<PAGE> 1
As filed with the Securities and Exchange Commission
on December 1, 1995
Registration No. 33-54126; 811-7332
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / /
Post-Effective Amendment No. 11 /X/
AND
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / /
Amendment No. 15 /X/
(Check appropriate box or boxes)
STAGECOACH INC.
(Exact Name of Registrant as specified in Charter)
111 Center Street
Little Rock, Arkansas 72201
(Address of Principal Executive Offices, including Zip Code)
Registrant's Telephone Number, including Area code: (800) 643-9691
Richard H. Blank, Jr.
c/o Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
(Name and Address of Agent for Service)
With a copy to:
Robert M. Kurucza, Esq.
Marco E. Adelfio, Esq.
Morrison & Foerster
2000 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
It is proposed that this filling will become effective (check appropriate box):
<TABLE>
<S> <C>
/ / Immediately upon filing pursuant to Rule 485(b), or / / on _________, pursuant to Rule 485(b) , or
/ / 60 days after filing pursuant to Rule 485(a), or / / on _________, pursuant to Rule 485(a).
/ / 75 days after filing pursuant paragraph (a) (2) /X/ on February 16, 1996, pursuant to paragraph (a) (2) of Rule 485
</TABLE>
If appropriate, check the following box:
/ / this post effective amendment designates a new effective date for a
previously filed post-effective amendment.
<PAGE> 2
The Registrant has registered an indefinite number of shares of its Common
Stock, $.001 par value, under the Securities Act of 1933, pursuant to Rule
24f-2 under the Investment Company Act 1940, as amended. The Registrant filed
the notice required by Rule 24f-2 for its most recent fiscal period ended
February 28, 1995 on April 27, 1995.
This Post-Effective Amendment to the Registrant's Registration Statement has
been executed by Master Investment Portfolio (a registered investment company
with separate series in which certain of the Registrant's series invest
substantially all of their assets) and its trustees and principal officers.
<PAGE> 3
EXPLANATORY NOTE
This Post-Effective Amendment No. 11 to the Registration Statement
(the "Amendment") of Stagecoach Inc. (the "Company") is being filed to register
five new series: the LifePath 2000 Series, LifePath 2010 Series, LifePath 2020
Series, LifePath 2030 Series and LifePath 2040 Series (the "LifePath Funds").
Each of the LifePath Funds will invest substantially all of its assets in the
corresponding master portfolio of Master Investment Portfolio, a management
investment company organized as a Delaware business trust (SEC File No.
811-8162). This Amendment does not effect the Registration Statement for the
Company's Asset Allocation, Bond Index, California Tax-Free Intermediate
Income, California Tax-Free Money Market, California Tax-Free Short-Term
Income, Growth and Income, Growth Stock, Money Market, National Tax-Free
Intermediate Income, National Tax-Free Money Market Mutual, Overland National
Tax-Free Institutional Money Market, Short-Intermediate Term, S&P 500 Stock and
U.S. Treasury Allocation Funds.
<PAGE> 4
Cross Reference Sheet
LIFEPATH 2000 FUND, LIFEPATH 2010 FUND, LIFEPATH 2020 FUND,
LIFEPATH 2030 FUND AND LIFEPATH 2040 FUND
Form N-1A Item Number
- ---------------------
Part A Prospectus Captions
- ------ -------------------
1 Cover Page
2 Fee Table
3 Financial Highlights
4 Description of the Funds; Management of the Funds; General
Information; Appendix
5 Description of the Funds; Management of the Funds; Performance
Information
6 Management of the Funds; Dividends, Distributions and Taxes
7 How to Buy Shares; Exchange Privilege
8 How to Redeem Shares
9 Not Applicable
Part B Statement of Additional Information Captions
- ------ --------------------------------------------
10 Cover Page
11 Table of Contents
12 Introduction
13 Investment Objectives and Management Policies; Appendix
14 Management of the Company; Management Arrangements
15 Management of the Company
16 Management of the Company; Management Arrangements; Custodian,
Transfer and Dividend Disbursing Agent; Independent Auditors
17 Portfolio Transactions
18 Capital Stock
19 Determination of Net Asset Value; Purchase and Redemption of Shares
20 Dividends, Distributions and Taxes
21 Management of the Company
22 Performance Information
23 Not Applicable
Part C General Information
- ------
24-32 Information required to be included in Part C is set forth under the
appropriate Item, so numbered, in Part C of this Document.
1
<PAGE> 5
[LOGO]
------------------------------
PROSPECTUS
------------------------------
[LOGO]
February , 1996
<PAGE> 6
SUBJECT TO COMPLETION, DATED DECEMBER 1, 1995
STAGECOACH LIFEPATH(TM) FUNDS
The LifePath Funds consist of five asset allocation funds (each, a "Fund"
and collectively, the "Funds" or the "LifePath Funds") offered by Stagecoach Inc
(the "Company"), an open-end, management investment company. By this Prospectus,
the Company is offering shares of the five LifePath Funds. Shares of the
LifePath Funds are only available to certain investors. See "How To Buy Shares".
