and other entities investing in the UBS Portfolio (e.g., other investment
companies, insurance company separate accounts and common and commingled trust
funds) will each be liable for all obligations of the UBS Portfolio. However,
the risk of the UBS Fund incurring financial loss on account of such liability
is limited to circumstances in which both inadequate insurance existed and the
UBS Portfolio itself was unable to meet its obligations. Accordingly, the
Directors of the Corporation believe that neither the UBS Fund nor its
shareholders will be adversely affected by reason of the UBS Fund's investing in
the UBS Portfolio.

CAPITALIZATION. The following table/(1)/ sets forth, as of June 30, 1998, (i)
- --------------
the capitalization of the UBS Fund, (ii) the capitalization of the Brinson Fund,
and (iii) the pro forma capitalization of the Brinson Fund as adjusted to give
effect to the proposed Reorganization. The capitalization of the Brinson Fund
is likely to be different when the Reorganization is consummated.

<TABLE>
<CAPTION>
UBS Private
Investor Funds, The Brinson Funds
Inc. - UBS Large - U.S. Large Capitalization Pro Forma After
Cap Growth Fund Growth Fund - Class I Shares Reorganization
---------------- ---------------------------- ---------------
<S> <C> <C> <C>
Net assets.......................................... $ 7,134,690 $ 0 $ 7,134,690
Net asset value per share........................... $ 112.25 $10.00 $ 10.00
Shares outstanding.................................. 65,563 $ 0 713,469
</TABLE>

_____________________
/(1)/ Full pro forma financial statements are included in the Statement of
Additional Information to this Prospectus/Proxy Statement.

To the extent permitted by law, the Agreement and Plan may be amended
without shareholder approval by mutual agreement in writing of the Corporation
and the Trust. The Agreement and Plan may be terminated and the Reorganization
abandoned at any time before or, to the extent permitted by law, after the
approval of shareholders of the UBS Fund by mutual consent of the parties to the
Agreement.

COMPARISON OF INVESTMENT OBJECTIVES AND POLICIES

THE BRINSON FUND AND THE UBS FUND. The investment objective of the Brinson
- ----------------------------------
Fund and the UBS Fund is identical: to provide long-term capital appreciation.
The Brinson Fund seeks to achieve its objective by investing in the equity
securities of large capital growth companies. The UBS Fund seeks to achieve its
investment objective by investing all of its investable assets in the UBS
Portfolio, which has the same investment objective and policies. The UBS
Portfolio seeks to achieve its objective by investing in common stocks and other
equity securities of companies that have market capitalizations at the time of
initial purchase that are within the market capitalization range of those
stocks listed on the Standard & Poor's 500 Composite Stock Price Index (the "S&P
500 Index") and that the UBS Adviser believes will have above average earnings
and cash flow growth or meaningful increases in underlying assets values over
time.

INVESTMENT POLICIES. In seeking to achieve their investment objectives, the
- --------------------
Brinson Fund and the UBS Fund are guided by substantially similar policies that
should be considered by the shareholders of the UBS Fund. However, unlike the
Brinson Fund, which directly acquires and manages its own portfolio securities,
the Corporation seeks to achieve the UBS Fund's investment objective by
investing all of the UBS Fund's investable assets in the UBS

19
<PAGE>

Portfolio, a series of a separate registered investment company. The UBS
Portfolio has the same investment objective and policies as the UBS Fund.

Unless otherwise specified, the investment policies of each of the
Brinson Fund and the UBS Fund may be changed without shareholder approval.
Policies or restrictions stated as fundamental may not be changed without the
approval of the lesser of (i) a majority of the outstanding shares, or (ii) 67%
or more of the shares represented at a meeting of shareholders at which the
holders of more than 50% of the outstanding shares are represented, whichever is
less ("Majority Vote").

The investment objective of the Brinson Fund is fundamental and may
not be changed without approval of the Brinson Fund's shareholders. The
investment objective of the UBS Fund is also fundamental, and may be changed
only with the approval of the holders of a majority of the outstanding shares of
the UBS Fund.

Since the UBS Fund pursues its investment objective by investing all
of its investable assets in the UBS Portfolio, the UBS Fund's and the UBS
Portfolio's investment objective are the same and, therefore, the investment
characteristics of the UBS Fund correspond directly to those of the UBS
Portfolio. Accordingly, the following is a discussion of the various
investments and restrictions of, and techniques employed by, the UBS Portfolio.

The Brinson Fund is a diversified series of the Trust, a multi-series
investment company registered under the 1940 Act. The UBS Fund is a diversified
series of the Corporation, a multi-series investment company registered under
the 1940 Act. Both calculate net asset value per share as of the close of
trading (currently 4:00 P.M. Eastern time) on each day that the New York Stock
Exchange is open for business. Such net asset value per share is calculated by
subtracting the aggregate of all liabilities from the gross value of all assets
and dividing the result by the total number of shares outstanding.

With respect to the Class I Shares of the Brinson Fund, such Class
will bear, pro rata, all of the common expenses of the Trust. The net asset
value of the outstanding shares of the Class I Shares of the Brinson Fund will
be computed on a pro rata basis for each outstanding share based on the
proportionate participation in the Brinson Fund represented by the value of
shares of each of the classes of the Fund. All income earned and expenses
incurred by the Brinson Fund will be borne on a pro rata basis by each
outstanding share of a class, based on such class' percentage in the Brinson
Fund represented by the value of the shares of the classes, except that the
Class I Shares of the Brinson Fund will not incur any of the expenses under the
distribution plans adopted by the UBS Investment Funds class of shares and the
Class N shares, respectively.

As further described below, the UBS Portfolio invests primarily in
common stocks, preferred stocks and other securities of small capital growth
companies. Under normal circumstances, the UBS Portfolio will invest at least
65% of its assets in small capital growth companies. The UBS Portfolio defines
"large capital" companies as companies whose market capitalizations at the time
of acquisition by the UBS Portfolio are within the market capitalization range
of those stocks listed on the Standard & Poor's 500 Composite Stock Price Index
(the "S&P 500 Index"). Additionally, the UBS Portfolio will not invest more than
20% of its net assets in securities of companies whose market capitalization is
less than $3 billion. "Growth" companies generally include companies which have,
the UBS Sub-Adviser's judgment, the prospects for above average earnings and
cash flow growth or meaningful increases in underlying asset values over time.

The UBS Portfolio will invest in companies believed by the UBS
Sub-Adviser to represent above average growth oppportunities. The UBS Sub-
Adviser will select individual securities for investment by screening for above
for above average earnings growth expectations and reasonable valuations (price
relative to earnings and cash flow). Growth company securities may have above
average price volatility. The UBS Portfolio attempts to reduce its overall
exposure to the risk of declines in individual security prices by diversifying
its investment over a carefully selected list of securities issued by different
companies in a variety of industries. The UBS Portfolio may also engage in
futures, options and currency transactions, and sell securities short, for
hedging purposes.

Under normal conditions, the Brinson Fund will invest at least 65% of
its total assets in large capital growth companies. In seeking to achieve its
investment objective, the Brinson Fund attempts to control risk. Similar to the
UBS Sub-Adviser, the Advisor defines large capitalization companies as those
with market

20
<PAGE>

capitalizations within the range of stocks listed in the S&P 500 Index. The
Brinson Fund, like the UBS Portfolio, will not invest more than 20% of its net
assets in securities of companies whose market capitalizations are less than $3
billion. In addition, the Brinson Fund may engage in futures, options and
currency transactions for non-speculative purposes, such as hedging against
interest rate and currency risks. Like the UBS Portfolio, the Brinson Fund may
sell securities short, for hedging purposes.

As a fundamental policy, both the Brinson Fund and the UBS Portfolio
do not intend to invest their assets in a particular industry. Both the Brinson
Fund and the UBS Portfolio may not purchase the securities (or other
obligations, in the case of the UBS Portfolio) of issuers conducting their
principal business activity in the same industry, other than obligations issued
or guaranteed by the U.S. government, its agencies or instrumentalities, if
immediately after such purchase, the value of the Brinson Fund's or the UBS
Portfolio's investments in such industry would exceed 25% of the value of its
respective total assets. In the case of the Brinson Fund, this restriction is
applied without reference to the countries in which an industry is located. The
UBS Portfolio's restriction also provides that it may invest all or part of its
investable assets in an open-end management investment company with the same
investment objective and restrictions.

Equity Investments

Both the Brinson Fund and the UBS Portfolio may invest in a wide range
of equity securities of large capital growth companies. The Brinson Fund's and
the UBS Portfolio's investments include common stocks and other securities with
equity characteristics, such as preferred stock, debt securities convertible
into or exchangeable for common stock, warrants, and rights that are convertible
into common stock. The Brinson Fund may also invest in closed-end investment
companies. The UBS Portfolio does not have a stated policy regarding investment
in closed-end investment companies.

Foreign Investments

Both the Brinson Fund and the UBS Portfolio may invest up to 20% of
their assets in securities of foreign issuers, either directly or in the form of
sponsored or unsponsored American, European and Global Depositary Receipts
("Depositary Receipts") or other similar securities.

Short-Term Debt and Money Market Instruments

Both the Brinson Fund and the UBS Portfolio may invest a portion of
their assets in short-term debt securities (including repurchase agreements) and
money market instruments of corporations (such as commercial paper), and short-
term debt securities of the U.S. government and its agencies and
instrumentalities, and banks and finance companies (in the case of the Brinson
Fund). These instruments, other than U.S. government securities, may be
denominated in any currency. The Brinson Fund and the UBS Portfolio may also
invest in money market mutual funds.

When unusual market conditions warrant, the Brinson Fund may make
substantial temporary defensive investments in cash equivalents up to a maximum
of 100% of its net assets. Under normal market conditions, the UBS Portfolio
may invest up to 20% of its assets in cash investments and short-term fixed
income securities. These securities may be used by the UBS Portfolio pending
other investments or settlements, for liquidity purposes or in adverse market
conditions. Under market conditions where the UBS Portfolio or the UBS Sub-
Adviser has adopted a temporary defensive posture, the UBS Portfolio may invest
in these securities without limit. When the Brinson Fund or the UBS Portfolio
invests for defensive purposes, this practice may affect the attainment of the
Brinson Fund's or the UBS Portfolio's investment objective.

The UBS Portfolio may invest in bank obligations of (i) banks, savings
and loan associations and savings banks that have more than $2 billion in total
assets and are organized under the laws of the United States or any state, (ii)
foreign branches of these banks or of foreign banks of equivalent size (Euros)
and (iii) U.S. branches of foreign banks of equivalent size (Yankees). The
Brinson Fund is not subject to such investment restrictions when investing in
bank obligations.

21
<PAGE>

The UBS Portfolio may also invest in master demand obligations, which
are a type of commercial paper that provide for periodic adjustments in the
interest rate paid and permit daily changes in the amount borrowed. Master
demand obligations are governed by agreements between the issuer and the UBS
Sub-Adviser. Master demand obligations are not rated, and the UBS Portfolio is
not subject to a specific percentage limitation on its investments in master
demand obligations. The Brinson Fund has no corresponding investment policy
regarding master demand obligations.

At the time the UBS Portfolio invests in any commercial paper, bank
obligations or repurchase agreements, the issuer must have outstanding debt
rated A or higher by Moody's Investors Service, Inc. ("Moody's") or Standard &
Poor's Ratings Group ("S&P"); the issuer's parent corporation, if any, must have
outstanding commercial paper rated Prime-1 by Moody's or A-1 by S&P; or if no
such ratings are available, the investment must be of comparable quality in the
UBS Sub-Adviser's opinion. At the time the UBS Portfolio invests in any other
short-term debt securities, they must be rated A or higher by Moody's or S&P or
if unrated, the investment must be of comparable quality in the UBS Sub-
Adviser's opinion. The Brinson Fund is not subject to specific quality
requirements for these investments.

Short Sales

In the event that the Advisor or the UBS Sub-Adviser anticipates that
the price of a security will decline, it may sell the security short and borrow
the same security from a broker or other institution to complete the sale. The
Brinson Fund or the UBS Portfolio will only enter into short sales for hedging
purposes. The Brinson Fund and the UBS Portfolio will incur a profit or loss,
depending upon whether the market price of the security decreases or increases
between the date of the short sale and the date upon which the Brinson Fund or
the UBS Portfolio must replace the borrowed security. All short sales will be
fully collateralized, and the Brinson Fund and the UBS Portfolio will not sell
securities short if immediately after and as a result of the short sale, the
value of all securities sold short by either the Brinson Fund or the UBS
Portfolio exceeds 25% of its total assets. The Brinson Fund and the UBS
Portfolio will also limit short sales of any one issuer's securities to 2% of
their total assets and to 2% of any one class of the issuer's securities.

Convertible Securities

Both the Brinson Fund and the UBS Portfolio may invest in convertible
securities. Convertible securities generally offer lower interest or dividend
yields than non-convertible securities of similar quality. The value of
convertible securities may reflect changes in the value of the underlying common
stock. The convertible securities in which the Brinson Fund and the UBS
Portfolio may invest include any debt securities or preferred stocks that may be
converted into common stock or that carry the right to purchase common stock.
Convertible securities entitle the holder to exchange the securities for a
specified number of shares of common stock, usually of the same company, at
specified prices within a certain period of time.

Special Situations

From time to time, the UBS Portfolio may invest in special situations.
A special situation arises when the UBS Sub-Adviser believes that the securities
of a particular issuer will be recognized and appreciate in value due to a
specific development affecting that issuer. Developments that might create a
special situation include a new product or process, a technological
breakthrough, a management change, merger, recapitalization or other
extraordinary corporate event, or a change in market supply of and demand for
the security. Investments in special situations may carry an additional risk of
loss in the event that the anticipated development does not occur or does not
result in the anticipated market reaction. The Brinson Fund does not have a
stated policy regarding investment in special situations.

When-Issued and Delayed Delivery Securities

Both the Brinson Fund and the UBS Portfolio may purchase securities on
a when-issued, and in the case of the UBS Portfolio, on a delayed delivery
basis. Delivery of and payment for these securities may take as long as a month
or more after the date of the purchase commitment. The value of these securities
is subject to market fluctuation during this period and no interest or income
accrues to the Brinson Fund or the UBS Portfolio

22
<PAGE>

until settlement. At the time of settlement, a when-issued security may be
valued at less than its purchase price. Between the trade and settlement dates,
the Brinson Fund and the UBS Portfolio will maintain a segregated account
consisting of a portfolio of liquid securities with a value equal to these
commitments. It is the current policy of the UBS Portfolio not to enter into
when-issued commitments exceeding in the aggregate 15% of the market value of
such Portfolio's total assets less liabilities (excluding the obligations
created by these commitments). The Brinson Fund does not have a 15% limitation
with respect to such investments.

Asset-Backed Securities

The Brinson Fund and the UBS Portfolio may invest in asset-backed
securities. Asset-backed securities are securities that represent a
participation in, or are secured by and payable from, a stream of payments
generated by particular assets, most often a pool or pools of similar assets
(e.g., receivables on home equity and credit loans, and receivables regarding
automobile, credit card, mobile home, and recreational vehicles loans, and
leases). Payments or distributions of principal and interest on asset-backed
securities may be supported by non-governmental credit enhancements similar to
those utilized in connection with mortgage-backed securities.

Repurchase Agreements

Both the Brinson Fund and the UBS Portfolio are authorized to enter
into repurchase agreements. In a repurchase agreement transaction, the Brinson
Fund or the UBS Portfolio purchases securities from a bank or broker-dealer
which simultaneously agrees to repurchase the securities at a mutually agreed
upon time and price, thereby determining the yield during the term of the
agreement. Repurchase agreements will be fully collateralized and the
collateral will be marked-to-market daily. The Brinson Fund and the UBS
Portfolio may not enter into a repurchase agreement having a maturity of longer
than seven days if, as a result, such agreement, together with any other
illiquid securities held, would exceed 15% of the value of their respective net
assets. At no time will the UBS Portfolio invest in repurchase agreements
maturing in more than thirteen months. The Brinson Fund is not subject to a
similar restriction.

Reverse Repurchase Agreements

The Brinson Fund and the UBS Portfolio may also borrow money by
entering into reverse repurchase agreements. Reverse repurchase agreements
involve sales of portfolio securities to member banks of the Federal Reserve
System or securities dealers believed creditworthy, concurrently with an
agreement to repurchase the same securities at a later date at a fixed price,
which is generally equal to the original sales price plus interest. In a
reverse repurchase agreement transaction, the Brinson Fund and the UBS Portfolio
direct their respective custodian bank to place cash or liquid securities in a
segregated account in an amount equal to the repurchase price. Reverse
repurchase agreements will be considered as borrowings for purposes of the
Brinson Fund's and the UBS Portfolio's limitation on borrowing. In order to
engage in such investments, the Brinson Fund and the UBS Portfolio are required
to maintain asset coverage of at least 300% for such borrowings.

Borrowing Policy

As a fundamental policy, the Brinson Fund may borrow money as a
temporary measure for extraordinary purposes or to facilitate redemptions,
although it will not borrow money in excess of 33 1/3% of the value of its total
assets. Any borrowing will be done from a bank and in accordance with the
requirements of the 1940 Act and relevant SEC positions. The Brinson Fund has
no intention of increasing its net income through borrowing. The Brinson Fund
will not pledge more than 10% of its net assets, or issue senior securities as
defined in the 1940 Act, except that it may purchase notes and enter into
reverse repurchase agreements.

Similarly, the UBS Portfolio has a fundamental policy that it may
borrow money from banks for extraordinary or emergency purposes. The UBS
Portfolio may enter into reverse repurchase agreements and other permitted
borrowings that constitute senior securities under the 1940 Act only in amounts
up to one-third of the market value of its total assets (including the amounts
borrowed), less liabilities (excluding obligations created by such borrowings
and reverse repurchase agreements). The UBS Portfolio's borrowing activities are
done in accordance with the requirements of the 1940 Act and relevant SEC
positions.

23
<PAGE>

Neither the Brinson Fund nor the UBS Portfolio may purchase investment
securities while either has any outstanding borrowings (including repurchase
agreements, in the case of the UBS Portfolio) that exceeds 5% of its respective
net assets. Unlike the Brinson Fund, the UBS Portfolio may increase its
interest in an open-end management investment company with the same investment
objective and restrictions while such borrowings are outstanding.

Securities Lending

The Brinson Fund and the UBS Portfolio may each loan securities held
in their respective portfolios to qualified broker-dealers and financial
institutions provided that such loans are continuously collateralized in amounts
at least equal to the current market value and accrued interest of the
securities loaned. The UBS Portfolio will not make any loans in excess of one
year, while the Brinson Fund is not subject to a comparable restriction.

Rule 144A Securities and Restricted Securities

Both the Brinson Fund and the UBS Portfolio may invest in securities
that are exempt under Rule 144A under the Securities Act of 1933, as amended
(the "1933 Act"), from the registration requirements of the 1933 Act.
Securities purchased under Rule 144A are traded among qualified institutional
investors. The Brinson Fund may invest up to 15% of its total assets in
illiquid securities. Illiquid securities are those securities that are not
readily marketable, including restricted securities and repurchase obligations
that mature in more than seven days. Certain restricted securities that may be
resold to institutional investors pursuant to Rule 144A under the 1933 Act may
be determined to be liquid under guidelines adopted by the Trust's Board of
Trustees. The Brinson Fund may invest up to 15% of its total assets in
securities of issuers which are restricted from selling to the public without
registration under the 1933 Act, excluding restricted securities eligible for
resale pursuant to Rule 144A.

As a matter of non-fundamental policy, the UBS Portfolio may not
invest more than 15% of its net assets (taken at the greater of cost or market
value) in securities that are illiquid or not readily marketable excluding (a)
Rule 144A securities that have been determined to be liquid by the UBS
Portfolio's Board of Trustees and (b) commercial paper that is sold under
Section 4(2) of the 1933 Act which: (i) is not traded flat or in default as to
interest or principal; and (ii) is rated in one of the two highest categories by
at least two nationally recognized statistical rating organizations and the
Corporation's Board of Directors has determined the commercial paper to be
liquid; or (iii) is rated in one of the two highest categories by one nationally
recognized statistical rating organization and the Corporation's Board of
Directors has determined that the commercial paper is of equivalent quality and
is liquid. In addition, the UBS Portfolio will not invest more than 10% of its
total assets (taken at the greater of cost or market value) in securities
(excluding Rule 144A securities) that are restricted as to resale under the 1933
Act.

Investment Company Securities

The UBS Portfolio may purchase securities of other investment
companies to the extent that such purchases are consistent with the UBS
Portfolio's investment objective and restrictions and are permitted under the
1940 Act. Securities of any investment company will not be purchased by the UBS
Portfolio if such purchase would cause: (a) more than 10% of the UBS
Portfolio's total assets (taken at the greater of cost or market value) to be
invested in the securities of such issuers; (b) more than 5% of the UBS
Portfolio's total assets to be invested in any one investment company; or (c)
more than 3% of the outstanding voting securities of any such issuer to be held
for the UBS Portfolio. The UBS Portfolio is subject to a non-fundamental
investment restriction that provides that the UBS Portfolio will not purchase
securities issued by any investment company except by purchase in the open
market where no commission or profit to a sponsor or dealer results from such
purchase other than customary broker's commissions, or except when such
purchase, though not made in the open market, is part of a plan of merger or
consolidation. In addition, except in the case of a merger or consolidation,
the UBS Portfolio shall not purchase any securities of any open-end investment
company unless the UBS Sub-Adviser waives its investment advisory fee with
respect to the assets of the UBS Portfolio invested in other open-end investment
companies.

As a matter of non-fundamental policy, the Brinson Fund may not invest
in securities of any open-end investment company, except that (1) the Brinson
Fund may purchase securities of money market mutual funds,

24
<PAGE>

and (2) the Brinson Fund may purchase shares of an open-end investment company
in accordance with any exemptive order obtained from the SEC which permits
investment by the Brinson Fund in other Trust Series or in other investment
companies or series thereof advised by the Advisor. In addition, the Brinson
Fund may acquire securities of other investment companies if the securities are
acquired pursuant to a merger, consolidation, acquisition, plan of
reorganization or a SEC approved offer of exchange.

Under the terms of an exemptive order issued by the SEC, the Brinson Fund
may invest cash (i) held for temporary defensive purposes; (ii) not invested
pending investment in securities; (iii) that is set aside to cover an obligation
or commitment of the Brinson Fund to purchase securities or other assets at a
later date; (iv) to be invested on a strategic management basis (i-iv herein
referred to as "Uninvested Cash"); and (v) collateral that it receives from the
borrowers of its portfolio securities in connection with the Brinson Fund's
securities lending program, in a series of shares of Brinson Supplementary Trust
(the "Supplementary Trust Series"). Brinson Supplementary Trust is a private
investment company which has retained the Advisor to manage its investments.
The Trustees of the Trust also serve as Trustees of the Brinson Supplementary
Trust. The Supplementary Trust Series will invest in U.S. dollar denominated
money market instruments having a dollar-weighted average maturity of 90 days or
less. The Brinson Fund's investment of Uninvested Cash in shares of the
Supplementary Trust Series will not exceed 25% of the Brinson Fund's total
assets. In the event that the Advisor waives 100% of its investment advisory
fee with respect to the Brinson Fund, as calculated monthly, then the Brinson
Fund will be unable to invest in the Supplementary Trust Series until additional
investment advisory fees are owed by the Brinson Fund. The UBS Portfolio is not
subject to a similar order.

As a shareholder of another investment company, the Brinson Fund or
the UBS Portfolio would bear, along with other shareholders, the pro rata
portion of the other investment company's expenses, including any advisory fees.
These expenses would be in addition to the expenses that the Brinson Fund or the
UBS Portfolio would bear in connection with its own operations.

Futures, Options and Other Derivative Instruments

The Brinson Fund and the UBS Portfolio may attempt to reduce the
overall level of investment risk of particular securities and attempt to protect
against adverse market movements by investing in certain derivative instruments
as described below. In addition, the UBS Portfolio and the Brinson Fund may
invest in derivatives for hedging purposes. A derivative instrument is a
financial instrument whose performance and value are derived, at least in part,
from another source, such as the performance of an underlying asset, a specific
security or an index of securities. The Brinson Fund and the UBS Portfolio may
invest in a variety of derivative instruments, including futures contracts and
options transactions. The Brinson Fund and the UBS Portfolio will invest in
derivatives only to the extent that the instruments are determined by the
Advisor and the UBS Sub-Adviser to be consistent with the Brinson Fund's or the
UBS Portfolio's investment objective and policies.

Futures and Options

The Brinson Fund and the UBS Portfolio may enter into contracts for
the future purchase or sale of equity securities, indices of equity securities
and foreign currencies. A financial futures contract is an agreement between
the parties to buy or sell a specified security (in the case of the Brinson Fund
and the UBS Portfolio, an equity security) at a set price on a future date. An
index futures contract is an agreement to take or make delivery of an amount of
cash based on the difference between the value of the index at the beginning and
at the end of the contract period. A futures contact on a foreign currency is
an agreement to buy or sell a specified amount of a currency for a set price on
a future date. (This latter type of futures contract is described below under
"Foreign Currencies and Forward Currency Transactions.") Both the Brinson Fund
and the UBS Portfolio will enter into futures transactions on domestic exchanges
and, to the extent such transactions have been approved by the Commodity Futures
Trading Commission ("CFTC") for sale to customers in the United States, on
foreign exchanges.

The Brinson Fund and the UBS Portfolio may enter into futures
contracts to the extent that not more than 5% of their respective net assets are
committed as futures contract margin deposits. The Brinson Fund may enter into
these transactions to the extent that obligations relating to such futures
transactions represent not more than 25% of its assets. The Brinson Fund may
effect futures transactions through futures commission merchants who are
affiliated with the Advisor or the Trust Series in accordance with procedures
adopted by the Trust's Board of Trustees.

The Brinson Fund and the UBS Portfolio may purchase and sell put and
call options on U.S. and foreign securities and indices and enter into related
closing transactions. In addition, the UBS Portfolio may purchase and sell put
and call options on futures transactions. The Brinson Fund and the UBS
Portfolio may purchase and sell options traded on U.S. exchanges and, to the
extent permitted by law, options traded over-the-counter and on recognized
foreign exchanges. Because the SEC construes over-the-counter options as being
illiquid, the Brinson Fund and the UBS Portfolio may only invest in such options
to the extent consistent with its respective 15% limit on investments in
illiquid securities.

The Brinson Fund and the UBS Portfolio may purchase call options on
securities to the extent that premiums paid by the Brinson Fund or the UBS
Portfolio do not aggregate more than 20% of the Brinson Fund's or the UBS
Portfolio's total assets. In addition, in order to assure that the Brinson Fund
and the UBS Portfolio will not be considered a "commodity pool operator" for
purposes of the rules of the CFTC, the Brinson Fund and the UBS

25
<PAGE>

Portfolio will only enter into transactions in futures contracts and options on
futures contracts if (i) such transactions constitute bona fide hedging
transactions as defined under CFTC rules, or (ii) no more than 5% of the Brinson
Fund's or the UBS Portfolio's net assets are committed as initial margin or
premiums to positions that do not constitute bona fide hedging transactions.

The Brinson Fund may only purchase put options to the extent that the
premiums on all outstanding put options do not exceed 20% of its total assets.
With regard to the selling of put options, the Brinson Fund will limit the
aggregate value of the obligations underlying such put options to 50% of its
total net assets. The Brinson Fund does not intend to purchase put and call
options that are traded on a national stock exchange in an amount exceeding 5%
of its net assets.

As a matter of non-fundamental policy, the UBS Portfolio may purchase
and sell puts and calls on securities, stock index futures or options on stock
index futures, or futures or options on futures according the following
conditions. First, the options or futures are offered through the facilities of
a national securities association or are listed on a national securities or
commodities exchange (except for put and call options issued by non-U.S.
entities or listed on non-U.S. securities or commodities exchanges). Second,
the aggregate margin requirements required on all such futures or options
thereon do not exceed 5% of the UBS Portfolio's total assets.

Swaps

The UBS Portfolio is authorized to invest in interest rate swaps and
related products such as equity index swaps, interest rate swaps, currency
swaps, and related caps, collars and floors. Interest rate swaps involve the
exchange by the UBS Portfolio with another party of their respective right to
receive interest payments. In such a transaction, there is the risk of loss of
the amount of interest to be received if the party who is obligated to make the
interest payment defaults. As a matter of non-fundamental policy, the Brinson
Fund may not engage in swaps or invest in related derivative instruments.

Foreign Currencies and Forward Currency Transactions

The Brinson Fund and the UBS Portfolio may maintain a portion of their
assets in foreign currencies. Because both the Brinson Fund and the UBS
Portfolio may invest up to 20% of their assets in foreign securities and such
securities may be denominated in various foreign currencies, their assets are
subject to certain risks associated with currency or exchange rate fluctuations.
Exposure to foreign currencies may be adjusted based on the perception of the
most favorable markets and issuers, taking into consideration the relationship
of the foreign currencies to the U.S. dollar. Both the Brinson Fund and the UBS
Portfolio are authorized to allocate their exposure to foreign currencies to
take advantage of or to protect their investments from risk and return
characteristics of foreign currencies and exchange rates.

The Brinson Fund and the UBS Portfolio may alter fixed income or money
market exposures, enter into forward currency exchange contracts, buy or sell
options or futures relating to foreign currencies and may purchase securities
indexed to currency baskets. Such investment techniques are designed to take
advantage of or protect the Brinson Fund and the UBS Portfolio from currency
fluctuations.

The Brinson Fund and the UBS Portfolio may purchase or sell currencies
and forward currency transactions. Both the Brinson Fund and the UBS Portfolio
may conduct their foreign currency exchange transactions on a spot (i.e., cash)
basis at the spot rate prevailing in the foreign currency exchange market or
through entering into contracts to purchase or sell foreign currencies at a
future date, at an amount set by the parties (i.e., a "forward foreign currency"
contract or "forward" contract). A forward contract involves an obligation to
purchase or sell a specific currency amount at a future date, which may be a
fixed number of days from the date agreed upon by the parties at a price set at
the time of the contract. The Brinson Fund and the UBS Portfolio will convert
currency on a spot basis from time to time and investors should be aware that
changes in currency exchange rates and exchange control regulations may affect
the costs of currency conversion.

At the maturity of a forward contract, the Brinson Fund or the UBS
Portfolio may either sell a portfolio security and make delivery of the foreign
currency, or the Brinson Fund or the UBS Portfolio may retain the security and
terminate its contractual obligation to deliver the foreign currency by
purchasing an "offsetting"

26
<PAGE>

contract with the same currency trader, obligating it to purchase, on the same
maturity date, the same amount of the foreign currency.

The Brinson Fund and the UBS Portfolio may purchase and sell put and
call options on foreign currencies for the purpose of protecting against
declines in the dollar value of portfolio securities and against increases in
the dollar costs of securities to be acquired. The Brinson Fund may purchase
and write options on foreign currencies for hedging purposes in a manner similar
to that in which futures contracts on foreign currencies, or forward contracts
will be utilized. The Brinson Fund and the UBS Portfolio may write covered call
options on foreign currencies, meaning that they will own an equal amount of, or
an offsetting position in, the underlying currency. If the Brinson Fund or the
UBS Portfolio writes put options, it will keep cash or high-quality liquid
securities segregated in a sufficient quantity with its custodian.

INVESTMENT RESTRICTIONS
- -----------------------

The investment restrictions of the Brinson Fund, the UBS Fund and the
UBS Portfolio are similar, but not identical. Each of the investment
restrictions applicable to the Brinson Fund is a fundamental policy that may not
be changed without a Majority Vote of the Brinson Fund's outstanding shares.
The UBS Fund and the UBS Portfolio, however, have adopted investment
restrictions that are fundamental and non-fundamental; to the extent that a
fundamental policy and non-fundamental policy apply to a given investment
activity or strategy, the more restrictive policy shall govern. Each investment
policy of the UBS Fund and the UBS Portfolio discussed below is fundamental,
unless otherwise indicated. These fundamental investment restrictions are in
addition to those discussed previously in the "Investment Policies" section. As
with the Brinson Fund, a fundamental investment restriction may not be changed
without a Majority Vote of the UBS Portfolio's (or the UBS Fund's) outstanding
shares.

The investment restrictions applicable to the UBS Fund have been
adopted by the Corporation's Board of Directors, with respect to the UBS Fund,
and by the UBS Trust's Board of Trustees, with respect to the UBS Portfolio.
The investment restrictions of the UBS Fund and the UBS Portfolio are identical,
unless otherwise specified.

With respect to both the Brinson Fund and the UBS Portfolio, if a
percentage restriction is adhered to at the time of investment, a later increase
or decrease in the percentage which results from a relative change in values or
from a change in the Fund's or Portfolio's total assets will not be considered
a violation.

Neither the Brinson Fund nor the UBS Portfolio may, as to 75% of its
total assets, purchase the securities (or other obligations, in the case of the
UBS Portfolio) of any one issuer, other than securities issued (or guaranteed,
in the case of the UBS Portfolio) by the U.S. government or its agencies or
instrumentalities, if immediately after such purchase more than 5% of the value
of the total assets of the Brinson Fund or the UBS Portfolio would be invested
in securities (or obligations, in the case of the UBS Portfolio) of such issuer.
The UBS Portfolio however, may invest all or part of its investable assets in an
open-end management investment company with the same investment objective and
restrictions.

Neither the Brinson Fund nor the UBS Portfolio may invest in real
estate (or interests in real estate, in the case of the Brinson Fund, but this
will not prevent the Brinson Fund from investing in publicly-held real estate
investment trusts or marketable securities of companies which may represent
indirect interests in real estate), interests in oil, gas and/or mineral
exploration or development programs (including limited partnerships, in the case
of the UBS Portfolio) or leases (in the case of the Brinson Fund only). The UBS
Portfolio's restriction further provides that it may not purchase or sell real
estate mortgage loans. Additionally, the UBS Portfolio may purchase the equity
securities or commercial paper issued by companies that invest in real estate or
interests therein, including real estate investment trusts.

Neither the Brinson Fund nor the UBS Portfolio may purchase or sell
commodities or commodity contracts. The Brinson Fund's restriction provides
that it may enter into futures contracts and options thereon in accordance with
its prospectus. The UBS Portfolio's restriction provides that it may not
purchase or sell options on

27
<PAGE>

commodities or commodity contracts except for its interest in hedging and
certain other activities described in its statement of additional information.

The UBS Portfolio has a non-fundamental investment restriction that
provides that it will not invest for the purpose of exercising control or
management. The Brinson Fund is not subject to a comparable restriction.

Neither the Brinson Fund nor the UBS Portfolio (with respect to 75% of
its total assets) may purchase the securities of an issuer if, immediately after
such purchase, the Brinson Fund or the UBS Portfolio would own more than 10% of
the outstanding voting securities of such issuer. The UBS Portfolio further
provides that it may invest all or part of its investable assets in an open-end
management investment company with the same investment objective and
restrictions.

The Brinson Fund may not sell securities short or purchase securities
on margin, except such short-term credits as are necessary for the clearance of
transactions. For this purpose, the deposit or payment by the Brinson Fund for
initial or maintenance margin in connection with futures contracts is not
considered to be the purchase or sale of a security on margin.

The UBS Portfolio is subject to a non-fundamental restriction that
provides that it may not purchase any security or evidence of interest therein
on margin, except that such short-term credit as may be necessary for the
clearance of purchases and sales of securities may be obtained and except that
deposits of initial deposit and variation margin may be made in connection with
the purchase, ownership, holding or sale of futures.

As a matter of non-fundamental policy, the UBS Portfolio may not sell
securities it does not own such that the dollar amount of such short sales at
any one time exceeds 25% of the net equity of the UBS Portfolio, and the value
of securities of any one issuer in which the UBS Portfolio is short exceeds the
lesser of 2.0% of the value of the Portfolio's net assets or 2.0% of the
securities of any class of any U.S. issuer, and provided that short sales may be
made only in those securities which are fully listed on a national securities
exchange or a foreign exchange (this provision does not include the sale of
securities the UBS Portfolio contemporaneously owns or where the UBS Portfolio
has the right to obtain securities equivalent in kind and amount to those sold,
i.e., short sales against the box). The UBS Portfolio has no current intention
to engage in short selling.

In addition to the restrictions on borrowing discussed previously in
the "Investment Policies" section, the UBS Portfolio's investment restriction
also provides that it may not mortgage, pledge, or hypothecate any assets,
except in connection with any permitted borrowing or reverse repurchase
agreements.

Neither the Brinson Fund nor the UBS Portfolio may act as an
underwriter of securities, except that, with respect to the Brinson Fund, in
connection with the disposition of a security, the Brinson Fund may be deemed to
be an "underwriter" as that term is defined in the 1933 Act.

The UBS Portfolio has adopted a non-fundamental investment restriction
which provides that it may not invest in warrants (other than warrants acquired
by the UBS Portfolio as part of a unit or attached to securities at the time of
purchase) if, as a result, the investments (valued at the lower of cost or
market) would exceed 5% of the value of the UBS Portfolio's net assets. The
Brinson Fund is not subject to a comparable restriction.

RISK FACTORS
- ------------

Equity Securities

The Brinson Fund and the UBS Portfolio invest primarily in equity
securities of small capitalization growth companies. Equity securities fluctuate
in value as a result of various factors, which are often unrelated to the value
of the issuer of the securities. These fluctuations may be pronounced.
Fluctuations in the value of equity investments will affect the value of the
shares and thus the Brinson Fund's and the UBS Portfolio's total return to
investors.

28
<PAGE>

Foreign Securities

The Brinson Fund and the UBS Portfolio share certain risks that are
inherent when investing in foreign securities that are not typically associated
with investments in U.S. issuers, including, but not limited to, economic
developments, possible withholding taxes, seizure of foreign deposits, changes
in currency rates or currency exchange controls, higher transactional costs due
to a lack of negotiated commissions, or other governmental restrictions which
might affect the amount and types of foreign investments made or the payment of
principal or interest on securities in the investment portfolios of the Brinson
Fund and the UBS Portfolio. In addition, in some non-U.S. countries there is
the possibility of political or social instability, or diplomatic developments
that could affect U.S. investments in those countries. Also, there may be less
information available about these securities in general, and it may be more
difficult to obtain or enforce a court judgment in the event of a lawsuit. In
the case of Depository Receipts, the issuers of these instruments are not
obligated to disclose material information in the United States.

Currency and Exchange Rate Fluctuations

The assets of the Brinson Fund and the UBS Portfolio are subject to
certain risks associated with currency or exchange rate fluctuations. The U.S.
dollar market value of the Brinson Fund's and the UBS Portfolio's investments
and dividends and interest earned may be significantly affected by changes in
currency exchange rates. Some currency prices may be volatile, and there is the
possibility of governmental controls on currency exchange or governmental
intervention in currency markets could have adverse affects. Although both the
Brinson Fund and the UBS Portfolio may attempt to manage currency exchange rate
risks, there is no assurance that either will do so at an appropriate time or
that either will be able to predict exchange rates accurately.

If the currency in which a security is denominated appreciates against
the U.S. dollar, the dollar value of the security will increase. Conversely, a
decline in the exchange rate of the currency would adversely affect the value of
the security expressed in dollars.

Although foreign currency transactions are intended to minimize the
risk of loss due to a decline in the value of the hedged currency, these
transactions also limit any potential gain that might be realized should the
value of the hedged currency increase. Additionally, any premiums paid for
currency or futures options increase transaction costs. Forward contracts that
convert one foreign currency into another foreign currency will cause the
Brinson Fund or the UBS Portfolio to assume the risk of fluctuations in the
value of the currency purchased vis-a-vis the hedged currency and the U.S.
dollar. The precise matching of these transactions and the value of the
securities involved will not generally be possible because the future value of
such securities in foreign currencies will change as a consequence of market
movements in the value of such securities between the date such a transaction is
entered into and the date it matures. The projection of currency market
increments is extremely difficult and the successful execution of a hedging
strategy is highly uncertain.

On January 1, 1999, the European Monetary Union (the "EMU") plans to
introduce a new single currency, the Euro, which will replace the national
currencies of participating member nations. If the Brinson Fund or the UBS
Portfolio holds investments in nations with currencies replaced by the Euro, its
investment process, including trading, foreign exchange, payments, settlements,
cash accounts, custody and accounting, will be impacted. Although it is not
possible to predict the impact of the Euro on the Brinson Fund or the UBS
Portfolio, the transition and the elimination of currency risk among nations
participating in the EMU may change the economic environment and behavior of
investors, particularly in European markets.

The adoption of the Euro does not reduce the currency risk presented
by fluctuations in value of the U.S. dollar to other currencies, and, in fact,
currency exchange risk may be magnified. Also, increased market volatility may
result. Additional risks that may result include the fact that European issuers
in which the Brinson Fund or the UBS Portfolio invest may face substantial
conversion costs, which may not be accurately anticipated and may impact issuer
profitability and creditworthiness.

The Advisor has created an interdepartmental team to handle all Euro-
related changes to enable the Brinson Fund to process transactions accurately
and completely with minimal disruption to business activities.

29
<PAGE>

While there can be no assurance that the Brinson Fund will not be adversely
affected, the Advisor and the Trust's service providers are taking steps that
they believe are reasonably designed to address the Euro issue.

The Brinson Fund's and the UBS Portfolio's ability to "pass through"
any foreign taxes paid for tax credit or deduction purposes will be determined
by the composition of their respective portfolios. Special rules govern the
federal income tax treatment of certain transactions denominated in terms of a
currency other than the U.S. dollar or determined by reference to the value of
one or more currencies other than the U.S. dollar.

Futures, Options and Other Derivative Instruments

The success of the investments by the Brinson Fund and the UBS
Portfolio in options, futures, forward contracts, swaps (in the case of the UBS
Portfolio) and other derivative instruments will depend on the judgment of the
Advisor and the UBS Sub-Adviser, respectively, as to trends relating to prices,
interest rates and currency rates. Risks inherent in the use of futures,
options and forward contracts include: adverse movements in the prices of
securities or currencies being hedged; the possible absence of a liquid
secondary market for any particular instrument at any time; and the possible
need to defer closing out certain hedge positions to avoid adverse tax
consequences. Options and futures can be volatile instruments and may not
perform as expected. The Brinson Fund or the UBS Portfolio could experience a
loss if the prices of its options and futures positions are poorly correlated
with its other investments. If a hedge is applied at an inappropriate time or
price trends are judged incorrectly, options and futures strategies may lower
return. Options and futures traded on foreign exchanges generally are not
regulated by U.S. authorities and may offer less liquidity and less protection
in the event of default by the other party to the contract. The loss from
investing in futures transactions is potentially unlimited.

The Brinson Fund's and the UBS Portfolio's purchases of options on
indices will subject them to the following risks. First, because the value of
an index option depends upon movements in the level of the index rather than the
price of a particular security, whether the Brinson Fund or the UBS Portfolio
will realize gain or loss on the purchase of an option on an index depends upon
movements in the level of prices in the market generally or in an industry or
market segment rather than movements in the price of a particular security.
Accordingly, successful use by either the Brinson Fund or the UBS Portfolio of
options on indices is subject to the Advisor's or the UBS Sub-Adviser's ability,
respectively, to predict correctly the direction of movements in the market
generally or in a particular industry. This requires different skills and
techniques than predicting changes in the prices of individual securities.

Second, index prices may be distorted if trading of a substantial
number of securities included in the index is interrupted causing the trading of
options on that index to be halted. If a trading halt occurred, the Brinson Fund
and the UBS Portfolio would not be able to close out options which they had
purchased and they may incur losses if the underlying index moved adversely
before trading resumed. If a trading halt occurred and restrictions prohibiting
the exercise of options were imposed through the close trading on the last day
before expiration, exercise on that day would be settled on the basis of a
closing index value that may not reflect current price information for
securities representing a substantial portion of the value of the index.

Finally, if either the Brinson Fund or the UBS Portfolio holds an
index option and exercises it before final determination of the closing index
value for that day, it runs the risk that the level of the underlying index may
change before closing. If such a change causes the exercised option to fall
"out-of-the-money," the Brinson Fund or the UBS Portfolio will be required to
pay the difference between the closing index value and the exercise price of the
option (times the applicable multiplier) to the assigned writer. Although either
the Brinson Fund or the UBS Portfolio may be able to minimize this risk by
withholding exercise instructions until just before the daily cutoff time or by
selling rather than exercising the option when the index level is close to the
exercise price, it may not be possible to eliminate this risk entirely because
the cutoff times for index options may be earlier than those fixed for other
types of options and may occur before definitive closing index values are
announced.

Repurchase Agreements

The Brinson Fund and the UBS Portfolio may each invest in repurchase
agreements, which involve risk of loss if a seller defaults on its obligations
under the agreement, and reverse repurchase agreements,

30
<PAGE>

which involve risk of loss if a purchaser defaults in its obligation to return
securities to the Brinson Fund or the UBS Portfolio.

Securities Lending

Both the Brinson Fund and the UBS Portfolio may loan portfolio
securities to qualified broker-dealers and other institutions on a
collateralized basis. As with any extension of credit, loans by the Brinson
Fund or the UBS Portfolio may be subject to the risks of delay in recovery and
loss of rights in the collateral should the borrower of the securities fail
financially. However, loans of portfolio securities are only made to firms
deemed by either the Brinson Fund or the UBS Portfolio to be of good standing,
and when, in the judgment of either the Brinson Fund or the UBS Portfolio, the
income that can be earned from such loans justifies the attendant risk.

When-Issued and Delayed Delivery Securities

Both the Brinson Fund and the UBS Portfolio may purchase securities on
a when-issued and, in the case of the UBS Portfolio, a delayed delivery basis.
At the time of settlement, a when-issued security may be valued at less than its
purchase price. When entering into a when-issued or delayed delivery
transaction, the Brinson Fund or the UBS Portfolio, as relevant, will rely on
the other party to consummate the transaction; if the other party fails to do
so, the Brinson Fund or the UBS Portfolio may be disadvantaged.

Asset-Backed Securities

Both the Brinson Fund and the UBS Portfolio may invest in asset-backed
securities. Risks of asset-backed securities include the prepayment of the
debtor's obligation and the creditor's limited interests in applicable
collateral. Additionally, if the letter of credit guaranteeing payments of
principal or interest for the asset-backed securities is exhausted, holders of
asset-backed securities may also experience delays in payments or losses if the
full amount due in underlying sales contracts are not realized.

Swaps

The use of swaps by the UBS Portfolio involves investment techniques
and risks different from those associated with ordinary portfolio security
transactions. If the UBS Portfolio is incorrect in its forecast of market
values, interest rates and other applicable factors, the investment performance
of the UBS Portfolio will be less favorable than it would have been if this
investment technique were never used. Thus, if the other party to the swap
defaults, the UBS Portfolio's risk of loss consists of the net amount of
interest payments that it is contractually entitled to receive.

INFORMATION ABOUT THE BRINSON FUND

Additional information about the Brinson Fund is included in Exhibit B
attached to this Prospectus/Proxy Statement, and in the Statement of Additional
Information related to this Prospectus/Proxy Statement, which is dated
___________, 1998, which has been filed with the Commission and is incorporated
by reference herein. Copies of the Statement of Additional Information may be
obtained without charge by writing to the Trust or calling 1-800-448-2430. The
Trust is subject to the informational requirements of the Securities Exchange
Act of 1934 and the 1940 Act, as applicable, and, in accordance with such
requirements, files proxy materials, reports and other information with the
Commission. These materials can be inspected and copied at the Public Reference
Facilities maintained by the Commission at 450 Fifth Street N.W., Washington, DC
20549, and at the offices of the Trust at 209 South LaSalle Street, Chicago, IL
60604 and at the Midwest Regional Office of the Commission at 500 West Madison
Street, Suite 1400, Chicago, IL 60661. Copies of such material can also be
obtained from the Public Reference Branch, Office of Consumer Affairs and
Information Services, U.S. Securities and Exchange Commission, Washington, DC
20549, at prescribed rates.

31
<PAGE>

INFORMATION ABOUT THE UBS FUND

Information about the UBS Fund is incorporated herein by reference
from its current prospectus, dated May 1, 1998, as amended or supplemented from
time to time, and Statement of Additional Information of the same date, and
annual report to shareholders, dated December 31, 1997, copies of which may be
obtained without charge by writing or calling the Corporation at the address and
telephone number shown on the cover page of this Prospectus/Proxy Statement.
Reports and other information filed by the Corporation can be inspected and
copied at the Public Reference Facilities maintained by the Commission at 450
Fifth Street N.W., Washington, DC 20549, and copies of such material can be
obtained from the Public Reference Branch, Office of Consumer Affairs and
Information Services, U.S. Securities and Exchange Commission, Washington, DC
20549, at prescribed rates.

TRANSFER AGENT AND CUSTODIAN

MSTC, One Pierrepont Plaza, Brooklyn, New York 11201 provides
custodian services for the Trust. CGFSC, 73 Tremont Street, Boston,
Massachusetts 02108-3913 provides transfer agency services to the Trust.
Investors Bank, whose principal offices are located at 200 Clarendon Street,
Boston, Massachusetts 02116, serves as the transfer and dividend disbursing
agent and custodian for the UBS Fund and the UBS Portfolio.

SHAREHOLDER INQUIRIES

Shareholder inquiries with respect to the Brinson Fund may be made by
writing the Trust at 209 South LaSalle Street, Chicago, Illinois 60604 or by
calling toll-free (800) 448-2430. Shareholder inquiries with respect to the
Corporation and the UBS Fund may be made by writing to the Corporation at 200
Clarendon Street, Boston, Massachusetts 02116 or by calling toll-free (888) 827-
3863.

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<PAGE>

SPECIAL MEETING OF SHAREHOLDERS OF THE UBS PRIVATE INVESTOR FUNDS, INC.

UBS LARGE CAP GROWTH FUND

DECEMBER 15, 1998

The undersigned hereby revokes all previous proxies for his/her shares and
appoints [NAMES], and each of them, proxies of the undersigned with full power
of substitution to vote all shares of the UBS Large Cap Growth Fund (the "UBS
Fund") of UBS Private Investor Funds, Inc. (the "Corporation") which the
undersigned is entitled to vote at the Corporation's Special Meeting to be held
at _____________________________ at _____ a.m. Eastern time on the 15th day of
December, 1998, including any adjournment thereof, upon such business as may
properly be brought before the Meeting.

No. 1 To approve an Agreement and Plan of Reorganization between the
Corporation, on behalf of the UBS Fund, and The Brinson Funds, on
behalf of the U.S. Large Capitalization Growth Fund series (the
"Brinson Fund"), that provides for the acquisition of substantially
all of the assets and liabilities of the UBS Fund in exchange for the
Brinson U.S. Large Capitalization Growth Fund - Class I shares of the
Brinson Fund, the distribution of such shares to the shareholders of
the UBS Fund, and the dissolution of the UBS Fund.

FOR AGAINST ABSTAIN
--- ------- -------

[_] [_] [_]

No. 2 To vote upon any other business which may legally come before the
meeting.

GRANT WITHHOLD
----- --------

[_] [_]

33
<PAGE>

PLEASE SIGN AND PROMPTLY RETURN IN THE ACCOMPANYING ENVELOPE. NO POSTAGE
REQUIRED IF MAILED IN THE U.S.

This proxy is solicited on behalf of the Board of Directors of the Corporation.
it will be voted as specified. If no specification is made, this proxy shall be
voted in favor of Proposal 1, regarding the reorganization of the UBS Fund of
the Corporation pursuant to the Agreement and Plan of Reorganization with the
Brinson Funds. If any other matters properly come before the meeting about
which the proxyholders were not aware prior to the time of the solicitation,
authorization is given the proxyholders to vote in accordance with the views of
management thereon. The management is not aware of any such matters.

Dated:___________________________________

_________________________________________
Signature

_________________________________________
Print Name

_________________________________________
Signature

_________________________________________
Print Name

NOTE: Please sign exactly as your name
appears on the proxy. If signing for
estates, trusts or corporations, title or
capacity should be stated. If shares are
held jointly, each holder must sign.

34
<PAGE>

EXHIBITS TO

PROSPECTUS AND PROXY STATEMENT

EXHIBIT
- -------

A Agreement and Plan of Reorganization between UBS Private Investor
Funds, Inc., on behalf of its UBS Large Cap Growth Fund, and The
Brinson Funds, on behalf of the U.S. Large Capitalization Growth
Fund.

B Additional Information Regarding the Brinson Fund.

35
<PAGE>

EXHIBIT A
---------

AGREEMENT AND PLAN OF REORGANIZATION

AGREEMENT AND PLAN OF REORGANIZATION, made as of this day of 1998, by
and between The Brinson Funds (the "Trust"), a business trust created under the
laws of the State of Delaware, with its principal place of business at 209 South
LaSalle Street, Chicago, Illinois 60604 and UBS Private Investor Funds, Inc.
(the "UBS Funds"), a corporation organized under the laws of the State of
Maryland, with its principal place of business at 200 Clarendon Street, Boston,
Massachusetts 02116.

PLAN OF REORGANIZATION

The reorganization (hereinafter referred to as the "Plan of
Reorganization") will consist of (i) the acquisition by the Trust of
substantially all of the property, assets and goodwill of the UBS Large Cap
Growth Fund (the "UBS Portfolio") of the UBS Funds in exchange solely for the
Brinson U.S. Large Capitalization Growth Fund Class I shares ("Class I shares")
of beneficial interest of the U.S. Large Capitalization Growth Fund (the
"Brinson Fund"), $0.001 par value, and the assumption by the Trust of the
liabilities of the UBS Portfolio, (ii) the distribution of such shares of
beneficial interest of the Brinson Fund to the shareholders of the UBS Portfolio
according to their respective interests, and (iii) the dissolution of the UBS
Portfolio as soon as practicable after the closing (as defined in Section 3,
hereinafter called the "Closing"), all upon and subject to the terms and
conditions of this Agreement hereinafter set forth.

AGREEMENT

In order to consummate the Plan of Reorganization and in consideration
of the premises and of the covenants and agreements hereinafter set forth, and
intending to be legally bound, the parties hereto covenant and agree as follows:

1. SALE AND TRANSFER OF ASSETS AND LIABILITIES, LIQUIDATION AND
DISSOLUTION OF THE UBS PORTFOLIO
--------------------------------

(a) Subject to the terms and conditions of this Agreement, and in
reliance on the representations and warranties of the Trust herein contained,
and in consideration of the delivery by the Trust of the number of its Class I
shares of the Brinson Fund hereinafter provided, the UBS Funds on behalf of the
UBS Portfolio agrees that it will convey, transfer and deliver to the Trust at
the Closing provided for in Section 3 (hereinafter called the "Closing") all of
the then existing liabilities and assets of the UBS Portfolio free and clear of
all liens, encumbrances, and claims whatsoever (other than shareholders' rights
of redemption and such restrictions as might arise under the Securities Act of
1933, as amended (the "1933 Act"), with respect to privately placed or otherwise
restricted securities that the UBS Portfolio may have acquired in the ordinary
course of business), except for cash, bank deposits, or cash equivalent
securities in an estimated amount necessary (1) to pay its costs and expenses of
carrying out this Agreement (including, but not limited to, fees of counsel and
accountants, and expenses of its liquidation and dissolution contemplated
hereunder), which costs and expenses shall be

A-1
<PAGE>

established on the books of the UBS Portfolio as liability reserves, (2) to
discharge all of the UBS Portfolio's liabilities on its books at the closing
date (as defined in Section 3, hereinafter called the "Closing Date"),
including, but not limited to, its income dividends and capital gains
distributions, if any, payable for any period prior to, and through, the Closing
Date, and excluding those liabilities and obligations which would otherwise be
discharged at a later date in the ordinary course of business, and (3) to pay
such contingent liabilities as the directors shall reasonably deem to exist
against the UBS Portfolio, if any, at the Closing Date, for which contingent and
other appropriate liability reserves shall be established on the books of the
UBS Portfolio (hereinafter "Net Assets"). The UBS Portfolio shall also retain
any and all rights which it may have over and against any person which may have
accrued up to and including the close of business on the Closing Date.

(b) Subject to the terms and conditions of this Agreement, and in
reliance on the representations and warranties of the Trust herein contained,
and in consideration of such sale, conveyance, transfer, and delivery, the Trust
agrees at the Closing to deliver to the UBS Portfolio the number of Class I
shares of beneficial interest of the Brinson Fund ($0.00l par value) determined
by dividing the net asset value per share of stock of the UBS Portfolio on the
Closing Date by the net asset value per share of beneficial interest of the
Class I shares of the Brinson Fund on the Closing Date, which net asset value
per share shall be identical to that determined to be the net asset value per
share of the Class I shares of the Brinson Fund on the Closing Date, and
multiplying the result by the number of outstanding shares of the UBS Portfolio
on the Closing Date. All such values shall be determined in the manner and as
of the time set forth in Section 2 hereof.

(c) Immediately following the Closing, the UBS Portfolio shall
dissolve and distribute pro rata to its shareholders of record as of the close
of business on the Closing Date the shares of beneficial interest of the Class I
shares of the Brinson Fund received by the UBS Portfolio pursuant to this
Section 1. Such liquidation and distribution shall be accomplished by the
establishment of accounts on the share records of the Brinson Fund of the type
and in the amounts due such shareholders based on their respective holdings as
of the close of business on the Closing Date. Fractional shares of beneficial
interest of the Class I shares of the Brinson Fund shall be carried to the third
decimal place. As promptly as practicable after the Closing, each holder of any
outstanding certificate or certificates representing shares of common stock of
the UBS Portfolio shall be entitled to surrender the same to the transfer agent
for the Trust and request in exchange therefor a certificate or certificates
representing the number of whole shares of beneficial interest of the Class I
shares of the Brinson Fund into which the shares of common stock of the UBS
Portfolio theretofore represented by the certificate or certificates so
surrendered shall have been converted. Certificates for fractional shares of
beneficial interest of the Class I shares of the Brinson Fund shall not be
issued, but shall continue to be carried by the Brinson Fund for the account of
such shareholder as unissued shares. Until so surrendered, each outstanding
certificate which, prior to the Closing, represented shares of common stock of
the UBS Portfolio shall be deemed for all the Brinson Fund purposes to evidence
ownership of the number of shares of beneficial interest of the Class I shares
of the Brinson Fund into which the shares of common stock of the UBS Portfolio
(which prior to the Closing were represented thereby) have been converted.

A-2
<PAGE>

2. VALUATION
---------

(a) The value of the UBS Portfolio's Net Assets to be acquired by the
Brinson Fund hereunder shall be computed as of the close of business (which
shall be deemed to be the close of The New York Stock Exchange, Inc. ("NYSE"))
on the Closing Date using the valuation procedures set forth in the UBS
Portfolio's currently effective prospectus.

(b) The net asset value of a share of beneficial interest of the
Class I shares of the Brinson Fund shall be identical to the net asset value per
share of the UBS Portfolio at the close of business on the Closing Date,
determined as set forth in subsection (c) of Section 2.

(c) The net asset value of a share of common stock of the UBS
Portfolio shall be determined to the nearest full cent as of the close of
business (which shall be deemed to be the close of the NYSE) on the Closing
Date, using the valuation procedures as set forth in the UBS Portfolio's
currently effective prospectus.

3. CLOSING AND CLOSING DATE
------------------------

The Closing Date shall be December 16, 1998, or such later date as the
parties may mutually agree. The Closing shall take place at the principal
office of the Trust, 209 South LaSalle Street, Chicago, Illinois 60604 at 10:00
a.m. Eastern Time on the first business day following the Closing Date. The UBS
Funds shall have provided for delivery as of the Closing of those Net Assets of
the UBS Portfolio to be transferred to the Trust's Custodian, Morgan Stanley
Trust Company, One Pierrepont Plaza, Brooklyn, New York 11201. Also, the UBS
Funds shall deliver at the Closing a list of names and addresses of the
shareholders of record of the UBS Portfolio and the number of shares of common
stock of the UBS Portfolio owned by each such shareholder, indicating thereon
which such shares are represented by outstanding certificates and which by book-
entry accounts, all as of the close of business on the Closing Date, certified
by its transfer agent, or by its President to the best of their knowledge and
belief. The Trust shall issue and deliver a certificate or certificates
evidencing the shares of beneficial interest of the Class I shares of the
Brinson Fund to be delivered to said transfer agent registered in such manner as
the UBS Funds may request, or provide evidence satisfactory to the UBS Portfolio
that such shares of the Brinson Fund have been registered in an account on the
books of the Brinson Fund in such manner as the UBS Funds may request.

4. REPRESENTATIONS AND WARRANTIES BY THE UBS FUNDS
-----------------------------------------------

The UBS Funds represents and warrants to the Trust that:

(a) UBS Funds is a corporation duly organized under the laws of the
State of Maryland on November 16, 1995, and is validly existing and in good
standing under the laws of that state. UBS Funds, of which the UBS Portfolio is
a diversified separate series of shares, is duly registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as an open-end, management
investment company and all its shares sold have been sold pursuant to an

A-3
<PAGE>

effective registration statement filed under the 1933 Act, except for those
shares sold pursuant to the private offering exemption for the purpose of
raising the required initial capital.

(b) The UBS Funds has an authorized capital of 500,000,000 shares of
common stock with $0.001 par value per share, each outstanding share of which is
fully paid, non-assessable, fully transferable and has full voting rights.

(c) The financial statements appearing in the UBS Funds' Annual
Report to Shareholders for the fiscal year ended December 31, 1997, audited by
Price Waterhouse LLP, and the unaudited financial statements appearing in the
UBS Funds' Semi-Annual Report to Shareholders for the period ended June 30,
1998, copies of which have been delivered to the Trust, fairly present the
financial position of the UBS Funds and the UBS Portfolio as of the respective
dates indicated, in conformity with generally accepted accounting principles
applied on a consistent basis.

(d) The books and records of the UBS Portfolio made available to the
Trust and/or its counsel are true and correct and contain no material omissions
with respect to the business and operations of the UBS Portfolio.

(e) The UBS Funds has the necessary power and authority to conduct
its business as such business is now being conducted.

(f) The UBS Funds is not a party to or obligated under any provision
of its Articles of Incorporation, By-laws, or any contract or any other
commitment or obligation, and is not subject to any order or decree, which would
be violated by its execution of or performance under this Agreement and Plan of
Reorganization.

(g) The UBS Funds is not under the jurisdiction of a Court in a Title
11 or similar case within the meaning of Section 368(a)(3)(A) of the Internal
Revenue Code of 1986, as amended (the "Code").

(h) The UBS Funds does not have any unamortized or unpaid
organizational fees or expenses.

(i) The UBS Portfolio satisfies, will at the Closing satisfy, and
consummation of this Agreement will not cause it to fail to satisfy, for any
period, the requirements of Subchapter M of the Code.

5. REPRESENTATIONS AND WARRANTIES BY THE TRUST
-------------------------------------------

The Trust represents and warrants to the UBS Funds that:

(a) The Trust is a business trust created under the laws of the State
of Delaware on August 9, 1993, and is validly existing and in good standing
under the laws of that state. The Trust, of which the Brinson Fund is a
diversified separate series of shares, is duly

A-4
<PAGE>

registered under the 1940 Act, as an open-end, management investment company and
all of its shares sold have been sold pursuant to an effective registration
statement filed under the 1933 Act, except for those shares sold pursuant to the
private offering exemption for the purpose of raising the required initial
capital.

(b) The Trust is authorized to issue an unlimited number of shares of
beneficial interest, par value $0.001 per share. Each outstanding share is
fully paid, non-assessable, fully transferable, and has full voting rights. The
shares of beneficial interest of the Class I shares of the Brinson Fund to be
issued pursuant to this Agreement and Plan of Reorganization will be fully paid,
non-assessable, freely transferable and have full voting rights.

(c) At the Closing, the shares of beneficial interest of the Class I
shares of the Brinson Fund will be eligible for offering to the public in those
states of the United States and jurisdictions in which the shares of the UBS
Portfolio are presently eligible for offering to the public, and there are a
sufficient number of such shares registered under the 1933 Act, to permit the
transfers contemplated by this Agreement to be consummated.

(d) The Trust has the necessary power and authority to conduct its
business as such business is now being conducted.

(e) The Trust is not a party to or obligated under any provision of
its Agreement and Declaration of Trust, By-laws, or any contract or any other
commitment or obligation, and is not subject to any order or decree, which would
be violated by its execution of or performance under this Agreement and Plan of
Reorganization.

(f) Neither the Trust nor the Brinson Fund is under the jurisdiction
of a Court in a Title 11 or similar case within the meaning of Section
368(a)(3)(A) of the Code.

6. REPRESENTATIONS AND WARRANTIES BY THE UBS FUNDS AND THE TRUST
-------------------------------------------------------------

The UBS Funds and the Trust each represents and warrants to the other
that:

(a) The statement of assets and liabilities to be furnished by it as
of the close of business on the Closing Date for the purpose of determining the
number of shares of beneficial interest of the Class I shares of the Brinson
Fund to be issued pursuant to Section 1 of this Agreement will accurately
reflect its Net Assets in the case of the UBS Portfolio and its net assets in
the case of the Brinson Fund, and outstanding shares of beneficial interest or
common stock, as applicable, as of such date in conformity with generally
accepted accounting principles applied on a consistent basis.

(b) At the Closing, it will have good and marketable title to all of
the securities and other assets shown on the statement of assets and liabilities
referred to in subsection (a) above, free and clear of all liens or encumbrances
of any nature whatever except such restrictions as might arise under the 1933
Act with respect to privately placed or otherwise restricted securities that the
UBS Portfolio may have acquired in the ordinary course of business

A-5
<PAGE>

and such imperfections of title or encumbrances as do not materially detract
from the value or use of the assets subject thereto, or materially affect title
thereto.

(c) Except as disclosed in its currently effective prospectus, there
is no material suit, judicial action, or legal or administrative proceeding
pending or threatened against it.

(d) There are no known actual or proposed deficiency assessments with
respect to any taxes payable by it.

(e) It has full power and authority to enter into and perform its
obligations under this Agreement. The execution, delivery and performance of
this Agreement have been duly authorized by all necessary action of its Board of
Directors or Board of Trustees, as the case may be, and this Agreement
constitutes its valid and binding obligation enforceable in accordance with its
terms.

7. COVENANTS OF THE UBS FUNDS AND THE TRUST
----------------------------------------

(a) The UBS Funds and the Trust each covenant to operate their
respective businesses as presently conducted between the date hereof and the
Closing.

(b) The UBS Funds undertakes that it will not acquire the Brinson
Fund's shares for the purpose of making distributions thereof other than to the
UBS Portfolio's shareholders.

(c) The UBS Funds undertakes that if this Agreement is consummated,
it will file an application pursuant to Section 8(f) of the 1940 Act for an
order declaring that it has ceased to be an investment company.

(d) The UBS Funds and the Trust each agree that by the Closing, all
of its federal and other tax returns and reports required by law to be filed on
or before such date shall have been filed and all federal and other taxes shown
as due on said returns shall have either been paid or adequate liability
reserves shall have been provided for the payment of such taxes.

(e) The UBS Funds will at the Closing provide the Trust with:

(1) A statement of the respective tax basis of all
investments and liabilities to be transferred by the UBS Portfolio to
the Brinson Fund certified by PricewaterhouseCoopers LLP.

(2) A copy of the shareholder ledger accounts for all the
shareholders of record of the UBS Portfolio as of the close of
business on the Closing Date, who are to become shareholders of the
Brinson Fund as a result of the transfer of assets which is the
subject of this Agreement, certified by its transfer agent or its
President to the best of their knowledge and belief.

A-6
<PAGE>

(f) UBS Funds agrees to mail to each shareholder of record of the UBS
Portfolio entitled to vote at the meeting of shareholders at which action on
this Agreement is to be considered, in sufficient time to comply with
requirements as to notice thereof, a Combined Proxy Statement and Prospectus
which complies in all material respects with the applicable provisions of
Section 14(a) of the Securities Exchange Act of 1934, as amended, and Section
20(a) of the 1940 Act, and the rules and regulations, respectively, thereunder.

(g) The Trust will file with the United States Securities and
Exchange Commission (the "Commission") a Registration Statement on Form N-14
under the 1933 Act ("Registration Statement"), relating to the shares of
beneficial interest of the Class I shares of the Brinson Fund issuable
hereunder, and will use its best efforts to provide that the Registration
Statement becomes effective as promptly as practicable. At the time the
Registration Statement becomes effective, it (i) will comply in all material
respects with the applicable provisions of the 1933 Act, and the rules and
regulations promulgated thereunder; and (ii) will not contain any untrue
statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading. At
the time the Registration Statement becomes effective, at the time of the UBS
Portfolio's shareholders' meeting, and at the Closing Date, the prospectus and
statement of additional information included in the Registration Statement will
not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.

8. CONDITIONS PRECEDENT TO BE FULFILLED BY THE UBS FUNDS AND THE TRUST
-------------------------------------------------------------------

The obligations of the UBS Funds and the Trust to effectuate this
Agreement and the Plan of Reorganization hereunder shall be subject to the
following respective conditions:

(a) That (1) all the representations and warranties of the other
party contained herein shall be true and correct as of the Closing with the same
effect as though made as of and at such date; (2) the other party shall have
performed all obligations required by this Agreement to be performed by it prior
to the Closing; and (3) the other party shall have delivered to such party a
certificate signed by the President and by the Secretary or equivalent officer
to the foregoing effect.

(b) That the other party shall have delivered to such party a copy of
the resolutions approving this Agreement adopted by the other party's Board of
Directors or Board of Trustees, as applicable, certified by the Secretary or
equivalent officer.

(c) That the Commission shall not have issued an unfavorable advisory
report under Section 25(b) of the 1940 Act, nor instituted nor threatened to
institute any proceeding seeking to enjoin consummation of the reorganization
under Section 25(c) of the 1940 Act, and no other legal, administrative or other
proceeding shall be instituted or threatened which would materially affect the
financial condition of either party or would prohibit the transactions
contemplated hereby.

A-7
<PAGE>

(d) That the adoption of this Agreement and Plan of Reorganization
contemplated hereby shall have been approved by the holders of at least a
majority of the outstanding shares of the UBS Portfolio at a special meeting to
be held no later than March 22, 1999 or other such date as the parties may
agree.

(e) That each party shall have declared a distribution or
distributions prior to the Closing Date which, together with all previous
distributions, shall have the effect of distributing to its shareholders (i) all
of its ordinary income and all of its capital gain net income, if any, for the
period from the close of its last fiscal year to the close of business on the
Closing Date, and (ii) any undistributed ordinary income and capital gain net
income from any prior period. Capital gain net income has the meaning given
such term by Section 1222(9) of the Code.

(f) That prior to or at the Closing, the UBS Funds and the Trust
shall receive an opinion from Messrs. Stradley, Ronon, Stevens & Young LLP,
counsel to the Trust, to the effect that provided the acquisition contemplated
hereby is carried out in accordance with this Agreement and in accordance with
customary representations provided by the UBS Funds and the Trust in
certificates delivered to counsel to the Trust:

(1) The acquisition by the Brinson Fund of substantially all
of the assets and liabilities of the UBS Portfolio in exchange for the
Brinson Fund voting shares followed by the distribution by the UBS
Portfolio of the Brinson Fund voting shares to the shareholders, in
complete liquidation, will constitute a reorganization within the
meaning of Section 368(a)(1)(C) of the Code. For these purposes,
"substantially all" means at least 70 percent of the fair market value
of the gross assets and at least 90 percent of the fair market value
of the net assets of the UBS Portfolio. Additionally, the Brinson
Fund and the UBS Portfolio will each be a "party to the
reorganization" within the meaning of Section 368(b) of the Code;

(2) No gain or loss will be recognized by the UBS Portfolio
upon the transfer of substantially all of its assets and liabilities
to the Brinson Fund in exchange solely for voting shares of the
Brinson Fund (Sections 361(a) and 357(a)). No opinion will be
expressed as to whether any accrued market discount will be required
to be recognized as ordinary income pursuant to Section 1276 of the
Code;

(3) No gain or loss will be recognized by the Brinson Fund
upon the receipt of substantially all of the assets and liabilities of
the UBS Portfolio in exchange solely for voting shares of the Brinson
Fund (Section 1032(a) of the Code);

A-8
<PAGE>

(4) The basis of the assets and liabilities of the UBS Portfolio
received by the Brinson Fund will be the same as the basis of such
assets and liabilities to the UBS Portfolio immediately prior to the
exchange (Section 362(b) of the Code);

(5) The holding period of the assets of the UBS Portfolio
received by the Brinson Fund will include the period during which such
assets were held by the UBS Portfolio (Section 1223(2) of the Code);

(6) No gain or loss will be recognized to the shareholders
of the UBS Portfolio upon the exchange of their shares in the UBS
Portfolio for voting shares of the Brinson Fund (including fractional
shares to which they may be entitled) (Section 354(a) of the Code);

(7) The basis of the Brinson Fund's shares received by the
UBS Portfolio shareholders (including fractional shares to which they
may be entitled) shall be the same as the basis of the shares of the
UBS Portfolio exchanged therefor (Section 358(a)(1) of the Code);

(8) The holding period of the Brinson Fund's shares received
by the UBS Portfolio's shareholders (including fractional shares to
which they may be entitled) will include the holding period of the UBS
Portfolio's shares surrendered in exchange therefor, provided that the
UBS Portfolio shares were held as a capital asset on the date of the
exchange (Section 1223(l) of the Code); and

(9) The Brinson Fund will succeed to and take into account
the items of the UBS Portfolio described in Section 381(c) of the
Code, including the earnings and profits, or deficit earnings and
profits, of the UBS Portfolio as of the date of the transaction
(Section 381(a) and Treasury Regulations 1.381-1(a)). Any deficit in
earnings and profits of the UBS Portfolio will be used only to offset
earnings and profits accumulated after the effective date of the
proposed reorganization. The Brinson Fund will take these items into
account subject to the conditions and limitations specified under
Sections 381, 382, 383 and 384 and the Treasury Regulations
thereunder.

(g) That the Trust shall have received an opinion in form and
substance satisfactory to it from Messrs. Willkie Farr & Gallagher, counsel to
the UBS Funds, to the effect that, subject in all respects to the effects of
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and
other laws now or hereafter affecting generally the enforcement of creditors'
rights:

(1) UBS Funds was incorporated under the laws of the State
of Maryland on November 16, 1995, and is validly existing and in good
standing under the laws of the State of Maryland;

A-9
<PAGE>

(2) UBS Funds has an authorized capital of 500,000,000
shares of common stock, par value $0.001 per share, and, assuming that
the initial shares of common stock of the UBS Portfolio were issued in
accordance with the 1940 Act, and the Articles of Incorporation and
By-laws of the UBS Funds, and that all other outstanding shares of the
UBS Portfolio were sold, issued and paid for in accordance with the
terms of the UBS Portfolio's prospectus in effect at the time of such
sales, each such outstanding share is fully paid, non-assessable,
fully transferable and has full voting rights;

(3) UBS Funds is an open-end, investment company of the
management type registered as such under the 1940 Act;

(4) Except as disclosed in the UBS Portfolio's currently
effective prospectus, such counsel does not know of any material suit,
action, or legal or administrative proceeding pending or threatened
against the UBS Funds, the unfavorable outcome of which would
materially and adversely affect the UBS Funds or the UBS Portfolio;

(5) All corporate actions required to be taken by the UBS
Funds to authorize this Agreement and to effect the Plan of
Reorganization contemplated hereby have been duly authorized by all
necessary corporate action on the part of the UBS Funds; and

(6) This Agreement is the legal, valid and binding obligation of
the UBS Funds and is enforceable against the UBS Funds in accordance
with its terms.

In giving the opinions set forth above, this counsel may state that it
is relying on certificates of the officers of the UBS Funds with regard to
matters of fact and certain certifications and written statements of
governmental officials with respect to the good standing of the UBS Funds and
the UBS Portfolio.

(h) That the UBS Funds shall have received an opinion in form and
substance satisfactory to it from Messrs. Stradley, Ronon, Stevens & Young LLP,
counsel to Trust, to the effect that, subject in all respects to the effects of
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and
other laws now or hereafter affecting generally the enforcement of creditors'
rights:

(1) The Trust was created as a business trust under the laws of
the State of Delaware on August 9, 1993, and is validly existing and
in good standing under the laws of that state;

(2) The Trust is authorized to issue an unlimited number of
shares of beneficial interest, par value $0.001 per share, and,
assuming that the initial shares of beneficial interest of the Class I
shares of the Brinson Fund were issued

A-10
<PAGE>

in accordance with the 1940 Act, and the Trust's Agreement and
Declaration of Trust and that all other such shares were sold, issued
and paid for in accordance with the terms of the Brinson Fund's
prospectus in effect at the time of such sales, each such outstanding
share is fully paid, non-assessable, freely transferable and has full
voting rights;

(3) The Trust is an open-end investment company of the
management type registered as such under the 1940 Act;

(4) Except as disclosed in the Brinson Fund's currently
effective prospectus, such counsel does not know of any material suit,
action, or legal or administrative proceeding pending or threatened
against the Trust, the unfavorable outcome of which would materially
and adversely affect the Trust or the Brinson Fund;

(5) The shares of beneficial interest of the Brinson Fund to be
issued pursuant to the terms of this Agreement have been duly
authorized and, when issued and delivered as provided in this
Agreement, will have been validly issued and fully paid and will be
nonassessable by the Trust or the Brinson Fund;

(6) All actions required to be taken by the Trust to authorize
this Agreement and to effect the Plan of Reorganization contemplated
hereby have been duly authorized by all necessary action on the part
of the Trust;

(7) Neither the execution, delivery nor performance of this
Agreement by the Trust violates any provision of its Agreement and
Declaration of Trust, its Bylaws, or the provisions of any agreement
or other instrument, known to such counsel to which the Trust is a
party or by which the Trust is otherwise bound;

(8) This Agreement is the legal, valid and binding obligation of
the Trust and is enforceable against the Trust in accordance with its
terms; and

(9) The registration statement of the Trust filed with the
Commission on September 15, 1998, is, at the time of the signing of
this Agreement, effective under the 1933 Act, and, to the best
knowledge of such counsel, no stop order suspending the effectiveness
of the registration statement has been issued, and no proceedings for
such purpose have been instituted or are pending before or threatened
by the Commission under the 1933 Act, and nothing has come to its
attention which causes it to believe that at the time the registration
statement became effective, or at the time of the signing of this
Agreement, such registration statement (except for the financial
statements and other financial and statistical data included therein,
as to which counsel need express no opinion), contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; and such counsel knows of no legal or
government proceedings required to be

A-11
<PAGE>

described in the registration statement or of any contract or document
of a character required to be described in the registration statement
that is not described as required.

In giving the opinions set forth above, this counsel may state that it
is relying on certificates of the officers of the Trust with regard to matters
of fact and certain certifications and written statements of governmental
officials with respect to the good standing of the Trust.

(i) That the UBS Funds shall have received a certificate from the
President and Secretary of the Trust to the effect that the statements contained
in the registration statement of the Trust filed with the Commission on April
28 1998, at the time the registration statement became effective, at the date of
the signing of this Agreement, at the Closing, and at all times during this
period did not contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading.

(j) That the Trust's Registration Statement with respect to the Class
I shares of the Brinson Fund to be delivered to the UBS Portfolio's shareholders
in accordance with this Agreement shall have become effective, and no stop order
suspending the effectiveness of the Registration Statement or any amendment or
supplement thereto, shall have been issued prior to the Closing Date or shall be
in effect at Closing, and no proceedings for the issuance of such an order shall
be pending or threatened on that date.

(k) That the Class I shares of the Brinson Fund to be delivered
hereunder shall be eligible for sale by the Trust with each state commission or
agency with which such eligibility is required in order to permit the shares
lawfully to be delivered to each UBS Portfolio shareholder.

(l) That at the Closing, the UBS Funds transfers to the Brinson Fund
aggregate Net Assets of the UBS Portfolio comprising at least 90% in fair market
value of the total net assets and 70% in fair market value of the total gross
assets recorded on the books of the UBS Portfolio on the Closing Date.

9. BROKERAGE FEES AND EXPENSES; OTHER AGREEMENTS
---------------------------------------------

(a) The UBS Funds and the Trust each represents and warrants to the
other that there are no broker or finders' fees payable by it in connection with
the transactions provided for herein.

(b) The expenses of entering into and carrying out the provisions of
this Agreement, whether or not consummated, shall be borne exclusively by UBS
A.G. or its affiliates and neither UBS Funds nor the Trust will bear any such
expenses.

(c) Any other provision of this Agreement to the contrary
notwithstanding, any liability of the UBS Funds under this Agreement with
respect to any UBS Portfolio, or in

A-12
<PAGE>

connection with the transactions contemplated herein with respect to any UBS
Portfolio, shall be discharged only out of the assets of that UBS Portfolio, and
no other Portfolio of the UBS Funds shall be liable with respect thereto.

10. TERMINATION, WAIVER; ORDER
--------------------------

(a) Anything contained in this Agreement to the contrary
notwithstanding, this Agreement may be terminated and the Plan of Reorganization
abandoned at any time (whether before or after adoption thereof by the
shareholders of the UBS Portfolio) prior to the Closing as follows:

(1) by mutual consent of the UBS Funds and the Trust;

(2) by the Trust if any condition precedent to its obligations
set forth in Section 8 has not been fulfilled or waived by the Trust;
or

(3) by the UBS Funds if any condition precedent to its
obligations set forth in Section 8 has not been fulfilled or waived by
the UBS Funds.

An election by the UBS Funds or the Trust to terminate this
Agreement and to abandon the Plan of Reorganization shall be exercised
respectively by the Board of Directors of the UBS Funds or the Board of Trustees
of the Trust.

(b) If the transactions contemplated by this Agreement have not
been consummated by March 31, 1999, this Agreement shall automatically terminate
on that date, unless a later date is agreed to by both the UBS Funds and the
Trust.

(c) In the event of termination of this Agreement pursuant to the
provisions hereof, the same shall become void and have no further effect, and
there shall not be any liability on the part of either the UBS Funds or the
Trust or persons who are their directors, trustees, officers, agents or
shareholders in respect of this Agreement.

(d) At any time prior to the Closing, any of the terms or
conditions of this Agreement may be waived by either the UBS Funds or the Trust,
respectively (whichever is entitled to the benefit thereof), by action taken by
the Board of Directors of the UBS Funds or the Board of Trustees of the Trust,
if, in the judgment of the Board of Directors of the UBS Funds or the Board of
Trustees of the Trust (as the case may be), such action or waiver will not have
a material adverse affect on the benefits intended under this Agreement to the
holders of shares of the UBS Portfolio or the Brinson Fund, on behalf of which
such action is taken.