EACH FUND INVESTS ALL OF ITS ASSETS IN A SEPARATE PORTFOLIO (EACH, A
"MASTER PORTFOLIO") OF MASTER INVESTMENT PORTFOLIO ("MIP"), AN OPEN-END,
MANAGEMENT INVESTMENT COMPANY, RATHER THAN IN A PORTFOLIO OF SECURITIES AND, AS
SUCH, MAY BE CONSIDERED A FEEDER FUND IN A MASTER/FEEDER STRUCTURE. EACH MASTER
PORTFOLIO HAS THE SAME INVESTMENT OBJECTIVE AS THE FUND BEARING THE
CORRESPONDING NAME. THEREFORE, EACH FUND'S INVESTMENT EXPERIENCE CORRESPONDS
DIRECTLY WITH THE RELEVANT MASTER PORTFOLIO'S INVESTMENT EXPERIENCE. INTERESTS
IN THE MASTER PORTFOLIO MAY BE PURCHASED ONLY BY OTHER INVESTMENT COMPANIES OR
SIMILAR ACCREDITED INVESTORS.
The LifePath Funds seek to provide long-term investors with an asset
allocation strategy designed to maximize assets for retirement or for other
purposes consistent with the quantitatively measured risk that investors, on
average, may be willing to accept given their investment time horizons.
This Prospectus sets forth concisely information about the Company and
Funds that a prospective investor should know before investing. It should be
read and retained for future reference. A Statement of Additional Information,
dated February , 1996, which may be revised from time to time, provides a
further discussion of certain areas in this Prospectus and other matters which
may be of interest to some investors. It has been filed with the Securities and
Exchange Commission and is incorporated herein by reference. For a free copy,
write to the Company c/o Wells Fargo Bank, N.A. -- Transfer Agent, 525 Market
Street, San Francisco, California 94105, or call 1-800-776-0179.
------------------------
FUND SHARES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF, OR ISSUED, ENDORSED OR
GUARANTEED BY WELLS FARGO BANK, N.A. OR BARCLAYS BANK PLC OR ANY OF THEIR
AFFILIATES. SUCH SHARES ARE NOT INSURED BY THE U.S. GOVERNMENT, THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENTAL AGENCY. AN INVESTMENT IN A FUND INVOLVES CERTAIN INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR ANY OTHER REGULATORY
AUTHORITY NOR HAVE ANY OF THESE AUTHORITIES PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
PROSPECTUS DATED FEBRUARY , 1996
***************************************************************************
* *
* INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A *
* REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED *
* WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT *
* BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE *
* REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT *
* CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY *
* NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH *
* SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO *
* REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH *
* STATE. *
* *
***************************************************************************
<PAGE> 7
Each LifePath Fund invests in the corresponding LifePath Master Portfolio,
which invests in a wide range of U.S. and foreign equity and debt securities and
money market instruments. Investors are encouraged to select a particular
LifePath Fund based on the decade of their anticipated retirement or when they
anticipate beginning to withdraw substantial portions of their investment.
- LIFEPATH 2000 FUND is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2000.
- LIFEPATH 2010 FUND is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2010.
- LIFEPATH 2020 FUND is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2020.
- LIFEPATH 2030 FUND is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2030.
- LIFEPATH 2040 FUND is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2040.
Shares of each Fund are sold to qualified investors without a sales charge.
Investors can invest, reinvest or redeem Fund Shares at any time without charge
or penalty imposed by the Fund.
------------------------
WELLS FARGO BANK, N.A. ("WELLS FARGO BANK") SERVES AS INVESTMENT ADVISER AND
WELLS FARGO NIKKO INVESTMENT ADVISORS ("WFNIA") SERVES AS SUB-ADVISER TO THE
MASTER PORTFOLIOS, AND, FOLLOWING THE ACQUISITION OF WFNIA BY BARCLAYS
BANK, PLC OR ITS AFFILIATES, BZW GLOBAL INVESTORS ("BZWGI") WILL SERVE AS
INVESTMENT ADVISER TO THE MASTER PORTFOLIOS. AS USED HEREIN, "ADVISER"
MEANS WELLS FARGO BANK AND/OR WFNIA, AS REQUIRED BY THE CONTEXT, OR,
FOLLOWING THE CONSUMMATION OF THE TRANSACTION, BZWGI. THE "ADVISER"
PROVIDES OTHER SERVICES TO THE FUNDS AND MASTER PORTFOLIOS FOR
WHICH IT IS COMPENSATED. STEPHENS INC. ("STEPHENS"), WHICH IS NOT
AFFILIATED WITH THE ADVISER OR ANY AFFILIATES THEREOF, SERVES
AS THE COMPANY'S ADMINISTRATOR AND AS DISTRIBUTOR OF EACH
FUND'S SHARES.
<PAGE> 8
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Fee Table..................................................... 1
Financial Highlights.......................................... 3
Description of the Funds...................................... 6
Risk Factors................................................ 7
Management of the Funds....................................... 20
How to Buy Shares............................................. 26
How to Redeem Shares.......................................... 31
Exchange Privilege............................................ 36
Dividends, Distributions and Taxes............................ 37
Performance Information....................................... 39
General Information........................................... 40
Appendix...................................................... A-1
</TABLE>
<PAGE> 9
FEE TABLE
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020 2030 2040
FUND FUND FUND FUND FUND
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average
daily net assets)*:
MIP Management Fees**............. .55% .55% .55% .55% .55%
Other Expenses
Shareholder Servicing Fees***... .20% .20% .20% .20% .20%
Miscellaneous Expenses.......... .20% .20% .20% .20% .20%
Total Other Expenses.............. .40% .40% .40% .40% .40%
Total Fund Operating Expenses..... .95% .95% .95% .95% .95%
EXAMPLE:
An investor would pay the
following expenses on a $1,000
investment in the Fund, assuming
(1) 5% annual return and (2)
redemption at the end of each
time period:
1 YEAR........................ $ 10 $ 10 $ 10 $ 10 $ 10
3 YEARS....................... $ 30 $ 30 $ 30 $ 30 $ 30
5 YEARS....................... $ 53 $ 53 $ 53 $ 53 $ 53
10 YEARS...................... $117 $117 $117 $117 $117
</TABLE>
- ---------------
* Other mutual funds invest in a Master Portfolio and such other funds'
expenses and, correspondingly, investment returns may differ from those of
the LifePath Fund that invests in such Master Portfolio.
** Each Master Portfolio has adopted a so-called "defensive" Rule 12b-1 Plan of
Distribution that does not result in additional expenses being borne by a
Master Portfolio or indirectly by a Fund. (See "Management of the
Funds -- Distribution Plans" for further information.)
*** A Shareholder Servicing Agent may charge certain fees, in addition to those
imposed by the Company, for additional services provided by the Shareholder
Servicing Agent. Shareholder Servicing Agents are required to disclose any
such fees to their customers who are Fund shareholders.
- --------------------------------------------------------------------------------
THE AMOUNTS LISTED IN THE EXAMPLE SHOULD NOT BE CONSIDERED AS
REPRESENTATIVE OF FUTURE EXPENSES, AND ACTUAL EXPENSES MAY BE GREATER OR LESS
THAN THOSE INDICATED. MOREOVER, WHILE THE EXAMPLE ASSUMES A 5% ANNUAL RETURN,
EACH FUND'S ACTUAL PERFORMANCE WILL VARY AND MAY RESULT IN AN ACTUAL RETURN
GREATER OR LESS THAN 5%.
- --------------------------------------------------------------------------------
All of the above figures are based on the 1994 actual expenses of the
Institutional Class shares of the LifePath Funds of Stagecoach Trust, an
open-end investment company whose series also invest in the Master Portfolios.
The offering of the Institutional Class shares has been termi-
1
<PAGE> 10
nated as of the commencement of operations of the Funds, which were established
to supersede the Institutional Class shares of Stagecoach Trust.
The purpose of the foregoing table is to assist investors in understanding
the various costs and expenses borne by a Fund and a Master Portfolio, and,
therefore, indirectly by a Fund and its investors, the payment of which will
reduce investors' return on an annual basis. The Company's Board of Directors
believes that the aggregate per share expenses of a Fund and its corresponding
Master Portfolio will be less than or approximately equal to the expenses such
Fund would incur if it directly acquired and managed the type of securities held
by such Master Portfolio. The information in the foregoing table does not
reflect any fee waivers or expense reimbursement arrangements that may be in
effect. For a description of the various costs and expenses incurred in the
operation of the Company and MIP, as well as any fee waivers or expense
reimbursements, see "Management of the Funds."
2
<PAGE> 11
FINANCIAL HIGHLIGHTS
The financial information presented below is for informational purposes
only and should not be considered as a projection of the future performance of
the Funds. The Funds have been established to supersede the LifePath Funds of
Stagecoach Trust for the types of investors that currently invest in the
Institutional Class shares of Stagecoach Trust, and the Institutional Class
shares of the LifePath Funds of Stagecoach Trust are no longer being offered.
The operation of the Institutional Class shares of the LifePath Funds of
Stagecoach Trust was substantially similar to the operation of the Funds.
The following information has been derived from the Financial Highlights in
the financial statements of the Institutional Class shares of the LifePath Funds
of Stagecoach Trust for the fiscal year ended February 28, 1995 and for the
six-month period ended August 31, 1995. The financial statements are included in
the Statement of Additional Information for the Funds. The financial statements
for the fiscal year ended February 28, 1995, have been audited by KPMG Peat
Marwick LLP, independent auditors of Stagecoach Trust, whose report on
Stagecoach Trust, dated April 20, 1995, is also included in the Statement of
Additional Information. The information presented below should be read in
conjunction with the annual financial statements and notes thereto for the
fiscal year ended February 28, 1995, of those funds. The financial statements
for the six-month period ended August 31, 1995, are unaudited. The information
presented below should be read in conjunction with the unaudited financial
statements and the notes thereto for the six-month period ended August 31, 1995.
The Statement of Additional Information has been incorporated by reference into
this Prospectus.