(e) The respective representations and warranties contained in
Sections 4-7 hereof shall expire with, and be terminated by, the Plan of
Reorganization, and neither the UBS Funds nor the Trust nor any of their
officers, trustees or directors, agents or shareholders shall have any liability
with respect to such representations or warranties after the Closing. This
provision shall not protect any officer, trustee or director, agent or
shareholder of the UBS Funds

A-13
<PAGE>

or the Trust against any liability to the entity for which that officer, trustee
or director, agent or shareholder so acts or to its shareholders to which that
officer, trustee or director, agent or shareholder would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties in the conduct of such office.

(f) If any order or orders of the Commission with respect to this
Agreement shall be issued prior to the Closing and shall impose any terms or
conditions which are determined by action of the Board of Directors of the UBS
Funds or the Board Trustees of the Trust to be acceptable, such terms and
conditions shall be binding as if a part of this Agreement without further vote
or approval of the shareholders of the UBS Portfolio, unless such terms and
conditions shall result in a change in the method of computing the number of
Class I shares of the Brinson Fund to be issued to the UBS Portfolio in which
event, unless such terms and conditions shall have been included in the proxy
solicitation material furnished to the shareholders of the UBS Portfolio prior
to the meeting at which the transactions contemplated by this Agreement shall
have been approved, this Agreement shall not be consummated and shall terminate
unless the UBS Funds shall promptly call a special meeting of shareholders of
the UBS Portfolio at which such conditions so imposed shall be submitted for
approval.

11. ENTIRE AGREEMENT AND AMENDMENTS
-------------------------------

This Agreement embodies the entire Agreement between the parties and
there are no agreements, understandings, restrictions, or warranties between the
parties other than those set forth herein or herein provided for. This
Agreement may be amended only by mutual consent of the parties in writing.
Neither this Agreement nor any interest herein may be assigned without the prior
written consent of the other party.

12. COUNTERPARTS
------------

This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but all such counterparts together
shall constitute but one instrument.

13. NOTICES
-------

Any notice, report, or demand required or permitted by any provision
of this Agreement shall be in writing and shall be deemed to have been given if
delivered or mailed, first class postage prepaid, addressed to the UBS Funds at
200 Clarendon Street, Boston, MA 02116 ATTENTION: Paul J. Jasinski, President,
or to the Trust at 209 South LaSalle Street, Chicago, Illinois 60604, Attention:
Thomas E. McFarlan, President, as the case may be .

14. GOVERNING LAW
-------------

This Agreement shall be governed by and carried out in accordance with
the internal laws of the State of Delaware.

A-14
<PAGE>

IN WITNESS WHEREOF, the UBS Funds and the Trust have each caused this
Agreement and Plan of Reorganization to be executed on its behalf by its duly
authorized officers, all as of the day and year first above written.

UBS PRIVATE INVESTOR FUNDS, INC.

Attest:

_____________________________ By: ______________________________
Susan C. Mosher, Secretary Paul J. Jasinski, President

THE BRINSON FUNDS

Attest:

By:
----------------------------- -------------------------------
Carolyn M. Burke, Secretary E. Thomas Mc Farlan, President

A-15
<PAGE>

EXHIBIT B

ADDITIONAL INFORMATION REGARDING THE BRINSON FUND

Unless otherwise defined in this Exhibit B, all capitalized terms have the
meanings set forth in the Prospectus/Proxy Statement.

INVESTMENT CONSIDERATIONS AND RISKS
- -----------------------------------

The following provides information about the types of instruments in which
the Brinson Fund may invest, strategies employed by the Advisor in its attempt
to attain the Brinson Fund's investment objective and a summary of related
risks. Shareholders should understand that all investments involve risks and
there can be no guarantee against loss resulting from an investment in the
Brinson Fund, nor can there be any assurance that the Brinson Fund will be able
to attain its investment objective.

Foreign Investments

Investments in securities of foreign issuers may involve greater risks than
those of U.S. issuers. There is generally less information available to the
public about non-U.S. companies and less government regulation and supervision
of non-U.S. stock exchanges, brokers and listed companies. Non-U.S. companies
are not subject to uniform global accounting, auditing and financial reporting
standards, practices and requirements. Securities of some non-U.S. companies are
less liquid and their prices more volatile than securities of comparable U.S.
companies. Securities trading practices abroad may offer less protection to
investors. Settlements of transactions in some non-U.S. markets may be delayed
or be less frequent than in the United States, which could affect the liquidity
of the Brinson Fund's portfolio. Additionally, in some non-U.S. countries, there
is the possibility of expropriation or confiscatory taxation, limitations on the
removal of securities, property or other assets of the Brinson Fund, political
or social instability, or diplomatic developments which could affect U.S.
investments in those countries. The Brinson Fund intends to diversify broadly
among countries, but reserves the right to invest a portion of its assets in one
or more countries if economic and business conditions warrant such investments.
The Advisor will take these factors in consideration by managing the Brinson
Fund's investments. Because the Brinson Fund will keep its books and records in
U.S. dollars, the Brinson Fund will be required, for federal income tax
purposes, to account for income and losses on all transactions involving foreign
currency under Section 988 of the Internal Revenue Code of 1986, as amended,
(the "Code") and the applicable U.S. Treasury Regulations, so that generally any
component of a gain or loss attributable to currency fluctuations results in
ordinary income or loss and not capital gain or loss.

The U.S. dollar market value of the Brinson Fund's investments and of
dividends and interest earned by the Brinson Fund may be significantly affected
by changes in currency exchange rates. Some currency prices may be volatile, and
there is the possibility of governmental controls on currency exchange or
governmental intervention in currency markets, which could adversely affect the
Brinson Fund. Although the Brinson Fund may attempt to manage currency exchange
rate risks, there is no assurance that the Brinson Fund will do so at an
appropriate time or that it will be able to predict exchange rates accurately.
For example, if the Brinson Fund increases its exposure to a currency and that
currency's price subsequently falls, such currency management may result in
increased losses to the Brinson Fund. Similarly, if the Brinson Fund decreases
its exposure to a currency, and the currency's price rises, the Brinson Fund
will lose the opportunity to participate in the currency's appreciation The
Brinson Fund will manage currency exposures relative to the normal currency
allocation and will consider return and risk of currency exposures relative to
its benchmark. In addition, if the currency in which a security is denominated
appreciates against the U.S. dollar, the dollar value of the security will
increase. Conversely, a decline in the exchange rate of the currency would
adversely affect the value of the security expressed in dollars.

The non-U.S. fixed income component of the Brinson Fund will typically be
invested in the securities of non-U.S. governments, governmental agencies and
supranational issues. A supranational entity is an entity established or
financially supported by the national governments of one or more countries to
promote reconstruction or development. Examples of supranational entities
include, among others: the World Bank, the European Economic Community, the
European Coal and Steel Community, the European Investment Bank, the Inter-
American Development Bank, the Export-Import Bank and the Asian Development
Bank.
<PAGE>

Payments to holders of the higher yielding foreign debt securities in which
the Brinson Fund may invest may be subject to foreign withholding and other
taxes. Although the holders of foreign government and government-related debt
securities may be entitled to tax gross-up payments from the issuers of such
securities, there is no assurance that such payments will be made.

Foreign Currency Transactions

To manage exposure to currency fluctuations, the Brinson Fund may alter
fixed income or money market exposures, enter into forward currency exchange
contracts, buy or sell options or futures relating to foreign currencies and may
purchase securities indexed to currency baskets. The Brinson Fund will also use
these currency exchange techniques in the normal course of business to hedge
against adverse changes in exchange rates in connection with purchases and sales
of securities. Some of these strategies may require the Brinson Fund to set
aside liquid assets in a segregated custodial account to cover its obligations.

Futures, Options and Derivative Instruments

The investment in futures, options, forward contracts, and similar
strategies by the Brinson Fund will depend on the Advisor's judgment as to the
potential risks and rewards of different types of strategies, and it should be
recognized that the use of these instruments exposes the Brinson Fund to
additional investment risks and transaction costs. If the Advisor incorrectly
analyzes the market conditions or does not employ the appropriate strategy with
respect to these instruments, the Brinson Fund could be left in a less favorable
position. For example, gains and losses on investments in futures depend on the
Advisor's ability to predict correctly the direction of security prices,
interest rates and other economic factors. For example, if a hedge is applied at
an inappropriate time or price trends are judged incorrectly, options and
futures strategies may lower the Brinson Fund's return (i.e., options and
futures may fail as hedging techniques in cases where the price movements of the
securities underlying the options and futures do not follow the price movements
of the portfolio securities subject to the hedge).

The Brinson Fund may invest in derivatives for hedging purposes, to
maintain liquidity, or in anticipation of changes in the composition of its
portfolio holdings. The Brinson Fund will not engage in derivative investments
purely for speculative purposes. The Brinson Fund will invest in one or more
derivatives only to the extent that the instrument under consideration is judged
by the Advisor to be consistent with the Brinson Fund's overall investment
objective and policies. In making such judgment, the potential benefits and
risks will be considered in relation to the Brinson Fund's other portfolio
investments.

Where not specified, investment limitations with respect to the Brinson
Fund's derivative instruments will be consistent with the Brinson Fund's
existing percentage limitations with respect to its overall investment policies
and restrictions. The risks and policies of various types of derivative
instruments permitted for the Brinson Fund, including options, futures and
forward contracts, are described in greater detail in the Statement of
Additional Information to this Prospectus/Proxy Statement.

B-2
<PAGE>

MANAGEMENT OF THE TRUST

The Board of Trustees

The Trust is a Delaware business trust. Under Delaware law, the Board of
Trustees has overall responsibility for managing the business and affairs of the
Trust. The Trustees elect the officers of the Trust, who are responsible for
administering the day-to-day operations of the Brinson Fund.

Information Regarding the Advisor

The Advisor, a Delaware corporation, is an investment management firm that,
in addition to managing the Trust, serves as the investment advisor to nine
other investment companies: Brinson Relationship Funds, which includes seventeen
investment portfolios (series); The Enterprise Group of Funds, Inc. -
International Growth Portfolio; Enterprise Accumulation Trust - International
Growth Portfolio; Fort Dearborn Income Securities, Inc.; The Hirtle Callaghan
International Trust - The International Equity Portfolio; John Hancock Variable
Annuity Series Trust - International Balanced Portfolio; Managed Accounts
Services Portfolio Trust - Pace Large Company Value Equity Investments; AON
Funds - International Equity Fund; and The Republic Funds - Republic Equity
Fund.

Brinson has offices in Bahrain, Basel, Frankfurt, Geneva, Hong Kong,
London, Melbourne, New York, Paris, Rio de Janeiro, Singapore, Sydney, Tokyo and
Zurich, in addition to its principal office at 209 South LaSalle Street,
Chicago, IL 60604-1295. Brinson is a wholly-owned subsidiary of UBS A.G. UBS
A.G., with headquarters in Basel, Switzerland, is an internationally diversified
organization with operations in many aspects of the financial services industry.
UBS A.G. was formed by the merger of Union Bank of Switzerland and Swiss Bank
Corporation in June 1998.

Pursuant to its investment advisory agreement (the "Agreement") with the
Trust on behalf of the Brinson Fund, the Advisor is entitled to receive a
monthly fee equal to an annual percentage rate of the Brinson Fund's average
daily net assets for providing investment advisory services. The Advisor is
responsible for paying its own expenses. Pursuant to the Agreement, the Advisor
is authorized, at its own expense, to obtain statistical and other factual
information and advice regarding economic factors and trends from its foreign
subsidiaries, but it does not generally receive advice or recommendations
regarding the purchase or sale of securities from such subsidiaries.

Investment decisions for the Brinson Fund are made by an investment
management team at Brinson. No one member of the investment management team is
primarily responsible for making recommendations for portfolio purchases for the
Brinson Fund.

ADMINISTRATION OF THE TRUST

The Underwriter

FDI was engaged as underwriter pursuant to an agreement dated February 5,
1997. The fee for FDI's service is borne by the Advisor.

The Administrator

Administrative, Accounting, Transfer Agency and Custodian Services

The Trust, on behalf of the Brinson Fund, has entered into a Services
Agreement with MSTC pursuant to which MSTC is required to provide general
administrative, accounting, portfolio valuation, transfer agency and custodian
services to the Brinson Fund.

MSTC provides custodian services for the securities and cash of the Brinson
Fund. The custody fee schedule is based primarily on the net amount of assets
held during the period for which payment is being made plus a per transaction
fee for transactions during the period and out-of-pocket expenses.

Investors Bank and Trust Company, 200 Clarendon Street, Boston,
Massachusetts, will serve as co-custodian for the Brinson Fund with respect to
certain foreign securities until such securities are transferred to

B-3
<PAGE>

MSTC. After such securities are transferred to MSTC, MSTC will be the sole
custodian of the Brinson Fund under the terms of the Services Agreement.

As authorized under the Services Agreement, MSTC has entered into the CGFSC
Agreement with CGFSC. Subject to the supervision of the Board of Trustees of the
Trust, MSTC supervises and monitors such services provided by CGFSC.

Pursuant to the CGFSC Agreement, CGFSC provides:

(1) administrative services, including providing the necessary office
space, equipment and personnel to perform administrative and clerical
services; preparing, filing and distributing proxy materials, periodic
reports to investors, registration statements and other documents; and
responding to investor inquiries;

(2) accounting and portfolio valuation services, including the daily
calculation of the Brinson Fund's net asset value and the preparation
of certain financial statements; and

(3) transfer agency services, including the maintenance of each investor's
account records, responding to investors' inquiries concerning
accounts, processing purchases and redemptions of the Brinson Fund's
shares, acting as dividend and distribution disbursing agent and
performing other service functions. Shareholder inquiries should be
made to the transfer agent at 1-800-448-2430.

Also, as authorized under the Services Agreement, MSTC has entered into a
sub-administration agreement (the "FDI Agreement") with FDI under which FDI
provides administrative assistance to the Brinson Fund with respect to (i)
regulatory matters, including regulatory developments and examinations, (ii) all
aspects of the Brinson Fund's day-to-day operations, (iii) office facilities,
clerical and administrative services, and (iv) maintenance of books and records.

Pursuant to the CGFSC Agreement and the FDI Agreement, MSTC pays CGFSC and
FDI, respectively, for the services that CGFSC and FDI provide to MSTC in
fulfilling MSTC's obligations under the Services Agreement.

Independent Auditors

Ernst & Young LLP, Chicago, Illinois, are the independent auditors of the
Trust.

PURCHASE OF SHARES

Shares of the Brinson Fund may be purchased directly from the Trust at the
net asset value next determined after receipt of the order in proper form by the
transfer agent. There is no sales load in connection with the purchase of the
Brinson Fund's shares. The Trust reserves the right to reject any purchase order
and to suspend the offering of shares of the Brinson Fund or any Trust Series.
The Brinson Fund will not accept a check endorsed over by a third-party.

Purchase orders for shares of the Brinson Fund which are received by the
transfer agent in proper form prior to the close of regular trading hours
(currently 4:00 p.m. Eastern time) on the New York Stock Exchange (the "NYSE")
on any day that the Brinson Fund's net asset value per share is calculated, are
priced according to the net asset value determined on that day. Purchase orders
for shares of the Brinson Fund received after the close of the NYSE on a
particular day are priced as of the time the net asset value per share is next
determined. The Brinson Fund reserves the right to change the time at which
purchases are priced if the NYSE closes at a time other than 4:00 p.m. Eastern
time or if an emergency exists.

Under certain circumstances, the Trust has entered into one or more
agreements (each, a "Sales Agreement") with brokers, dealers or financial
institutions (each, an "Authorized Dealer") under which the Authorized Dealer
may directly, or through intermediaries that the Authorized Dealer is authorized
to designate under the Sales Agreement (each a "Sub-designee"), accept purchase
and redemption orders that are in "good form" on behalf of the Brinson Fund. The
Brinson Fund will be deemed to have received a purchase order when the
Authorized Dealer or Sub-designee accepts the purchase order and such order will
be priced at the Brinson Fund's net asset value next computed after such order
is accepted by the Authorized Dealer or Sub-designee.

B-4
<PAGE>

The Trust may accept telephone orders for the Brinson Fund's shares from
broker-dealers or service organizations which have been previously approved by
the Trust. It is the responsibility of such broker-dealers or service
organizations to promptly forward purchase orders and payments for the same to
the Brinson Fund. Shares of the Brinson Fund may be purchased through broker-
dealers, banks and bank trust departments which may charge the investor a
transaction fee or other fee for their services at the time of purchase. Such
fees would not otherwise be charged if the shares were purchased directly from
the Trust.

The Advisor, or its affiliates, from its own resources, may compensate
broker-dealers or the financial intermediaries ("Services Providers") for
marketing, shareholder servicing, recordkeeping and/or other services performed
with respect to the Brinson Fund's Class I Shares. Payments made for any of
these purposes may be made from its revenues, its profits or any other sources
available to it. When such service arrangements are in effect, they are made
generally available to all qualified Service Providers.

Purchases may be made in one of the following ways:

<TABLE>
<CAPTION>
INITIAL INVESTMENT SUBSEQUENT INVESTMENTS
------------------ ----------------------
<S> <C> <C>
MINIMUM $1,000,000 MINIMUM $2,500

By Mail: . Complete and sign the Account Application . Make your check payable to "Brinson U.S. Large
that accompanies the Brinson Fund's prospectus. Capitalization Growth Fund-Class I."
. Make your check payable to "Brinson U.S. . Enclose the remittance portion of your account
Large Capitalization Growth Fund-Class I." statement and include the amount of investment,
. Mail to the address indicated on the Account the account name and number.
Application. . Mail to the address indicated on your account
statement or enclose in the envelope provided.

By Wire: . Call 1-800-448-2430 to arrange for a wire . Wire federal funds to:
transaction. THE CHASE MANHATTAN BANK
. Wire federal funds within 24 hours to: ABA#021000021
THE CHASE MANHATTAN BANK DDA#9102-783504
ABA#021000021 FOR: "BRINSON U.S. LARGE CAPITALIZATION
DDA#9102-783504 GROWTH FUND-CLASS I" AND INCLUDE YOUR NAME
FOR: "BRINSON U.S. LARGE CAPITALIZATION AND ACCOUNT NUMBER.
GROWTH FUND-CLASS I" AND INCLUDE YOUR NAME
AND NEW ACCOUNT NUMBER.
. Complete and sign the Account Application and
mail to the address indicated on the Account
Application immediately following the initial
wire transaction.

INITIAL INVESTMENT SUBSEQUENT INVESTMENTS
------------------ ----------------------

MINIMUM $1,000,000 MINIMUM $2,500

By telephone: . Call 1-800-448-2430 to arrange for a . Call 1-800-448-2430 to arrange for a
telephone transaction. telephone transaction.
Purchasing By . You may open a new account for a Trust Series . You may purchase additional shares of a Trust
Exchanges: by making an exchange from an existing Brinson Series by making an exchange from an existing
Fund-Class I account of any other Trust Series. Brinson Fund-Class I account of any other Trust
Exchanges may be made by mail or telephone. Series. Exchanges may be made by mail or
Call 1-800-448-2430 for assistance. telephone. Call 1-800-448-2430 for assistance.
</TABLE>

B-5
<PAGE>

<TABLE>
<CAPTION>
INITIAL INVESTMENT SUBSEQUENT INVESTMENTS
------------------ ----------------------
<S> <C> <C>
MINIMUM $1,000,000 MINIMUM $2,500

Automatically: . Please refer to "Automatic Investment Plan" under . Please refer to "Automatic Investment Plan"
"Account Options" or call 1-800-448-2430 for under "Account Options" or call 1-800-448-2430 for
assistance. assistance.
</TABLE>

ACCOUNT OPTIONS

The following account options are available to shareholders. There are no
charges for the programs noted below and an investor may change or terminate
these plans at any time by written notice to the Trust. For information about
participating in these account options, call the transfer agent at 1-800-448-
2430.

<TABLE>
<CAPTION>
ACCOUNT OPTIONS INSTRUCTIONS
--------------- -------------
<S> <C>
AUTOMATIC INVESTMENT PLAN . You may have money deducted directly from your checking, savings or bank money
market accounts for investment in the Trust Series each month or quarter.
. Complete the Automatic Investment Plan application, which is available upon
request by calling 1-800-448-2430, and mail it to the address indicated.
. The initial account must be opened first with the initial $1,000,000 minimum
investment, with subsequent minimum investments of $500 pursuant to the Automatic
Investment Plan.
. The account designated will be debited in the specified amount, on the date
indicated, and Fund shares will be purchased. The Trust may alter or terminate
the Automatic Investment Plan at any time.

SYSTEMATIC WITHDRAWAL PLAN . A shareholder with a minimum account of $1,000,000 may direct the transfer
agent to send the shareholder (or anyone the shareholder designates) regular,
monthly, quarterly or semi-annual payments. Each payment under a systematic
Withdrawal Plan ("SWP") must be at least $500. Such payments are drawn from
share redemptions.
. Shareholders participating in the SWP must elect to have their dividends and
distributions automatically reinvested in additional Brinson Fund shares.
. The Trust may terminate any SWP for an account if the value of the account
falls below $50,000 as a result of share redemptions or an exchange of shares of
a Trust Series for Brinson Fund-Class I shares of another Trust Series.

INDIVIDUAL RETIREMENT . An IRA is a tax-deferred retirement savings account that may be used by an
ACCOUNTS individual under age 70 1/2 who has compensation or self-employment income and
his or her unemployed spouse, or an individual who has received a qualified
distribution from his or her employer's retirement plan.
. The minimum purchase requirement for IRAs is $2,000.
</TABLE>

REDEMPTION OF SHARES

Shares of the Brinson Fund may be redeemed without charge on any business
day that the NYSE is open. Redemptions will be effected at the net asset value
per share next determined after the receipt by the transfer agent of a
redemption request meeting the requirements described below. The Trust normally
sends redemption proceeds on the next business day but, in any event, redemption
proceeds are sent within five business days of receipt of a redemption request
in proper form. Payment also may be made by wire directly to any bank previously
designated by the shareholder in an Account Application. A shareholder's bank
may impose a fee for wire service. The Trust will honor redemption requests of
shareholders who recently purchased shares by check, but will not mail the
proceeds until it is reasonably satisfied that the purchase check has cleared,
which may take up to fifteen days from the purchase date.

B-6
<PAGE>

Except as noted below, redemption requests received in proper form by the
transfer agent prior to the close of regular trading hours on the NYSE on any
business day that the Brinson Fund's net asset value per share is calculated are
effected that day. The Brinson Fund reserves the right to change the time at
which purchases are priced if the NYSE closes at a time other than 4:00 p.m.
Eastern time or if an emergency exists. Redemption requests received in proper
form by the transfer agent after the close of the NYSE are effected as of the
time the net asset value per share is next determined. No redemption will be
processed until the transfer agent has received a completed application with
respect to the account.

Shares of the Brinson Fund may be redeemed through certain broker-dealers,
banks and bank trust departments who may charge the investor a transaction fee
or other fee for their services at the time of redemption. Such fees would not
otherwise be charged if the shares were redeemed directly from the Trust.

Customers of Eligible Institutions must request a representative of their
Eligible Institution to assist them in placing a redemption order with the
Brinson Fund.

Under the Sales Agreement, the Authorized Dealer or Sub-designee is
authorized to accept redemption orders on behalf of the Brinson Fund. The
Brinson Fund will be deemed to have received a redemption order when the
Authorized Dealer or Sub-designee accepts the redemption order and such order
will be priced at the Brinson Fund's net asset value next computed after such
order is accepted by the Authorized Dealer or Sub-designee.

The Trust will satisfy redemption requests in cash to the fullest extent
feasible, so long as such payments would not, in the opinion the of Advisor or
the Board of Trustees, result in the necessity of the Brinson Fund selling
assets under disadvantageous conditions and to the detriment of the remaining
shareholders of the Brinson Fund. Pursuant to the Trust's Agreement and
Declaration of Trust, payment for shares redeemed may be made either in cash or
in-kind, or partly in cash and part in-kind. However, the Trust has elected,
pursuant to Rule 18f-1 under the 1940 Act, to redeem its shares solely in cash
up to the lesser of $250,000 or 1% of the net asset value of the Brinson Fund,
during any 90-day period for any one shareholder. Payments in excess of this
limit will also be made wholly in cash unless the Board of Trustees believes
that economic conditions exist which would make such a practice detrimental to
the best interests of the Brinson Fund. Any portfolio securities paid or
distributed in-kind would be valued as described under "Net Asset Value." In the
event that an in-kind distribution is made, a shareholder may incur additional
expenses, such as the payment of brokerage commissions, on the sale or other
disposition of the securities received from the Brinson Fund. In-kind payments
need not constitute a cross-section of the Brinson Fund's portfolio. Where a
shareholder has requested redemption of all or a part of the shareholder's
investment and where the Brinson Fund computes such redemption in-kind, the
Brinson Fund will not recognize gain or loss for federal tax purposes on the
securities used to compute the redemption, but the shareholder will recognize
gain or loss equal to the difference between the fair market value of the
securities received and the shareholder's basis in the Fund shares redeemed.

Shares may be redeemed in one of the following ways:

By Mail: . Submit a written request for redemption with:
. The Brinson Fund's name;
. Your Fund account number;
. The dollar amount or number of shares to be
redeemed; and
. Signatures of all persons required to sign for
transactions, exactly as their names appear on the
Account Application.
. A signature guarantee for the signature of each person in
whose name the account is registered is required on all
written redemption requests over $5,000.
. Mail to the address indicated on the Account Application.
Questions may be directed to the transfer agent at 1-800-
448-2430.

By Wire: . This service must be elected either on the initial
application or subsequently arranged in writing.
. Shares may be redeemed by instructing the transfer agent
by telephone at 1-800-448-2430.

B-7
<PAGE>

. Wire redemption requests must be received by the transfer
agent before 4:00 p.m. Eastern time for money to be wired
the next business day.

By Telephone: . This service must be elected either on the initial
application or subsequently arranged in writing.
. Shares may be redeemed by instructing the transfer agent
by telephone at 1-800-448-2430.
. Shares will be sold at the next share price calculated
after the order is received and accepted. Share price is
normally calculated at 4:00 p.m. Eastern time.

Automatically: . Please refer to "Systematic Withdrawal Plan" under
"Account Options" or call 1-800-448-2430 for assistance.

_____________

Note: The Trust reserves the right to refuse a wire or telephone redemption if
it is believed advisable to do so. Procedures for redeeming shares of the
Brinson Fund by wire or telephone may be modified or terminated at any
time by the Trust.

TELEPHONE TRANSACTIONS

Shareholders who wish to initiate purchase, exchange or redemption
transactions by telephone must elect the option, as described above. With
respect to such telephone transactions, the Brinson Fund will ensure that
reasonable procedures are used to confirm that instructions communicated by
telephone are genuine (including verification of the shareholder's social
security number or mother's maiden name) and, if it does not, the Brinson Fund
or the transfer agent may be liable for any losses due to unauthorized or
fraudulent transactions. Written confirmation will be provided for all purchase,
exchange and redemption transactions initiated by telephone.

EXCHANGE OF SHARES

Shares of the Brinson Fund may be exchanged for Brinson Fund-Class I Shares
of any other Trust Series. Exchanges will not be permitted between the Brinson
Fund-Class I shares and either the UBS Investment Funds class of shares or the
Brinson Fund-Class N shares of a Trust Series.

Shares of the Brinson Fund may be exchanged by written request or by
telephone if the shareholder has previously signed a telephone authorization on
the Account Application. The telephone exchange may be difficult to implement
during times of drastic economic or market changes. The Trust reserves the right
to restrict the frequency of, or otherwise modify, condition, terminate or
impose changes upon the exchange and/or telephone transfer privileges upon 60
days' prior written notice to shareholders.

Exchanges will be made on the basis of the relative net asset value per
share of the Brinson Fund-Class I shares of the Trust Series from which, and the
Trust Series into which, the exchange is made. Exchanges may be made only for
shares of a Trust Series and class then offering its shares for sale in the
purchaser's state of residence and are subject to the minimum initial investment
requirement. For federal income tax purposes, an exchange of shares would be
treated as if the shareholder had redeemed shares of one Trust Series and
reinvested in shares of another Trust Series. Gains or losses on the shares
exchanged are realized by the shareholder at the time of the exchange. Any
shareholder wishing to make an exchange should first obtain and review a
prospectus of the other Trust Series. Requests for telephone exchanges must be
received by the transfer agent by the close of regular trading hours (currently
4:00 p.m. Eastern time) on the NYSE on any day that the NYSE is open for regular
trading. The Brinson Fund reserves the right to change the time at which
exchanges are priced if the NYSE closes at a time other than 4:00 p.m. Eastern
time or if an emergency exists.

TRANSFER OF SECURITIES

At the discretion of the Trust, investors may be permitted to purchase the
Brinson Fund's Class I Shares by transferring securities to the Brinson Fund
that meet the Brinson Fund's investment objective and policies. Securities
transferred to the Brinson Fund will be valued in accordance with the same
procedures used to determine

B-8
<PAGE>

the Brinson Fund's net asset value at the time of the next determination of net
asset value after such acceptance. Shares issued by the Brinson Fund in exchange
for securities will be issued at the net asset value per share of the Brinson
Fund determined as of the same time. All dividends, interest, subscription, or
other rights pertaining to such securities shall become the property of the
Brinson Fund and must be delivered to the Brinson Fund by the investor upon
receipt from the issuer. Investors who are permitted to transfer such securities
will be required to recognize a gain or loss on such transfer and pay tax
thereon, if applicable, measured by the difference between the fair market value
of the securities and the investors' basis therein. Securities will not be
accepted in exchange for shares of the Brinson Fund unless: (1) such securities
are, at the time of the exchange, eligible to be included in the Brinson Fund's
portfolio and current market quotations are readily available for such
securities; (2) the investor represents and warrants that all securities offered
to be exchanged are not subject to any restrictions upon their sale by the
Brinson Fund under the Securities Act of 1933, as amended, or under the laws of
the country in which the principal market for such securities exists, or
otherwise; and (3) the value of any such security (except U.S. government
securities) being exchanged, together with other securities of the same issuer
owned by the Brinson Fund, will not exceed 5% of the Brinson Fund's net assets
immediately after the transaction.

NET ASSET VALUE

The net asset value per share for each class of shares of the Brinson Fund
is computed by adding, with respect to each class of shares, the value of the
Brinson Fund's investments, cash and other assets attributable to that class,
deducting liabilities of the class and dividing the result by the number of
shares of that class outstanding. The public offering price of the shares of
each classes' shares, all of which are sold on a continuous basis, is the net
asset value of that class.

The valuation of assets for determining the net asset value of the Class I
Shares may be summarized as follows: Securities traded on securities exchanges
are valued at the last available sale price. Securities that are not traded on a
particular day or on an exchange are valued at either (a) the bid price or (b) a
valuation within the range considered best to represent value in the
circumstances. Price information on listed securities is generally taken from
the closing price on the exchange where the security is primarily traded.
Valuations of equity securities may be obtained from a pricing service and/or
broker-dealers when such prices are believed to reflect fair value of such
securities. Use of a pricing service and/or broker-dealers has been approved by
the Board of Trustees. Futures contracts are valued at their daily quoted
settlement price on the exchange on which they are traded. Forward foreign
currency contracts are valued daily using the mean between the bid and asked
forward points added to the current exchange rate and an unrealized gain or loss
is recorded. The Brinson Fund realizes a gain or loss upon settlement of the
contracts. For valuation purposes, foreign securities initially expressed in
foreign currency values will be converted into U.S. dollar values using
WM/Reuters closing spot rates as of 4:00 p.m. London time.

Securities with a remaining maturity of 60 days or less are valued at
amortized cost, which approximates market value. Fixed income securities having
a remaining maturity of over 60 days are valued at market price. Debt securities
are valued on the basis of prices provided by a pricing service, or at the bid
price where readily available, as long as the bid price, in the opinion of the
Advisor, continues to reflect the value of the security. Redeemable securities
issued by open-end investment companies are valued using their respective net
asset values for purchase orders placed at the close of the NYSE. Securities
(including over-the-counter options) for which market quotations are not readily
available and other assets are valued at their fair value as determined in good
faith by or under the direction of the Trustees.

Net asset value is determined on each day that the NYSE is open, as of the
close of business of the regular session of the NYSE (currently 4:00 p.m.
Eastern time). Investments and requests to exchange or redeem shares received by
the Brinson Fund in proper form before such close of business are effective, and
will receive the price determined, on that day. Investment, exchange and
redemption requests received after such close of business are effective, and
will receive the share price determined, on the next business day. The Brinson
Fund reserves the right to change the time at which purchases, redemptions and
exchanges are priced if the NYSE closes at a time other than 4:00 p.m. Eastern
time or if an emergency exists.

Because of time zone differences, foreign exchanges and securities markets
will usually be closed prior to the time of the closing of the NYSE and values
of foreign securities and options and foreign securities will be determined as
of the earlier closing of such exchanges and securities markets. However, events
affecting the values

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<PAGE>

of such foreign securities may occasionally occur between the earlier closings
of such exchanges and securities markets and the closing of the NYSE which will
not be reflected in the computation of the net asset value of a class of the
Brinson Fund. If an event materially affecting the value of such foreign
securities occurs during such period, then such securities will be valued at
fair value as determined in good faith by or under the direction of the Board of
Trustees. Where a foreign securities market remains open at the time that the
Brinson Fund values its portfolio securities, or closing prices of securities
from that market may not be retrieved because of local time differences or other
difficulties in obtaining such prices at that time, last sale prices in such
market at a point in time most practicable to timely valuation of the Brinson
Fund may be used.

The Brinson Fund's portfolio securities from time to time may be listed
primarily on foreign exchanges which trade on days when the NYSE is closed (such
as Saturday). As a result, the net asset value of a class of the Brinson Fund
may be significantly affected by such trading on days when shareholders have no
access to the Brinson Fund.

All of the Brinson Fund's classes of shares will bear pro rata all of the
expenses of the Brinson Fund common to all classes. The net asset value of all
outstanding shares of each class of the Brinson Fund will be computed on a pro
rata basis for each outstanding share based on the proportionate participation
in the Brinson Fund represented by the value of shares of that class. All income
earned and expenses incurred by the Brinson Fund will be borne on a pro rata
basis by each outstanding share of a class, based on each class' proportionate
participation in the Brinson Fund represented by the value of shares of such
class, except that the Brinson Fund-Class N and UBS Investment Funds class of
shares will bear 12b-1 expenses payable under their respective 12b-1 plans.

Due to the specific distribution expenses and other costs that will be
allocable to each class, the dividends paid to each class, and related
performance, of the Brinson Fund may vary. The per share net asset value of the
Brinson Fund-Class N shares and the UBS Investment Funds class of shares will
generally be lower than that of the Brinson Fund-Class I shares of the Brinson
Fund because of the higher expenses borne by the UBS Investment Funds class of
shares and the Brinson Fund-Class N shares. It is expected, however, that the
net asset value per share of the two classes will tend to converge immediately
after the payment of dividends, which will differ by approximately the amount of
the service and distribution expenses differential among the classes.

DIVIDENDS AND DISTRIBUTIONS

The Brinson Fund will distribute its net investment income semi-annually in
June and December. The Brinson Fund will distribute annually in December
substantially all of its net long-term capital gains and any undistributed net
short-term capital gains realized during the one year period commencing November
1 (or date of the creation of the Brinson Fund, if later) and ending October 31,
and, at the same time, will distribute all of its net investment income earned
through the end of December and not previously distributed as ordinary (not
capital) income.

Dividends and other distributions paid by the Brinson Fund with respect to
its Brinson Fund-Class N, Brinson Fund-Class I and UBS Investment Funds class of
shares are calculated in the same manner and at the same time. The per share
amount of any income dividends will generally differ among the classes only to
the extent that the Brinson Fund-Class N and UBS Investment Funds class are
subject to separate 12b-1 fees. The per share dividends on UBS Investment Funds
class of shares and Brinson Fund-Class N shares will be lower than the per share
dividends on the Brinson Fund-Class I shares of the Brinson Fund as a result of
the distribution and service fees applicable with respect to the UBS Investment
Funds class of shares and Brinson Fund-Class N shares.

Income dividends and capital gain distributions are reinvested
automatically in additional Fund shares of the same class of the Brinson Fund at
net asset value, unless the shareholder has notified the transfer agent, in
writing, of the shareholder's election to receive them in cash. Distribution
options may be changed at any time by requesting a change in writing. Any check
in payment of dividends or other disbursements which cannot be delivered by the
Post Office or which remains uncashed for a period of more than one year may be
reinvested in the shareholder's account at the then current net asset value and
the dividend option may be changed from cash to reinvest. Dividends are
reinvested on the ex dividend date (the "ex date") at the net asset value
determined at the close of business on that date. Please note that shares
purchased shortly before the record date for a dividend or distribution may have
the effect of returning capital although such dividend and distributions are
subject to taxes.`

B-10
<PAGE>

TAXES

The Brinson Fund intends to qualify for taxation as a "regulated investment
company" under the Code. Such qualification would relieve the Brinson Fund of
liability for federal income taxes to the extent the Brinson Fund's earnings are
distributed in accordance with the Code. The Brinson Fund is treated as a
separate corporate entity for federal tax purposes.

Distributions of any net investment income and of any net realized short-
term capital gains are taxable to shareholders as ordinary income. All
distributions may be subject to state and local taxes. Distributions of net
capital gain (the excess of net long-term capital gain over net short-term
capital loss) are taxable to shareholders as long-term capital gain regardless
of how long a shareholder may have held Class I Shares of the Brinson Fund. The
tax treatment of distributions of ordinary income or capital gains will be the
same whether the shareholder reinvests the distributions or elects to receive
them in cash. A distribution will be treated as paid on December 31 of the
current calendar year if it is declared in October, November or December with a
record date in such a month and paid during January of the following calendar
year. Such distributions will be taxable to shareholders in the calendar year in
which the distributions are declared, rather than the calendar year in which the
distributions are received.

Shareholders will be advised annually of the source and tax status of all
distributions for federal income tax purposes. Investors should consult their
own tax advisors for more specific information on the tax consequences of
particular types of distributions. Further information regarding the tax
consequences of investing in the Brinson Fund is included in the Statement of
Additional Information to this Prospectus/Proxy Statement. The above discussion
is intended for general information only. Investors should consult their own tax
advisors for more specific information on the tax consequences of particular
types of distributions.

Redemptions of the Brinson Fund's Class I Shares, and the exchange of
shares between the Trust Series, are taxable events and, accordingly,
shareholders may realize capital gains or losses on these transactions. If
shares of a Trust Series are held for six months or less, any loss that a
shareholder will have will be treated as a long-term capital loss to the extent
of any capital gains distributions received by such shareholder from the Trust
Series. All or a portion of any loss on the redemption or exchange of shares
will be disallowed if the shareholder purchases other shares in the Trust Series
within 30 days before or after such redemption or exchange. Redemptions and
exchanges of shares in a Trust Series may also be subject to state and local
taxes.

Shareholders may be subject to back-up withholding on reportable dividend
and redemption payments ("back-up withholding") if a certified taxpayer
identification number is not on file with the Brinson Fund, or if, to the
Brinson Fund's knowledge, an incorrect number has been furnished, or if the
Brinson Fund has been notified by the Internal Revenue Service that an account
is subject to back-up withholding. An individual's taxpayer identification
number is the individual's social security number.

GENERAL INFORMATION

The Trust is registered under the 1940 Act as an open-end management
investment company, commonly known as a mutual fund and consists of thirteen
Trust Series. The Trustees of the Trust may establish additional series or
classes of shares without the approval of shareholders.

DESCRIPTION OF SHARES

Each Trust Series is authorized to issue an unlimited number of shares of
beneficial interest with a $0.001 par value per share. The Board of Trustees has
the power to designate one or more series or sub-series/classes of shares of
beneficial interest and to classify or reclassify only unissued shares with
respect to such series. Shares of each Trust Series represent equal
proportionate interests in the assets of that Trust Series only and have
identical voting, dividend, redemption, liquidation, and other rights, except
that only shares of each Trust Series' Brinson Fund-Class N and UBS Investment
Funds class of shares shall have voting rights with respect to the Rule 12b-1
plan relating to such classes, respectively, as described below. All shares
issued are fully paid and non-assessable, and shareholders have no preemptive or
other right to subscribe to any additional shares and no conversion rights.

B-11
<PAGE>

VOTING RIGHTS

Each issued and outstanding full and fractional share of the Brinson Fund
is entitled to one full and fractional vote in the Brinson Fund and all shares
of the Brinson Fund participate equally with regard to dividends, distributions,
and liquidations with respect to the Brinson Fund. Shareholders do not have
cumulative voting rights. On any matter submitted to a vote of shareholders,
shares of each Trust Series will vote separately except when a vote of
shareholders in the aggregate is required by law, or when the Trustees have
determined that the matter affects the interests of more than one Trust Series,
in which case the shareholders of all such Trust Series shall be entitled to
vote thereon. Only the Brinson Fund-Class N shareholders may vote on matters
related to the Rule 12b-1 plan associated with that class and only the UBS
Investment Funds class shareholders may vote on matters related to the Rule 12b-
1 plan associated with that class.

SHAREHOLDER MEETINGS

The Trustees of the Trust do not intend to hold annual meetings of
shareholders of the Trust Series. The SEC, however, requires the Trustees to
promptly call a meeting for the purpose of voting upon the question of removal
of any Trustee when requested to do so by not less than 10% of the outstanding
shareholders of the respective Trust Series. In addition, subject to certain
conditions, shareholders of each Trust Series may apply to the Trust Series to
communicate with other shareholders to request a shareholders' meeting to vote
upon the removal of a Trustee or Trustees.

PORTFOLIO TRANSACTIONS AND BROKERAGE COMMISSIONS

The Trust will attempt to obtain the best overall price and most favorable
execution of transactions in portfolio securities. However, subject to policies
established by the Board of Trustees of the Trust, the Brinson Fund may pay a
broker-dealer a commission for effecting a portfolio transaction for the Brinson
Fund in excess of the amount of commission another broker-dealer would have
charged if the Advisor determines in good faith that the commission paid was
reasonable in relation to the brokerage or research services provided by such
broker-dealer, viewed in terms of that particular transaction or such firm's
overall responsibilities with respect to the clients, including the Brinson
Fund, as to which it exercises investment discretion. In selecting and
monitoring broker-dealers and negotiating commissions, consideration will be
given to a broker-dealer's reliability, the quality of its execution services on
a continuing basis and its financial condition.

When buying or selling securities, the Brinson Fund may pay commissions to
brokers who are affiliated with the Advisor or the Brinson Fund. The Brinson
Fund may purchase securities in certain underwritten offerings for which an
affiliate of the Brinson Fund may act as an underwriter. The Brinson Fund may
effect futures transactions through, and pay commissions to, futures commission
merchants who are affiliated with the Advisor or the Brinson Fund in accordance
with procedures adopted by the Board of Trustees of the Trust.

SHAREHOLDER REPORTS AND INQUIRIES

Shareholders will receive semi-annual reports showing portfolio investments
and other information as of December 31 and annual reports audited by
independent auditors as of June 30. Shareholders with inquiries should call The
Brinson Funds at 1-800-448-2430 or write to The Brinson Funds, P.O. Box 2798,
Boston, MA 02208-2798.

YEAR 2000 ISSUES

Like other investment companies, as well as other financial and business
organizations around the world, the Trust could be adversely affected if the
computer systems used by the Advisor, MSTC, CGFSC and other service providers,
in performing their administrative functions for the Trust, do not properly
process and calculate date-related information and data as of and after January
1, 2000. This is commonly known as the "Year 2000 Issue." The Year 2000 Issue,
and, in particular, foreign service providers' responsiveness to the issue,
could affect portfolio and operational areas including securities trade
processing, interest and dividend payments, securities pricing, shareholder
account services, custody functions and others. The Advisor, MSTC and CGFSC are
taking

B-12
<PAGE>

steps that they believe are reasonably designed to address the Year 2000 Issue
with respect to computer systems that they use and to obtain reasonable
assurances that comparable steps are being taken by the Trust's other service
providers. These include identifying those systems that may not function
properly after December 31, 1999, and constructing or replacing those systems.
In addition, steps include testing the processing of Trust Series data on all
systems relied on by the Advisor, MSTC and CGFSC. As of the date of this
Prospectus/Proxy Statement, however, there can be no assurance that these steps
will be sufficient to avoid any adverse impact to the Brinson Fund.

PERFORMANCE INFORMATION

From time to time, performance information, such as yield or total return,
may be quoted in advertisements or in communications to present or prospective
shareholders. Performance quotations represent the Brinson Fund's past
performance and should not be considered as representative of future results.
The current yield will be calculated by dividing the net investment income
earned per share by the Brinson Fund during the period stated in the
advertisement (based on the average daily number of shares entitled to receive
dividends outstanding during the period) by the maximum net asset value per
share on the last day of the period and annualizing the result on a semi-annual
compounded basis. The Brinson Fund's total return may be calculated on an
annualized and aggregate basis for various periods (which periods will be stated
in the advertisement). Average annual return reflects the average percentage
change per year in value of an investment in the Brinson Fund. Aggregate total
return reflects the total percentage change over the stated period.

To help investors better evaluate how an investment in the Brinson Fund
might satisfy its investment objective, advertisements regarding the Brinson
Fund may discuss yield or total return as reported by various financial
publications. Advertisements may also compare yield or total return to other
investments, indices and averages. The following publications, benchmarks,
indices and averages may be used: Lipper Mutual Fund Performance Analysis;
Lipper Fixed Income Analysis; Lipper Mutual Fund Indices; Morgan Stanley
Indices; Lehman Brothers Treasury Index; Salomon Brothers Indices; Dow Jones
Composite Average or its component indices; Standard & Poor's 500 Stock Index or
its component indices; Wilshire Indices; The New York Stock Exchange composite
or component indices; CDA Mutual Fund Report; Weisenberger-Mutual Funds Panorama
and Investment Companies; Mutual Fund Values and Mutual Fund Service Book,
published by Morningstar, Inc.; comparable portfolios managed by the Advisor;
and financial publications, such as Business Week, Kiplinger's Personal Finance,
Financial World, Forbes, Fortune, Money Magazine, The Wall Street Journal,
Barron's, et al., which rate fund performance over various time periods.

The principal value of an investment in the Brinson Fund will fluctuate, so
that an investor's shares, when redeemed, may be worth more or less than their
original cost. Any fees charged by banks or other institutional investors
directly to their customer accounts in connection with investments in shares of
the Brinson Fund will not be included in the Brinson Fund's calculations of
yield or total return.

B-13
<PAGE>

STATEMENT OF ADDITIONAL INFORMATION

THE BRINSON FUNDS

RELATING TO THE ACQUISITION OF THE ASSETS OF
UBS LARGE CAP GROWTH FUND OF UBS PRIVATE INVESTOR FUNDS, INC.

This Statement of Additional Information relates specifically to the
proposed acquisition of substantially all of the assets of the UBS Large Cap
Growth Fund (the "UBS Fund") of UBS Private Investor Funds, Inc. (the
"Corporation") by the U.S. Large Capitalization Growth Fund (the "Brinson Fund")
of The Brinson Funds (the "Transaction").

This Statement of Additional Information also includes the following
documents, which are attached and incorporated by reference:

. Pro forma financial statements reflecting the financial situation
of the Brinson Fund following the Transaction as if the
Transaction had taken place on June 30, 1998.

. The Annual Report to Shareholders of the UBS Fund, containing
audited financial statements for the fiscal period ended December
31, 1997, and including the Annual Report to Shareholders of the
UBS Large Cap Growth Portfolio (the "UBS Portfolio") of UBS
Investor Portfolios Trust, containing audited financial
statements for the fiscal year ended December 31, 1997.

. The Semi-Annual Report to Shareholders of the UBS Fund for the
period ended June 30, 1998, and including the Semi-Annual Report
to Shareholders of the UBS Portfolio for the period ended June
30, 1998.

Much of the information contained in this Statement of Additional
Information expands upon subjects discussed in the Prospectus/Proxy Statement.

This Statement of Additional Information is not a Prospectus; a
Prospectus/Proxy Statement dated ________ , 1998, relating to the Transaction
may be obtained from the Trust, 209 South LaSalle Street, Chicago, Illinois
60604, (800) 448-2430. This document should be read in conjunction with such
Prospectus/Proxy Statement. The date of this Statement of Additional Information
is _____, 1998.

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<PAGE>

U.S. LARGE CAPITALIZATION GROWTH FUND

TABLE OF CONTENTS

THE BRINSON FUNDS...............................................................
INVESTMENT STRATEGIES...........................................................
Repurchase Agreements......................................................
Reverse Repurchase Agreements..............................................
Loans of Portfolio Securities..............................................
Futures....................................................................
Options....................................................................
Index Options..............................................................
Special Risks of Options on Indices........................................
Rule 144A Securities.......................................................
Other Investments..........................................................
Foreign Securities.........................................................
Forward Foreign Currency Contracts.........................................
Options on Foreign Currencies..............................................
Convertible Securities.....................................................
When-Issued Securities.....................................................
Asset-Backed Securities....................................................
Zero Coupon and Delayed Interest Securities................................
INVESTMENT RESTRICTIONS.........................................................
MANAGEMENT OF THE TRUST.........................................................
Trustees and Officers......................................................
Compensation Table.........................................................
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES.............................
INVESTMENT ADVISORY AND OTHER SERVICES..........................................
Advisor....................................................................
Administrator..............................................................
Underwriter................................................................
Code of Ethics.............................................................
PORTFOLIO TRANSACTIONS AND BROKERAGE COMMISSIONS................................
Portfolio Turnover.........................................................
SHARES OF BENEFICIAL INTEREST...................................................
PURCHASES.......................................................................
Exchanges of Shares........................................................
Net Asset Value............................................................
REDEMPTIONS.....................................................................
TAXATION........................................................................
PERFORMANCE CALCULATIONS........................................................
Total Return...............................................................
Yield......................................................................
FINANCIAL STATEMENTS............................................................
CORPORATE DEBT RATINGS --- APPENDIX A...........................................
PRO FORMA FINANCIAL STATEMENTS..................................................

1
<PAGE>

THE BRINSON FUNDS

The Brinson Funds (the "Trust"), 209 South LaSalle Street, Chicago,
Illinois 60604-1295, is an open-end management investment company which offers
shares of beneficial interest in series representing separate portfolios of
investments (collectively referred to as the "Trust Series"). This Statement of
Additional Information relates only to the U.S. Large Capitalization Growth Fund
(the "Brinson Fund").

INVESTMENT STRATEGIES

The following discussion of investment techniques and instruments
supplements and should be read in conjunction with the investment objective and
policies set forth in the Brinson Fund's Prospectus/Proxy Statement of the same
date as this Statement of Additional Information. Unless otherwise defined in
this Statement of Additional Information, all capitalized terms have the
meanings set forth in the Prospectus/Proxy Statement. The investment practices
described below are not fundamental and may be changed by the Board of Trustees
without the approval of the shareholders.

REPURCHASE AGREEMENTS

A repurchase agreement provides a fixed rate of return insulated from
market fluctuations during the term of the agreement. The term of a repurchase
agreement generally is short, possibly overnight or for a few days, although it
may extend over a number of months (up to one year) from the date of delivery.
Repurchase agreements will be fully collateralized and the collateral will be
marked-to-market daily.

In the event of bankruptcy or other default by the seller of the security
under a repurchase agreement, the Brinson Fund may suffer time delays and incur
costs or possible losses in connection with the disposition of the collateral.
In such event, instead of the contractual fixed rate of return, the rate of
return to the Brinson Fund would be dependent upon intervening fluctuations of
the market value of the underlying security and the accrued interest on the
security. Although the Brinson Fund would have rights against the seller for
breach of contract with respect to any losses arising from market fluctuations
following the failure of the seller to perform, the ability of the Brinson Fund
to recover damages from a seller in bankruptcy or otherwise in default would be
reduced.

Repurchase agreements are securities for purposes of the tax
diversification requirements that must be met for pass-through treatment under
Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code").
Accordingly, the Brinson Fund will limit the value of its repurchase agreements
on each of the quarterly testing dates to ensure compliance with Subchapter M of
the Code.

REVERSE REPURCHASE AGREEMENTS

In a reverse repurchase agreement, the Brinson Fund retains record
ownership and the right to receive interest and principal payments on the
portfolio securities involved. Any assets held in any segregated accounts
maintained by the Brinson Fund with respect to any reverse repurchase
agreements, when-issued securities, options, futures, forward contracts or other
derivative transactions shall be liquid, unencumbered and marked-to-market daily
(any such assets held in a segregated account are referred to in this Statement
of Additional Information as "Segregated Assets").

A reverse repurchase agreement involves the risk that the market value of
the securities retained by the Brinson Fund may decline below the price of the
securities the Brinson Fund has sold but is obligated to repurchase under the
agreement. In the event the buyer of securities under a reverse repurchase
agreement files for bankruptcy or becomes insolvent, the Brinson Fund's use of
the proceeds of the agreement may be restricted pending a determination by the
other party, or its trustee or receiver, whether to enforce the Brinson Fund's
obligation to repurchase the securities. Reverse repurchase agreements are
considered borrowings by the Brinson Fund and as such, are subject to the same
investment limitations.

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<PAGE>

LOANS OF PORTFOLIO SECURITIES

The Brinson Fund may lend portfolio securities to qualified broker-dealers
and financial institutions provided: (1) the loan is secured continuously by
collateral marked-to-market daily and maintained in an amount at least equal to
the current market value of the securities loaned; (2) the Brinson Fund may call
the loan at any time and receive the securities loaned; (3) the Brinson Fund
will receive any interest or dividends paid on the loaned securities; and (4)
the aggregate market value of securities loaned will not at any time exceed 33
1/3% of the Brinson Fund's total assets.

Collateral will consist of U.S. and non-U.S. securities, cash equivalents
or irrevocable letters of credit. Loans of securities involve a risk that the
borrower may fail to return the securities or may fail to maintain the proper
amount of collateral. Therefore, the Brinson Fund will only enter into
portfolio loans after a review of all pertinent factors by Brinson Partners,
Inc. ("Brinson" or the "Advisor") under the supervision of the Board of
Trustees, including the creditworthiness of the borrower. Creditworthiness will
be monitored on an ongoing basis by the Advisor.

FUTURES

The Brinson Fund may enter into contracts for the purchase or sale for
future delivery of securities. The Brinson Fund may also enter into contracts
for the purchase or sale for future delivery of foreign currencies. A purchase
of a futures contract means the acquisition of a contractual right to obtain
delivery to the Brinson Fund of the securities or foreign currency called for by
the contract at a specified price during a specified future month. When a
futures contract is sold, the Brinson Fund incurs a contractual obligation to
deliver the securities or foreign currency underlying the contract at a
specified price on a specified date during a specified future month.

When the Brinson Fund enters into a futures transaction, it must deliver to
the futures commission merchant selected by the Brinson Fund an amount referred
to as "initial margin." This amount is maintained by the futures commission
merchant in a segregated account at the custodian bank. Thereafter, a
"variation margin" may be paid by the Brinson Fund to, or drawn by the Brinson
Fund from, such account in accordance with controls set for such accounts,
depending upon changes in the price of the underlying securities subject to the
futures contract.

The Brinson Fund will enter into futures transactions on domestic exchanges
and, to the extent such transactions have been approved by the Commodity Futures
Trading Commission for sale to customers in the United States, on foreign
exchanges. In addition, the Brinson Fund may sell stock index futures in
anticipation of or during a market decline to attempt to offset the decrease in
market value of its common stocks that might otherwise result; and it may
purchase such contracts in order to offset increases in the cost of common
stocks that it intends to purchase. Unlike other futures contracts, a stock
index futures contract specifies that no delivery of the actual stocks making up
the index will take place. Instead, settlement in cash must occur upon the
termination of the contract.

While futures contracts provide for the delivery of securities, deliveries
usually do not occur. Contracts are generally terminated by entering into
offsetting transactions.

The Brinson Fund may enter into futures contracts to protect against the
adverse affects of fluctuations in security prices, interest or foreign exchange
rates without actually buying or selling the securities or foreign currency.
For example, if interest rates are expected to increase, the Brinson Fund might
enter into futures contracts for the sale of debt securities. Such a sale would
have much the same effect as selling an equivalent value of the debt securities
owned by the Brinson Fund. If interest rates did increase, the value of the
debt securities in the portfolio would decline, but the value of the futures
contracts to the Brinson Fund would increase at approximately the same rate,
thereby keeping the net asset value of the Brinson Fund from declining as much
as it otherwise would have. Similarly, when it is expected that interest rates
may decline, futures contracts may be purchased to hedge in anticipation of
subsequent purchases of securities at higher prices. Since the fluctuations in
the value of futures contracts should be similar to those of debt securities,
the Brinson Fund could take advantage of the anticipated rise in value of debt
securities without actually buying them until the market had stabilized. At
that time, the futures contracts could be liquidated and the Brinson Fund could
then buy debt securities on the cash market.

3
<PAGE>

To the extent that market prices move in an unexpected direction, the
Brinson Fund may not achieve the anticipated benefits of futures contracts or
may realize a loss. For example, if the Brinson Fund is hedged against the
possibility of an increase in interest rates which would adversely affect the
price of securities held in its portfolio and interest rates decrease instead,
the Brinson Fund would lose part or all of the benefit of the increased value
which it has because it would have offsetting losses in its futures position.
In addition, in such situations, if the Brinson Fund had insufficient cash, it
may be required to sell securities from its portfolio to meet daily variation
margin requirements. Such sales of securities may, but will not necessarily, be
at increased prices which reflect the rising market. The Brinson Fund may be
required to sell securities at a time when it may be disadvantageous to do so.

OPTIONS

The Brinson Fund may purchase and write call or put options on securities
but will only engage in option strategies for non-speculative purposes.

PURCHASING CALL OPTIONS - When the Brinson Fund purchases a call option,
in return for a premium paid by the Brinson Fund to the writer of the option,
the Brinson Fund obtains the right to buy the security underlying the option at
a specified exercise price at any time during the term of the option. The
writer of the call option, who receives the premium upon writing the option, has
the obligation, upon exercise of the option, to deliver the underlying security
against payment of the exercise price. The advantage of purchasing call options
is that the Brinson Fund may alter portfolio characteristics and modify
portfolio maturities without incurring the cost associated with transactions.

The Brinson Fund may, following the purchase of a call option, liquidate
its position by effecting a closing sale transaction. This is accomplished by
selling an option of the same series as the option previously purchased. The
Brinson Fund will realize a profit from a closing sale transaction if the price
received on the transaction is more than the premium paid to purchase the
original call option; the Brinson Fund will realize a loss from a closing sale
transaction if the price received on the transaction is less than the premium
paid to purchase the original call option.

Although the Brinson Fund will generally purchase only those call options
for which there appears to be an active secondary market, there is no assurance
that a liquid secondary market on an exchange will exist for any particular
option, or at any particular time, and for some options no secondary market on
an exchange may exist. In such event, it may not be possible to effect closing
transactions in particular options, with the result that the Brinson Fund would
have to exercise its options in order to realize any profit and would incur
brokerage commissions upon the exercise of such options and upon the subsequent
disposition of the underlying securities acquired through the exercise of such
options. Further, unless the price of the underlying security changes
sufficiently, a call option purchased by the Brinson Fund may expire without any
value to the Brinson Fund, in which event the Brinson Fund would realize a
capital loss which will be short-term unless the option was held for more than
one year.

COVERED CALL WRITING - The Brinson Fund may write covered call options
from time to time on such portions of its portfolio, without limit, as the
Advisor determines is appropriate in seeking to achieve its investment
objective. The advantage to the Brinson Fund of writing covered calls is that
it receives a premium which is additional income. However, if the security
rises in value, the Brinson Fund may not fully participate in the market
appreciation.

During the option period for a covered call option, the writer may be
assigned an exercise notice by the broker-dealer through whom such call option
was sold, requiring the writer to deliver the underlying security against
payment of the exercise price. This obligation is terminated upon the
expiration of the option or upon entering a closing purchase transaction. A
closing purchase transaction, in which the Brinson Fund, as writer of an option,
terminates its obligation by purchasing an option of the same series as the
option previously written, cannot be effected with respect to an option once the
option writer has received an exercise notice for such option.

Closing purchase transactions will ordinarily be effected to realize a
profit on an outstanding call option, to prevent an underlying security from
being called, to permit the sale of the underlying security or to enable the
Brinson Fund to write another call option on the underlying security with either
a different exercise price or

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expiration date or both. The Brinson Fund may realize a net gain or loss from a
closing purchase transaction depending upon whether the net amount of the
original premium received on the call option is more or less than the cost of
effecting the closing purchase transaction. Any loss incurred in a closing
purchase transaction may be partially or entirely offset by the premium received
from a sale of a different call option on the same underlying security. Such a
loss may also be wholly or partially offset by unrealized appreciation in the
market value of the underlying security. Conversely, a gain resulting from a
closing purchase transaction could be offset in whole or in part by a decline in
the market value of the underlying security.

If a call option expires unexercised, the Brinson Fund will realize a
short-term capital gain in the amount of the premium on the option less the
commission paid. Such a gain, however, may be offset by depreciation in the
market value of the underlying security during the option period. If a call
option is exercised, the Brinson Fund will realize a gain or loss from the sale
of the underlying security equal to the difference between the cost of the
underlying security and the proceeds of the sale of the security plus the amount
of the premium on the option less the commission paid.

The Brinson Fund will write call options only on a covered basis, which
means that it will own the underlying security subject to a call option at all
times during the option period. Unless a closing purchase transaction is
effected, the Brinson Fund would be required to continue to hold a security
which it might otherwise wish to sell or deliver a security it would want to
hold. The exercise price of a call option may be below, equal to or above the
current market value of the underlying security at the time the option is
written.

PURCHASING PUT OPTIONS - The purchase of a put on substantially identical
securities held will constitute a short sale for tax purposes, the effect of
which is to create short-term capital gain on the sale of the security and to
suspend running of its holding period (and treat it as commencing on the date of
the closing of the short sale) or that of a security acquired to cover the same
if, at the time the put was acquired, the security had not been held for more
than one year.

A put option purchased by the Brinson Fund gives it the right to sell one
of its securities for an agreed price up to an agreed date. The Brinson Fund
intends to purchase put options in order to protect against a decline in the
market value of the underlying security below the exercise price less the
premium paid for the option ("protective puts"). The ability to purchase put
options will allow the Brinson Fund to protect unrealized gains in an
appreciated security in its portfolio without actually selling the security. If
the security does not drop in value, the Brinson Fund will lose the value of the
premium paid. The Brinson Fund may sell a put option which it has previously
purchased prior to the sale of the securities underlying such option. Such sale
will result in a net gain or loss depending on whether the amount received on
the sale is more or less than the premium and other transaction costs paid on
the put option which is sold.

The Brinson Fund may sell a put option purchased on individual portfolio
securities, and enter into closing sale transactions. A closing sale
transaction is one in which the Brinson Fund, when it is the holder of an
outstanding option, liquidates its position by selling an option of the same
series as the option previously purchased.

WRITING PUT OPTIONS - The Brinson Fund may also write put options on a
secured basis which means that the Brinson Fund will maintain in a segregated
account with its custodian Segregated Assets in an amount not less than the
exercise price of the option at all times during the option period. The amount
of Segregated Assets held in the segregated account will be adjusted on a daily
basis to reflect changes in the market value of the securities covered by the
put option written by the Brinson Fund. Secured put options will generally be
written in circumstances where the Advisor wishes to purchase the underlying
security for the Brinson Fund's portfolio at a price lower than the current
market price of the security. In such event, the Brinson Fund would write a
secured put option at an exercise price which, reduced by the premium received
on the option, reflects the lower price it is willing to pay.

Following the writing of a put option, the Brinson Fund may wish to
terminate the obligation to buy the security underlying the option by effecting
a closing purchase transaction. This is accomplished by buying an option of the
same series as the option previously written. The Brinson Fund may not,
however, effect such a closing transaction after it has been notified of the
exercise of the option.

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INDEX OPTIONS

The Brinson Fund may purchase exchange-listed call options on stock and
fixed income indices depending upon whether the Brinson Fund is an equity or
bond portfolio and sell such options in closing sale transactions for hedging
purposes. The Brinson Fund may purchase call options on broad market indices to
temporarily achieve market exposure when the Brinson Fund is not fully invested.
The Brinson Fund may also purchase exchange-listed call options on particular
market segment indices to achieve temporary exposure to a specific industry.

In addition, the Brinson Fund may purchase put options on stock and fixed
income indices and sell such options in closing sale transactions for hedging
purposes. The Brinson Fund may purchase put options on broad market indices in
order to protect its fully invested portfolio from a general market decline.
Put options on market segments may be bought to protect the Brinson Fund from a
decline in value of heavily weighted industries in its portfolio. Put options
on stock and fixed income indices may also be used to protect the Brinson Fund's
investments in the case of a major redemption.

The Brinson Fund may also write (sell) put and call options on stock and
fixed income indices. While the option is open, the Brinson Fund will maintain
a segregated account with its custodian in an amount equal to the market value
of the option.

Options on indices are similar to regular options except that an option on
an index gives the holder the right, upon exercise, to receive an amount of cash
if the closing level of the index upon which the option is based is greater than
(in the case of a call) or lesser than (in the case of a put) the exercise price
of the option. This amount of cash is equal to the difference between the
closing price of the index and the exercise price of the option expressed in
dollars times a specified multiple (the "multiplier"). The indices on which
options are traded include both U.S. and non-U.S. markets.

SPECIAL RISKS OF OPTIONS ON INDICES

The Brinson Fund's purchases of options on indices will subject it to the
risks described below.

Because the value of an index option depends upon movements in the level of
the index rather than the price of a particular security, whether the Brinson
Fund will realize gain or loss on the purchase of an option on an index depends
upon movements in the level of prices in the market generally or in an industry
or market segment rather than movements in the price of a particular security.
Accordingly, successful use by the Brinson Fund of options on indices is subject
to the Advisor's ability to predict correctly the direction of movements in the
market generally or in a particular industry. This requires different skills
and techniques than predicting changes in the prices of individual securities.

Index prices may be distorted if trading of a substantial number of
securities included in the index is interrupted causing the trading of options
on that index to be halted. If a trading halt occurred, the Brinson Fund would
not be able to close out options which it had purchased and the Brinson Fund may
incur losses if the underlying index moved adversely before trading resumed. If
a trading halt occurred and restrictions prohibiting the exercise of options
were imposed through the close of trading on the last day before expiration,
exercises on that day would be settled on the basis of a closing index value
that may not reflect current price information for securities representing a
substantial portion of the value of the index.

If the Brinson Fund holds an index option and exercises it before final
determination of the closing index value for that day, it runs the risk that the
level of the underlying index may change before closing. If such a change
causes the exercised option to fall "out-of-the-money," the Brinson Fund will be
required to pay the difference between the closing index value and the exercise
price of the option (times the applicable multiplier) to the assigned writer.
Although the Brinson Fund may be able to minimize this risk by withholding
exercise instructions until just before the daily cutoff time or by selling
rather than exercising the option when the index level is close to the exercise
price, it may not be possible to eliminate this risk entirely because the cutoff
times for index options may be earlier than those fixed for other types of
options and may occur before definitive closing index values are announced.

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RULE 144A SECURITIES

The Brinson Fund may invest in securities that are exempt under Rule 144A
from the registration requirements of the Securities Act of 1933, as amended
(the "1933 Act"). Those securities purchased under Rule 144A are traded among
qualified institutional investors.

The Board of Trustees of the Trust has instructed Brinson to consider the
following factors in determining the liquidity of a security purchased under
Rule 144A: (i) the frequency of trades and trading volume for the security; (ii)
whether at least three dealers are willing to purchase or sell the security and
the number of potential purchasers; (iii) whether at least two dealers are
making a market in the security; and (iv) the nature of the security and the
nature of the marketplace trades (e.g., the time needed to dispose of the
security, the method of soliciting offers and the mechanics of transfer).
Although having delegated the day-to-day functions, the Board of Trustees will
continue to monitor and periodically review the Advisor's selection of Rule 144A
securities, as well as the Advisor's determinations as to their liquidity.
Investing in securities under Rule 144A could have the effect of increasing the
level of the Brinson Fund's illiquidity to the extent that qualified
institutional buyers become, for a time, uninterested in purchasing these
securities. After the purchase of a security under Rule 144A, however, the
Board of Trustees and Brinson will continue to monitor the liquidity of that
security to ensure that the Brinson Fund has no more than 15% of its net assets
in illiquid securities.

The Brinson Fund will limit investments in securities of issuers which it
is restricted from selling to the public without registration under the 1933 Act
to no more than 15% of the Brinson Fund's net assets, excluding restricted
securities eligible for resale pursuant to Rule 144A that have been determined
to be liquid pursuant to a policy and procedures adopted by the Trust's Board of
Trustees which includes continuing oversight by the Board of Trustees.

If the Advisor determines that a security purchased in reliance on Rule
144A which was previously determined to be liquid, is no longer liquid and, as a
result, the Brinson Fund's holdings of illiquid securities exceed the 15% limit
on investment in such securities, the Advisor will determine what action shall
be taken to ensure that the Brinson Fund continues to adhere to such limitation,
including disposing of illiquid assets which may include such Rule 144A
securities.

OTHER INVESTMENTS

The Board of Trustees may, in the future, authorize the Brinson Fund to
invest in securities other than those listed in this Statement of Additional
Information or in the Prospectus/Proxy Statement, provided such investment would
be consistent with the Brinson Fund's investment objective and that it would not
violate any fundamental investment policies or restrictions applicable to the
Brinson Fund.

FOREIGN SECURITIES

Investors should recognize that investing in foreign issuers involves
certain considerations, including those set forth in the Brinson Fund's
Prospectus/Proxy Statement, which are not typically associated with investing in
U.S. issuers. Since the stocks of foreign companies are frequently denominated
in foreign currencies, and since the Brinson Fund may temporarily hold
uninvested reserves in bank deposits in foreign currencies, the Brinson Fund
will be affected favorably or unfavorably by changes in currency rates and in
exchange control regulations and may incur costs in connection with conversions
between various currencies. The investment policies of the Brinson Fund permit
it to enter into forward foreign currency exchange contracts, futures, and
options in order to hedge portfolio holdings and commitments against changes in
the level of future currency rates.

There has been in the past, and there may be again in the future, an
interest equalization tax levied by the United States in connection with the
purchase of foreign securities such as those purchased by the Brinson Fund.
Payment of an interest equalization tax, if imposed, would reduce the Brinson
Fund's rates of return on investment. Dividends paid by foreign issuers may be
subject to withholding and other foreign taxes which may decrease the net return
on such investments as compared to dividends paid to the Brinson Fund by U.S.
corporations. The Brinson Fund's ability to "pass through" the foreign taxes
paid for tax credit or deduction purposes will be determined by the

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composition of the Brinson Fund's portfolio. More than 50% of the Brinson Fund
must be invested in stock or securities of foreign corporations for "pass
through" to be possible in the first instance. Special rules govern the federal
income tax treatment of certain transactions denominated in terms of a currency
other than the U.S. dollar or determined by reference to the value of one or
more currencies other than the U.S. dollar. The types of transactions covered by
the special rules generally include the following: (i) the acquisition of, or
becoming the obligor under, a bond or other debt instrument (including, to the
extent provided in the Treasury Regulations, preferred stock); (ii) the accruing
of certain trade receivables and payables; and (iii) the entering into or
acquisition of any forward contract, futures contract and similar financial
instruments other than any "regulated futures contract" or "non-equity option"
which would be marked-to-market under the rules of Section 1256 of the Code if
held at the end of the tax year. The disposition of a currency other than the
U.S. dollar by a U.S. taxpayer is also treated as a transaction subject to the
special currency rules. However, foreign currency-related regulated futures
contracts and non-equity options are generally not subject to these special
currency rules. If subject, they are or would be treated as sold for their fair
market value at year-end under the marked-to-market rules applicable to other
futures contracts, unless an election is made to have such currency rules apply.
With respect to transactions covered by the special rules, foreign currency gain
or loss is calculated separately from any gain or loss on the underlying
transaction and is normally a taxable gain or loss. A taxpayer may elect to
treat as capital gain or loss foreign currency gain or loss arising from certain
identified forward contracts, futures contracts and options that are capital
assets in the hands of the taxpayer and which are not part of a straddle.
Certain transactions subject to the special currency rules that are part of a
"section 988 hedging transaction" (as defined in the Code and the Treasury
Regulations) will be integrated and treated as a single transaction or otherwise
treated consistently for purposes of the Code. The income tax effects of
integrating and treating a transaction as a single transaction are generally to
create a synthetic debt instrument that is subject to the original discount
provisions. It is anticipated that some of the non-U.S. dollar denominated
investments and foreign currency contracts the Brinson Fund may make or enter
into will be subject to the special currency rules described above.

FORWARD FOREIGN CURRENCY CONTRACTS

The Brinson Fund may purchase or sell currencies and/or engage in forward
foreign currency transactions in order to expedite settlement of portfolio
transactions and to manage currency risk.

Forward foreign currency contracts are traded in the inter-bank market
conducted directly between currency traders (usually large commercial banks) and
their customers. A forward contract generally has no deposit requirement and no
commissions are charged at any stage for trades. The Brinson Fund will account
for forward contracts by marking-to-market each day at current forward contract
values.

The Brinson Fund will only enter into forward contracts to sell, for a
fixed amount of U.S. dollars or other appropriate currency, an amount of foreign
currency, to the extent that the value of the short forward contract is covered
by the underlying value of securities denominated in the currency being sold.
Alternatively, when the Brinson Fund enters into a forward contract to sell an
amount of foreign currency, the Brinson Fund's custodian or sub-custodian will
place Segregated Assets in a segregated account in an amount not less than the
value of the Brinson Fund's total assets committed to the consummation of such
forward contracts. If the additional Segregated Assets placed in the segregated
account decline, additional cash or securities will be placed in the account on
a daily basis so that the value of the account will equal the amount of the
Brinson Fund's commitments with respect to such contracts.

OPTIONS ON FOREIGN CURRENCIES

The Brinson Fund also may purchase and write put and call options on
foreign currencies (traded on U.S. and foreign exchanges or over-the-counter
markets) to manage the Brinson Fund's exposure to changes in currency exchange
rates. The Brinson Fund may purchase and write options on foreign currencies
for hedging purposes in a manner similar to that in which futures contracts on
foreign currencies, or forward contracts, will be utilized. For example, a
decline in the dollar value of a foreign currency in which portfolio securities
are denominated will reduce the dollar value of such securities, even if their
value in the foreign currency remains constant. In order to protect against
such diminutions in the value of portfolio securities, the Brinson Fund may
purchase put options on the foreign currency. If the dollar price of the
currency does decline, the Brinson Fund will have the right to sell such

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currency for a fixed amount in dollars and will thereby offset, in whole or in
part, the adverse effect on its portfolio which otherwise would have resulted.

Conversely, where a rise in the dollar value of a currency in which
securities to be acquired are denominated is projected, thereby increasing the
dollar price of such securities, the Brinson Fund may purchase call options on
such currency.

The purchase of such options could offset, at least partially, the effects
of the adverse movement in exchange rates. As in the case of other types of
options, however, the benefit to the Brinson Fund to be derived from purchases
of foreign currency options will be reduced by the amount of the premium and
related transaction costs. In addition, where currency exchange rates do not
move in the direction or to the extent anticipated, the Brinson Fund could
sustain losses on transactions in foreign currency options which would require
it to forego a portion or all of the benefits of advantageous changes in such
rates.

The Brinson Fund may write options on foreign currencies for the same types
of hedging purposes. For example, where the Brinson Fund anticipates a decline
in the dollar value of foreign currency denominated securities due to adverse
fluctuations in exchange rates, it could, instead of purchasing a put option,
write a call option on the relevant currency. If the expected decline occurs,
the option will most likely not be exercised, and the diminution in the value of
portfolio securities will be offset by the amount of the premium received.

Similarly, instead of purchasing a call option to hedge against an
anticipated increase in the dollar cost of securities to be acquired, the
Brinson Fund could write a put option on the relevant currency which, if rates
move in the manner projected, will expire unexercised and allow the Brinson Fund
to hedge such increased cost up to the amount of the premium. As in the case of
other types of options, however, the writing of a foreign currency option will
constitute only a partial hedge up to the amount of the premium, and only if
rates move in the expected direction. If this does not occur, the option may be
exercised and the Brinson Fund would be required to purchase or sell the
underlying currency at a loss which may not be offset by the amount of the
premium. Through the writing of options on foreign currencies, the Brinson Fund
also may be required to forego all or a portion of the benefit which might
otherwise have been obtained from favorable movements in exchange rates.

The Brinson Fund may write covered call options on foreign currencies. A
call option written on a foreign currency is "covered" if the Brinson Fund owns
the underlying foreign currency covered by the call or has an absolute and
immediate right to acquire that foreign currency without additional cash
consideration (or for additional cash consideration held in a segregated account
by the custodian bank) upon conversion or exchange of other foreign currency
held in its portfolio. A call option is also covered if the Brinson Fund has a
call on the same foreign currency and in the same principal amount as the call
written where the exercise price of the call held (a) is equal to or less than
the exercise price of the call written, or (b) is greater than the exercise
price of the call written if the difference is maintained by the Brinson Fund in
Segregated Assets in a segregated account with its custodian bank.

With respect to writing put options, at the time the put is written, the
Brinson Fund will establish a segregated account with its custodian bank
consisting of Segregated Assets in an amount equal in value to the amount the
Brinson Fund will be required to pay upon exercise of the put. The account will
be maintained until the put is exercised, has expired, or the Brinson Fund has
purchased a closing put of the same series as the one previously written.

CONVERTIBLE SECURITIES

The Brinson Fund may invest in convertible securities which generally offer
lower interest or dividend yields than non-convertible debt securities of
similar quality. The value of convertible securities may reflect changes in the
value of the underlying common stock. Convertible securities entail less credit
risk than the issuer's common stock because they rank senior to common stock.
Convertible securities entitle the holder to exchange the securities for a
specified number of shares of common stock, usually of the same company, at
specified prices within a certain period of time and to receive interest or
dividends until the holder elects to convert. The provisions of any convertible
security determine its ranking in a company's capital structure. In the case of
subordinated convertible debentures, the holder's claims on assets and earnings
are subordinated to the claims of other creditors and are

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senior to the claims of preferred and common shareholders. In the case of
preferred stock and convertible preferred stock, the holder's claim on assets
and earnings are subordinated to the claims of all creditors but are senior to
the claims of common shareholders.

WHEN-ISSUED SECURITIES

The Brinson Fund may purchase securities 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. During the period between purchase and
settlement, no payment is made by the purchaser to the issuer and no interest on
the when-issued or forward delivery security accrues to the purchaser. While
when-issued or forward delivery securities may be sold prior to the settlement
date, it is intended that the Brinson Fund will purchase such securities with
the purpose of actually acquiring them unless a sale appears desirable for
investment reasons. At the time the Brinson Fund makes the commitment to
purchase a security on a when-issued or forward delivery basis, it will record
the transaction and reflect the value of the security in determining its net
asset value. The market value of when-issued or forward delivery securities may
be more or less than the purchase price. The Advisor does not believe that the
Brinson Fund's net asset value or income will be adversely affected by its
purchase of securities on a when-issued or forward delivery basis. The Brinson
Fund will establish a segregated account in which it will maintain Segregated
Assets equal in value to commitments for when-issued or forward delivery
securities.

ASSET-BACKED SECURITIES

The Brinson Fund may invest a portion of its assets in debt obligations
known as "asset-backed securities." Asset-backed securities are securities that
represent a participation in, or are secured by and payable from, a stream of
payments generated by particular assets, most often a pool or pools of similar
assets (e.g., receivables on home equity and credit loans and receivables
regarding automobile, credit card, mobile home and recreational vehicle loans,
wholesale dealer floor plans and leases).

Such receivables are securitized in either a pass-through or a pay-through
structure. Pass-through securities provide investors with an income stream
consisting of both principal and interest payments in respect of the receivables
in the underlying pool. Pay-through asset-backed securities are debt
obligations issued usually by a special purpose entity, which are collateralized
by the various receivables and in which the payments on the underlying
receivables provide that the Brinson Fund pay the debt service on the debt
obligations issued. The Brinson Fund may invest in these and other types of
asset-backed securities that may be developed in the future.

The credit quality of these securities depends primarily upon the quality
of the underlying assets and the level of credit support and/or enhancement
provided. Such asset-backed securities are subject to the same prepayment risks
as mortgage-backed securities. For federal income tax purposes, the Brinson
Fund will be required to accrue income on pay-through asset-backed securities
using the "catch-up" method, with an aggregate prepayment assumption.

The credit quality of most asset-backed securities depends primarily on the
credit quality of the assets underlying such securities, how well the entity
issuing the security is insulated from the credit risk of the originator or any
other affiliated entities, and the amount and quality of any credit support
provided to the securities. The rate of principal payment on asset-backed
securities generally depends on the rate of principal payments received on the
underlying assets which in turn may be affected by a variety of economic and
other factors. As a result, the yield on any asset-backed security is difficult
to predict with precision and actual yield to maturity may be more or less than
the anticipated yield to maturity. Asset-backed securities may be classified as
"pass-through certificates" or "collateralized obligations."

Asset-backed securities are often backed by a pool of assets representing
the obligations of a number of different parties. To lessen the effect of
failures by obligors on underlying assets to make payment, such securities may
contain elements of credit support. Such credit support falls into two
categories: (i) liquidity protection; and (ii) protection against losses
resulting from ultimate default by an obligor on the underlying assets.
Liquidity protection refers to the provision of advances, generally by the
entity administering the pool of assets, to ensure that

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the receipt of payments due on the underlying pool is timely. Protection against
losses resulting from ultimate default enhances the likelihood of payments of
the obligations on at least some of the assets in the pool. Such protection may
be provided through guarantees, insurance policies or letters of credit obtained
by the issuer or sponsor from third parties, through various means of
structuring the transaction or through a combination of such approaches. The
Brinson Fund will not pay any additional fees for such credit support, although
the existence of credit support may increase the price of a security.

Due to the shorter maturity of the collateral backing such securities,
there is less of a risk of substantial prepayment than with mortgage-backed
securities. Such asset-backed securities do, however, involve certain risks not
associated with mortgage-backed securities, including the risk that security
interests cannot be adequately, or in many cases, ever, established. In
addition, with respect to credit card receivables, a number of state and federal
consumer credit laws give debtors the right to set off certain amounts owed on
the credit cards, thereby reducing the outstanding balance. In the case of
automobile receivables, there is a risk that the holders may not have either a
proper or first security interest in all of the obligations backing such
receivables due to the large number of vehicles involved in a typical issuance
and technical requirements under state laws. Therefore, recoveries on
repossessed collateral may not always be available to support payments on the
securities.