3
<PAGE> 12
FOR AN INSTITUTIONAL CLASS SHARE OUTSTANDING
FOR THE YEAR ENDED FEBRUARY 28, 1995 OR
THE PERIOD ENDED AUGUST 31, 1995:
<TABLE>
<CAPTION>
LIFEPATH
LIFEPATH 2000 FUND LIFEPATH 2010 FUND 2020 FUND
-------------------------- ------------------------- -----------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED ENDED
AUGUST 31, FEBRUARY 28, AUGUST 31, FEBRUARY 28, AUGUST 31,
1995 1995 1995 1995 1995
------------ ------------ ----------- ------------ -----------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net Asset Value, beginning
of period................ $ 9.94 $ 10.00 $ 10.02 $ 10.00 $ 10.17
-------- -------- ------- -------- -------
Income from investment
operations:
Net investment income.... 0.22 0.35 0.19 0.33 0.16
Net realized and
unrealized gain/(loss)
on investments......... 0.57 (0.12) 0.92 0.01 1.13
-------- -------- ------- -------- -------
Total from investment
operations............... 0.79 0.23 1.10 0.34 1.29
Less distributions:
Dividends from net
investment income...... (0.22) (0.28) (0.19) (0.27) (0.16)
Distributions from net
realized capital
gains.................. 0.00 (0.01) 0.00 (0.05) 0.00
-------- -------- ------- -------- -------
Total Distributions....... (0.22) (0.29) (0.19) (0.32) (0.16)
-------- -------- ------- -------- -------
Net Asset Value, end of
period................... $ 10.51 $ 9.94 $ 10.94 $ 10.02 $ 11.30
======== ======== ======= ======== =======
Total Return (not
annualized).............. 8.04% 2.38% 11.17% 3.53% 12.79%
Ratios/Supplemental Data:
Net assets, end of period
(000).................. $ 11,885 $ 7,499 $25,049 $ 13,028 $25,685
Number of shares
outstanding, end of
period (000)........... 1,130 754 2,289 1,300 2,273
Ratios to average net
assets (annualized):
Ratio of expenses to
average net
assets(1).............. 0.95% 0.95% 0.95% 0.95% 0.95%
Ratio of net investment
income to average net
assets(1).............. 4.69% 4.89% 3.92% 4.61% 3.12%
Portfolio Turnover(2)..... -- 17% -- 24% --
</TABLE>
(Continued)
4
<PAGE> 13
<TABLE>
<CAPTION>
LIFEPATH
2020 FUND LIFEPATH 2030 FUND LIFEPATH 2040 FUND
------------ ------------------------- -------------------------
SIX MONTHS SIX MONTHS
YEAR ENDED ENDED YEAR ENDED ENDED YEAR ENDED
FEBRUARY 28, AUGUST 31, FEBRUARY 28, AUGUST 31, FEBRUARY 28,
1995 1995 1995 1995 1995
------------ ----------- ------------ ----------- ------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net Asset Value, beginning
of period................ $ 10.00 $ 10.18 $ 10.00 $ 10.37 $ 10.00
-------- ------- -------- ------- --------
Income from investment
operations:
Net investment income.... 0.30 0.13 0.29 0.10 0.20
Net realized and
unrealized gain/(loss)
on investments......... 0.12 1.35 0.14 1.50 0.34
-------- ------- -------- ------- --------
Total from investment
operations............... 0.42 1.48 0.43 1.60 0.54
Less distributions:
Dividends from net
investment income...... (0.25) (0.13) (0.25) (0.10) (0.17)
Distributions from net
realized capital
gains.................. 0.00 0.00 0.00 0.00 0.00
-------- ------- -------- ------- --------
Total Distributions....... (0.25) (0.13) (0.25) (0.10) (0.17)
-------- ------- -------- ------- --------
Net Asset Value, end of
period................... $ 10.17 $ 11.53 $ 10.18 $ 11.87 $ 10.37
======== ======= ======== ======= ========
Total Return (not
annualized).............. 4.39% 14.63% 4.42% 15.48% 5.55%
Ratios/Supplemental Data:
Net assets, end of period
(000).................. $ 16,618 $17,319 $ 9,682 $20,765 $ 9,976
Number of shares
outstanding, end of
period (000)........... 1,634 1,502 951 1,749 962
Ratios to average net
assets (annualized):
Ratio of expenses to
average net
assets(1).............. 0.95% 0.95% 0.95% 0.95% 0.95%
Ratio of net investment
income to average net
assets(1).............. 3.88% 0.44% 3.59% 1.92% 2.61%
Portfolio Turnover(2)..... 28% -- 40% -- 5%
</TABLE>
- ---------------
(1) This ratio includes expenses charged to the Master Portfolio.
(2) The portfolio turnover rate represents activity by the Master Portfolio. For
the year ended February 28, 1995, this information was audited by Coopers &
Lybrand L.L.P., which served as MIP's independent auditors for the fiscal
year ended February 28, 1995.
5
<PAGE> 14
DESCRIPTION OF THE FUNDS
GENERAL
The Company is a "series fund," which is a mutual fund divided into
separate portfolios. Each portfolio is treated as a separate entity for certain
matters under the Investment Company Act of 1940, as amended (the "1940 Act"),
and for other purposes, and a shareholder of one portfolio is not deemed to be a
shareholder of any other portfolio. Each LifePath Fund is comprised of one class
of shares. By this Prospectus, five of the Company's portfolios are being
offered -- the LifePath 2000 Fund, LifePath 2010 Fund, LifePath 2020 Fund,
LifePath 2030 Fund and LifePath 2040 Fund, each of which is diversified. The
Company has established fourteen other portfolios that are not offered through
this Prospectus. From time to time, other portfolios may be established. See
"General Information."
MASTER/FEEDER STRUCTURE
Each Fund is a feeder fund in a master/feeder structure, which means it
invests all of its assets in a separate Master Portfolio of MIP with the same
investment objective as such Fund. See "Investment Objectives" and "Management
Policies" below. MIP is organized as a trust under the laws of the State of
Delaware. See "Management of the Funds." In addition to selling its interests to
a Fund, each Master Portfolio may sell its interests to certain other mutual
funds or other qualified investors. Information regarding additional options, if
any, for investment in interests of the Master Portfolio is available from
Stephens and may be obtained by calling 1-800-643-9691. The expenses and,
correspondingly, the returns of other investment options in MIP are expected to
differ from those of the Funds.
The Board of Directors believes that, if other investors invest their
assets in a Master Portfolio of MIP, certain economic efficiencies may be
realized with respect to such Master Portfolio. For example, fixed expenses that
otherwise would have been borne solely by a Fund would be spread across a larger
asset base provided by more than one fund investing in the Master Portfolio. The
Fund and other entities investing in that Master Portfolio will each be liable
for all obligations of the Master Portfolio. However, the risk of the Fund
incurring financial loss on account of such liability is limited to
circumstances in which both inadequate insurance exists and MIP itself is unable
to meet its obligations. Accordingly, the Company's Board of Directors believes
that none of the Funds nor their shareholders will be adversely affected by
reason of investing their assets in a Master Portfolio. However, if a mutual
fund or other investor withdraws its investment from a Master Portfolio, the
economic efficiencies
6
<PAGE> 15
(e.g., spreading fixed expenses across a larger asset base) that the Company's
Board believes should be available through investment in the Master Portfolio
may not be fully achieved or maintained. In addition, given the relatively novel
nature of the master/feeder structure, accounting and operational difficulties
could occur.
Each Master Portfolio's investment objective and other fundamental
policies, which are the same as those of the Fund bearing the corresponding
name, cannot be changed without approval by the holders of a majority (as
defined in the 1940 Act) of such Portfolio's outstanding voting interests.
Whenever a Fund, as a Master Portfolio interestholder, is requested to vote on
matters pertaining to any fundamental policy of such Master Portfolio, the Fund
will hold a meeting of its shareholders to consider such matters and such Fund
will cast its votes in proportion to the votes received from Fund shareholders.
A Fund will vote Master Portfolio interests for which it receives no voting
instructions in the same proportion as the votes received from Fund
shareholders. In addition, certain policies of the Master Portfolio which are
non-fundamental could be changed by vote of a majority of MIP's Trustees without
a vote of interestholders. If a Master Portfolio's investment objective or
fundamental or non-fundamental policies are changed, the Fund investing in that
Master Portfolio could subsequently change its objective or policies to
correspond to those of the Master Portfolio or the Fund could redeem its Master
Portfolio interests and either seek a new investment company with a matching
objective in which to invest or retain its own investment adviser to manage such
Fund's portfolio in accordance with its objective. In the latter case, the
Fund's inability to find a substitute investment company in which to invest or
equivalent management services could adversely affect shareholders' investments
in that Fund. A Fund will provide shareholders with 30 days' written notice
prior to the implementation of any change in a non-fundamental policy of such
Fund or Master Portfolio, to the extent possible.
RISK FACTORS
The net asset value and investment return of each LifePath Fund and
LifePath Master Portfolio are expected to fluctuate and are neither insured nor
guaranteed. To the extent that each LifePath Master Portfolio holds both equity
and fixed-income securities, it is subject to equity-market risk, as well as
credit- and interest-rate risks. Equity-market risk is the risk that common
stock prices will fluctuate or decline over short or even extended periods of
time. Credit risk is the risk that the issuer of a debt instrument is unable,
due to financial constraints, to make timely payments on its outstanding
obligations. Interest-rate risk is the risk that increases in market interest
rates may adversely affect the value of the debt instruments
7
<PAGE> 16
in which a Master Portfolio invests and hence the value of an investment in the
Master Portfolio. The value of debt instruments held by a Master Portfolio
generally changes inversely to changes in market interest rates. Investments in
foreign securities can expose the Master Portfolio to currency exchange risks
and other potentially adverse consequences associated with investing in
securities markets that are not as developed or efficient as those in the United
States. Certain investment techniques that may be used by the LifePath Master
Portfolios, such as investing in stock index options, futures contracts and
interest-rate swaps, present special risk considerations. See
"Appendix -- Investment Techniques." As with all mutual funds, there can be no
assurance that each Fund or Master Portfolio will achieve its investment
objective. This summary of risk factors is qualified by reference to more
detailed descriptions of the risks associated with an investment in the Funds,
as set forth under "Risk Considerations" below.
INVESTMENT OBJECTIVES
Each LifePath Fund seeks to provide long-term investors with an asset
allocation strategy designed to maximize assets for retirement or for other
purposes consistent with the quantitatively measured risk investors, on average,
may be willing to accept given their investment time horizons. Specifically:
- LifePath 2000 Fund is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2000.
- LifePath 2010 Fund is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2010.
- LifePath 2020 Fund is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2020.
- LifePath 2030 Fund is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2030.
- LifePath 2040 Fund is managed for investors planning to retire (or begin
to withdraw substantial portions of their investment) approximately in the year
2040.
Each Fund's investment objective cannot be changed without approval by the
holders of a majority (as defined in the 1940 Act) of such Fund's
8
<PAGE> 17
outstanding voting securities. Each Master Portfolio's investment objective,
which is the same as the corresponding Fund's, cannot be changed without
approval by the holders of a majority (as defined in the 1940 Act) of such
Master Portfolio's outstanding voting interests. Shareholders of a Fund that
invests in a Master Portfolio will be provided the opportunity to vote on any
proposed change to such Master Portfolio's investment objective, and that Fund
will vote on any such proposal in proportion to the votes received from Fund
shareholders. See "General" above. The differences in objectives and policies
among the Master Portfolios determine the types of portfolio securities in which
each Master Portfolio invests and can be expected to affect the degree of risk
to which each Master Portfolio and, therefore, the corresponding Fund is subject
and the yield or return of each Master Portfolio and Fund.