Examples of credit support arising out of the structure of the transaction
include "senior-subordinated securities" (multiple class securities with one or
more classes subordinate to other classes as to the payment of principal thereof
and interest thereon, with the result that defaults on the underlying assets are
borne first by the holders of the subordinated class), creation of "reserve
funds" (where cash or investments, sometimes funded from a portion of the
payments on the underlying assets, are held in reserve against future losses)
and "over collateralization" (where the scheduled payments on, or the principal
amount of, the underlying assets exceeds that required to make payments of the
securities and pay any servicing or other fees). The degree of credit support
provided for each issue is generally based on historical information respecting
the level of credit information respecting the level of credit risk associated
with the underlying assets. Delinquencies or losses in excess of those
anticipated could adversely affect the return on an investment in such issue.

ZERO COUPON AND DELAYED INTEREST SECURITIES

The Brinson Fund may invest in zero coupon or delayed interest securities
which pay no cash income until maturity or a specified date when the securities
begin paying current interest (the "cash payment date") and are sold at
substantial discounts from their value at maturity. When held to maturity or
cash payment date, the entire income of such securities, which consists of
accretion of discount, comes from the difference between the purchase price and
their value at maturity or cash payment date. The discount varies depending on
the time remaining until maturity or cash payment date, prevailing interest
rates, liquidity of the security and the perceived credit quality of the issuer.
The discount, in the absence of financial difficulties of the issuer, decreases
as the final maturity or cash payment date of the security approaches. The
market prices of zero coupon and delayed interest securities are generally more
volatile and more likely to respond to changes in interest rates than the market
prices of securities having similar maturities and credit qualities that pay
interest periodically. Current federal income tax law requires that a holder of
a zero coupon security report as income each year the portion of the original
issue discount on such security (other than tax-exempt original issue discount
from a zero coupon security) that accrues that year, even though the holder
receives no cash payments of interest during the year. The Brinson Fund will be
required to distribute such income to shareholders to comply with Subchapter M
of the Code and avoid excise taxes, even though the Brinson Fund has not
received any cash from the issue.

Zero coupon securities are subject to greater market value fluctuations
from changing interest rates than debt obligations of comparable maturities
which make current distributions of interest (cash). Zero coupon convertible
securities offer the opportunity for capital appreciation as increases (or
decreases) in market value of such securities closely follow the movements in
the market value of the underlying common stock. Zero coupon convertible
securities generally are expected to be less volatile than the underlying common
stocks as they usually are issued with short maturities (15 years or less) and
are issued with options and/or redemption features exercisable by the holder of
the obligation entitling the holder to redeem the obligation and receive a
defined cash payment.

Zero coupon securities include securities issued directly by the U.S.
Treasury, and U.S. Treasury bonds or notes and their unmatured interest coupons
and receipts for their underlying principal ("coupons") which have been

11
<PAGE>

separated by their holder, typically a custodian bank or investment brokerage
firm. A holder will separate the interest coupons from the underlying principal
(the "corpus") of the U.S. Treasury security. A number of securities firms and
banks have stripped the interest coupons and receipts and then resold them in
custodial receipt programs with a number of different names, including "Treasury
Income Growth Receipts" ("TIGRS") and Certificate of Accrual on Treasuries
("CATS"). The underlying U.S. Treasury bonds and notes themselves are held in
book-entry form at the Federal Reserve Bank or, in the case of bearer securities
(i.e., unregistered securities which are owned ostensibly by the bearer or
holder thereof), in trust on behalf of the owners thereof. Counsel to the
underwriters of these certificates or other evidences of ownership of the U.S.
Treasury securities has stated that for federal tax and securities purposes, in
its opinion, purchasers of such certificates, such as the Brinson Fund, most
likely will be deemed the beneficial holder of the underlying U.S. government
securities. The Brinson Fund understands that the staff of the SEC no longer
considers such privately stripped obligations to be U.S. government securities,
as defined in the Act; therefore, the Brinson Fund intends to adhere to this
staff position and will not treat such privately stripped obligations to be U.S.
government securities for the purpose of determining if the Brinson Fund is
"diversified," or for any other purpose, under the Act.

The U.S. Treasury has facilitated transfers of ownership of zero coupon
securities by accounting separately for the beneficial ownership of particular
interest coupon and corpus payments on Treasury securities through the Federal
Reserve book-entry record-keeping system. The Federal Reserve program as
established by the U.S. Treasury Department is known as "STRIPS" or "Separate
Trading of Registered Interest and Principal of Securities." Under the STRIPS
program, the Brinson Fund will be able to have its beneficial ownership of zero
coupon securities recorded directly in the book-entry record-keeping system in
lieu of having to hold certificates or other evidences of ownership of the
underlying U.S. Treasury securities.

When U.S. Treasury obligations have been stripped of their unmatured
interest coupons by the holder, the principal or corpus is sold at a deep
discount because the buyer receives only the right to receive a future fixed
payment on the security and does not receive any rights to periodic interest
(cash) payments. Once stripped or separated, the corpus and coupons may be sold
separately. Typically, the coupons are sold separately or grouped with other
coupons with like maturity dates and sold in such bundled form. Purchasers of
stripped obligations acquire, in effect, discount obligations that are
economically identical to the zero coupon securities that the U.S. Treasury
sells itself. These stripped securities are also treated as zero coupon
securities with original issue discount For tax purposes.

INVESTMENT RESTRICTIONS

The investment restrictions as set forth below are fundamental policies and
may not be changed as to the Brinson Fund without the approval of a majority of
the outstanding voting securities (as defined in the Act) of the Brinson Fund.
Unless otherwise indicated, all percentage limitations listed below apply to the
Brinson Fund only at the time of the transaction. Accordingly, if a percentage
restriction is adhered to at the time of investment, a later increase or
decrease in the percentage which results from a relative change in values or
from a change in the Brinson Fund's total assets will not be considered a
violation.

Except as set forth in the Prospectus/Proxy Statement or under "Investment
Strategies" in this Statement of Additional Information, the Brinson Fund may
not:

(i) As to 75% of the total assets of the Brinson Fund, purchase the
securities of any one issuer, other than securities issued by the
U.S. government or its agencies or instrumentalities, if immediately
after such purchase more than 5% of the value of the total assets of
the Brinson Fund would be invested in securities of such issuer, or
purchase the securities of any one issuer if, immediately after such
purchase, the Brinson Fund would own more than 10% of the
outstanding voting securities of such issuer;

(ii) Invest in real estate or interests in real estate (this will not
prevent the Brinson Fund from investing in publicly-held real estate
investment trusts or marketable securities of companies which may
represent indirect interests in real estate), interests in oil, gas
and/or mineral exploration or development programs or leases;

12
<PAGE>

(iii) Purchase or sell commodities or commodity contracts, but may enter
into futures contracts and options thereon in accordance with its
Prospectus. Additionally, the Brinson Fund may engage in forward
foreign currency contracts for hedging and non-hedging purposes;

(iv) Make loans, except that this restriction shall not prohibit (a) the
purchase and holding of a portion of an issue of publicly
distributed or privately placed debt securities, (b) the lending of
portfolio securities, or (c) entry into repurchase agreements with
banks or broker-dealers;

(v) Borrow money in excess of 33 1/3% of the value of its assets except
as a temporary measure for extraordinary or emergency purposes to
facilitate redemptions or issue senior securities. All borrowings
will be done from a bank and to the extent that such borrowing
exceeds 5% of the value of the Brinson Fund's assets, asset coverage
of at least 300% is required. The Brinson Fund will not purchase
securities when borrowings exceed 5% of the Brinson Fund's total
assets;

(vi) Purchase the securities of issuers conducting their principal
business activities in the same industry, other than obligations
issued or guaranteed by the U.S. government, its agencies or
instrumentalities, if immediately after such purchase, the value of
the Brinson Fund's investments in such industry would exceed 25% of
the value of the total assets of the Brinson Fund across several
countries; and

(vii) Act as an underwriter of securities, except that, in connection with
the disposition of a security, the Brinson Fund may be deemed to be
an "underwriter" as that term is defined in the 1933 Act.

13
<PAGE>

MANAGEMENT OF THE TRUST

TRUSTEES AND OFFICERS

<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
POSITION
WITH
NAME AGE THE TRUST PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Walter E. Auch 77 Trustee Retired; formerly Chairman and CEO of Chicago Board of Options
6001 N. 62nd Place Exchange (1979-1986); Trustee of the Trust since May, 1994;
Paradise Valley, AZ 85253 Trustee, Brinson Relationship Funds since December, 1994;
Director, Thomsen Asset Management Corp. since 1987;
Director, Fort Dearborn Income Securities, Inc. 1987 to 1995;
Director, Geotek Industries, Inc. since 1989; Director, Smith
Barney VIP Fund since 1991; Director, SB Advisers since 1992;
Director, SB Trak since 1992; Director, Banyan Realty Trust
since 1987; Director, Banyan Land Fund II since 1988;
Director, Banyan Mortgage Investment Fund since 1989; and
Director, Express America Holdings Corp. since 1992, and
Nicholas/Applegate, Legend Properties, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
Frank K. Reilly 62 Chairman and Professor, University of Notre Dame since 1982; Trustee of the
College of Business Trustee Trust since December, 1993; Trustee, Brinson Relationship
Administration Funds since September, 1994; Director of The Brinson Funds,
University of Inc. 1992-1993; Trustee, Brinson Trust Company, 1992-July,
Notre Dame 1993; Director, Fort Dearborn Income Securities, Inc. since
Notre Dame, IN 46556-0399 1993; Director, First Interstate Bank of Wisconsin from
January, 1989 through March, 1990; Director, Greenwood Trust
Company since 1993; and Director, Dean Witter Trust, FSB,
since 1996.
- -----------------------------------------------------------------------------------------------------------------------------------
Edward M. Roob 63 Trustee Retired; prior thereto, Senior Vice President, Daiwa
841 Woodbine Lane Securities America Inc. (1986-1993); Trustee of the Trust
Northbrook, IL 60002 since January, 1995; Trustee, Brinson Relationship Funds since
January 1995; Director, Fort Dearborn Income Securities, Inc.
since 1993; Director, Brinson Trust Company since 1993;
Committee Member, Chicago Stock Exchange since 1993; Member of
Board of Governors, Midwest Stock Exchange (1987-1991).
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

OTHER OFFICERS

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

POSITION
WITH OFFICER PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS
NAME AGE THE TRUST SINCE
- ------------------------------------------------------------------------------------------------------------------------------------

<S> <C> <C> <C> <C>
E. Thomas McFarlan 54 President 1992 Managing Director, Brinson Partners, Inc. since 1991;
Treasurer and Principal Accounting Officer, The
Brinson Funds 1995-1997; President and Director of
The Brinson Funds, Inc., 1992 - 1993; Trustee,
Brinson Trust Company since 1991; prior thereto,
Executive Vice President of Washington Mutual Savings
Bank.
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

14
<PAGE>

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

<S> <C> <C> <C> <C>
Thomas J. Digenan 34 Vice 1993 Director, Brinson Partners, Inc. since 1993;
President Assistant Treasurer, The Brinson Funds 1995-1997;
Assistant Secretary, The Brinson Funds, 1993 - 1995;
Assistant Secretary, The Brinson Funds, Inc., 1993;
prior thereto, Senior Manager, KPMG Peat Marwick.
- ------------------------------------------------------------------------------------------------------------------------------------

Debra L. Nichols 32 Vice 1992 Director, Brinson Partners, Inc. since 1995;
President Associate, Brinson Partners, Inc. from 1991 to 1995;
Vice President, The Brinson Funds since 1997;
Secretary, The Brinson Funds 1997; Assistant
Secretary, The Brinson Funds 1993 - 1997; Assistant
Secretary, The Brinson Funds, Inc. 1992-1993; prior
thereto, private investor.
- ------------------------------------------------------------------------------------------------------------------------------------

Carolyn M. Burke 31 Treasurer, 1995 Director, Brinson Partners, Inc., since January 1997;
Secretary Associate, Brinson Partners, Inc. from 1995 to 1997;
and Secretary, Treasurer and Principal Accounting
Principal Officer, The Brinson Funds since 1997; Assistant
Accounting Secretary, The Brinson Funds 1995-1997; prior
Officer thereto, Financial Analyst, Van Kampen American
Capital Investment Advisory Corp. 1992-1995; Senior
Accountant, KPMG Peat Marwick 1989-1992.
- ------------------------------------------------------------------------------------------------------------------------------------

Catherine E. Macrae 41 Assistant 1995 Associate Director, Brinson Partners, Inc. since
Secretary January 1996; Associate Brinson Partners, Inc., from
1992 to 1996; prior thereto, Economic Analyst,
Chicago Mercantile Exchange.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

COMPENSATION TABLE

TRUSTEES AND OFFICERS

AGGREGATE COMPENSATION TOTAL COMPENSATION FROM
FROM TRUST FOR FISCAL YEAR TRUST AND FUND COMPLEX
NAME AND POSITION HELD ENDED JUNE 30, 1998 PAID TO TRUSTEES/1/
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Walter E. Auch, Trustee $12,300 $24,900
6001 N. 62nd Place
Paradise Valley, AZ 85253
- --------------------------------------------------------------------------------------------------------------------
Frank K. Reilly, Trustee $14,400 $42,450
College of Business Administration
University of Notre Dame
Notre Dame, IN 46556-0399
- --------------------------------------------------------------------------------------------------------------------
Edward M. Roob, Trustee $14,400 $42,450
841 Woodbine Lane
Northbrook, IL 60002
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>

/1/ This amount represents the aggregate amount of compensation paid to the
Trustees for (a) service on the Board of Trustees for the Trust's most recently
completed fiscal year; and (b) service on the Board of Directors of two other
investment companies managed by Brinson Partners for the calendar year ending
June 30, 1998.

15
<PAGE>

No officer or Trustee of the Trust who is also an officer or employee of
Brinson Partners receives any compensation from the Trust for services to the
Trust. The Trust pays each Trustee who is not affiliated with Brinson Partners
a fee of $6,000 per year, plus $300 per Series per meeting, and reimburses each
Trustee and officer for out-of-pocket expenses in connection with travel and
attendance at Board meetings.

The Board of Trustees has an Audit Committee which has the responsibility,
among other things, to (i) recommend the selection of the Trust's independent
auditors, (ii) review and approve the scope of the independent auditors' audit
activity, (iii) review the audited financial statements, and (iv) review with
such independent auditors the adequacy of the Brinson Fund's basic accounting
system and the effectiveness of the Brinson Fund's internal controls. The Audit
Committee met once during the fiscal year ended June 30, 1998. There is no
separate nominating or investment committee. Items pertaining to these
committees are submitted to the full Board of Trustees.

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As of __________, 199__, the officers and Trustees as a group owned less
than 1% of the outstanding equity securities of the Trust and of each class of
equity securities of the Trust.

INVESTMENT ADVISORY AND OTHER SERVICES

ADVISOR

Pursuant to its investment advisory agreement (the "Agreement") with the
Trust, on behalf of the Brinson Fund, Brinson receives from the Brinson Fund a
monthly fee at an annual rate (as described in the Prospectus/Proxy Statement)
multiplied by the average daily net assets of the Brinson Fund for providing
investment advisory services. Brinson is responsible for paying its expenses.
Under the Agreements the Brinson Fund pays the following expenses: (1) the fees
and expenses of the Trust's disinterested Trustees; (2) the salaries and
expenses of any of the Trust's officers or employees who are not affiliated with
the Advisor; (3) interest expenses; (4) taxes and governmental fees; (5)
brokerage commissions and other expenses incurred in acquiring or disposing of
portfolio securities; (6) the expenses of registering and qualifying shares for
sale with the SEC and with various state securities commissions; (7) auditing
and legal costs; (8) insurance premiums; (9) fees and expenses of the Trust's
custodian, administrative and transfer agent and any related services; (10)
expenses of obtaining quotations of the Brinson Fund's portfolio securities and
of pricing its shares; (11) expenses of maintaining the Trust's legal existence
and of shareholders' meetings; (12) expenses of preparation and distribution to
existing shareholders of reports, proxies and prospectuses; and (13) fees and
expenses of membership in industry organizations.

General expenses of the Trust (such as costs of maintaining corporate
existence, legal fees, insurance, etc.) will be allocated among the Trust Series
in proportion to their relative net assets. Expenses that relate exclusively to
the Brinson Fund, such as certain registration fees, brokerage commissions and
other portfolio expenses, will be borne directly by the Brinson Fund.

ADMINISTRATOR

ADMINISTRATIVE, ACCOUNTING, TRANSFER AGENCY AND CUSTODIAN SERVICES

Effective May 10, 1997, the Trust, on behalf of each Trust Series, entered
into a Multiple Services Agreement (the "Services Agreement") with Morgan
Stanley Trust Company, One Pierrepont Plaza, Brooklyn, New York 11201 ("MSTC"),
pursuant to which MSTC is required to provide general administrative,
accounting, portfolio valuation, transfer agency and custodian services to the
Trust Series, including the coordination and monitoring of any third party
service providers.

16
<PAGE>

Custody Services. MSTC provides custodian services for the securities and
cash of the Brinson Fund. The custody fee schedule is based primarily on the
net amount of assets held during the period for which payment is being made plus
a per transaction fee for transactions during the period and out-of-pocket
expenses.

Investors Bank and Trust Company, 200 Clarendon Street, Boston,
Massachusetts 02116, will serve as co-custodian for the Brinson Fund with
respect to certain foreign securities until such securities are transferred to
MSTC. After such securities are transferred to MSTC, MSTC will be the sole
custodian of the Brinson Fund under the terms of the Services Agreement.

As authorized under the Services Agreement, MSTC has entered into a Mutual
Funds Service Agreement (the "CGFSC Agreement") with Chase Global Funds Services
Company ("CGFSC"), a corporate affiliate of The Chase Manhattan Bank, under
which CGFSC provides administrative, accounting, portfolio valuation and
transfer agency services to the Brinson Fund. CGFSC's business address is 73
Tremont Street, Boston, Massachusetts 02108-3913.

Pursuant to the CGFSC Agreement, CGFSC provides:

(2) accounting and portfolio valuation services, including the daily
calculation of the Brinson Fund's net asset value and the preparation
of certain financial statements; and

As authorized under the Services Agreement, MSTC has entered into a sub-
administration agreement (the "FDI Agreement") with Funds Distributor, Inc.
("FDI") under which FDI provides administrative assistance to the Brinson Fund
with respect to (i) regulatory matters, including regulatory developments and
examinations, (ii) all aspects of the Brinson Fund's day-to-day operations,
(iii) office facilities, clerical and administrative services, and (iv)
maintenance of books and records. FDI's business address is 60 State Street,
Suite 1300, Boston, Massachusetts, 02109.

UNDERWRITER

FDI, 60 State Street, Suite 1300, Boston, MA 02109, acts as an underwriter
of the Brinson Fund's continuous offer of shares for the purpose of facilitating
the filing of notices regarding sale of the shares of the Brinson Fund under
state securities laws and to assist in sales of shares pursuant to an
underwriting agreement (the "Underwriting Agreement") approved by the Board of
Trustees. In this regard, FDI has agreed at its own expense to qualify as a
broker-dealer under all applicable federal or state laws in those states which
the Trust shall from time to time identify to FDI as states in which it wishes
to offer the Brinson Fund's shares for sale, in order that state filings may be
maintained for the Brinson Fund. FDI does not receive any compensation under the
Underwriting Agreement.

FDI is a broker-dealer registered with the SEC and a member in good
standing of the National Association of Securities Dealers, Inc.

17
<PAGE>

The Trust does not impose any sales loads or redemption fees. The Brinson
Fund shall continue to bear the expense of all filing fees incurred in
connection with the filing of notices regarding sale of shares under state
securities laws.

The Underwriting Agreement may be terminated by either party upon sixty
(60) days' prior written notice to the other party, and if so terminated, the
pro rata portion of the unearned fee will be returned to the Trust.

CODE OF ETHICS

The Trust has adopted a Code of Ethics which establishes standards by which
certain access persons of the Trust, which include officers of the Advisor and
officers and Trustees of the Trust, must abide relating to personal securities
trading conduct.

Under the Code of Ethics, access persons are prohibited from engaging in
certain conduct, including, but not limited to: 1) investing in companies in
which the Trust Series invest unless the securities have a broad public market
and are registered on a national securities exchange or are traded in the over-
the-counter markets; 2) making or maintaining an investment in any corporation
or business with which the Trust Series have business relationships if the
investment might create, or give the appearance of creating, a conflict of
interest; 3) participating in an initial public offering; 4) entering into a
securities transaction when the access person knows or should know that such
activity will anticipate, parallel or counter any securities transaction of the
Trust Series; 5) entering into any securities transaction, without prior
approval, in connection with any security which has been designated as
restricted; 6) entering into a net short position with respect to any security
held by the Brinson Fund; 7) entering into any derivative transaction when a
direct transaction in the underlying security would be a violation; and 8)
engaging in self-dealing or other transactions benefiting the access person at
the expense of the Trust Series or their shareholders.

In addition, access persons are required to receive advance approval prior
to purchasing or selling a restricted security, and may not buy or sell certain
prohibited securities. The Advisor will identify for access persons prohibited
securities, which include securities that are being considered for purchase or
sale by any account or fund managed by the Advisor, and provide a list of such
securities to all access persons. Access persons are required to file quarterly
reports of security investment transactions. Trustees or officers who are not
"interested persons" of the Trust, as defined in the 1940 Act, need only report
a transaction in a security if such Trustee or officer, at the time of the
transaction, knew or should have known, in the ordinary course of fulfilling his
or her official duties as a Trustee or officer, that, during the 15-day period
immediately preceding or after the date of the transaction by the Trustee or
officer, such security was purchased or sold by the Trust Series, or was being
considered for purchase by the Trust Series.

PORTFOLIO TRANSACTIONS AND BROKERAGE COMMISSIONS

The Advisor is responsible for decisions to buy and sell securities for the
Brinson Fund and for the placement of the Brinson Fund's portfolio business and
the negotiation of commissions, if any, paid on such transactions. Fixed income
securities in which the Brinson Fund invests are traded in the over-the-counter
market. These securities are generally traded on a net basis with dealers acting
as principal for their own accounts without a stated commission, although the
bid/ask spread quoted on securities includes an implicit profit to the dealers.
In over-the-counter transactions, orders are placed directly with a principal
market-maker unless a better price and execution can be obtained by using a
broker. Brokerage commissions are paid on transactions in listed securities,
futures contracts and options thereon. The Advisor is responsible for effecting
portfolio transactions and will do so in a manner deemed fair and reasonable to
the Brinson Fund. Under its advisory agreements with certain Trust Series, the
Advisor is authorized to utilize the trading desk of its foreign subsidiaries to
execute foreign securities transactions, but monitors the selection by such
subsidiaries of brokers and dealers used to execute transactions for those Trust
Series. The primary consideration in all portfolio transactions will be prompt
execution of orders in an efficient manner at the most favorable price. In
selecting and monitoring broker-dealers and negotiating commissions, the Advisor
considers the firm's reliability, the quality of its execution services on a
continuing basis and its financial condition. When more than one firm is
believed to meet these criteria, preference may be given to brokers who provide
research or statistical material or other services to the Trust Series or to
Brinson. Such services

18
<PAGE>

include advice, both directly and in writing, as to the value of the securities;
the advisability of investing in, purchasing or selling securities; and the
availability of securities, or purchasers or sellers of securities, as well as
analyses and reports concerning issues, industries, securities, economic factors
and trends, portfolio strategy and the performance of accounts. This allows the
Advisor to supplement its own investment research activities and obtain the
views and information of others prior to making investment decisions. The
Advisor is of the opinion that, because this material must be analyzed and
reviewed by its staff, its receipt and use does not tend to reduce expenses but
may benefit the Trust Series by supplementing the Advisor's research.

The Advisor effects portfolio transactions for other investment companies
and advisory accounts. Research services furnished by dealers through whom the
Brinson Fund effects its securities transactions may be used by the Advisor in
servicing all of its accounts; not all such services may be used in connection
with the Brinson Fund. In the opinion of the Advisor, it is not possible to
measure separately the benefits from research services to each of the accounts.
The Advisor will attempt to equitably allocate portfolio transactions among the
Trust Series and others whenever concurrent decisions are made to purchase or
sell securities by the Trust Series and another. In making such allocations
between the Trust Series and others, the main factors to be considered are the
respective investment objectives, the relative size of portfolio holdings of the
same or comparable securities, the availability of cash for investment, the size
of investment commitments generally held and the opinions of the persons
responsible for recommending investments to the Trust Series and the others. In
some cases, this procedure could have an adverse effect on the Brinson Fund. In
the opinion of the Advisor, however, the results of such procedures will, on the
whole, be in the best interest of each of the clients.

For the fiscal year ended June 30, 1998, the Trust and the Advisor had no
agreements or understandings with a broker or otherwise causing brokerage
transactions or commissions for research services.

PORTFOLIO TURNOVER

The Trust Series are free to dispose of their portfolio securities at any
time, subject to complying with the Code and the Act, when changes in
circumstances or conditions make such a move desirable in light of the
respective investment objective. The Brinson Fund will not attempt to achieve or
be limited to a predetermined rate of portfolio turnover, such a turnover always
being incidental to transactions undertaken with a view to achieving the Brinson
Fund's investment objective.

The Brinson Fund does not intend to use short-term trading as a primary
means of achieving its investment objective. The rate of portfolio turnover
shall be calculated by dividing (a) the lesser of purchases and sales of
portfolio securities for the particular fiscal year by (b) the monthly average
of the value of the portfolio securities owned by the Brinson Fund during the
particular fiscal year. Such monthly average shall be calculated by totaling
the values of the portfolio securities as of the beginning and end of the first
month of the particular fiscal year and as of the end of each of the succeeding
eleven months and dividing the sum by 13.

SHARES OF BENEFICIAL INTEREST

Each Trust Series offers three classes of shares representing shares of
beneficial interest in the respective Trust Series. Each share of beneficial
interest represents an equal proportionate interest in the assets and
liabilities of the applicable Trust Series and has the same voting and other
rights and preferences as the other class of that Series, except that only
shares of the UBS Investment Funds class may vote on any matter affecting only
the UBS Investment Funds Plan under Rule 12b-1. Similarly, only shares of the
Brinson Fund-Class N may vote on matters that affect only the Class N Plan. No
class may vote on matters that affect only another class. Under Delaware law,
the Trust does not normally hold annual meetings of shareholders. Shareholders'
meetings may be held from time to time to consider certain matters including
changes to the Brinson Fund's fundamental investment objective and fundamental
investment policies, changes to the Trust's investment advisory agreement and
the election of Trustees when required by the Act. When matters are submitted
to shareholders for a vote, shareholders are entitled to one vote per share with
proportionate voting for fractional shares. The shares of the Brinson Fund do
not have cumulative voting rights or any preemptive or conversion rights, and
the Trustees have authority from time to time to divide or combine the shares of
the Brinson Fund into a greater or lesser number of shares so affected. In the
case of a liquidation, each shareholder of the Brinson Fund will be entitled to
share, based upon the shareholder's

19
<PAGE>

percentage share ownership, in the distribution out of assets, net of
liabilities, of the Brinson Fund. No shareholder is liable for further calls or
assessment by the Brinson Fund.

On any matters affecting only one Trust Series or class, only the
shareholders of that Trust Series or class are entitled to vote. On matters
relating to the Trust but affecting the Trust Series differently, separate votes
by the Trust Series or class are required. With respect to the submission to
shareholder vote of a matter requiring separate voting by a Trust Series or
class, the matter shall have been effectively acted upon with respect to any
Trust Series or class if a majority of the outstanding voting securities of that
Trust Series or class votes for the approval of the matter, notwithstanding
that: (1) the matter has not been approved by a majority of the outstanding
voting securities of any other Trust Series or class; and (2) the matter has not
been approved by a majority of the outstanding voting securities of the Trust.

PURCHASES

Shares of the Brinson Fund are sold at the net asset value next determined
after the receipt of a purchase application in proper form by the transfer
agent. The minimum for initial investments with respect to the Brinson Fund-
Class I is $1,000,000; subsequent investment minimums are $2,500. A more
detailed description of methods of purchase is included in the Prospectus/Proxy
Statement.

Certificates representing shares purchased are not issued. However, such
purchases are confirmed to the investor and credited to the shareholder's
account on the books maintained by the Trust's transfer agent. The investor will
have the same rights of ownership with respect to such shares as if certificates
had been issued.

EXCHANGES OF SHARES

Shares of one class of the Brinson Fund may only be exchanged for the same
class of another Trust Series. Exchanges will not be permitted between the
different classes.

Each qualifying exchange will be made on the basis of the relative net
asset values per share of both the Trust Series from which, and the Trust Series
into which, the exchange is made, that is next computed following receipt of the
exchange order in proper form by the Trust's transfer agent. Exchanges may be
made by telephone if the shareholder's Account Application Form includes
specific authorization for telephone exchanges. The telephone exchange privilege
may be difficult to implement during times of drastic economic or market
changes.

The transactions described above will result in a taxable gain or loss for
federal income tax purposes. Generally, any such taxable gain or loss will be a
capital gain or loss (long-term or short-term, depending on the holding period
of the shares) in the amount of the difference between the net asset value of
the shares surrendered and the shareholder's tax basis for those shares. Each
investor should consult his or her tax adviser regarding the tax consequences of
an exchange transaction.

Any shareholder who wishes to make an exchange should first obtain and
review the prospectus of the Trust Series to be acquired in the exchange.
Requests for telephone exchanges must be received prior to the close of regular
trading on the New York Stock Exchange ("NYSE") on any day on which the NYSE is
open for regular trading.

At the discretion of the Trust, this exchange privilege may be terminated
or modified at any time upon 60 days' prior written notice to shareholders.
Contact the transfer agent for details about a particular exchange.

NET ASSET VALUE

The net asset value per share is calculated separately for each class of
the Brinson Fund. The net asset value per share of the Brinson Fund is computed
by dividing the value of the assets of the Brinson Fund, less its liabilities,
by the number of shares of the Brinson Fund outstanding.

20
<PAGE>

Each class of the Brinson Fund will bear pro rata all of the common
expenses of the Brinson Fund. The net asset values of all outstanding shares of
each class of the Brinson Fund will be computed on a pro rata basis for each
outstanding share based on the proportionate participation in the Brinson Fund
represented by the value of shares of the Brinson Fund. All income earned and
expenses incurred by the Brinson Fund will be borne on a pro rata basis by each
outstanding share of a class, based on each class' percentage in the Brinson
Fund represented by the value of such shares of such classes, except that none
of the shares of a class will incur any of the expenses under the 12b-1 plan of
another class.

Portfolio securities are valued and net asset value per share is determined
as of the close of regular trading on the NYSE which currently is 4:00 p.m.
Eastern time on each day the NYSE is open for trading. The Brinson Fund and the
Trust reserve the right to change the time at which purchases, redemptions or
exchanges are priced if the NYSE closes at a time other than 4:00 p.m. Eastern
time or if an emergency exits. The NYSE is open for trading on every day except
Saturdays, Sundays and the following holidays: New Year's Day, Dr. Martin Luther
King, Jr. Day, Presidents' Day, Good Friday, Memorial Day (day observed),
Independence Day, Labor Day, Thanksgiving and Christmas and on the preceding
Friday or subsequent Monday when any of these holidays falls on a Saturday or
Sunday, respectively.

Portfolio securities listed on a national or foreign securities exchange
are valued on the basis of the last sale on the date the valuation is made.
Securities that are not traded on a particular day or an exchange, are valued at
either (a) the bid price or (b) a valuation within the range considered best to
represent value in the circumstances. Price information on listed securities is
generally taken from the closing price on the exchange where the security is
primarily traded. Other portfolio securities which are traded in the over-the-
counter market are valued at the bid price as long as the bid price, in the
opinion of the Advisor, continues to reflect the value of the security.
Valuations of fixed income and equity securities may be obtained from a pricing
service and/or broker-dealers when such prices are believed to reflect the fair
value of such securities. Use of a pricing service and/or broker-dealers has
been approved by the Board of Trustees.

Futures contracts are valued at their daily quoted settlement price on the
exchange on which they are traded. Forward foreign currency contracts are valued
daily using the mean between the bid and asked forward points added to the
current exchange rate and an unrealized gain or loss is recorded. A Series
realizes a gain or loss upon settlement of the contracts. For valuation
purposes, foreign securities initially expressed in foreign currency values will
be converted into U.S. dollar values using WM/Reuters closing spot rates as of
4:00 p.m. London time. Securities with a remaining maturity of 60 days or less
are valued at amortized cost, which approximates market value. Fixed income
securities having a remaining maturity of over 60 days are valued at market
price. Debt securities are valued on the basis of prices provided by a pricing
service, or at the bid price where readily available, as long as the bid price,
in the opinion of CGFSC and the Advisor, continues to reflect the value of the
security. Redeemable securities issued by open-end investment companies are
valued using their respective net asset values for purchase orders placed at the
close of the NYSE. Securities (including over-the-counter options) for which
market quotations are not readily available and other assets are valued at their
fair value as determined in good faith by or under the direction of the
Trustees.

Because of time zone differences, foreign exchanges and securities markets
will usually be closed prior to the time of the closing of the NYSE and values
of foreign futures and options and foreign securities will be determined as of
the earlier closing of such exchanges and securities markets. However, events
affecting the values of such foreign securities may occasionally occur between
the earlier closings of such exchanges and securities markets and the closing of
the NYSE which will not be reflected in the computation of the net asset value
of the Brinson Fund. If an event materially affecting the value of such foreign
securities occurs during such period, then such securities will be valued at
fair value as determined in good faith by or under the direction of the Board of
Trustees. Where a foreign securities market remains open at the time that the
Brinson Fund values its portfolio securities, or closing prices of securities
from that market may not be retrieved because of local time differences or other
difficulties in obtaining such prices at that time, last sale prices in such
market at a point in time most practicable to timely valuation of the Brinson
Fund may be used.

21
<PAGE>

REDEMPTIONS

Under normal circumstances shareholders may redeem their shares at any time
without a fee. The redemption price will be based upon the net asset value per
share next determined after receipt of the redemption request, provided it has
been submitted in the manner described below. The redemption price may be more
or less than the original cost, depending upon the net asset value per share at
the time of redemption.

Payment for shares tendered for redemption is made by check within five
business days after tender in proper form, except that the Trust reserves the
right to suspend the right of redemption, or to postpone the date of payment
upon redemption beyond five business days, (i) for any period during which the
NYSE is closed (other than customary weekend and holiday closings) or during
which trading on the NYSE is restricted, (ii) for any period during which an
emergency exists as determined by the SEC as a result of which disposal of
securities owned by the Brinson Fund is not reasonably practicable or it is not
reasonably practicable for the Brinson Fund fairly to determine the value of its
net assets, or (iii) for such other periods as the SEC may by order permit for
the protection of shareholders of the Brinson Fund.

Under unusual circumstances, when the Board of Trustees deems it in the
best interest of the Brinson Fund's shareholders, the Trust may make payment for
shares repurchased or redeemed in whole or in part in securities of the Brinson
Fund taken at current values. With respect to such redemptions in kind, the
Trust has made an election pursuant to Rule 18f-1 under the Act. This will
require the Trust to redeem in cash at a shareholder's election in any case
where the redemption involves less than $250,000 (or 1% of the Brinson Fund's
net asset value at the beginning of each 90 day period during which such
redemptions are in effect, if that amount is less than $250,000), during any 90-
day period for any one shareholder. Should payment be made in securities, the
redeeming shareholder may incur brokerage costs in converting such securities to
cash.

TAXATION

The Brinson Fund intends to qualify each year as a regulated investment
company under Subchapter M of the Code. In order to so qualify, a mutual fund
must, among other things, (i) derive at least 90% of its gross income from
dividends, interest, payments with respect to certain securities loans, gains
from the sale of securities or foreign currencies, or other income (including
but not limited to gains from options, futures or forward contracts) derived
with respect to its business of investing in such stock, securities or
currencies; (ii) distribute at least 90% of its dividend, interest and certain
other taxable income each year; and (iii) at the end of each fiscal quarter
maintain at least 50% of the value of its total assets in cash, government
securities, securities of other regulated investment companies and other
securities of issuers which represent, with respect to each issuer, no more than
5% of the value of a fund's total assets and 10% of the outstanding voting
securities of such issuer, and with no more than 25% of its assets invested in
the securities (other than those of the government or other regulated investment
companies) of any one issuer or of two or more issuers which the fund controls
and which are engaged in the same, similar or related trades and businesses.

To the extent the Brinson Fund qualifies for treatment as a regulated
investment company, it will not be subject to federal income tax on income and
net capital gains paid to shareholders in the form of dividends or capital gains
distributions.

An excise tax at the rate of 4% will be imposed on the excess, if any, of
the Brinson Fund's "required distributions" over actual distributions in any
calendar year. Generally, the "required distribution" is 98% of a fund's
ordinary income for the calendar year plus 98% of its capital gain net income
recognized during the one-year period ending on October 31 plus undistributed
amounts from prior years. The Brinson Fund intends to make distributions
sufficient to avoid imposition of the excise tax. Distributions declared by the
Brinson Fund during October, November or December to shareholders of record
during such month and paid by January 31 of the following year will be taxable
to shareholders in the calendar year in which they are declared, rather than the
calendar year in which they are received.

Gains or losses attributable to fluctuations in exchange rates which occur
between the time the Brinson Fund accrues interest or other receivables or
accrues expenses or liabilities denominated in a foreign currency and

22
<PAGE>

the time the Brinson Fund actually collects such receivables, or pays such
liabilities, are generally treated as ordinary income or loss. Similarly, a
portion of the gains or losses realized on disposition of debt securities
denominated in a foreign currency may also be treated as ordinary gain or loss.
These gains, referred to under the Code as "Section 988" gains or losses, may
increase or decrease the amount of the Brinson Fund's investment company taxable
income to be distributed to its shareholders, rather than increasing or
decreasing the amount of the Brinson Fund' capital gains or losses.

When the Brinson Fund writes a call, or purchases a put option, an amount
equal to the premium received or paid by it is included in its assets and
liabilities as an asset and as an equivalent liability.

In writing a call, the amount of the liability is subsequently "marked-to-
market" to reflect the current market value of the option written. The current
market value of a written option is the last sale price on the principal
exchange on which such option is traded or, in the absence of a sale, the mean
between the last bid and asked prices. If an option which the Brinson Fund has
written expires on its stipulated expiration date, the Brinson Fund recognizes a
short-term capital gain. If the Brinson Fund enters into a closing purchase
transaction with respect to an option which it has written, the Brinson Fund
realizes a short-term gain (or loss if the cost of the closing transaction
exceeds the premium received when the option was sold) without regard to any
unrealized gain or loss on the underlying security, and the liability related to
such option is extinguished. If a call option which the Brinson Fund has
written is exercised, the Brinson Fund realizes a capital gain or loss from the
sale of the underlying security and the proceeds from such sale are increased by
the premium originally received.

The premium paid by the Brinson Fund for the purchase of a put option is
recorded in the Brinson Fund' assets and liabilities as an investment and
subsequently adjusted daily to the current market value of the option. For
example, if the current market value of the option exceeds the premium paid, the
excess would be unrealized appreciation and, conversely, if the premium exceeds
the current market value, such excess would be unrealized depreciation. The
current market value of a purchased option is the last sale price on the
principal exchange on which such option is traded or, in the absence of a sale,
the mean between the last bid and asked prices. If an option which the Brinson
Fund has purchased expires on the stipulated expiration date, the Brinson Fund
realizes a short-term or long-term capital loss for Federal income tax purposes
in the amount of the cost of the option. If the Brinson Fund exercises a put
option, it realizes a capital gain or loss (long-term or short-term, depending
on the holding period of the underlying security) from the sale which will be
decreased by the premium originally paid.

Accounting for options on certain stock indices will be in accordance with
generally accepted accounting principles. The amount of any realized gain or
loss on closing out such a position will result in a realized gain or loss for
tax purposes. Such options held by the Brinson Fund at the end of each fiscal
year on a broad-based stock index will be required to be "marked-to-market" for
Federal income tax purposes. Sixty percent of any net gain or loss recognized
on such deemed sales or on any actual sales will be treated as long-term capital
gain or loss and the remainder will be treated as short-term capital gain or
loss. Certain options, futures contracts and options on futures contracts
utilized by the Brinson Fund are "Section 1256 contracts." Any gains or losses
on Section 1256 contracts held by a Series at the end of each taxable year (and
on October 31 of each year for purposes of the 4% excise tax) are "marked-to-
market" with the result that unrealized gains or losses are treated as though
they were realized and the resulting gain or loss is treated as a 60/40 gain or
loss.

If there is a constructive sale (e.g., short sale against the box) of an
appreciated financial position the taxpayer must recognize gain as if such
position were sold, assigned, or otherwise terminated at its fair market value
as of the date of the constructive sale and immediately repurchased.
Shareholders will be subject to federal income taxes on distributions made by
the Brinson Fund whether received in cash or additional shares of the Brinson
Fund. Distributions of net investment income and net short-term capital gains,
if any, will be taxable to shareholders as ordinary income. Distributions of net
long-term capital gains, if any, will be taxable to shareholders as long-term
capital gains, without regard to how long a shareholder has held shares of the
Brinson Fund. A loss on the sale of shares held for six months or less will be
treated as a long-term capital loss to the extent of any long-term capital gain
dividend paid to the shareholder with respect to such shares. Dividends eligible
for designation under the dividends received deduction and paid by the Brinson
Fund may qualify in part for the 70% dividends received deduction for
corporations provided, however, in respect of any dividend, that those shares
have been held for at least 46 days during the 90-day period that begins 45 days
before the stock becomes ex-dividend with respect to such dividend. The Brinson
Fund will notify shareholders each year of the amount of dividends and
distributions,

23
<PAGE>

including the amount of any distribution of long-term capital gains and the
portion of its dividends which may qualify for the 70% deduction.