INTRODUCTION
Each Fund invests all of its assets in the Master Portfolio bearing the
corresponding name, which has the same investment objective as such Fund. A Fund
may withdraw its investment in the relevant Master Portfolio at any time,
provided that the Company's Board of Directors determines that it is in the best
interests of the Fund to do so. Upon any such withdrawal, the Company's Board of
Directors would consider what action should be taken, including investing all
such Fund's assets in another pooled investment entity having the same
investment objective as the Fund, or retaining an investment adviser to manage
such Fund's assets in accordance with the policies described below.
Since the investment characteristics of each Fund correspond directly with
those of the Master Portfolio bearing the corresponding name, the following is a
discussion of the management policies used by each Master Portfolio.
The LifePath Master Portfolios are a diversified series of asset allocation
funds designed for long-term investors. The LifePath Master Portfolios follow an
asset allocation strategy among three broad investment classes: equity and debt
securities of issuers located throughout the world and cash in the form of money
market instruments. Each LifePath Master Portfolio differs in the weighting
assigned to each such investment class, with a later-dated Master Portfolio
generally bearing more risk than an earlier-dated Master Portfolio, with the
expectation of greater total return. Thus, the investment class weightings of
the LifePath 2040 Master Portfolio initially might be 100%, 0% and 0% among
equity securities, debt securities and cash, respectively, while the weightings
of the LifePath 2000 Master Portfolio initially might be 25%, 50% and 25%,
respectively. Over
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the years, each LifePath Master Portfolio is managed more conservatively, on the
premise that individuals investing for retirement desire to reduce investment
risk in their retirement accounts as they age. The difference in such investment
class weightings is based on the statistically determined risk that such
investors, on average, may be willing to accept given their investment time
horizons in an effort to maximize assets in anticipation of retirement or for
other purposes.
Investors are encouraged to invest in a particular LifePath Fund based on
the decade of their anticipated retirement or when they anticipate beginning to
withdraw substantial portions of their accounts. For example, the LifePath 2000
Fund is designed for investors in their 50s and 60s who plan to retire (or begin
to withdraw substantial portions of their investment) in approximately 2000; the
LifePath 2010 Fund is designed for investors in their 40s and 50s who plan to
retire (or begin to withdraw as described above) in approximately 2010; and so
on. In addition, when making their investment decisions, investors could
consider evaluating their own risk profiles, recognizing, for example, that the
LifePath 2040 Fund is designed for investors with a high tolerance for risk
while the LifePath 2000 Fund is designed for investors with a low tolerance for
risk.
To manage the LifePath Master Portfolio, the Adviser employs a proprietary
investment model (the "Model") that analyzes extensive financial and economic
data, including risk correlation and expected return statistics, to recommend
the portfolio allocation among the investment classes described below. At its
simplest, for each point in time, the Model recommends a portfolio allocation
designed to maximize total return for each LifePath Master Portfolio based on
each such LifePath Master Portfolio's evolving risk profile. As a result, while
each LifePath Master Portfolio invests in substantially the same securities
within an investment class, the amount of each LifePath Master Portfolio's
aggregate assets invested in a particular investment class, and thus in
particular securities, differs, but the relative percentage that a particular
security comprises within an investment class ordinarily remains substantially
the same. As of October 31, 1995 asset allocations in the LifePath Master
Portfolios were approximately as follows:
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH LIFEPATH LIFEPATH
2040 2030 2020 2010 2000
MASTER MASTER MASTER MASTER MASTER
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Equity Securities........ 95.6% 81.5% 68.2% 49.9% 22.5%
Debt Securities.......... 3.3% 14.6% 25.2% 40.0% 6.3%
Cash..................... 1.1% 3.9% 6.6% 10.1% 21.2%
</TABLE>
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<PAGE> 19
The Adviser may in the future refine the Model, or the financial and
economic data analyzed by the Model, in ways that could result in changes to
recommended allocations.
The relative weightings for each LifePath Master Portfolio of the various
investment classes are expected to change over time, with the LifePath 2040
Master Portfolio adopting in the 2030s characteristics similar to the LifePath
2000 Master Portfolio today.
MANAGEMENT POLICIES
LifePath Master Portfolios. The LifePath Model contains both "strategic"
and "tactical" components, with the strategic component weighted more heavily
than the tactical component. The strategic component of the Model evaluates the
risk that investors, on average, may be willing to accept given their investment
time horizons. The strategic component thus determines the changing investment
risk level of each LifePath Master Portfolio as time passes. The tactical
component of the Model, on the other hand, addresses short-term market
conditions. The tactical component thus adjusts the amount of investment risk
taken by each LifePath Master Portfolio without regard to time horizon, but
rather in consideration of the relative risk-adjusted short-term attractiveness
of various asset classes.
Through the strategic and tactical components, the asset allocation
strategy contemplates shifts, which may be frequent, among a wide range of U.S.
and foreign investments and market sectors. Each LifePath Master Portfolio may
invest up to approximately 20% of the value of its total assets in foreign
securities that are not publicly traded in the United States. Rather than
choosing specific securities, the Adviser selects indices representing segments
of the global equity and debt markets and invests to create market exposure to
these market segments by purchasing representative samples of securities
comprising the indices in an attempt to replicate their performance. From time
to time, other indices may be selected in addition to, or as a substitute for,
any of the indices listed herein and market exposure may be broadened. Investors
will be notified of any such change.
The Adviser has broad latitude in selecting the class of investments and
the particular securities within a class in which each LifePath Master Portfolio
invests. No LifePath Master Portfolio is managed as a balanced portfolio nor is
it required to maintain a portion of its investments in each of its permitted
investment categories at all times. Until a LifePath Master Portfolio attains an
asset level of approximately $100 to $150 million, the Adviser will allocate
assets across fewer of the investment categories identified below than it
otherwise would. As a LifePath Master Portfolio
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<PAGE> 20
approaches this minimum asset level, the Adviser will add investment categories
from among those identified below, thereby approaching the desired investment
mix over time. Each LifePath Master Portfolio's investments is compared from
time to time to the Model's recommended allocation. Recommended reallocations
are implemented subject to the Adviser's assessment of current economic
conditions and investment opportunities. The Adviser may change from time to
time the criteria and methods it uses to implement the recommendations of the
Model. Any recommended reallocation is implemented in accordance with trading
policies designed to take advantage of market opportunities and reduce
transaction costs. The asset allocation mix selected is a primary determinant in
the respective LifePath Master Portfolio's investment performance.
The Adviser manages other portfolios which also invest in accordance with
the Model. The performance of each of those other portfolios is likely to vary
from the performance of each LifePath Master Portfolio and corresponding
LifePath Fund. Such variation in performance is primarily due to different
equilibrium asset-mix assumptions used for the various portfolios, timing
differences in the implementation of the Model's recommendations and differences
in expenses and liquidity requirements.
The LifePath Master Portfolio may invest in up to 17 asset classes,
including 10 stock classes, 6 bond classes and a money market class. Each
LifePath Master Portfolio invests in the classes of investments described below
in the following manner:
EQUITY SECURITIES -- The LifePath Master Portfolios seek U.S. equity
market exposure through the following indices of common stock:
- The S&P/BARRA Value Stock Index (consisting of primarily large-
capitalization U.S. stocks with lower-than-average price/book ratios).
- The S&P/BARRA Growth Stock Index (consisting of primarily
large-capitalization U.S. stocks with higher-than-average price/book
ratios).
- The Intermediate Capitalization Value Stock Index (consisting of
primarily medium-capitalization U.S. stocks with lower-than-average
price/book ratios).
- The Intermediate Capitalization Growth Stock Index (consisting of
primarily medium-capitalization U.S. stocks with higher-than-average
price/book ratios).
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<PAGE> 21
- The Intermediate Capitalization Utility Stock Index (consisting of
primarily medium-capitalization U.S. utility stocks).
- The Micro Capitalization Market Index (consisting of primarily
small-capitalization U.S. stocks).
- The Small Capitalization Value Stock Index (consisting of primarily
small-capitalization U.S. stocks with lower-than-average price/book
ratios).
- The Small Capitalization Growth Stock Index (consisting of primarily
small-capitalization U.S. stocks with higher-than-average price/book
ratios).
The LifePath Master Portfolios seek foreign equity market exposure
through the following indices of foreign equity securities:
- The Morgan Stanley Capital International (MSCI) Japan Index (consisting
of primarily large-capitalization Japanese stocks).
- The Morgan Stanley Capital International Europe, Australia, Far East
Index (MSCI EAFE) Ex-Japan Index (consisting of primarily
large-capitalization foreign stocks, excluding Japanese stocks).
In addition, each LifePath Master Portfolio may invest in other common
stocks, preferred stocks and convertible securities, including those in the
form of American, European and Continental Depositary Receipts, as well as
warrants to purchase such securities, and investment company securities.
See "Appendix -- Portfolio Securities."
DEBT SECURITIES -- The LifePath Master Portfolios seek U.S. debt market
exposure through the following indices of U.S. debt securities:
- The Lehman Brothers Long-Term Government Bond Index (consisting of all
U.S. Government bonds with maturities of at least ten years).
- The Lehman Brothers Intermediate-Term Government Bond Index (consisting
of all U.S. Government bonds with maturities of less than ten years and
greater than one year).
- The Lehman Brothers Long-Term Corporate Bond Index (consisting of all
U.S. investment-grade corporate bonds with maturities of at least ten
years).
- The Lehman Brothers Intermediate-Term Corporate Bond Index (consisting of
all U.S. investment-grade corporate bonds with maturities of less than
ten years and greater than one year).
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<PAGE> 22
- The Lehman Brothers Mortgage-Backed Securities Index (consisting of all
fixed-coupon mortgage pass-throughs issued by the Federal National
Mortgage Association, Government National Mortgage Association and
Federal Home Loan Mortgage Corporation with maturities greater than one
year).
The LifePath Master Portfolios seek foreign debt market exposure
through the following index of foreign debt securities:
- The Salomon Brothers Non-U.S. World Government Bond Index (consisting of
foreign government bonds with maturities of greater than one year).
Each U.S. and foreign debt security is expected to be part of an issuance
with a minimum outstanding amount at the time of purchase of approximately $50
million and $100 million, respectively. Each security in which a LifePath Master
Portfolio invests must be rated at least "Baa" by Moody's Investors Service,
Inc. ("Moody's"), or "BBB" by Standard & Poor's Corporation ("S&P"), Fitch
Investors Service, Inc. ("Fitch") or Duff & Phelps, Inc. ("Duff") or, if
unrated, deemed to be of comparable quality by the Adviser in accordance with
procedures approved by MIP's Board of Trustees. See "Risk
Considerations -- Fixed-Income Securities" below, and "Appendix" in the
Statement of Additional Information.