Each class of the Brinson Fund will share proportionately in the investment
income and expenses of the Fund, except that the respective UBS Investment Funds
class and Brinson Fund-Class N will incur distribution fees under their
respective 12b-1 plans.

Generally, a credit for foreign taxes is subject to the limitation that it
may not exceed the shareholder's U.S. tax attributable to his or her total
foreign source taxable income. For this purpose, the source of the Brinson
Fund's income flows through to its shareholders. Gains from the sale of
securities will be treated as derived from U.S. sources and certain currency
fluctuation gains, including fluctuation gains from foreign currency denominated
debt securities, receivables and payables, will be treated as income derived
from U.S. sources. The limitation on the foreign tax credit is applied
separately to foreign source passive income (as defined for purposes of foreign
tax credit), such as foreign source passive income received from the Brinson
Fund. Because of changes made by the Code, shareholders may be unable to claim a
credit for the full amount of their proportionate share of the foreign taxes
paid by the Brinson Fund. Beginning in 1998, an individual with $300 or less
($600 or less for joint filers) of foreign tax credits is generally exempt from
the foreign tax credit limitation and likely will not have to file Form 1116 in
order to claim a foreign tax credit.

The foregoing is a general and abbreviated summary of the applicable
provisions of the Code and Treasury Regulations currently in effect. For the
complete provisions, reference should be made to the pertinent Code sections and
Regulations. The Code and Regulations are subject to change by legislative or
administrative action at any time and retroactively.

Dividends and distributions also may be subject to state and local taxes.

Shareholders are urged to consult their tax advisers regarding specific
questions as to federal, state and local taxes as well as the application of the
foreign tax credit.

The foregoing discussion relates solely to U.S. federal income tax law.
Non-U.S. investors should consult their tax advisers concerning the tax
consequences of ownership of shares of the Brinson Fund, including the
possibility that distributions may be subject to a 30% U.S. withholding tax (or
a reduced rate of withholding provided by treaty).

PERFORMANCE CALCULATIONS

Performance information for the UBS Investment Funds class, Brinson Fund-
Class N and Brinson Fund-Class I shares will vary due to the effect of expense
ratios on the performance calculations.

TOTAL RETURN

Current yield and total return quotations used by the Brinson Fund (and
classes of shares) are based on standardized methods of computing performance
mandated by rules adopted by the SEC. As the following formula indicates, the
average annual total return is determined by multiplying a hypothetical initial
purchase order of $1,000 by the average annual compound rate of return
(including capital appreciation/depreciation and dividends and distributions
paid and reinvested) for the stated period less any fees charged to all
shareholder accounts and annualizing the result. The calculation assumes that
all dividends and distributions are reinvested at the net asset value on the
reinvestment dates during the period. The quotation assumes the account was
completely redeemed at the end of each period and deduction of all applicable
charges and fees. According to the SEC formula:

P(1+T)/n/=ERV

where:
P = a hypothetical initial payment of $1,000,
T = average annual total return,

24
<PAGE>

n = number of years,
ERV = ending redeemable value of a hypothetical $1,000 payment
made at the beginning of the 1, 5 or 10 year periods at
the end of the 1, 5 or 10 year periods (or fractional
portion thereof).

YIELD

As indicated below, current yield is determined by dividing the net
investment income per share earned during the period by the maximum offering
price per share on the last day of the period and annualizing the result.
Expenses accrued for the period include any fees charged to all shareholders
during the 30-day base periods. According to the SEC formula:

Yield = 2[(a-b + 1)/6/ - 1
------------------
cd

where:
a = dividends and interest earned during the period.
b = expenses accrued for the period (net of reimbursements).
c = the average daily number of shares outstanding during
the period that were entitled to receive dividends.
d = the maximum offering price per share on the last day of
the period.

The yield of the Brinson Fund may be calculated by dividing the net
investment income per share earned by the Brinson Fund during a 30-day (or one
month) period by the net asset value per share on the last day of the period and
annualizing the result on a semi-annual basis. The Brinson Fund's net investment
income per share earned during the period is based on the average daily number
of shares outstanding during the period entitled to receive dividends and
includes dividends and interest earned during the period minus expenses accrued
for the period, net of reimbursements.

FINANCIAL STATEMENTS

The Brinson Funds' Financial Statements for the fiscal year ended June 30,
1998 and the report thereon of Ernst & Young LLP, which are contained in The
Brinson Funds' Annual Reports dated June 30, 1998 (which do not include the
Brinson Fund, which had not commenced operations as of the time period
indicated) are incorporated herein by reference.

25
<PAGE>

CORPORATE DEBT RATINGS APPENDIX A

MOODY'S INVESTORS SERVICE, INC. DESCRIBES CLASSIFICATIONS OF CORPORATE BONDS AS
FOLLOWS:

AAA - Bonds which are rated Aaa are judged to be of the best quality.
They carry the smallest degree of investment risk and are generally referred to
as "gilt-edged". Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized are
most unlikely to impair the fundamentally strong position of such issues.

AA - Bonds which are rated Aa are judged to be of high-quality by all
standards. Together with the Aaa group they comprise what are generally known as
high-grade. They are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities or fluctuation of protective
elements may be of greater amplitude or there may be other elements present
which make the long-term risks appear somewhat larger than in Aaa securities.

A - Bonds which are rated A possess many favorable investment
attributes and are to be considered as upper medium-grade obligations. Factors
giving security to principal and interest are considered adequate, but elements
may be present which suggest a susceptibility to impairment sometime in the
future.

BAA - Bonds which are rated Baa are considered as medium-grade
obligations, (i.e., they are neither highly protected nor poorly secured).
Interest payments and principal security appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.

BA - Bonds which are rated Ba are judged to have speculative elements;
their future cannot be considered as well-assured. Often the protection of
interest and principal payments may be very moderate and thereby not well
safeguarded during both good and bad times over the future. Uncertainty of
position characterizes bonds in this class.

B - Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may be
small.

CAA - Bonds which are rated Caa are of poor standing. Such issues may
be in default or there may be present elements of danger with respect to
principal or interest.

CA - Bonds which are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in default or have other
marked shortcomings.

C - Bonds which are rated C are the lowest rated class of bonds and
issues so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.

Moody's also supplies numerical indicators 1, 2, and 3 to rating
categories. The modifier 1 indicates the security is in the higher end of its
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates a ranking toward the lower end of the category.

STANDARD & POOR'S RATINGS GROUP DESCRIBES CLASSIFICATIONS OF CORPORATE BONDS AS
FOLLOWS:

AAA - This is the highest rating assigned by Standard & Poor's Ratings
Group to a debt obligation and indicates an extremely strong capacity to pay
principal and interest.

AA - Bonds rated AA also qualify as high-quality debt obligations.
Capacity to pay principal and interest is very strong and in the majority of
instances they differ from the AAA issues only in small degree.

A - 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.

A-26
<PAGE>

BBB - Bonds rated BBB are regarded as having an adequate capacity to pay
principal and interest. Whereas they normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay principal and interest for bonds in
this category than for bonds in the A category.

BB - Debt rated BB has less near-term vulnerability to default than other
speculative grade debt. However, it faces major ongoing uncertainties or
exposure to adverse business, financial or economic conditions which could lend
to inadequate capacity to meet timely interest and principal payments.

B - Debt rated B has a greater vulnerability to default but presently has
the capacity to meet interest payments and principal repayments. Adverse
business, financial or economic conditions would likely impair capacity or
willingness to pay interest and repay principal.

CCC - Debt rated CCC has a current identifiable vulnerability to default,
and is dependent upon favorable business, financial and economic conditions to
meet timely payments of interest and repayment of principal. In the event of
adverse business, financial or economic conditions, it is not likely to have the
capacity to pay interest or repay principal.

CC - The rating CC is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC rating.

C - The rating C is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC rating.

CI - The rating CI is reserved for income bonds on which no interest is
being paid.

D - Debt rated D is in default, or is expected to default upon maturity or
payment date.

Plus (+) or minus (-): The ratings from AA to CCC may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.

A-27
<PAGE>

U. S. LARGE CAPITALIZATION GROWTH FUND
PRO FORMA STATEMENT OF ASSETS AND LIABILITIES
June 30, 1998 (Unaudited)

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

UBS LARGE CAP FUND PRO FORMA ADJUSTMENTS PRO FORMA COMBINED
------------------ --------------------- ------------------
<S> <C> <C> <C>
ASSETS:
Investment in UBS Investor Portfolios Trust -
UBS Large Cap Growth Portfolio, at value.............. $ 7,138,155 $ (7,138,155) (1) $ -
Investments, at value......................................... - 7,138,155 (1) 7,138,155
Receivable from fund shares sold.............................. 9,000 9,000
Receivable from funds services agent.......................... 5,937 5,937
Deferred organization expenses................................ 10,169 (10,169) (2) -
Other assets.................................................. - 10,169 (2) 10,169
---------------- --------------- -----------------
Total Assets.......................................... 7,163,261 - 7,163,261
---------------- --------------- -----------------

LIABILITIES:
Payable from fund shares redeemed............................. 4,637 4,637
Administrative services fees payable.......................... 368 368
Accrued expenses.............................................. 23,566 23,566
---------------- --------------- -----------------
Total Liabilities..................................... 28,571 - 28,571
---------------- --------------- -----------------

NET ASSETS.................................................... $ 7,134,690 $ - $ 7,134,690
================ =============== =================

SHARES OUTSTANDING ($0.001 par value, shares authorized of
10 million and unlimited, respectively)............... 63,563 649,906 (3) 713,469
================ --------------- =================

NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE............................................. $ 112.25 $ 10.00
================ =================

COMPOSITION OF NET ASSETS:
Paid-in capital............................................... $ 6,362,895 $ - $ 6,362,895
Accumulated undistributed net investment income............... 17,826 17,826
Accumulated net realized loss................................. (10,461) (10,461)
Net unrealized appreciation of investments.................... 764,430 764,430
---------------- --------------- -----------------
Net Assets............................................ $ 7,134,690 $ - $ 7,134,690
================ =============== =================
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
U.S. LARGE CAPITALIZATION GROWTH FUND
PRO FORMA STATEMENT OF OPERATIONS
For the Period From October 14, 1997 (Commencement of Operations) through June 30, 1998 (Unaudited)
- ----------------------------------------------------------------------------------------------------------------------------
UBS
Large Cap Pro Forma Pro-Forma
Growth Fund Adjustments Combined
----------------- ---------------- --------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 17,711 $ - $ 17,711
Dividends 46,125 46,125
----------------- ---------------- --------------
TOTAL INCOME 63,836 63,836
----------------- ---------------- --------------

EXPENSES
Advisory 18,326 7,546 (a) 25,872
Administration 5,054 (5,054) (b) 0
Professional 38,817 (13,817) (c) 25,000
Registration 18,927 6,073 (c) 25,000
Custodian 5,882 (5,752) (c) 130
Other 70,327 (62,557) (c) 7,770
----------------- ---------------- --------------
TOTAL EXPENSES 157,333 (73,561) 83,772
Expenses waived/reimbursed by Advisor (120,373) 66,169 (d) (54,204)
----------------- ---------------- --------------

NET EXPENSES 36,960 (7,392) 29,568
----------------- ---------------- --------------

NET INVESTMENT INCOME 26,876 7,392 34,268
----------------- ---------------- --------------

NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized loss (10,461) (10,461)
Change in net unrealized appreciation or depreciation 764,430 764,430
----------------- ---------------- --------------

Net realized and unrealized loss 753,969 753,969
----------------- ---------------- --------------

Net increase in net assets resulting from operations $ 780,845 $ 7,392 $ 788,237
================= ================ ==============
</TABLE>

See accompanying notes to the pro forma financial statements.
<PAGE>

<TABLE>
<CAPTION>
BRINSON U.S. LARGE CAPITALIZATION GROWTH FUND
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
JUNE 30, 1998
- ----------------------------------------------------------------------------------------------------------------------------
Shares Value
- --------------------------------- -------------------------------------
BRINSON BRINSON
UBS LARGE U.S. UBS LARGE U.S.
CAP LARGE CAP PRO FORMA CAP LARGE CAP PRO FORMA
GROWTH GROWTH COMBINED GROWTH GROWTH COMBINED
FUND FUND FUND FUND FUND FUND
- --------------------------------- -------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Common Stocks
Airlines - 1.3%
1,580 - 1,580 Continental Airlines, Inc., Class B*................ $96,193 - $96,193
---------- ---------- -----------
Banking & Financial Institutions - 7.5%
2,169 - 2,169 American Express Company............................ 247,279 - 247,279
1,822 - 1,822 BankAmerica Corp.................................... 157,450 - 157,450
351 - 351 Wells Fargo & Company............................... 129,443 - 129,443
---------- ---------- -----------
534,172 534,172
---------- ---------- -----------
Chemicals - 4.7%
2,896 - 2,896 Du Pont (E.I.) de Nemours........................... 216,148 - 216,148
2,102 - 2,102 Monsanto Company.................................... 117,424 - 117,424
---------- ---------- -----------
333,572 333,572
---------- ---------- -----------
Consumer Foods - 2.6%
4,496 - 4,496 PepsiCo, Inc........................................ 185,176 - 185,176
---------- ---------- -----------
Cosmetics & Toiletries - 1.8%
2,839 - 2,839 Kimberly-Clark Corporation.......................... 130,217 - 130,217
---------- ---------- -----------
Diversified - 3.2%
2,546 - 2,546 General Electric Company............................ 231,655 - 231,655
---------- ---------- -----------
Drugs & Pharmaceuticals - 12.4%
5,362 - 5,362 Abbott Laboratories................................. 219,158 - 219,158
1,886 - 1,886 Bristol-Myers Squibb Co............................. 216,762 - 216,762
1,136 - 1,136 Eli Lilly & Company................................. 75,051 - 75,051
1,493 - 1,493 Johnson & Johnson................................... 110,130 - 110,130
1,110 - 1,110 Merck & Co., Inc.................................... 148,504 - 148,504
1,223 - 1,223 Schering-Plough Corporation......................... 112,053 - 112,053
---------- ---------- -----------
881,658 881,658
---------- ---------- -----------
Electronics - 2.6%
1,223 - 1,223 Emerson Electric Company............................ 73,835 - 73,835
1,925 - 1,925 Raytheon Company, Class A........................... 110,901 - 110,901
---------- ---------- -----------
184,736 184,736
---------- ---------- -----------
Entertainment - 4.4%
5,455 - 5,455 Tele-Communications TCI Ventures Group, Class A*.... 109,441 - 109,441
2,414 - 2,414 Time Warner Inc..................................... 206,221 - 206,221
---------- ---------- -----------
315,662 315,662
---------- ---------- -----------
Environmental Control - 1.6%
3,270 - 3,270 Waste Management Inc................................ 114,442 - 114,442
---------- ---------- -----------
Food - Retail - 2.2%
3,041 - 3,041 Albertson's, Inc.................................... 157,576 - 157,576
---------- ---------- -----------
Health Care Providers - 1.9%
4,560 - 4,560 Columbia / HCA Healthcare Corporation............... 132,819 - 132,819
---------- ---------- -----------
Insurance - 6.7%
5,915 - 5,915 AFLAC Incorporated.................................. 179,305 - 179,305
1,847 - 1,847 Chubb Corporation................................... 148,476 - 148,476
2,451 - 2,451 Travelers Group, Inc................................ 148,575 - 148,575
---------- ---------- -----------
476,356 476,356
---------- ---------- -----------
Media / Cable - 3.5%
4,110 - 4,110 CBS Corporation..................................... 130,485 - 130,485
3,119 - 3,119 Tele-Communications TCI Group, Class A*............. 119,868 - 119,868
---------- ---------- -----------
250,353 250,353
---------- ---------- -----------
Medical Supplies - 3.1%
</TABLE>

See accompanying notes to the pro forma combining financial statements.
<PAGE>

<TABLE>
<CAPTION>
BRINSON U.S. LARGE CAPITALIZATION GROWTH FUND
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
JUNE 30, 1998
- ----------------------------------------------------------------------------------------------------------------------------
Shares Value
- -------------------------------- -------------------------------------
BRINSON BRINSON
UBS LARGE U.S. UBS LARGE U.S.
CAP LARGE CAP PRO FORMA CAP LARGE CAP PRO FORMA
GROWTH GROWTH COMBINED GROWTH GROWTH COMBINED
FUND FUND FUND FUND FUND FUND
- --------------------------------- -------------------------------------
<S> <C> <C> <C> <C> <C> <C>
3,501 - 3,501 Medtronic, Inc...................................... 223,220 - 223,220
----------- ---------- -----------
Oil Services - 4.2%
2,118 - 2,118 Baker Hughes Incorporated........................... 73,190 - 73,190
1,583 - 1,583 Halliburton Company................................. 70,560 - 70,560
2,269 - 2,269 Schlumberger Ltd.................................... 154,993 - 154,993
----------- ---------- -----------
298,743 298,743
----------- ---------- -----------
Packaging - 1.9%
2,867 - 2,867 Crown Cork & Seal Company, Inc...................... 136,564 - 136,564
----------- ---------- -----------
Petroleum Production & Sales - 2.9%
2,855 - 2,855 Burlington Resources Inc............................ 122,927 - 122,927
1,175 - 1,175 Exxon Corporation................................... 83,769 - 83,769
----------- ---------- -----------
206,696 206,696
----------- ---------- -----------
Real Estate - 1.8%
3,891 - 3,891 Simon DeBartolo Group, Inc. REIT (a)................ 126,454 - 126,454
----------- ---------- -----------
Retail - 9.1%
3,971 - 3,971 Dayton Hudson Corporation........................... 192,611 - 192,611
2,916 - 2,916 Lowe's Companies, Inc............................... 118,271 - 118,271
2,562 - 2,562 McDonald's Corporation.............................. 176,761 - 176,761
2,623 - 2,623 Wal-Mart Stores, Inc................................ 159,341 - 159,341
----------- ---------- -----------
646,984 646,984
----------- ---------- -----------
Technology - 12.8%
676 - 676 America Online, Inc................................. 71,639 - 71,639
3,595 - 3,595 Compaq Computer Corporation......................... 102,003 - 102,003
2,494 - 2,494 Electronic Data Systems Corporation................. 99,767 - 99,767
2,507 - 2,507 Hewlett-Packard Company............................. 150,109 - 150,109
1,406 - 1,406 International Business Machines Corporation......... 161,471 - 161,471
724 - 724 Microsoft Corporation............................... 78,476 - 78,476
3,218 - 3,218 Sun Microsystems, Inc.*............................. 139,794 - 139,794
1,925 - 1,925 Texas Instruments Incorporated...................... 112,224 - 112,224
----------- ---------- -----------
915,483 915,483
----------- ---------- -----------
Telecommunications - 5.9%
3,952 - 3,952 Loral Space & Communications Ltd.*.................. 111,645 - 111,645
2,607 - 2,607 Lucent Technologies, Inc............................ 216,855 - 216,855
1,683 - 1,683 QUALCOMM, Inc.*..................................... 94,573 - 94,573
----------- ---------- -----------
423,073 423,073
----------- ---------- -----------
Tobacco - 1.9%
3,463 - 3,463 Philip Morris Companies, Inc........................ 136,351 - 136,351
----------- ---------- -----------

Total Investments At Market Value - 100.00%
(Cost $6,373,725)................................ $7,138,155 - $7,138,155
=========== ========== ===========
</TABLE>

NOTES TO SCHEDULE OF INVESTMENTS

(a) REIT - Real Estate Investment Trust

* Non-income producing security.

See accompanying notes to the pro forma combining financial statements.
<PAGE>

U.S. LARGE CAPITALIZATION GROWTH FUND
NOTES TO PRO FORMA FINANCIAL STATEMENTS
(Unaudited)

The unaudited pro forma statement of assets and liabilities as of June 30, 1998,
statement of operations for the period from October 14, 1997 though June 30,
1998 and the schedule of investments at June 30, 1998 have been prepared to
reflect the reorganization of the UBS Large Cap Growth Fund (the "UBS Fund")
into the U.S. Large Capitalization Growth Fund (the "Brinson Fund") as if the
proposed reorganization occurred as of and for the period ended June 30, 1998.
The Brinson Fund did not have any assets or liabilities at June 30, 1998. These
statements have been prepared to conform to the presentation policy of the
Brinson Funds. The pro forma financial statements do not reflect the expenses
of either fund in carrying out its obligations under the Agreement and Plan of
Reorganization or any adjustment with respect to additional distributions that
may be made prior to reorganization. The pro forma statements of assets and
liabilities, including the pro forma schedule of investments, and of operations
should be read in conjunction with the historical financial statements of the
UBS Fund and Brinson Fund (incorporated by reference in the Statement of
Additional Information).

UBS Investors Portfolios Trust, a master trust formed under New York law (the
"Trust"), was organized on February 9, 1996, and is an open-end management
investment company. At June 30, 1998, the Trust had established seven
portfolios, including the UBS Large Cap Growth Portfolio (the "Portfolio"). The
UBS Fund invests in the Portfolio.

The pro forma statement of assets and liabilities reflects adjustments to show
the transfer of assets and liabilities from the UBS Fund to the Brinson Fund and
are explained below:

(1) Reflects the in-kind transfer of investments out of the Portfolio into the
Brinson Fund.

(2) Reflects the write off of unamortized organization costs of the UBS Fund.
The Brinson Fund will be reimbursed for this write off.

(3) Reflects the exchange of shares of the UBS Fund to the Brinson Fund.

For the pro forma statement of operations, income, expenses, and realized and
unrealized loss on investments allocated from the Portfolio were itemized and
combined with UBS Fund's operating expenses. The pro forma statement of
operations reflects the adjustments necessary to show expenses at the rates
which would have been in effect if the UBS Fund were included in the Brinson
Fund for the period from October 14, 1997 through June 30, 1998 and are
explained below:

(a) Investment advisory fees were adjusted to reflect the application of the
fee structure in effect as of June 30, 1998 for the Brinson Fund (.70% of
average net assets).

(b) Administration fees were adjusted to reflect the application of the fee
structure in effect as of June 30, 1998 for the Brinson Fund (.075% of
average net assets, subject to the expense limitation).

(c) Actual expenses incurred by the individual funds, for various expenses
included on a pro forma basis, were reduced to reflect estimated savings
arising from the merger.

(d) Waiver of investment advisory fees was adjusted to reflect the advisor's
commitment to voluntarily waive fees in excess of .80% for the Brinson
Fund.

The pro forma schedule of investments represents the UBS Fund's proportionate
interest in each of the securities held by the Portfolio as of June 30, 1998.
<PAGE>

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

UBS
LARGE CAP
GROWTH FUND

-----------

UBS
PRIVATE INVESTOR
FUNDS, INC.

ANNUAL REPORT
DECEMBER 31, 1997

- --------------------------------------------------------------------------------
<PAGE>

UBS Private Investor Funds, Inc.
Chairman's Letter
- --------------------------------------------------------------------------------

Dear Shareholder,

Thank you for your investment in the UBS Large Cap Growth Fund, which is part of
the UBS Private Investor Funds.

We are pleased to provide you with the Fund's annual report for the period ended
December 31, 1997. This report contains a letter from the portfolio manager
discussing the performance of the Fund during the period October 14, 1997
(commencement of operations) through December 31, 1997 including a market
overview. In addition, it includes a complete set of audited financial
statements as well as a schedule of investments.

The UBS Private Investor Funds are an integral part of the asset allocation
service provided by The Private Bank* of Union Bank of Switzerland, the largest
bank in Switzerland. The Funds provide investment opportunities in U.S. and
international securities markets to enhance investment performance, diversify
risk and preserve capital within your investment objectives.

The UBS Private Investor Funds bring you:

The expertise of The Private Bank's professional money managers

Global investment perspective and knowledge

A high priority on financial stability and preservation of wealth

As you are aware, in December, 1997, Union Bank of Switzerland and Swiss Bank
Corporation ('SBC') announced their intention to merge. Early in February, 1998,
the shareholders of UBS and SBC overwhelmingly approved the proposed merger.
Completion of the merger is still subject to regulatory approvals which are
expected to be received soon.

This merger will create a top-tier global financial services group which will
concentrate on clearly defined core businesses. As private banking and asset
management are core businesses of the banks, shareholders of the UBS Private
Investor Funds will continue to see a commitment to growing and building the
mutual fund business.

We will continue to keep you informed of any new developments as they occur.

To learn more about the other UBS Private Investor Funds, please call (888)
UBS-FUND. You will be provided with a copy of the prospectus which contains more
complete information including charges and expenses. Please read it carefully
before investing.

We appreciate your confidence in the UBS Private Investor Funds.

Sincerely,

/s/ Dr. HansPeter Lochmeier

Dr. HansPeter Lochmeier
Chairman of the Board
UBS Private Investor Funds, Inc.

- ------------
* 'The Private Bank', as used in this document, refers to Union Bank of
Switzerland, New York Branch.

This annual report must be accompanied or preceded by the Fund's prospectus.
<PAGE>

UBS Private Investor Funds, Inc.
Fund Commentary
- --------------------------------------------------------------------------------

FUND PERFORMANCE

During the period October 14, 1997 (commencement of operations) through December
31, 1997, the UBS Large Cap Growth Fund generated a total return of -0.55%
versus 0.38% for the S&P 500 Index.

This chart provides a comparison of the Fund's performance to that of the S&P
500 Index. This chart compares total returns (which includes changes in share
price and reinvestment of all income dividends and capital gains distributions)
of a hypothetical $10,000 investment made on October 14, 1997 (commencement of
operations) and held through December 31, 1997.

[PERFORMANCE GRAPH]

DATE UBS LARGE CAP GROWTH FUND S&P 500 INDEX
---- ------------------------- -------------
10/14/97 10,000 10,000
10/31/97 9,570 9,431.64
11/30/97 9,747 9,868.32
12/31/97 9,944.57 10,038

A number of factors contributed to our underperformance against the benchmark.
Most important was the extreme narrowing in the breadth of the market to the top
100 stocks in the S&P 500. As a result, investors fled many stocks that had good
fundamentals but were not perceived as being 'safe havens' from the Asian
currency crisis.

As the fourth quarter progressed, the Fund was negatively impacted by an absence
of communications stocks. Holdings in cyclical areas, including technology, also
hurt us. These initial setbacks were offset by our slight overweighting in
consumer staples, financials and healthcare sectors. In particular, our holdings
in TCI Group, Albertson's, Wells Fargo, and Bristol-Myer Squibb have produced
double digit returns for the quarter.

<PAGE>

UBS Private Investor Funds, Inc.
Fund Commentary
- --------------------------------------------------------------------------------

MARKET OVERVIEW

It would be easy to become pessimistic over the outlook for U.S. stocks in 1998,
for undoubtedly the American marketplace has shown unprecedented investment
returns for most of the 1990's -- and especially the last three years. Perhaps
the time for change has arrived, as the Asian 'contagion' could spread to the
U.S. and scare investors into selling shares in order to protect gains made in
earlier years. Further, investors are becoming aware that overall corporate
earnings throughout the U.S. will fall from the 12-15% year over year gains of
1995-97 to lower levels (6-8%) in 1998 as imports and exports may both be
negatively affected by Asian, and other emerging country recessions.

While recession in the U.S. is not being whispered, one does begin to wonder
whether the benign investment environment of recent years is changing. We are
persuaded, however, that the U.S. marketplace still has many good things going
for it. After all, inflation remains well contained and interest rates are now
at 20 year lows for intermediate and long maturity bonds. The Asian economies
have become adept at imitating Western products like autos, computers,
semiconductors, textiles, etc. but the real global competitive game is one of
innovation -- a game where American technology and inventive techniques excel.
Mergers, acquisitions and restructurings are always changing American companies
and the rest of the corporate world must keep running to catch up. This
continuous change will be seen for years to come and will, hopefully, keep U.S.
industries in the forefront of worldwide competition. Finally, we are also
seeing major changes in the structure of the U.S. economy itself. New investment
spending, as noted above, remains strong and is driven more by trade and the
private sector than by less efficient government spending. All of this spending,
restructuring, cost cutting, as well as reduced government spending has done
wonders for profitability and the Federal deficit. The Federal budget should
soon be in surplus for the first time since 1969, a wondrous event that has not
been seen by most living Americans!

All of these thoughts lead us to the conclusion that although Asian concerns
will probably remain at least throughout the first half of 1998, the U.S. equity
markets will continue to show smaller, but acceptable gains in 1998. We expect
to see increased volatility during the winter and spring period as investors
inevitably react to the more turbulent Asian environment that has moved into the
forefront of investor thinking. Equity prices may indeed move lower during this
period and the Dow Jones average may re-visit its late October lows around 7000
if first quarter earnings weaken to the extent that we now believe possible. The
so-called wealth effect that has kept U.S. consumption relatively strong
throughout 1997 may also slow temporarily this spring and help to cause Gross
Domestic Product (GDP) to dip low enough to bring about talk of the Federal
Reserve actually lowering interest rates later this year. Therefore, while we
sense that the winter-spring period may indeed be choppy for investors we do not
presently anticipate lasting difficulties in the U.S. economy. We would expect
to see a stronger market during the second half of the year, and a move into
higher market levels by the end of 1998.

Wayne Thornbrough
Portfolio Manager
- ------------------------

The Fund is not insured by the FDIC and is not a deposit with, an obligation of,
or guaranteed by Union Bank of Switzerland. The Fund is subject to investment
risks, including possible loss of principal amount invested.

Shares of the Fund are distributed by First Fund Distributors, Inc. which is not
affiliated with Union Bank of Switzerland.

<PAGE>

UBS Private Investor Funds, Inc.
Fund Commentary
- --------------------------------------------------------------------------------

Unlike other mutual funds, the Fund seeks to achieve its investment objective by
investing all of its investable assets in UBS Investor Portfolios Trust -- UBS
Large Cap Growth Portfolio (the 'Portfolio') which is a separate fund with an
identical investment objective.

Union Bank of Switzerland is voluntarily waiving all shareholder servicing fees
for the Fund and reimbursing all of the Fund's expenses. Union Bank of
Switzerland is also waiving all of its advisory fees for the Portfolio and a
portion of the Portfolio's expenses. If Union Bank of Switzerland had not waived
fees and reimbursed expenses, total return would have been lower. Past
performance is not a guarantee of future results. Investment return and
principal value of an investment will fluctuate so that an investor's shares,
when redeemed, may be worth more or less than their original cost.

The S&P 500 Index is an unmanaged index broadly representative of the U.S. stock
market.

4
<PAGE>

UBS Large Cap Growth Fund
Statement of Assets and Liabilities
December 31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
ASSETS:
Investment in UBS Investor Portfolios Trust -- UBS Large Cap Growth Portfolio, at
value.............................................................................. $4,138,823
Receivable from sale of capital stock................................................ 10,000
Receivable from funds services agent................................................. 1,705
Deferred organization expenses and other assets...................................... 32,273
----------
Total Assets............................................................... 4,182,801
----------
LIABILITIES:
Administrative services fees payable................................................. 388
Organization expenses payable........................................................ 20,000
Other accrued expenses............................................................... 25,299
----------
Total Liabilities.......................................................... 45,687
----------

NET ASSETS........................................................................... $4,137,114
----------
----------

SHARES OUTSTANDING ($0.001 par value, 10 million shares authorized).................. 41,697
----------
----------

NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE....................... $ 99.22
----------
----------
COMPOSITION OF NET ASSETS:
Shares of common stock, at par....................................................... $ 42
Additional paid-in capital........................................................... 4,117,496
Net unrealized appreciation of investments........................................... 33,821
Accumulated undistributed net investment income...................................... 300
Accumulated net realized loss........................................................ (14,545)
----------
Net Assets................................................................. $4,137,114
----------
----------
</TABLE>

- ------------------------
See notes to financial statements.

<PAGE>

UBS Large Cap Growth Fund
Statement of Operations
For the Period October 14, 1997 (Commencement of Operations) through December
31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Investment Income and Expenses from UBS Investor Portfolios Trust -- UBS
Large Cap Growth Portfolio
Dividends............................................................ $ 10,648
Interest............................................................. 5,624
--------
Investment income............................................... 16,272
Total expenses....................................................... $ 12,215
Less: Fee waiver and expense reimbursements.......................... (5,293)
--------
Net expenses......................................................... 6,922
--------
Net Investment Income from UBS Investor Portfolios Trust -- UBS Large Cap
Growth Portfolio........................................................ 9,350

EXPENSES:
Shareholder service fees.................................................. 1,730
Administrative services fees.............................................. 450
Reports to shareholders expense........................................... 15,425
Audit fees................................................................ 11,300
Registration fees......................................................... 6,155
Legal fees................................................................ 3,750
Transfer agent fees....................................................... 3,185
Fund accounting fees...................................................... 1,911
Directors' fees........................................................... 857
Amortization of organization expenses..................................... 855
Miscellaneous expenses.................................................... 1,250
--------
Total expenses....................................................... 46,868
Less: Fee waiver and expense reimbursements.......................... (46,868)
--------
Net expenses......................................................... --
--------
Net investment income..................................................... 9,350
--------

NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS FROM UBS INVESTOR
PORTFOLIOS TRUST -- UBS LARGE CAP GROWTH PORTFOLIO
Net realized loss on securities transactions.............................. (14,545)
Net change in unrealized appreciation of investments...................... 33,821
--------
Net realized and unrealized gain on investments from UBS Investor
Portfolios Trust -- UBS Large Cap Growth Portfolio...................... 19,276
--------

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS...................... $ 28,626
--------
--------
</TABLE>

- ------------------------
See notes to financial statements.

6
<PAGE>

UBS Large Cap Growth Fund
Statement of Changes in Net Assets
For the Period October 14, 1997 (Commencement of Operations) through December
31, 1997
- --------------------------------------------------------------------------------

DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income......................................................................... (9,050)
-----------------

TRANSACTIONS IN SHARES OF COMMON STOCK:
Net proceeds from sale of shares.............................................................. 4,108,844
Net asset value of shares issued to shareholders in reinvestment of dividends................. 9,050
Cost of shares redeemed....................................................................... (356)
-----------------
Net increase in net assets from transactions in shares of common stock........................ 4,117,538
-----------------

NET INCREASE IN NET ASSETS.................................................................... 4,137,114
NET ASSETS:
Beginning of period........................................................................... --
-----------------
End of period (including undistributed net investment income of $300)......................... $ 4,137,114
-----------------
-----------------
</TABLE>

- ------------------------
See notes to financial statements.

<PAGE>

UBS Large Cap Growth Fund
Financial Highlights
For the Period October 14, 1997 (Commencement of Operations) through December
31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
FOR A SHARE OUTSTANDING FOR THE PERIOD

Net asset value, beginning of period.......................................................... $100.00
-----------------
Income from investment operations:
Net investment income.................................................................... 0.23
Net realized and unrealized loss on investments.......................................... (0.79)
-----------------
Total loss from investment operations.................................................... (0.56)
-----------------

Less: Dividends from net investment income.................................................... (0.22)
-----------------
Net asset value, end of period................................................................ $ 99.22
-----------------
-----------------
Total return.................................................................................. (0.55%)(1)

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s omitted)................................................. $ 4,137
Ratio of expenses to average net assets(2)............................................... 1.00%(3)
Ratio of net investment income to average net assets(2).................................. 1.35%(3)
</TABLE>

- ------------------------
(1) Not annualized.
(2) Includes the Fund's share of UBS Investor Portfolios Trust -- UBS Large Cap
Growth Portfolio expenses and net of fee waivers and expense reimbursements.
Such fee waivers and expense reimbursements had the effect of reducing the
ratio of expenses to average net assets and increasing the ratio of net
investment income to average net assets by 7.54% (annualized). The
annualization of these ratios is affected by the fact that the Investment
Advisory Agreement and Investment Sub-Advisory Agreement was not ratified
until December 29, 1997. Prior to this date, investment advisory services
were being provided without compensation.
(3) Annualized.

See notes to financial statements.

8
<PAGE>

UBS Large Cap Growth Fund
Notes to Financial Statements
December 31, 1997
- --------------------------------------------------------------------------------

1. GENERAL
UBS Large Cap Growth Fund (the 'Fund') is a diversified, no-load mutual fund
registered under the Investment Company Act of 1940. The Fund is one of several
series of UBS Private Investor Funds, Inc. (the 'Company'), an open-end
management investment company organized as a corporation under Maryland law. At
December 31, 1997, the Company included six other funds, UBS Bond Fund, UBS
Value Equity Fund, UBS Institutional International Equity Fund, UBS High Yield
Bond Fund, UBS Small Cap Fund and UBS International Equity Fund. These financial
statements relate only to the Fund.

The Fund seeks to achieve its investment objective by investing substantially
all of its investable assets in the UBS Large Cap Growth Portfolio of UBS
Investor Portfolios Trust (the 'Portfolio'), an open-end management investment
company that has the same investment objective as that of the Fund. At December
31, 1997, certain shares of the Fund were held by UBS or its affiliates on
behalf of its clients. Two shareholders, individually owning greater than 10% of
the shares of the Fund, collectively held 52.0% at December 31, 1997.

Investors Bank & Trust Company ('IBT') serves as the Fund's administrator and
First Fund Distributors, Inc. ('FFDI') serves as the Fund's distributor. Union
Bank of Switzerland, New York Branch ('UBS') serves as the funds services agent
to the Fund.

The financial statements of the Portfolio, including its Schedule of
Investments, are included elsewhere within this report and should be read in
conjunction with the Fund's financial statements.

2. SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates. Significant accounting policies
followed by the Fund are as follows:

A. INVESTMENT VALUATION -- The value of the Fund's investment in the Portfolio
included in the accompanying Statement of Assets and Liabilities reflects the
Fund's proportionate beneficial interest in the net assets of the Portfolio
(21.6% at December 31, 1997). Valuation of securities by the Portfolio is
discussed in Note 2A of the Portfolio's Notes to Financial Statements.

B. INVESTMENT INCOME, EXPENSES AND REALIZED AND UNREALIZED GAINS AND
LOSSES -- The Fund records its share of the investment income, expenses and
realized and unrealized gains and losses recorded by the Portfolio on a daily
basis. The investment income, expenses and realized and unrealized gains and
losses are allocated daily to investors of the Portfolio based upon the amount
of their investment in the Portfolio.

C. FEDERAL TAXES -- The Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies, including
the requirement to distribute substantially all of its taxable income, including
any net realized capital gains on investment transactions, to its shareholders.
Accordingly, no provision for federal income or excise taxes is necessary.

D. DIVIDENDS AND DISTRIBUTIONS -- The Fund declares dividends from net
investment income to shareholders of record on the day of declaration. Such
dividends are declared and paid annually. Net realized gains, if any, will be
distributed at least annually. However, to the extent that net realized gains of
the Fund can be reduced by capital loss carryovers, such gains will not be
distributed. Dividends and distributions are recorded on the ex-dividend date.

<PAGE>

UBS Large Cap Growth Fund
Notes to Financial Statements
December 31, 1997
- --------------------------------------------------------------------------------

The amounts of dividends from net investment income and distributions from net
realized gains are determined in accordance with federal income tax regulations
which may differ from generally accepted accounting principles. These 'book/tax'
differences are either considered temporary or permanent in nature. To the
extent these differences are permanent in nature, such amounts are reclassified
within the composition of net assets based upon their federal tax-basis
treatment; temporary differences do not require reclassification. For the period
ended December 31, 1997, there were no permanent 'book/tax' differences.

E. DEFERRED ORGANIZATION EXPENSES -- Expenses incurred by the Fund in connection
with its organization in the amount of approximately $20,000 have been deferred
and are being amortized on a straight line basis over five years from the Fund's
commencement of operations (October 14, 1997).

F. OTHER -- The Fund bears all costs of its operations other than expenses
specifically assumed by IBT, FFDI and UBS. Expenses incurred by the Company on
behalf of any two or more funds are allocated in proportion to the net assets of
each fund, except when allocations of direct expenses to each fund can otherwise
be made fairly. Expenses directly attributable to the Fund are charged directly
to the Fund.

3. AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES
A. ADMINISTRATION AGREEMENT -- Under the terms of an Administration Agreement
with the Company, IBT provides overall administrative services and general
office facilities. As compensation for such services, the Company has agreed to
pay IBT a fee, accrued daily and payable monthly, at an annual rate of 0.065% of
the Fund's first $100 million average daily net assets and 0.025% of the next
$100 million average daily net assets. IBT does not receive a fee on average
daily net assets in excess of $200 million. For the period October 14, 1997
(commencement of operations) through December 31, 1997, the administrative
services fee amounted to $450.

B. DISTRIBUTION AGREEMENT -- Under the terms of a Distribution Agreement, FFDI
serves as the distributor of Fund shares. FFDI does not receive any fees from
the Fund for services provided pursuant to this agreement.

C. SHAREHOLDER SERVICING AGREEMENT -- The Fund has entered into a Shareholder
Servicing Agreement with UBS pursuant to which UBS provides certain services to
shareholders of the Fund. The Fund has agreed to pay UBS a fee for these
services, accrued daily and payable monthly, at an annual rate of 0.25% of the
average daily net assets of the Fund. For the period October 14, 1997
(commencement of operations) through December 31, 1997, the shareholder service
fee amounted to $1,730, all of which was waived.

D. FUNDS SERVICES AGREEMENT -- Under the terms of a Funds Services Agreement
with the Company, UBS has agreed to provide certain administrative services to
the Fund. UBS is not entitled to any additional compensation pursuant to this
agreement.

E. EXPENSE REIMBURSEMENTS -- UBS has voluntarily agreed to limit the total
operating expenses of the Fund, including its share of the Portfolio's expenses
and excluding extraordinary expenses, to an annual rate of 1.00% of the Fund's
average daily net assets. For the period October 14, 1997 (commencement of
operations) through December 31, 1997, UBS reimbursed the Fund for expenses
totaling $45,138 in connection with this voluntary limitation. UBS may modify or
discontinue this voluntary expense limitation at any time with 30 days' advance
notice to the Fund.

<PAGE>

UBS Large Cap Growth Fund
Notes to Financial Statements
December 31, 1997
- --------------------------------------------------------------------------------

4. CAPITAL SHARE TRANSACTIONS
At December 31, 1997 there were 500 million shares of the Company's common stock
authorized, of which 10 million shares were classified as common stock of the
Fund. Transactions in shares of the Fund during the period October 14, 1997
(commencement of operations) through December 31, 1997 were as follows:

<TABLE>
<S> <C>
Shares subscribed.............................................. 41,609
Shares issued in reinvestment of dividends..................... 92
Shares redeemed................................................ (4)
-------
Net increase in shares outstanding............................. 41,697
-------
-------
</TABLE>

11
<PAGE>

UBS Large Cap Growth Fund
Report of Independent Accountants
- --------------------------------------------------------------------------------

To the Board of Directors
and Shareholders of
UBS Private Investor Funds, Inc.

In our opinion, the accompanying statement of assets and liabilities and the
related statements of operations and of changes in net assets and the financial
highlights present fairly, in all material respects, the financial position of
the UBS Large Cap Growth Fund (the 'Fund') (one of the funds constituting UBS
Private Investor Funds, Inc.) at December 31, 1997, and the results of its
operations, the changes in its net assets and the financial highlights for the
period October 14, 1997 (commencement of operations) through December 31, 1997,
in conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as 'financial
statements') are the responsibility of the Fund's management; our responsibility
is to express an opinion on these financial statements based on our audit. We
conducted our audit of these financial statements in accordance with generally
accepted auditing standards which require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for the opinion expressed above.

PRICE WATERHOUSE LLP

1177 Avenue of Americas
New York, New York
February 17, 1998

12
<PAGE>

UBS Large Cap Growth Portfolio
Schedule of Investments
December 31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------ ------------------------------------------------------------------------------------------ -----------
<C> <S> <C>
COMMON STOCK -- 92.9%
AIRLINES -- 1.5%
6,010 Continental Airlines, Inc., Class B....................................................... $ 289,231
-----------
AUTOMOTIVE -- 1.9%
6,000 General Motors Corporation................................................................ 363,750
-----------
BANKING & FINANCIAL INSTITUTIONS -- 7.6%
6,390 American Express Company.................................................................. 570,308
5,220 BankAmerica Corp.......................................................................... 381,060
2,360 Chase Manhattan Corporation............................................................... 258,420
700 Wells Fargo & Company..................................................................... 237,606
-----------
1,447,394
-----------
CHEMICALS -- 1.9%
6,120 Du Pont (E.I.) de Nemours................................................................. 367,583
-----------
CONSUMER FOODS -- 3.9%
6,920 Kellogg Company........................................................................... 343,405
11,210 PepsiCo, Inc.............................................................................. 408,464
-----------
751,869
-----------
COSMETICS & TOILETRIES -- 1.8%
7,150 Kimberly-Clark Corporation................................................................ 352,584
-----------
DIVERSIFIED -- 2.4%
6,390 General Electric Company.................................................................. 468,866
-----------
DRUGS & PHARMACEUTICALS -- 9.4%
6,680 Abbott Laboratories....................................................................... 437,958
4,680 Bristol-Myers Squibb Co................................................................... 442,845
7,460 Johnson & Johnson......................................................................... 491,428
4,140 Merck & Co., Inc.......................................................................... 439,875
-----------
1,812,106
-----------
ELECTRONICS -- 2.4%
7,580 Emerson Electric Company.................................................................. 427,796
383 Raytheon Company, Class A................................................................. 18,868
-----------
446,664
-----------
ENTERTAINMENT -- 3.6%
6,620 Tele-Communications TCI Ventures Group, Class A *......................................... 187,429
8,040 Time Warner Inc........................................................................... 498,480
-----------
685,909
-----------
ENVIRONMENTAL CONTROL -- 2.1%
14,670 Waste Management Inc...................................................................... 403,425
-----------
FOOD -- RETAIL -- 2.3%
9,220 Albertson's, Inc.......................................................................... 436,798
-----------
</TABLE>

- ------------------------
See notes to financial statements.
13

<PAGE>

UBS Large Cap Growth Portfolio
Schedule of Investments
December 31, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------ ------------------------------------------------------------------------------------------ -----------
<C> <S> <C>
HEALTH CARE PROVIDERS -- 1.1%
6,780 Columbia/HCA Healthcare Corporation....................................................... $ 200,858
-----------
INSURANCE -- 6.8%
6,120 AFLAC Incorporated........................................................................ 312,885
3,730 Allstate Corporation...................................................................... 338,964
3,560 Chubb Corporation......................................................................... 269,225
7,085 Travelers Group, Inc...................................................................... 381,704
-----------
1,302,778
-----------
LUMBER, PAPER & BUILDING SUPPLIES -- 3.0%
2,690 Georgia-Pacific Timber Group *............................................................ 61,029
2,790 Georgia-Pacific Corporation............................................................... 169,493
7,860 International Paper Company............................................................... 338,963
-----------
569,485
-----------
MANUFACTURING -- 0.8%
4,000 Corning Inc............................................................................... 148,500
-----------
MEDIA/CABLE -- 3.3%
14,500 CBS Corporation........................................................................... 426,844
7,820 Tele-Communications TCI Group, Class A.................................................... 218,471
-----------
645,315
-----------
MEDICAL SUPPLIES -- 2.4%
8,710 Medtronic, Inc............................................................................ 455,642
-----------
METALS & MINING -- 1.5%
4,100 Aluminum Company of America............................................................... 288,538
-----------
OIL SERVICES -- 5.0%
5,260 Baker Hughes Incorporated................................................................. 229,468
4,650 Dresser Industries, Inc................................................................... 195,009
4,000 Halliburton Company....................................................................... 207,750
4,080 Schlumberger Ltd.......................................................................... 328,440
-----------
960,667
-----------
PETROLEUM PRODUCTION & SALES -- 5.8%
7,130 Burlington Resources Inc.................................................................. 319,513
8,220 Exxon Corporation......................................................................... 502,961
7,420 Unocal Corporation........................................................................ 287,989
-----------
1,110,463
-----------
REAL ESTATE -- 1.7%
9,720 Simon DeBartolo Group, Inc. REIT(a)....................................................... 317,723
-----------
RETAIL -- 4.8%
8,980 Dayton Hudson Corporation................................................................. 606,150
6,370 McDonald's Corporation.................................................................... 304,168
-----------
910,318
-----------
</TABLE>

- ------------------------
See notes to financial statements.
14

<PAGE>

- ------------------------
(a) REIT -- Real Estate Investment Trust.

* Non-income producing security.

Note: Based upon the cost of investments of $17,470,426 for Federal Income Tax
purposes at December 31, 1997, the aggregate gross unrealized appreciation
and depreciation was $803,351 and $500,700, respectively, resulting in net
unrealized appreciation of $302,651.

See notes to financial statements.
15
<PAGE>

UBS Large Cap Growth Portfolio
Statement of Assets and Liabilities
December 31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
ASSETS:
<S> <C>
Investment, at value (cost $17,470,426)............................................. $17,773,077
Cash................................................................................ 1,355,342
Dividends and interest receivable................................................... 28,932
Receivable from Investment Advisor.................................................. 11,793
Deferred organization expenses and other assets..................................... 4,588
-----------
Total Assets.............................................................. 19,173,732
-----------
LIABILITIES:
Administrative services fees payable................................................ 1,915
Other accrued expenses.............................................................. 37,689
-----------
Total Liabilities......................................................... 39,604
-----------
NET ASSETS.......................................................................... $19,134,128
-----------
-----------
</TABLE>

- ------------------------
See notes to financial statements.

<PAGE>

UBS Large Cap Growth Portfolio
Statement of Operations
For the Period October 14, 1997 (Commencement of Operations) through December
31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<S> <C> <C>
INVESTMENT INCOME
Dividends................................................................. $ 49,436
Interest.................................................................. 22,239
--------
Investment income.................................................... $ 71,675
EXPENSES
Investment advisory fees.................................................. 923
Administrative services fees.............................................. 2,096
Audit fees................................................................ 24,500
Fund accounting fees...................................................... 7,433
Custodian fees and expenses............................................... 6,000
Legal fees................................................................ 3,750
Trustees' fees............................................................ 1,000
Insurance expense......................................................... 375
Amortization of organization expenses..................................... 214
Miscellaneous expenses.................................................... 1,000
--------
Total expenses....................................................... 47,291
Less: Fee waiver and expense reimbursements.......................... (12,716)
--------
Net expenses......................................................... 34,575
--------
Net investment income..................................................... 37,100
--------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on securities transactions.............................. (59,628)
Net change in unrealized appreciation of investments...................... 302,651
--------
Net realized and unrealized gain on investments........................... 243,023
--------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS...................... $280,123
--------
--------
</TABLE>

- ------------------------
See notes to financial statements.

<PAGE>

UBS Large Cap Growth Portfolio
Statement of Changes in Net Assets
For the Period October 14, 1997 (Commencement of Operations) through December
31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS:
Net investment income......................................................................... $ 37,100
Net realized loss on securities transactions.................................................. (59,628)
Net change in unrealized appreciation of investments.......................................... 302,651
-----------------
Net increase in net assets resulting from operations.......................................... 280,123
-----------------
CAPITAL TRANSACTIONS:
Proceeds from contributions................................................................... 18,949,248
Value of withdrawals.......................................................................... (95,243)
-----------------
Net increase in net assets from capital transactions.......................................... 18,854,005
-----------------
NET INCREASE IN NET ASSETS.................................................................... 19,134,128
NET ASSETS:
Beginning of period........................................................................... --
-----------------
End of period................................................................................. $19,134,128
-----------------
-----------------
</TABLE>

- ------------------------
See notes to financial statements.

18
<PAGE>

UBS Large Cap Growth Portfolio
Financial Highlights
For the Period October 14, 1997 (Commencement of Operations) through December
31, 1997
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s omitted)................................................. $19,134
Average commission rate per share........................................................ $0.05
Ratio of expenses to average net assets(1)............................................... 1.14%(2)
Ratio of net investment income to average net assets(1).................................. 1.22%(2)
Portfolio turnover....................................................................... 6%
</TABLE>

- ------------------------
(1) Net of fee waivers. Such fee waivers had the effect of reducing the ratio of
expenses to average net assets and increasing the ratio of net investment
income to average net assets by 0.42% (annualized). The annualization
of these ratios is affected by the fact that the Investment Advisory
Agreement and Investment Sub-Advisory Agreement was not ratified until
December 29, 1997. Prior to this date, investment advisory services were
being provided without compensation.
(2) Annualized.

See notes to financial statements.

19
<PAGE>

UBS Large Cap Growth Portfolio
Notes to Financial Statements
December 31, 1997
- --------------------------------------------------------------------------------

1. GENERAL
UBS Large Cap Growth Portfolio (the 'Portfolio'), a separate series of UBS
Investor Portfolios Trust (the 'Trust'), is registered under the Investment
Company Act of 1940, as a diversified, open-end management investment company.
The Trust is organized as a trust under the laws of the State of New York. At
December 31, 1997, all of the beneficial interests in the Portfolio were held by
UBS Large Cap Growth Fund and UBS Large Cap Growth Fund, Ltd.

The investment adviser of the Portfolio is Union Bank of Switzerland, New York
Branch ('UBS'); UBS Asset Management (New York) Inc. ('UBSAM') is the
sub-adviser of the portfolio. Investors Fund Services (Ireland) Limited ('IBT
Ireland') acts as the Portfolio's administrator.

2. SIGNIFICANT ACCOUNTING POLICIES

The preparation of financial statements in accordance with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts and disclosures in the
financial statements. Actual results could differ from those estimates. The
following is a summary of significant accounting policies followed by the
Portfolio in the preparation of its financial statements:

A. INVESTMENT VALUATION -- Equity securities in the portfolio are valued at the
last sale price on the exchange on which they are primarily traded, or in the
absence of recorded sales, at the average of readily available closing bid and
asked prices, or at the quoted bid price. Unlisted securities are valued at the
average of the quoted bid and asked prices in the over-the-counter market.

Securities or other assets for which market quotations are not readily available
are valued at fair value in accordance with procedures established by and under
the general supervision of the Portfolio's Board of Trustees (the 'Trustees').

B. ACCOUNTING FOR INVESTMENTS -- Securities transactions are accounted for on
trade date. Realized gains and losses on securities transactions are determined
on the identified cost basis. Dividend income and other distributions from
portfolio securities are recorded on the ex-dividend date. Interest income,
adjusted for amortization of premiums and accretion of discounts on investments,
is accrued daily.

C. U.S. FEDERAL INCOME TAXES -- The Portfolio is considered a partnership under
the U.S. Internal Revenue Code (the 'Code'). As such, each investor in the
Portfolio will be taxed on its share of the Portfolio's ordinary income and
capital gains. Accordingly, no provision for federal income taxes is necessary.
It is intended that the Portfolio will be managed in such a way that an investor
will be able to satisfy the requirements of the Code applicable to regulated
investment companies.

D. DEFERRED ORGANIZATION EXPENSES -- Expenses incurred by the Portfolio in
connection with its organization in the amount of approximately $5,000 have been
deferred and are being amortized on a straight line basis over five years from
the Portfolio's commencement of operations (October 14, 1997).

E. OTHER -- The Portfolio bears all costs of its operations other than expenses
specifically assumed by UBS, UBSAM and IBT Ireland. Expenses incurred by the
Trust on behalf of any two or more portfolios are allocated in proportion to the
net assets of each portfolio, except when allocations of direct expenses to each
portfolio can otherwise be made fairly. Expenses directly attributable to the
Portfolio are charged directly to the Portfolio.

3. AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES

A. INVESTMENT ADVISORY AGREEMENT -- Effective December 29, 1997, the Portfolio
has retained the services of UBS as investment adviser and UBSAM as investment
sub-adviser. UBS and UBSAM were

<PAGE>

UBS Large Cap Growth Portfolio
Notes to Financial Statements
December 31, 1997
- --------------------------------------------------------------------------------
not entitled to receive any investment advisory fee prior to the approval of the
Investment Advisory Agreement and Investment Sub-Advisory Agreement by the
shareholders of the Fund. UBSAM makes the Portfolio's day-to-day investment
decisions, arranges for the execution of portfolio transactions and generally
manages the Portfolio's investments and operations subject to the supervision of
UBS and the Trustees. As compensation for overall investment management
services, the Trust has agreed to pay UBS an investment advisory fee, accrued
daily and payable monthly, at an annual rate of 0.60% of the Portfolio's average
daily net assets. UBS, in turn, has agreed to pay UBSAM a fee, accrued daily and
payable monthly, at an annual rate of 0.30% of the Portfolio's first $25 million
average daily net assets, 0.25% of the Portfolio's next $25 million average
daily net assets and 0.20% of the Portfolio's average daily net assets in excess
of $50 million. For the period from December 29, 1997 through December 31, 1997,
the investment advisory fee amounted to $923, all of which was waived.

B. ADMINISTRATION AGREEMENT -- Under the terms of an Administration Agreement
with the Trust, IBT Ireland provides overall administrative services and general
office facilities to the Portfolio and the Trust. As compensation for such
services, the Portfolio has agreed to pay IBT Ireland an administrative services
fee, accrued daily and payable monthly, at an annual rate of 0.07% of the
Portfolio's first $100 million average daily net assets and 0.05% of the
Portfolio's average daily net assets in excess of $100 million. For the period
ended December 31, 1997, the administrative services fee amounted to $2,096.

4. PURCHASES AND SALES OF INVESTMENTS

For the period October 14, 1997 (commencement of operations) through December
31, 1997, purchases and sales of investment securities, excluding short-term
investments, aggregated $18,325,865 and $795,811, respectively.

21
<PAGE>

UBS Large Cap Growth Portfolio
Report of Independent Accountants
- --------------------------------------------------------------------------------

To the Board of Trustees
and Investors of
UBS Investor Portfolios Trust

In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the UBS Large Cap Growth Portfolio
(the 'Portfolio') (one of the portfolios constituting UBS Investor Portfolios
Trust) at December 31, 1997, and the results of its operations, the changes in
its net assets and the financial highlights for the period October 14, 1997
(commencement of operations) through December 31, 1997, in conformity with
accounting principles generally accepted in the United States. These financial
statements and financial highlights (hereafter referred to as 'financial
statements') are the responsibility of the Portfolio's management; our
responsibility is to express an opinion on these financial statements based on
our audit. We conducted our audit of these financial statements in accordance
with auditing standards generally accepted in the United States which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audit, which included confirmation
of securities at December 31, 1997 by correspondence with the custodian and
brokers, and the application of alternative auditing procedures where
confirmations from brokers were not received, provides a reasonable basis for
the opinion expressed above.

PRICE WATERHOUSE
Chartered Accountants

Toronto, Ontario
February 17,1998

<PAGE>

Special Meeting of Shareholders (unaudited)
- --------------------------------------------------------------------------------

A special meeting of the shareholders of UBS Private Investor Funds, Inc. with
respect to UBS Small Cap Fund, UBS Large Cap Growth Fund and UBS High Yield Bond
Fund was held Monday, December 22, 1997. The Meeting was adjourned with respect
to Proposal 3 and 4 with respect to the UBS Large Cap Growth Fund and was
reconvened on December 29, 1997. The results of votes taken among shareholders
of UBS Large Cap Growth Fund on Proposals 3 and 4 are listed below.

PROPOSAL 3
To approve a proposal to adopt an Investment Advisory Agreement between the
Trust and UBS, with respect to the assets of UBS Large Cap Growth Portfolio.

<TABLE>
<CAPTION>
# OF SHARES VOTED % OF SHARES
----------------- -----------
<S> <C> <C>
Affirmative........................................ 22,537.275 80.99%
Against............................................ 0 0.00%
Abstain............................................ 0 0.00%
</TABLE>

PROPOSAL 4
To adopt an Investment Sub-Advisory Agreement between UBS and UBSAM, with
respect to the assets of UBS Large Cap Growth Portfolio.

<PAGE>

[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>

UBS LARGE CAP GROWTH FUND
200 CLARENDON STREET
BOSTON, MASSACHUSETTS 02116

INVESTMENT ADVISER Union Bank of Switzerland,
New York Branch
1345 Avenue of the Americas
New York, NY 10105

ADMINISTRATOR Investors Bank & Trust Company
200 Clarendon Street
Boston, Massachusetts 02116

DISTRIBUTOR First Fund Distributors, Inc.
4455 East Camelback Road
Phoenix, AZ 85018

CUSTODIAN AND TRANSFER AGENT Investors Bank & Trust Company
200 Clarendon Street
Boston, Massachusetts 02116
<PAGE>

UBS
LARGE CAP
GROWTH FUND

---------

UBS
Private Investor
Funds, Inc.

Semi-Annual Report
June 30, 1998
<PAGE>

UBS Private Investor Funds, Inc.
Chairman's Letter

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

Dear Shareholder,

Thank you for your investment in the UBS Large Cap Growth Fund, which is part of
the UBS Private Investor Funds.

We are pleased to provide you with the Fund's semi-annual report for the
six-months ended June 30, 1998. This report contains a letter from the portfolio
manager discussing the performance of the Fund for the six months ended June 30,
1998, including a market overview. In addition, it includes a complete set of
financial statements as well as a schedule of investments.

The UBS Private Investor Funds bring you:

The expertise of The Private Bank's professional money managers

Global investment perspective and knowledge

A high priority on financial stability and preservation of wealth

As you are aware, in December, 1997, Union Bank of Switzerland and Swiss Bank
Corporation ('SBC') announced their intention to merge. Early in February, 1998,
the shareholders of UBS and SBC overwhelmingly approved the proposed merger. The
merger was completed on Monday June 29, 1998, creating UBS A.G.

UBS A.G. is a top-tier global financial services company which concentrates on
clearly defined core businesses. As private banking and asset management are
core businesses of the bank, shareholders of the UBS Private Investor Funds will
continue to see a commitment to growing and building the mutual fund business.

We will continue to keep you informed of any new developments as they occur.

We appreciate your confidence in the UBS Private Investor Funds.

Sincerely,

Dr. HansPeter Lochmeier

Dr. HansPeter Lochmeier
Chairman of the Board
UBS Private Investor Funds, Inc.

- ------------------------
* 'The Private Bank', as used in this document, refers to Union Bank of
Switzerland, New York Branch.

The semi-annual report must be accompanied or preceded by the Fund's prospectus.
<PAGE>

UBS Private Investor Funds, Inc.
Fund Commentary

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

FUND PERFORMANCE

During the first half of the year through June 30th, the UBS Large Cap Growth
Fund earned a return of 13.13% compared to a return of 17.71% for the S&P 500
Index. This underperformance all occurred in the first quarter of the year when
the surge in the market was driven by very large cap issues to which we were
underexposed. The second quarter was a much happier experience and the Fund
outperformed the Index by returning 3.6% against 3.3%.

This chart provides a comparison of the Fund's performance to that of the S&P
500 Index. This chart compares total returns (which includes changes in share
price and reinvestment of all dividends and capital gains distributions) of a
hypothetical $10,000 investment made on October 14, 1997* and held through June
30, 1998.

[PERFORMANCE GRAPH]

<TABLE>
<CAPTION>
UBS Large Cap Growth Fund S&P 500 Index
- ------------------------- -------------
<S> <C>
$10,000 $10,000
9,570 9,432
9,474 9,868
9,945 10,038
9,871 10,149
10,448 10,881
10,859 11,438
11,071 11,554
10,828 11,355
11,251 11,816
</TABLE>

Average Annual Total Return:

<TABLE>
<CAPTION>
UBS
LARGE CAP
GROWTH S&P 500
FUND INDEX
--------- -------

<S> <C> <C>
Six months ended June 30, 1998..................................... 13.13% 17.71%
Since inception* through June 30, 1998............................. 12.51% 18.16%
</TABLE>

----------------------
* Commencement of operations -- October 14, 1997

2
<PAGE>

UBS Private Investor Funds, Inc.
Fund Commentary

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

MARKET OVERVIEW

In addition to the capitalization size issue which has been hurting fund
managers in general, there were some difficulties in stock selection
particularly in technology, and to a lesser extent in energy where a
concentration in oil service stocks hurt performance. Sector concentrations were
helpful overall in consumer staples (particularly the cable companies),
healthcare, and technology, but were a problem in the consumer cyclical area
where we missed the automobile stocks and were underweighted in retail. As the
first half of the year wore on, however, we corrected some of these problems by
adding major commitments to WalMart, Microsoft, America Online, and continuing
to add to our drug holdings by purchasing Schering Plough and Eli Lilly. In
addition we sold positions in some of the basic industry areas which were being
hurt by the Asian crisis. In the second quarter and so far in the third quarter
these commitments appear to be paying off.

For ten of the twelve weeks in the second quarter, stock prices traded sideways
to downward. By mid June, however, the Dow Jones average had bounced off the
8600 level and moved smartly up to close near 9000, thereby earning a small gain
for the quarter. The S&P 500 did a bit better as investors decided that with
interest rates having moved down to new lows in the 5.60% area, stocks again
looked attractive for purchase. The ensuing rally has been and continues today
to be narrow in scope and breadth with primarily the larger, more well known
stocks leading the way. Smaller capitalization stocks have languished and are
presently almost unchanged as a group from year end 1997 levels.

Economies around the world are slipping and we believe that the biggest
unanswered question looking ahead is whether the U.S. eventually gets pulled
downward or the U.S., Europe and hopefully Japan, pulls the rest of the world
ahead. Regarding the U.S. economy, most economists have recently lowered their
GDP expectations for the present spring quarter that has just ended from the 3%
range down into the 2% area, but overall consumption appears to be remaining
strong enough to keep the U.S. economy in a growth mode at least into next year.
Growth in the U.S. economy has clearly peaked (probably last quarter) as cheaper
foreign imported goods have now begun to land on our shores. Manufacturing
should slow rapidly for the next few quarters as U.S. made goods are beginning
to experience the price pressures that have been forecast to occur since the
fall of 1997. The rest of the world's troubles have, so far, served to lower
interest rates, kept inflation well under control and propelled consumer
confidence numbers to all time highs.

The stock market, as noted earlier, has corrected the oversold conditions that
drove prices downward in mid June and may have already discounted less than
satisfactory corporate earnings which may be announced in coming days. Worries
over Asia may also have peaked for awhile, especially if Japan can come up with
a credible plan to stimulate consumer spending and write off some more bad bank
loans -- as they have promised. We have entered the summer rally phase that has
been typically seen in recent years and prices may indeed move higher in coming
weeks as investors celebrate the lower interest rates that entered the
investment scene in June. There is no fear that the Federal Reserve Bank may
become more active, at least until the fall months. At that time they may even
be thinking of reducing short term interest rates rather than raising them, for
world economic pressures seem to be pushing growth downward instead of upward
these days. We feel that some upward room may indeed be available for the stock
market to rally this summer, but while monetary conditions may be favorable for
stocks, the developing earnings slowdown will not be easy to reverse and will
keep the market from making much more than marginal new highs. Worse, the
downward pressure on commodity, and now many retail prices, may become more
intense as the year progresses, all of which may present new hurdles for
investors who have never witnessed deflation in their lifetimes.

3
<PAGE>

UBS Private Investor Funds, Inc.
Fund Commentary

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

In this economic environment, the best equity investments are those companies
that show fairly assured growth and are large enough to weather most economic
storms if they should develop. The major issue becomes one of valuation and what
price does one pay for this assurance. There is no question that companies which
disappoint these days are severely penalized in the market so one buys anything
today, except after careful examination. We believe that the Large Cap Growth
Portfolio is well positioned to deliver superior results over time by
emphasizing large companies with reasonably assured growth prospects which also
sell at relatively attractive prices.

Wayne Thornbrough
Portfolio Manager

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

Shares of the Fund are distributed by First Fund Distributors, Inc. which is not
affiliated with Union Bank of Switzerland.

Union Bank of Switzerland is voluntarily waiving all shareholder servicing fees
for the Fund and reimbursing a portion of the Fund's expenses. Union Bank of
Switzerland is also waiving all of its advisory fees for the Portfolio. If Union
Bank of Switzerland had not waived fees and reimbursed expenses, total return
would have been lower. Past performance is not a guarantee of future results.
Investment return and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their original
cost.

The S&P 500 Index is an unmanaged index broadly representative of the U.S. stock
market.

4
<PAGE>

UBS Large Cap Growth Fund
Statement of Assets and Liabilities
June 30, 1998 (Unaudited)

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

LIABILITIES:
Payable from purchase of capital stock............................................... 4,637
Administrative services fees payable................................................. 368
Other accrued expenses............................................................... 23,566
----------
Total Liabilities.......................................................... 28,571
----------

NET ASSETS........................................................................... $7,134,690
----------
----------

SHARES OUTSTANDING ($0.001 par value, 10 million shares authorized).................. 63,563
----------
----------

NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE....................... $ 112.25
----------
----------

COMPOSITION OF NET ASSETS:
Shares of common stock, at par....................................................... $ 64
Additional paid-in capital........................................................... 6,362,831
Net unrealized appreciation of investments........................................... 764,430
Accumulated undistributed net investment income...................................... 17,826
Accumulated net realized loss........................................................ (10,461)
----------
Net Assets................................................................. $7,134,690
----------
----------
</TABLE>

- ------------------------
See notes to financial statements.

5
<PAGE>

UBS Large Cap Growth Fund
Statement of Operations
For the Six Months Ended June 30, 1998 (Unaudited)

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

<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Investment Income and Expenses from UBS Investor Portfolios Trust -- UBS
Large Cap Growth Portfolio
Dividends.......................................................... $ 35,477
Interest........................................................... 12,087
--------
Investment income............................................. 47,564
Total expenses..................................................... $ 36,745
Less: Fee waiver and expense reimbursements........................ (18,141)
--------
Net expenses....................................................... 18,604
--------
Net Investment Income from UBS Investor Portfolios Trust -- UBS Large
Cap Growth Portfolio.................................................. 28,960

EXPENSES:
Shareholder service fees................................................ 7,509
Administrative services fees............................................ 1,953
Registration fees....................................................... 12,772
Reports to shareholders expense......................................... 10,855
Transfer agent fees..................................................... 7,438
Legal fees.............................................................. 5,411
Audit fees.............................................................. 5,112
Fund accounting fees.................................................... 4,463
Directors' fees......................................................... 1,700
Miscellaneous expenses.................................................. 4,292
--------
Total expenses..................................................... 61,505
Less: Fee waiver and expense reimbursements........................ (50,071)
--------
Net expenses....................................................... 11,434
--------
Net investment income................................................... 17,526
--------

NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS FROM UBS INVESTOR
PORTFOLIOS TRUST -- UBS LARGE CAP GROWTH PORTFOLIO
Net realized gain on securities transactions............................ 4,084
Net change in unrealized appreciation of investments.................... 730,609
--------
Net realized and unrealized gain on investments from UBS Investor
Portfolios Trust -- UBS Large Cap Growth Portfolio.................... 734,693
--------

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................... $752,219
--------
--------
</TABLE>

- ------------------------
See notes to financial statements.

6
<PAGE>

UBS Large Cap Growth Fund
Statement of Changes in Net Assets

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

<TABLE>
<CAPTION>
SIX MONTHS
ENDED OCTOBER 14, 1997*
JUNE 30, 1998 THROUGH
(UNAUDITED) DECEMBER 31, 1997
------------- -----------------

<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS:
Net investment income........................................... $ 17,526 $ 9,350
Net realized gain (loss) on securities transactions............. 4,084 (14,545)
Net change in unrealized appreciation of investments............ 730,609 33,821
------------- -----------------
Net increase in net assets resulting from operations............ 752,219 28,626
------------- -----------------

DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income........................................... -- (9,050)
------------- -----------------

TRANSACTIONS IN SHARES OF COMMON STOCK:
Net proceeds from sale of shares................................ 4,662,313 4,108,844
Net asset value of shares issued to shareholders from
reinvestment of dividends..................................... -- 9,050
Cost of shares redeemed......................................... (2,416,956) (356)
------------- -----------------
Net increase in net assets from transactions in shares of common
stock......................................................... 2,245,357 4,117,538
------------- -----------------

NET INCREASE IN NET ASSETS...................................... 2,997,576 4,137,114

NET ASSETS:
Beginning of period............................................. 4,137,114 --
------------- -----------------
End of period (including undistributed net investment income of
$17,826 and $300, respectively)............................... $ 7,134,690 $ 4,137,114
------------- -----------------
------------- -----------------
</TABLE>

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

* Commencement of operations.

See notes to financial statements.

7
<PAGE>

UBS Large Cap Growth Fund
Financial Highlights

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

<TABLE>
<CAPTION>
SIX MONTHS
ENDED OCTOBER 14, 1997*
JUNE 30, 1998 THROUGH
(UNAUDITED) DECEMBER 31, 1997
------------- -----------------

<S> <C> <C>
FOR A SHARE OUTSTANDING FOR THE PERIOD

Net asset value, beginning of period............................. $ 99.22 $100.00
------------- --------
Income from investment operations:
Net investment income....................................... 0.27 0.23
Net realized and unrealized gain (loss) on investments...... 12.76 (0.79)
------------- --------
Total gain (loss) from investment operations................ 13.03 (0.56)
------------- --------
Less: Total dividends and distributions.......................... -- (0.22)
------------- --------
Net asset value, end of period................................... $112.25 $ 99.22
------------- --------
------------- --------
Total return..................................................... 13.13%(1) (0.55%)(1)

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s omitted).................... $ 7,135 $ 4,137
Ratio of expenses to average net assets(2).................. 1.00%(4) 1.00%(3)(4)
Ratio of net investment income to average net assets(2)..... 0.58%(4) 1.35%(3)(4)
</TABLE>

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

* Commencement of operations.
(1) Not annualized.
(2) Includes the Fund's share of UBS Investor Portfolios Trust -- UBS Large Cap
Growth Portfolio expenses, net of fee waivers and expense reimbursements.
Such fee waivers and expense reimbursements had the effect of reducing the
ratio of expenses to average net assets and increasing the ratio of net
investment income to average net assets by 2.27% (annualized) and 7.54%
(annualized) for the respective periods.
(3) The annualization of these ratios is affected by the fact that the
Investment Advisory Agreement and Investment Sub-Advisory Agreement were not
ratified by shareholders until December 29, 1997. Prior to this date,
investment advisory services were being provided without compensation.
(4) Annualized.

See notes to financial statements.

8
<PAGE>

UBS Large Cap Growth Fund
Notes to Financial Statements
June 30, 1998 (Unaudited)

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

1. GENERAL
UBS Large Cap Growth Fund (the 'Fund') is a diversified, no-load mutual fund
registered under the Investment Company Act of 1940. The Fund is one of several
series of UBS Private Investor Funds, Inc. (the 'Company'), an open-end
management investment company organized as a corporation under Maryland law. At
June 30, 1998, the Company included six other funds, UBS Bond Fund, UBS Value
Equity Fund, UBS Institutional International Equity Fund, UBS High Yield Bond
Fund, UBS Small Cap Fund and UBS International Equity Fund. These financial
statements relate only to the Fund.

The Fund seeks to achieve its investment objective by investing substantially
all of its investable assets in the UBS Large Cap Growth Portfolio of UBS
Investor Portfolios Trust (the 'Portfolio'), an open-end management investment
company that has the same investment objective as that of the Fund. At June 30,
1998, certain shares of the Fund were held by UBS or its affiliates on behalf of
its clients.

The financial statements of the Portfolio, including its Schedule of
Investments, are included elsewhere within this report and should be read in
conjunction with the Fund's financial statements.

A. INVESTMENT VALUATION -- The value of the Fund's investment in the Portfolio
included in the accompanying Statement of Assets and Liabilities reflects the
Fund's proportionate beneficial interest in the net assets of the Portfolio
(32.08% at June 30, 1998). Valuation of securities by the Portfolio is discussed
in Note 2A of the Portfolio's Notes to Financial Statements.

9
<PAGE>

UBS Large Cap Growth Fund
Notes to Financial Statements
June 30, 1998 (Unaudited)

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

composition of net assets based upon their federal tax-basis treatment;
temporary differences do not require reclassification.

E. OTHER -- The Fund bears all costs of its operations other than expenses
specifically assumed by IBT, FFDI and UBS. Expenses incurred by the Company on
behalf of any two or more funds are allocated in proportion to the net assets of
each fund, except when allocations of direct expenses to each fund can otherwise
be made fairly. Expenses directly attributable to the Fund are charged directly
to the Fund.

3. AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES

A. ADMINISTRATION AGREEMENT -- Under the terms of an Administration Agreement
with the Company, IBT provides overall administrative services and general
office facilities. As compensation for such services, the Company has agreed to
pay IBT a fee, accrued daily and payable monthly, at an annual rate of 0.065% of
the Fund's first $100 million average daily net assets and 0.025% of the next
$100 million average daily net assets. IBT does not receive a fee on average
daily net assets in excess of $200 million. For the six months ended June 30,
1998, the administrative services fee amounted to $1,953.

C. SHAREHOLDER SERVICING AGREEMENT -- The Fund has entered into a Shareholder
Servicing Agreement with UBS pursuant to which UBS provides certain services to
shareholders of the Fund. The Fund has agreed to pay UBS a fee for these
services, accrued daily and payable monthly, at an annual rate of 0.25% of the
average daily net assets of the Fund. For the six months ended June 30, 1998,
the shareholder service fee amounted to $7,509, all of which was waived.

E. EXPENSE REIMBURSEMENTS -- UBS has voluntarily agreed to limit the total
operating expenses of the Fund, including its share of the Portfolio's expenses
and excluding extraordinary expenses, to an annual rate of 1.00% of the Fund's
average daily net assets. For the six months ended June 30, 1998, UBS reimbursed
the Fund for expenses totaling $42,562 in connection with this voluntary
limitation. UBS may modify or discontinue this voluntary expense limitation at
any time with 30 days' advance notice to the Fund.

4. CAPITAL SHARE TRANSACTIONS

At June 30, 1998 there were 500 million shares of the Company's common stock
authorized, of which 10 million shares were classified as common stock of the
Fund. Transactions in shares of the Fund were as follows:

<TABLE>
<CAPTION>
SIX MONTHS
ENDED PERIOD FROM OCTOBER 14, 1997
JUNE 30, 1998 (COMMENCEMENT OF OPERATIONS)
(UNAUDITED) THROUGH DECEMBER 31, 1997
------------- -----------------------------
<S> <C> <C>
Shares subscribed.............................. 45,025 41,609
Shares issued in reinvestment of dividends..... 0 92
Shares redeemed................................ (23,159) (4)
------------- -------
Net increase in shares outstanding............. 21,866 41,697
------------- -------
------------- -------
</TABLE>

10
<PAGE>

UBS Large Cap Growth Portfolio
Schedule of Investments
June 30, 1998 (Unaudited)

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

<TABLE>
<CAPTION>
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- ------------------------------------------------------------------------------------------ -----------
<C> <S> <C>
COMMON STOCK -- 99.7%
AIRLINES -- 1.3%
4,910 Continental Airlines, Inc., Class B*...................................................... $ 298,896
-----------
BANKING & FINANCIAL INSTITUTIONS -- 7.5%
6,740 American Express Company.................................................................. 768,357
5,660 BankAmerica Corp.......................................................................... 489,236
1,090 Wells Fargo & Company..................................................................... 402,210
-----------
1,659,803
-----------
CHEMICALS -- 4.7%
9,000 Du Pont (E.I.) de Nemours................................................................. 671,624
6,530 Monsanto Company.......................................................................... 364,864
-----------
1,036,488
-----------
CONSUMER FOODS -- 2.6%
13,970 PepsiCo, Inc.............................................................................. 575,389
-----------
COSMETICS & TOILETRIES -- 1.8%
8,820 Kimberly-Clark Corporation................................................................ 404,618
-----------
DIVERSIFIED -- 3.2%
7,910 General Electric Company.................................................................. 719,810
-----------
DRUGS & PHARMACEUTICALS -- 12.3%
16,660 Abbott Laboratories....................................................................... 680,978
5,860 Bristol-Myers Squibb Co................................................................... 673,534
3,530 Eli Lilly & Company....................................................................... 233,201
4,640 Johnson & Johnson......................................................................... 342,200
3,450 Merck & Co., Inc.......................................................................... 461,438
3,800 Schering-Plough Corporation............................................................... 348,175
-----------
2,739,526
-----------
ELECTRONICS -- 2.6%
3,800 Emerson Electric Company.................................................................. 229,425
5,980 Raytheon Company, Class A................................................................. 344,598
-----------
574,023
-----------
ENTERTAINMENT -- 4.4%
16,950 Tele-Communications TCI Ventures Group, Class A*.......................................... 340,059
7,500 Time Warner Inc........................................................................... 640,781
-----------
980,840
-----------
ENVIRONMENTAL CONTROL -- 1.6%
10,160 Waste Management Inc...................................................................... 355,600
-----------
FOOD -- RETAIL -- 2.2%
9,450 Albertson's, Inc.......................................................................... 489,628
-----------
HEALTH CARE PROVIDERS -- 1.9%
14,170 Columbia/HCA Healthcare Corporation....................................................... 412,701
-----------
INSURANCE -- 6.6%
18,380 AFLAC Incorporated........................................................................ 557,144
5,740 Chubb Corporation......................................................................... 461,353
7,615 Travelers Group, Inc...................................................................... 461,659
-----------
1,480,156
-----------
MEDIA/CABLE -- 3.5%
12,770 CBS Corporation........................................................................... 405,448
9,690 Tele-Communications TCI Group, Class A*................................................... 372,459
-----------
777,907
-----------
</TABLE>

- ------------------------
See notes to financial statements.

11
<PAGE>

UBS Large Cap Growth Portfolio
Schedule of Investments
June 30, 1998 (Unaudited)

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- ------------------------------------------------------------------------------------------ -----------
<C> <S> <C>
MEDICAL SUPPLIES -- 3.1%
10,880 Medtronic, Inc............................................................................ $ 693,600
-----------
OIL SERVICES -- 4.2%
6,580 Baker Hughes Incorporated................................................................. 227,421
4,920 Halliburton Company....................................................................... 219,248
7,050 Schlumberger Ltd.......................................................................... 481,603
-----------
928,272
-----------
PACKAGING -- 1.9%
8,910 Crown Cork & Seal Company, Inc............................................................ 424,339
-----------
PETROLEUM PRODUCTION & SALES -- 2.9%
8,870 Burlington Resources Inc.................................................................. 381,964
3,650 Exxon Corporation......................................................................... 260,291
-----------
642,255
-----------
REAL ESTATE -- 1.8%
12,090 Simon DeBartolo Group, Inc. REIT(a)....................................................... 392,925
-----------
RETAIL -- 9.0%
12,340 Dayton Hudson Corporation................................................................. 598,490
9,060 Lowe's Companies, Inc..................................................................... 367,496
7,960 McDonald's Corporation.................................................................... 549,240
8,150 Wal-Mart Stores, Inc...................................................................... 495,113
-----------
2,010,339
-----------
TECHNOLOGY -- 12.8%
2,100 America Online, Inc....................................................................... 222,600
11,170 Compaq Computer Corporation............................................................... 316,949
7,750 Electronic Data Systems Corporation....................................................... 310,000
7,790 Hewlett-Packard Company................................................................... 466,426
4,370 International Business Machines Corporation............................................... 501,731
2,250 Microsoft Corporation..................................................................... 243,844
10,000 Sun Microsystems, Inc.*................................................................... 434,375
5,980 Texas Instruments Incorporated............................................................ 348,709
-----------
2,844,634
-----------
TELECOMMUNICATIONS -- 5.9%
12,280 Loral Space & Communications Ltd.*........................................................ 346,910
8,100 Lucent Technologies, Inc.................................................................. 673,819
5,230 QUALCOMM, Inc.*........................................................................... 293,861
-----------
1,314,590
-----------
TOBACCO -- 1.9%
10,760 Philip Morris Companies, Inc.............................................................. 423,675
-----------
TOTAL INVESTMENTS AT MARKET VALUE -- 99.7% (COST $19,499,837)...................................... 22,180,014
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.3%...................................................... 72,556
-----------
NET ASSETS -- 100.0%............................................................................... $22,252,570
-----------
-----------
</TABLE>

- ------------------------
(a) REIT -- Real Estate Investment Trust.
* Non-income producing security.
Note: Based upon the cost of investments of $19,499,837 for Federal Income Tax
purposes at June 30, 1998, the aggregate gross unrealized appreciation and
depreciation was $3,192,372 and $512,195, respectively, resulting in net
unrealized appreciation of $2,680,177.

See notes to financial statements.

12
<PAGE>

UBS Large Cap Growth Portfolio
Statement of Assets and Liabilities
June 30, 1998 (Unaudited)

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

<TABLE>
<S> <C>
ASSETS:
Investment, at value (cost $19,499,837).......................................... $22,180,014
Cash............................................................................. 47,035
Dividends and interest receivable................................................ 26,598
Receivable for investment securities sold........................................ 142,625
Deferred organization expenses and other assets.................................. 85
-----------
Total Assets................................................................ 22,396,357
-----------

LIABILITIES:
Administrative services fees payable............................................. 1,279
Payable for investment securities purchased...................................... 105,434
Other accrued expenses........................................................... 37,074
-----------
Total Liabilities........................................................... 143,787
-----------

NET ASSETS....................................................................... $22,252,570
-----------
-----------
</TABLE>

- ------------------------
See notes to financial statements.

13
<PAGE>

UBS Large Cap Growth Portfolio
Statement of Operations
For the Six Months Ended June 30, 1998 (Unaudited)

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

<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends............................................................. $121,117
Interest.............................................................. 42,633
--------
Investment income................................................ $ 163,750

EXPENSES:
Investment advisory fees.............................................. 62,790
Administrative services fees.......................................... 7,325
Audit fees............................................................ 18,608
Fund accounting fees.................................................. 17,356
Custodian fees and expenses........................................... 15,041
Legal fees............................................................ 2,036
Trustees' fees........................................................ 1,984
Insurance expense..................................................... 871
Miscellaneous expenses................................................ 1,548
--------
Total expenses................................................... 127,559
Less: Fee waiver and expense reimbursements...................... (62,790)
--------
Net expenses..................................................... 64,769
----------
Net investment income................................................. 98,981
----------

NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain on securities transactions.......................... 121,099
Net change in unrealized appreciation of investments.................. 2,377,527
----------
Net realized and unrealized gain on investments....................... 2,498,626
----------

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................. $2,597,607
----------
----------
</TABLE>

- ------------------------
See notes to financial statements.

14
<PAGE>

UBS Large Cap Growth Portfolio
Statement of Changes in Net Assets

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

<TABLE>
<CAPTION>
SIX MONTHS
ENDED OCTOBER 14, 1997*
JUNE 30, 1998 THROUGH
(UNAUDITED) DECEMBER 31, 1997
------------- -----------------

<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS:
Net investment income.......................................................... $ 98,981 $ 37,100
Net realized gain (loss) on securities transactions............................ 121,099 (59,628)
Net change in unrealized appreciation of investments........................... 2,377,527 302,651
------------- -----------------
Net increase in net assets resulting from operations........................... 2,597,607 280,123
------------- -----------------

CAPITAL TRANSACTIONS:
Proceeds from contributions.................................................... 7,908,988 18,949,248
Value of withdrawals........................................................... (7,388,153) (95,243)
------------- -----------------
Net increase in net assets from capital transactions........................... 520,835 18,854,005
------------- -----------------

NET INCREASE IN NET ASSETS..................................................... 3,118,442 19,134,128

NET ASSETS:
Beginning of period............................................................ 19,134,128 --
------------- -----------------
End of period.................................................................. $ 22,252,570 $19,134,128
------------- -----------------
------------- -----------------
</TABLE>

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

* Commencement of operations.

See notes to financial statements.

15
<PAGE>

UBS Large Cap Growth Portfolio
Financial Highlights
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SIX MONTHS
ENDED OCTOBER 14, 1997*
JUNE 30, 1998 THROUGH
(UNAUDITED) DECEMBER 31, 1997
------------- -----------------

<S> <C> <C>
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s omitted)................................... $22,253 $19,134
Ratio of expenses to average net assets(1)................................. 0.62%(3) 1.14%(2)(3)
Ratio of net investment income to average net assets(1).................... 0.95%(3) 1.22%(2)(3)
Portfolio turnover......................................................... 35% 6%
</TABLE>

- ------------------------
* Commencement of operations.
(1) Net of fee waivers. Such fee waivers had the effect of reducing the ratio of
expenses to average net assets and increasing the ratio of net investment
income to average net assets by 0.60% (annualized) and 0.42% (annualized)
for the respective periods.
(2) The annualization of these ratios is affected by the fact that the
Investment Advisory Agreement and Investment Sub-Advisory Agreement were not
ratified by shareholders until December 29, 1997. Prior to this date,
investment advisory services were being provided without compensation.
(3) Annualized.

See notes to financial statements.

16
<PAGE>

UBS Large Cap Growth Portfolio
Notes to Financial Statements
June 30, 1998 (Unaudited)

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

1. GENERAL

UBS Large Cap Growth Portfolio (the 'Portfolio'), a separate series of UBS
Investor Portfolios Trust (the 'Trust'), is registered under the Investment
Company Act of 1940, as a diversified, open-end management investment company.
The Trust is organized as a trust under the laws of the State of New York. At
June 30, 1998, all of the beneficial interests in the Portfolio were held by UBS
Large Cap Growth Fund and UBS Large Cap Growth Fund, Ltd.

2. SIGNIFICANT ACCOUNTING POLICIES

B. ACCOUNTING FOR INVESTMENTS -- Securities transactions are accounted for on
trade date. Realized gains and losses on security transactions are determined on
the identified cost basis. Dividend income and other distributions from
portfolio securities are recorded on the ex-dividend date. Interest income,
adjusted for amortization of premiums and accretion of discounts on investments,
is accrued daily.

D. OTHER -- The Portfolio bears all costs of its operations other than expenses
specifically assumed by UBS, UBSAM and IBT Ireland. Expenses incurred by the
Trust on behalf of any two or more portfolios are allocated in proportion to the
net assets of each portfolio, except when allocations of direct expenses to each
portfolio can otherwise be made fairly. Expenses directly attributable to the
Portfolio are charged directly to the Portfolio.

3. AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES

A. INVESTMENT ADVISORY AGREEMENT -- The Portfolio has retained the services of
UBS as investment adviser and UBSAM as investment sub-adviser. UBS makes the
Portfolio's day-to-day investment decisions, arranges for the execution of
portfolio transactions and generally manages the Portfolio's investments and
operations subject to the supervision of UBS and the Trustees. As compensation
for overall investment management services, the Trust has agreed to pay UBS an
investment advisory fee,

17
<PAGE>

UBS Large Cap Growth Portfolio
Notes to Financial Statements
June 30, 1998 (Unaudited)

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

accrued daily and payable monthly, at an annual rate of 0.60% of the Portfolio's
average daily net assets. UBS, in turn, has agreed to pay UBSAM a fee, accrued
daily and payable monthly, on an annual basis, to 0.30% of the Portfolio's first
$25 million average daily net assets, 0.25% of the Portfolio's next $25 million
average daily net assets and 0.20% of the Portfolio's average daily net assets
in excess of $50 million. For the six months ended June 30, 1998, the investment
advisory fee amounted to $62,790, all of which was waived.

B. ADMINISTRATION AGREEMENT -- Under the terms of an Administration Agreement
with the Trust, IBT Ireland provides overall administrative services and general
office facilities to the Portfolio and the Trust. As compensation for such
services, the Portfolio has agreed to pay IBT Ireland an administrative services
fee, accrued daily and payable monthly, at an annual rate of 0.07% of the
Portfolio's first $100 million average daily net assets and 0.05% of the
Portfolio's average daily net assets in excess of $100 million. For the six
months ended June 30, 1998, the administrative services fee amounted to $7,325.

4. PURCHASE AND SALES OF INVESTMENTS
For the six months ended June 30, 1998, purchases and sales of investment
securities, excluding short-term investments, aggregated to $8,781,646 and
$6,873,335, respectively.

18
<PAGE>

[THIS PAGE INTENTIONALLY LEFT BLANK]

<PAGE>

[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>

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

UBS Large Cap Growth Fund
200 Clarendon Street
Boston, Massachusetts 02116

<TABLE>
<S> <C>
Investment Advisor Union Bank of Switzerland,
New York Branch
1345 Avenue of the Americas
New York, NY 10105

Administrator Investors Bank & Trust Company
200 Clarendon Street
Boston, Massachusetts 02116

Distributor First Fund Distributors, Inc.
4455 East Camelback Road
Phoenix, AZ 85018

Custodian and Transfer Agent Investors Bank & Trust Company
200 Clarendon Street
Boston, Massachusetts 02116

</TABLE>

The accompanying financial statements dated as of June 30, 1998 were not audited
and, accordingly, no opinion is expressed on them.

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

<PAGE>

PART C. OTHER INFORMATION

ITEM 15. INDEMNIFICATION.

Indemnification of the Registrant's Trustees is provided for in
Article VII, Sections 2 and 3 of the Registrant's Agreement and
Declaration of Trust dated August 9, 1993, as amended through August
24, 1998, as follows:

Section 2. Indemnification and Limitation of Liability. The Trustees
shall not be responsible or liable in any event for any neglect or
wrong-doing of any officer, agent, employee, Manager or Principal
Underwriter of the Trust, nor shall any Trustee be responsible for the
act or omission of any other Trustee, and, subject to the provisions
of the Bylaws, the Trust out of its assets may indemnify and hold
harmless each and every Trustee and officer of the Trust from and
against any and all claims, demands, costs, losses, expenses, and
damages whatsoever arising out of or related to such Trustee's
performance of his or her duties as a Trustee or officer of the Trust;
provided that nothing herein contained shall indemnify, hold harmless
or protect any Trustee or officer from or against any liability to the
Trust or any Shareholder to which he or she would otherwise be subject
by reason of wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his or her
office.

Every note, bond, contract, instrument, certificate or undertaking and
every other act or thing whatsoever issued, executed or done by or on
behalf of the Trust or the Trustees or any of them in connection with
the Trust shall be conclusively deemed to have been issued, executed
or done only in or with respect to their or his or her capacity as
Trustees or Trustee, and such Trustees or Trustee shall not be
personally liable thereon.

Section 3. Trustee's Good Faith Action, Expert Advice, No Bond or
Surety. The exercise by the Trustees of their powers hereunder shall
be binding upon everyone interested in or dealing with the Trust. A
Trustee shall be liable to the Trust and to any Shareholder solely for
his or her own wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of the office
of Trustee and shall not be liable for errors of judgment or mistakes
of fact or law. The Trustees may take advice of counsel or other
experts with respect to the meaning and operation of this Declaration
of Trust and shall be under no liability for any act or omission in
accordance with such advice nor for failing to follow such advice. The
Trustees shall not be required to give any bond as such, nor any
surety if a bond is required.

C-1
<PAGE>

Section 4. Insurance. The Trustees shall be entitled and empowered to
the fullest extent permitted by law to purchase with Trust assets
insurance for liability and for all expenses, reasonably incurred or
paid or expected to be paid by a Trustee or officer in connection with
any claim, action, suit or proceeding in which he or she becomes
involved by virtue of his or her capacity or former capacity with the
Trust, whether or not the Trust would have the power to indemnify him
or her against such liability under the provisions of this Article.

Indemnification of Registrant's custodian, transfer agent, accounting
services provider, administrator and distributor against certain
stated liabilities is provided until May 9, 1997 under the following
documents:

(a) Section 12 of Accounting Services Agreement, between the
Registrant and Fund/Plan Services, Inc., incorporated herein
by reference to Post-Effective Amendment No. 16 to
Registrant's Registration Statement on Form N-1A (File Nos.
33-47287 and 811-6637), Exhibit 9(c) as filed electronically
with the Commission on February 14, 1996.

(b) Section 8 of Administration Agreement between the Registrant
and Fund/Plan Services, Inc., incorporated herein by
reference to Post-Effective Amendment No. 16 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-47287 and
811-6637), Exhibit 9(b) as filed electronically with the
Commission on February 15, 1996.

(c) Section 14 of Custodian Agreement between the Registrant and
Bankers Trust Company, incorporated herein by reference to
Post-Effective Amendment No. 13 to Registrant's Registration
Statement on Form N-1A (File Nos. 33-47287 and 811-6637),
Exhibit Nos. 8(a) and 8(b) as filed electronically with the
Commission on September 20, 1995.

(d) Section 19 of Shareholder Services Agreement between
Registrant and Fund/Plan Services, Inc., incorporated herein
by reference to Post-Effective Amendment No. 16 to
Registrant's Registration Statement on Form N-1A (File Nos.
33-47287 and 811-6637), Exhibit 9(a) as filed electronically
with the Commission on February 15, 1996.

(e) Section 8 of the Underwriting Agreement between Registrant
and Fund/Plan Broker Services, Inc. are incorporated herein
by reference to Post-Effective No. 16 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-47287 and
811-6637), Exhibit No. (6) as filed electronically with the
Commission on February 15, 1996.

C-2
<PAGE>

Effective May 10, 1997, indemnification of Registrant's custodian,
transfer agent, accounting services provider, administrator and
distributor against certain stated liabilities is provided for in the
following documents:

(a) Sections I.8(a), I.8(c)(iii), I.10, II.A.2, II.B.5, II.C.6,
III.1., III.2.(b) through III.2.(e), III.4.(e) and III.9.(b)
of the Multiple Services Agreement dated May 9, 1997, as
amended through January 23, 1998, between Morgan Stanley
Trust Company and the Registrant on behalf of each of the
series of the Registrant is incorporated herein by reference
to Post-Effective Amendment No. 21 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-47287 and
811-6637) as filed electronically with the Commission on
September 15, 1998.

Effective February 24, 1997, indemnification of Registrant's
distributor against certain stated liabilities is provided for in the
following document:

(b) Section 1.10 of the Distribution Agreement between Funds
Distributor, Inc. and the Registrant on behalf of each
series of the Registrant dated February 24, 1997, as amended
through August 24, 1998, is incorporated herein by reference
to Post-Effective Amendment No. 21 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-47287 and
811-6637) as filed electronically with the Commission on
September 15, 1998.

ITEM 16. EXHIBITS.

(1) Copies of the charter of the registrant as now in effect.

(a) Certificate of Trust of the Registrant dated August 9, 1993,
as filed with the Office of the Secretary of State of the
State of Delaware on August 13, 1993, is incorporated herein
by reference to Post-Effective Amendment No. 21 to
Registrant's Registration Statement on Form N-1A (File Nos.
33-47287 and 811-6637) as filed electronically with the
Commission on September 15, 1998.

(b) Agreement and Declaration of Trust dated August 19, 1993, as
amended through August 24, 1998, of the Registrant is
incorporated herein by reference to Post-Effective Amendment
No. 21 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 15, 1998.

(c) Certificates of the Secretary of the Registrant dated April
14, 1998 are incorporated herein by reference to Post-
Effective Amendment

C-3
<PAGE>

No. 21 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 15, 1998.

(2) By-Laws.

By-Laws of The Brinson Funds dated August 9, 1993, are
incorporated hereby by reference to Exhibit 2 to Post-Effective
Amendment No. 17 to Registrant's Registration Statement on Form
N-1A (File Nos. 33-47287 and 811-6637), as electronically filed
with the Commission on August 29, 1996.

(3) Voting Trust Agreement.

Not applicable.

(4) Copies of the agreement of acquisition, reorganization, merger,
liquidation and any amendments to it:

Form of Agreement and Plan of Reorganization is filed herewith as
Exhibit A to the Combined Prospectus/Proxy Statement.

(5) Instruments Defining the Rights of Security Holders.

(a) Form of Specimen Share Certificate of The Brinson Funds is
incorporated herein by reference to Post-Effective Amendment
No. 9 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed with the
Commission on July 21, 1994 and is incorporated herein by
reference to Post-Effective Amendment No. 21 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-47287 and
811-6637) as filed electronically with the Commission on
September 15, 1998.

The rights of security holders of The Brinson Funds are
further defined in the following sections of The Brinson
Funds By-Laws and Agreement and Declaration of Trust :

a. By-Laws.
See Article II "Voting," Section 7 and Section 10.

b. Agreement and Declaration of Trust.
See Article III "Shares," Section 1, Section 2 and
Section 6.

(6) Investment Advisory Contracts.

C-4
<PAGE>

(a) Investment Advisory Agreement dated April 25, 1995 between
Brinson Partners, Inc. and the Registrant on behalf of the
Global Fund (f/k/a Brinson Global Fund) series, and
Secretary's Certificate relating thereto, is incorporated
herein by reference to Post-Effective Amendment No. 21 to
Registrant's Registration Statement on Form N-1A (File Nos.
33-47287 and 811-6637) as filed electronically with the
Commission on September 15, 1998.

(b) Investment Advisory Agreement dated April 25, 1995 between
Brinson Partners, Inc. and the Registrant on behalf of the
Global Bond Fund (f/k/a Brinson Global Bond Fund) series,
and Secretary's Certificate relating thereto, is
incorporated herein by reference to Post-Effective Amendment
No. 21 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 15, 1998.

(c) Investment Advisory Agreement dated April 25, 1995 between
Brinson Partners, Inc. and the Registrant on behalf of the
Global (ex-U.S.) Equity Fund (f/k/a Non-U.S. Equity Fund)
series, and Secretary's Certificate relating thereto, is
incorporated herein by reference to Post-Effective Amendment
No. 21 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 15, 1998.

(d) Investment Advisory Agreement dated April 25, 1995 between
Brinson Partners, Inc. and the Registrant on behalf of the
Global Equity Fund (f/k/a Brinson Global Equity Fund)
series, and Secretary's Certificate relating thereto, is
incorporated herein by reference to Post-Effective Amendment
No. 21 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 15, 1998.

(e) Investment Advisory Agreement dated April 25, 1995 between
Brinson Partners, Inc. and the Registrant on behalf of the
U.S. Equity Fund (f/k/a Brinson U.S. Equity Fund) series,
and Secretary's Certificate relating thereto, is
incorporated herein by reference to Post-Effective Amendment
No. 21 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 15, 1998.

(f) Investment Advisory Agreement dated April 25, 1995 between
Brinson Partners, Inc. and the Registrant on behalf of the
U.S.

C-5
<PAGE>

Balanced Fund (f/k/a Brinson U.S. Balanced Fund) series, and
Secretary's Certificate relating thereto, is incorporated
herein by reference to Post-Effective Amendment No. 21 to
Registrant's Registration Statement on Form N-1A (File Nos.
33-47287 and 811-6637) as filed electronically with the
Commission on September 15, 1998.

(g) Investment Advisory Agreement dated April 25, 1995 between
Brinson Partners, Inc. and the Registrant on behalf of the
U.S. Bond Fund (f/k/a Brinson U.S. Bond Fund) series, and
Secretary's Certificate relating thereto, is incorporated
herein by reference to Post-Effective Amendment No. 21 to
Registrant's Registration Statement on Form N-1A (File Nos.
33-47287 and 811-6637) as filed electronically with the
Commission on September 15, 1998.

(h) Investment Advisory Agreement dated November 24, 1997
between Brinson Partners, Inc. and the Registrant on behalf
of the U.S. Large Capitalization Equity Fund series is
incorporated herein by reference to Post-Effective Amendment
No. 21 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 15, 1998.

(i) Form of Investment Advisory Agreement dated December __,
1998 between Brinson Partners, Inc. and the Registrant on
behalf of the U.S. Large Capitalization Growth Fund series
is incorporated herein by reference to Post-Effective
Amendment No. 22 to Registrant's Registration Statement on
Form N-1A (File Nos. 33-47287 and 811-6637) as filed
electronically with the Commission on September 18, 1998.

(j) Form of Investment Advisory Agreement dated December __,
1998 between Brinson Partners, Inc. and the Registrant on
behalf of the U.S. Small Capitalization Fund series is
incorporated herein by reference to Post-Effective Amendment
No. 22 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 18, 1998.

(k) Form of Investment Advisory Agreement dated December __,
1998 between Brinson Partners, Inc. and the Registrant on
behalf of the High Yield Bond Fund series is incorporated
herein by reference to Post-Effective Amendment No. 22 to
Registrant's Registration Statement on Form N-1A (File Nos.
33-47287 and 811-6637) as filed electronically with the
Commission on September 18, 1998.

C-6
<PAGE>

(l) Form of Investment Advisory Agreement dated December __,
1998 between Brinson Partners, Inc. and the Registrant on
behalf of the Emerging Markets Equity Fund series is
incorporated herein by reference to Post-Effective Amendment
No. 22 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 18, 1998.

(m) Form of Investment Advisory Agreement dated December __,
1998 between Brinson Partners, Inc. and the Registrant on
behalf of the Emerging Markets Debt Fund series is
incorporated herein by reference to Post-Effective Amendment
No. 22 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 18, 1998.

(7) Underwriting or Distribution Contracts.

Distribution Agreement dated February 24, 1997, as amended
through August 24, 1998, between Funds Distributor, Inc. and the
Registrant on behalf of each series is incorporated herein by
reference to Post-Effective Amendment No. 21 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-47287 and 811-
6637) as filed electronically with the Commission on September
15, 1998.

(8) Bonus, Profit Sharing, Pension or Other Similar Contracts.

Not applicable.

(9) Custodian Agreements.

Custodial arrangements are provided under the Multiple Services
Agreement dated May 9, 1997, as amended through January 23, 1998,
between Morgan Stanley Trust Company and the Registrant on behalf
of each series of the Registrant which is incorporated herein by
reference to Post-Effective Amendment No. 21 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-47287 and 811-
6637) as filed electronically with the Commission on September
15, 1998, and forms of amendments to Schedule B1 and Schedule F
are incorporated herein by reference to Post-Effective Amendment
No. 22 to Registrant's Registration Statement on Form N-1A (File
Nos. 33-47287 and 811-6637) as filed electronically with the
Commission on September 18, 1998.

(10) Rule 12b-1 Plan and Rule 18f-3 Plan.

C-7
<PAGE>

(a) Amended Distribution Plan dated February 21, 1995, as
amended through August 24, 1998, relating to the UBS
Investment Fund class of shares (f/k/a the SwissKey Fund
Class) of each series of the Registrant is incorporated
herein by reference to Post-Effective Amendment No. 21 to
Registrant's Registration Statement on Form N-1A (File Nos.
33-47287 and 811-6637) as filed electronically with the
Commission on September 15, 1998 and form of amendment to
Schedule A is incorporated herein by reference to Post-
Effective Amendment No. 22 to Registrant's Registration
Statement on Form N-1A (File Nos. 33-47287 and 811-6637) as
filed electronically with the Commission on September 18,
1998.

(b) Distribution Plan dated June 30, 1997, as amended through
August 24, 1998, relating to the Brinson Fund-Class N shares
of each series of the Registrant is incorporated herein by
reference to Post-Effective Amendment No. 21 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-47287 and
811-6637) as filed electronically with the Commission on
September 15, 1998 and amendment to Schedule A is
incorporated herein by reference to Post-Effective Amendment
No. 22 to Registrant's Registration Statement on Form N-1A
(File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 18, 1998.

(c) Selected Dealer and Selling Agreement as last approved on
August 24, 1998 for the UBS Investment Fund class of shares
(f/k/a SwissKey Fund Class) of each series of the Registrant
is incorporated herein by reference to Post-Effective
Amendment No. 21 to Registrant's Registration Statement on
Form N-1A (File Nos. 33-47287 and 811-6637) as filed
electronically with the Commission on September 15, 1998 and
amendment to Exhibits A and B are incorporated herein by
reference to Post-Effective Amendment No. 22 to Registrant's
Registration Statement on Form N-1A (File Nos. 33-47287 and
811-6637) as filed electronically with the Commission on
September 18, 1998.

(d) The Selected Dealer and Selling Agreements as approved
November 24, 1997 on behalf of each series of The Brinson
Funds are incorporated herein by reference to Post-Effective
Amendment No. 21 to Registrant's Registration Statement on
Form N-1A (File Nos. 33-47287 and 811-6637) as filed
electronically with the Commission on September 15, 1998.

(e) Revised Multiple Class Plan dated May 19, 1997, as amended
through August 24, 1998, pursuant to Rule 18f-3 on behalf of
each series of the Registrant is incorporated herein by
reference to Post-Effective Amendment No. 21 to Registrant's
Registration Statement (File Nos. 33-47287 and 811-6637) as
filed electronically with the Commission on September 15,
1998 and amendment to Appendix A is incorporated herein by
reference to Post-Effective Amendment No. 22 to Registrant's
Registration Statement (File Nos. 33-47287 and 811-6637) as
filed electronically with the Commission on September 18,
1998.

(11) Opinion of Counsel.

C-8
<PAGE>

Legal opinion of Stradley, Ronon, Stevens & Young, LLP, counsel
to the Registrant, as to the legality of the securities being
registered, is incorporated herein by reference to Post-Effective
Amendment No. 22 to Registrant's Registration Statement on Form
N-1A (File Nos. 33-47287 and 811-6637) as filed electronically
with the Commission on September 18, 1998.

(12) Opinion of Counsel Supporting the Tax Matters and Consequences to
Shareholders.

Form of tax opinion of Stradley, Ronon, Stevens & Young, LLP,
counsel to the Registrant, supporting the tax matters and
consequences to shareholders discussed in the prospectus is filed
electronically herewith as EX-8.

(13) Other Material Contracts.

Not applicable.

(14) Other Opinions and Consents.

(a) Consent of Ernst & Young LLP, independent auditors to the
Registrant, is filed electronically herewith as EX-23.1.

(b) Consent of PricewaterhouseCoopers, LLP, independent auditors
to the UBS Private Investor Funds, Inc., is filed
electronically herewith as EX-23.2.

(c) Consent of PricewaterhouseCoopers, independent auditors to
the UBS Investor Portfolios Trust, is electronically filed
herewith as EX-23.3.

(15) Omitted Financial Statements.

Not applicable.

(16) Power of Attorney.

(a) Power-of-Attorney appointing Karl Hartmann, Lloyd Lipsett,
Kathleen O'Neill, Eddie Wang and Paul Roselli as attorneys-
in-fact and agents is filed electronically herewith as EX-
24.

(b) Certificate of Secretary and resolution relating to the
appointment of power of attorney is filed electronically
herewith as EX-24.1.

C-9
<PAGE>

ITEM 17. UNDERTAKINGS.

(1) The undersigned registrant agrees that prior to any public
reoffering of the securities registered through the use of a
prospectus which is a part of this registration statement by any
person or party who is deemed to be an underwriter within the
meaning of Rule 145(c) of the Securities Act [17 CFR 230.145c],
the reoffering prospectus will contain the information called for
by the applicable registration form for reofferings by persons
who may be deemed underwriters, in addition to the information
called for by the other items of the applicable form.

(2) The undersigned registrant agrees that every prospectus that is
filed under paragraph (1) above will be filed as a part of an
amendment to the registration statement and will not be used
until the amendment is effective, and that, in determining any
liability under the 1933 Act, each post-effective amendment shall
be deemed to be a new registration statement for the securities
offered therein, and the offering of the securities at that time
shall be deemed to be the initial bona fide offering of them.

C-10
<PAGE>

Pursuant to the requirements of the Securities Act of 1933, and the
Investment Company Act of 1940, as amended, the Registrant has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereto
duly authorized, in the City of Chicago, and State of Illinois, on the 21st day
of September 1998.

THE BRINSON FUNDS

By: /s/ E. Thomas McFarlan
-----------------------
E. Thomas McFarlan
President

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.

SIGNATURE: TITLE: DATE:

/s/ E. Thomas McFarlan* President, September 21, 1998
- -----------------------
E. Thomas McFarlan

/s/ Frank K. Reilly* Chairman and Trustee September 21, 1998
- -----------------------
Frank K. Reilly

/s/ Walter E. Auch* Trustee September 21, 1998
- -----------------------
Walter E. Auch

/s/ Edward M. Roob* Trustee September 21, 1998
- -----------------------
Edward M. Roob

/s/ Carolyn M. Burke* Principal Accounting September 21, 1998
- -----------------------
Carolyn M. Burke Officer, Secretary and
Treasurer

* By: Lloyd Lipsett
--------------
as Attorney-in-Fact and Agent
Pursuant to Power of Attorney

<PAGE>

EXHIBIT INDEX

<TABLE>
<CAPTION>
Sequentially
Numbered
Exhibit No. Document Page
- ----------- -------- ----
<S> <C> <C>
EX - 8 Form of tax opinion of Stradley, Ronon, Stevens & Young, LLP

EX - 23.1 Consent of Ernst & Young LLP, independent
auditors, relating to The Brinson Funds

EX - 23.2 Consent of PricewaterhouseCoopers, LLP independent
auditors, relating to the UBS Private Investor Funds, Inc.

EX 23.3 Consent of PricewaterhouseCoopers independent auditors,
relating to UBS Investor Portfolios Trust

EX - 24 Power of Attorney

EX - 24.1 Certificate of Secretary and resolution relating to
appointment of Power of Attorney
</TABLE>

<PAGE>

EX-8

FORM OF OPINION

, 1998

Board of Directors
UBS Private Investor Funds, Inc. -- UBS Large Cap Growth Fund
200 Clarendon Street
Boston, MA 02116

Board of Trustees
The Brinson Funds -- U.S. Large Capitalization Growth Fund
209 South LaSalle Street
Chicago, IL 60604

Re: AGREEMENT AND PLAN OF REORGANIZATION, DATED AS OF THE
DAY OF , 1998, BY AND BETWEEN UBS PRIVATE INVESTOR
FUNDS, INC. (THE "CORPORATION") ON BEHALF OF THE UBS LARGE
CAP GROWTH FUND ("ACQUIRED FUND") AND THE BRINSON FUNDS (THE
"TRUST") ON BEHALF OF U.S. LARGE CAPITALIZATION GROWTH FUND
("ACQUIRING FUND")
------------------------------------------------------------

Ladies and Gentlemen:

You have requested our opinion as to certain federal income tax
consequences of the reorganization of Acquired Fund whereby, Acquired Fund will
transfer substantially all of its property, assets, and goodwill and liabilities
to Acquiring Fund in exchange solely for Class I Shares of Acquiring Fund (the
"Acquiring Fund Shares"), followed by the distribution by Acquired Fund of
Acquiring Fund Shares to the shareholders of Acquired Fund, the cancellation of
all of the outstanding Shares of beneficial interest of Acquired Fund (the
"Acquired Fund Shares") and the liquidation of Acquired Fund (the
"Reorganization").
<PAGE>

, 1998

Page 2

In rendering our opinion, we have reviewed and relied upon (a) the
Agreement and Plan of Reorganization, dated as of the th day of ,
1998, by and between the Corporation and the Trust ("Agreement"), (b) the proxy
proxy materials provided to stockholders of Acquired Fund in connection with the
Special Meeting of Stockholders of Acquired Fund held on ,
1998, (c) certain representations concerning the Reorganization made to us by
Custodian Funds and the Acquired Fund in a letter dated ,
1998 (the "Representation Letter"), (d) all other documents, financial and other
reports and corporate minutes which we deemed relevant or appropriate, and (e)
such statutes, regulations, rulings and decisions as we deemed material to the
rendition of this opinion. All terms used herein, unless otherwise defined, are
used as defined in the Agreement.

For purposes of this opinion, we have assumed that Acquired Fund on
the effective date of the Reorganization satisfies, and following the
Reorganization, Acquiring Fund will continue to satisfy, the requirements of
subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"), for
qualification as a regulated investment company.

Under regulations to be prescribed by the Secretary of Treasury under
Section 1276(d) of the Code, certain transfers of market discount bonds will be
excepted from the requirement that accrued market discount be recognized on
disposition of a market discount bond under Section 1276(a) of the Code. Such
regulations are to provide, in part, that accrued market discount will not be
included in income if no gain is recognized under Section 361(a) of the Code
where a bond is transferred in an exchange qualifying as a tax-free
reorganization. As of the date hereof, the Secretary has not issued any
regulations under Section 1276 of the Code.

Based on the foregoing and provided the Reorganization is carried out
in accordance with the applicable laws of the State of Maryland and the State of
Delaware, the Agreement and the Representation Letter, it is our opinion that:

1. The Reorganization will constitute a tax-free reorganization
within the meaning of Section 368(a) of the Code, and Acquired Fund and
Acquiring Fund will each be a party to the reorganization within the meaning of
Section 368(b) of the Code.

2. No gain or loss will be recognized by Acquired Fund upon the
transfer of all of its assets to Acquiring Fund in exchange solely for Acquiring
Fund Shares pursuant to Section 361(a) and Section 357(a) of the Code. We
express no opinion as to whether any accrued market discount will be required to
be recognized as ordinary income pursuant to Section 1276 of the Code.

3. No gain or loss will be recognized by Acquiring Fund upon the
receipt by it of all of the assets of Acquired Fund in exchange solely for
Acquiring Fund Shares pursuant to Section 1032(a) of the Code.

4. The basis of the assets of Acquired Fund received by Acquiring
Fund will be the same as the basis of such assets to Acquired Fund immediately
prior to the exchange pursuant to Section 362(b) of the Code.

5. The holding period of the assets of Acquired Fund received by
Acquiring Fund will include the period during which such assets were held by
Acquired Fund pursuant to Section 1223(2) of the Code.
<PAGE>

, 1998

Page 3

6. No gain or loss will be recognized by the stockholders of
Acquired Fund upon the exchange of their Acquired Fund Shares for Acquiring Fund
Shares (including fractional shares to which they may be entitled), pursuant to
Section 354(a) of the Code.

7. The basis of the Acquiring Fund Shares received by the
stockholders of Acquired Fund (including fractional shares to which they may be
entitled) will be the same as the basis of the Acquired Fund Shares exchanged
therefor pursuant to Section 358(a)(1) of the Code.

8. The holding period of the Acquiring Fund Shares received by the
stockholders of Acquired Fund (including fractional shares to which they may be
entitled) will include the holding period of the Acquired Fund Shares
surrendered in exchange therefor, provided that the Acquired Fund Shares were
held as a capital asset on the effective date of the Reorganization, pursuant to
Section 1223(1) of the Code.

9. Acquiring Fund will succeed to and take into account as of the
date of the proposed transfer (as defined in Section 1.381(b)-1(b) of the Income
Tax Regulations) the items of Acquired Fund described in Section 381(c) of the
Code, subject to the conditions and limitations specified in Sections 381(b) and
(c), 382, 383 and 384 of the Code.

Our opinion is based upon the Code, the applicable Treasury
Regulations promulgated thereunder, the present position of the Internal Revenue
Service as set forth in published revenue rulings and revenue procedures,
present administrative positions of the Internal Revenue Service, and existing
judicial decisions, all of which are subject to change either prospectively or
retroactively. We do not undertake to make any continuing analysis of the facts
or relevant law following the date of this letter.

Our opinion is conditioned upon the performance by Acquiring Fund and
Acquired Fund of their undertakings in the Agreement and the Representation
Letter.

This opinion is being rendered to Acquiring Fund and Acquired Fund and
may be relied upon only by such funds and the stockholders of each.

Very truly yours,

STRADLEY, RONON, STEVENS & YOUNG, LLP

By:___________________________________
William P. Zimmerman, a Partner

<PAGE>

EX-23.1

CONSENT OF INDEPENDENT AUDITORS

We consent to the incorporation by reference of our reports for The Brinson
Funds (comprised of Global Fund, Global Equity Fund, Global Bond Fund, U.S.
Balanced Fund, U.S. Equity Fund, U.S. Large Capitalization Equity Fund, U.S.
Bond Fund and Non-U.S. Equity Fund) dated August 7, 1998, in the Registration
Statement (Form N-14) and related Proxy Statement and Prospectus, filed with the
Securities and Exchange Commission under the Securities Act of 1933
(Registration No. 33-47287).

ERNST & YOUNG LLP

Chicago, Illinois
September 18, 1998

<PAGE>

EX-23.2

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in this Registration
Statement on Form N-14 (the "Registration Statement on Form N-14") of our report
dated February 17, 1998 relating to the financial statements and financial
highlights of the UBS Large Cap Growth Fund appearing in the December 31, 1997
Annual Report to Shareholders of The UBS Private Investor Funds, Inc. - Large
Cap Growth Fund, which is also incorporated by reference into the Registration
Statement on Form N-14.

PRICEWATERHOUSECOOPERS LLP

New York, New York
September 21, 1998

<PAGE>

EX-23.3

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in this Registration
Statement on Form N-14 (the "Registration Statement on Form N-14") of our report
dated February 17, 1998 relating to the financial statements and financial
highlights of the UBS Large Cap Growth Portfolio appearing in the December 31,
1997 Annual Report to Shareholders of The UBS Private Investor Funds,
Inc. - Large Cap Growth Fund, which is also incorporated by reference into the
Registration Statement on Form N-14.

PRICEWATERHOUSECOOPERS

Chartered Accountants
Toronto, Ontario
September 21, 1998

<PAGE>

EX-24

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned constitutes and
appoints Karl Hartmann, Lloyd Lipsett, Kathleen O'Neill, Eddie Wang and Paul
Rosselli and each of them, with full power to act without the other, as a true
and lawful attorney-in-fact and agent, with full and several power of
substitution, on behalf of The Brinson Funds (the "Trust") and on behalf of each
of the undersigned, to take any appropriate action to execute and file with the
U.S. Securities and Exchange Commission ("Commission") any amendment to the
registration statement of the Trust, execute and file any request for exemptive
relief from state and federal regulations, execute and file any Rule 24f-2
notices to register shares of the Trust with the Commission, execute and file
any registration statement on Form N-14 with the Commission, and perform any and
all such acts as such attorneys-in-fact may deem necessary or advisable in order
to comply with the applicable laws of the United States or any individual state,
and in connection therewith to execute and file all requisite papers and
documents, including but not limited to, applications, reports, notices, surety
bonds, irrevocable consents and appointments of attorneys for service of
process; granting to such attorneys-in-fact and agents, and each of them, full
power and authority to do and perform each and every act requisite and necessary
to be done in connection therewith, as fully as each of the Trust and the
undersigned persons might or could do itself or in person, hereby ratifying and
confirming all that such attorneys-in-fact and agents or any of them, or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney on
the 24th day of August, 1998.

THE BRINSON FUNDS

/s/ Frank K. Reilly /s/ E. Thomas McFarlan
- --------------------------- -------------------------------------------
Frank K. Reilly, Chairman E. Thomas McFarlan, President, on behalf of
the Trust and himself, as President of the
Trust

/s/ Walter E. Auch
- ---------------------------
Walter E. Auch, Trustee

/s/ Edward M. Roob /s/ Carolyn M. Burke
- --------------------------- -------------------------------------------
Edward M. Roob, Trustee Carolyn M. Burke, Principal Accounting
Officer Secretary and Treasurer

<PAGE>

ACKNOWLEDGMENT
--------------

State of Illinois )
)
County of Cook )

On this, the 24th day of August, 1998, before me, a notary public, the
undersigned officer, personally appeared the above-named persons, known to me
(or satisfactorily proven) to be the persons whose names are subscribed to the
foregoing instrument, and that each individual executed the same for the
purposes therein contained.

IN WITNESS WHEREOF, I have hereunto set my hand and official seal.

/s/ Rebecca Wardlaw
--------------------------------
Notary Public
In and for the County of Cook
State of Illinois
My commission expires 6/22/99

<PAGE>

Ex-24.1

CERTIFICATE OF THE SECRETARY

THE BRINSON FUNDS

RESOLUTION AUTHORIZING
APPOINTMENT OF AN ATTORNEY-IN-FACT

I hereby confirm that the resolution of the Board of Trustees (the "Board")
of The Brinson Funds (the "Trust"), with respect to the Power of Attorney
appointing Karl Hartmann, Lloyd Lipsett, Kathleen O'Neill, Eddie Wong and Paul
Rosselli as attorneys-in-fact for the Trust, adopted at the regularly scheduled
August 24, 1998 Board meeting, and previously filed as an exhibit to the Trust's
Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933,
as amended, continues in full force and effect as of the date hereof.

IN WITNESS WHEREOF, the undersigned has caused this certificate to be
signed on this 21st day of September, 1998.

/s/ Carolyn M. Burke
--------------------
Carolyn M. Burke, Secretary
The Brinson Funds