MONEY MARKET INSTRUMENTS -- The money market instrument portion of the
portfolio of each Master Portfolio generally is invested in high-quality money
market instruments, including U.S. Government obligations, obligations of
domestic and foreign banks, short-term corporate debt instruments and repurchase
agreements. See "Appendix" below for a more complete description of the money
market instruments in which each Master Series may invest.
INVESTMENT TECHNIQUES -- Each LifePath Master Portfolio also may lend its
portfolio securities and enter into transactions in certain derivatives, each of
which involves risk.
Derivatives are financial instruments whose values are derived, at least in
part, from the prices of other securities or specified assets, indices or rates.
The futures contracts and options on futures contracts that each Master
Portfolio may purchase are considered derivatives. Each Master Portfolio may use
some derivatives as part of its short-term liquidity holdings and/or as
substitutes for comparable market positions in the underlying securities. Also,
asset-backed securities issued or guaranteed by U.S. Government agencies or
instrumentalities and certain floating- and variable-rate instruments can be
considered derivatives. Some derivatives may be more sensitive than direct
securities to changes in interest rates or
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<PAGE> 23
sudden market moves. Some derivatives also may be susceptible to fluctuations in
yield or value due to their structure or contract terms.
The Adviser uses a variety of internal risk management procedures to ensure
that derivatives use is consistent with each Master Portfolio's investment
objective, does not expose either the Master Portfolio or, indirectly, the Fund
to undue risks and is closely monitored, including providing periodic reports to
the Board of Trustees or Board of Directors, as the case may be, concerning the
use of derivatives. Derivatives use also is subject to broadly applicable
investment policies. For example, in no case may a Master Portfolio invest more
than 15% of the current value of its assets in "illiquid securities," including
derivatives without active secondary markets, nor may a Master Portfolio use
derivatives to create leverage without establishing adequate "cover" in
compliance with Securities and Exchange Commission leverage rules. For more
information, see "Risk Considerations" below, and "Appendix -- Investment
Techniques."
CERTAIN FUNDAMENTAL POLICIES
Each Fund and Master Portfolio may (i) borrow money to the extent permitted
under the 1940 Act; (ii) invest up to 5% of its total assets in the obligations
of any single issuer, except that up to 25% of the value of the total assets of
such Fund or Master Portfolio may be invested, and obligations issued or
guaranteed by the U.S. Government, its agencies or instrumentalities may be
purchased, without regard to any such limitation; and (iii) invest up to 25% of
the value of its total assets in the securities of issuers in a particular
industry or group of closely related industries, provided there is no limitation
on the purchase of obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities. Each Fund, however, may invest all of its assets
in another registered investment company without violation of these fundamental
policies on diversification. This paragraph describes fundamental policies that
cannot be changed as to a Fund or Master Portfolio without approval by the
holders of a majority (as defined in the 1940 Act) of the outstanding voting
securities of such Fund or Master Portfolio, as the case may be. See "Investment
Objectives and Management Policies -- Investment Restrictions" in the Statement
of Additional Information.
CERTAIN ADDITIONAL NON-FUNDAMENTAL POLICIES
Each Fund and Master Portfolio may (i) purchase securities of any company
having less than three years' continuous operation (including operations of any
predecessors) if such purchase does not cause the value of its investments in
all such companies to exceed 5% of the value of its total assets; (ii) pledge,
hypothecate, mortgage or otherwise encumber its
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<PAGE> 24
assets, but only to secure permitted borrowings; and (iii) invest up to 15% of
the value of its net assets in repurchase agreements providing for settlement in
more than seven days after notice and in other illiquid securities. Although
each LifePath Fund and LifePath Master Portfolio reserves the right to invest up
to 15% of the value of its net assets in illiquid securities, including
repurchase agreements providing for settlement in more than seven days after
notice, as long as such Fund's shares are registered for sale in a state that
imposes a lower limit on the percentage of a fund's assets that may be so
invested, such LifePath Fund and LifePath Master Portfolio will comply with the
lower limit. Each LifePath Fund currently is limited to investing up to 10% of
the value of its net assets in such securities due to limits applicable in
several states. See "Investment Objectives and Management Policies -- Investment
Restrictions" in the Statement of Additional Information.
RISK CONSIDERATIONS
General -- Since the investment characteristics and, therefore, investment
risks directly associated with such characteristics of each LifePath Fund
correspond to those of the Master Portfolio in which such Fund invests, the
following is a discussion of the risks associated with an investment in the
Master Portfolio.
The net asset value per share of each LifePath Fund is not fixed and should
be expected to fluctuate.
Investment Techniques -- Each LifePath Master Portfolio may engage in
various investment techniques the use of which involves greater risk than that
incurred by other funds with similar investment objectives. See
"Appendix -- Investment Techniques." Using these techniques may affect the
degree to which a LifePath Master Portfolio's net asset value fluctuates.
Equity Securities -- Investors should be aware that equity securities
fluctuate in value, often based on factors unrelated to the value of the issuer
of the securities, and that fluctuations can be pronounced. Changes in the value
of a LifePath Master Portfolio's portfolio securities result in changes in the
value of such LifePath Master Portfolio's shares and thus the LifePath Master
Portfolio's yield and total return to investors.
The securities of the smaller companies in which each LifePath Master
Portfolio may invest may be subject to more abrupt or erratic market movements
than larger, more-established companies, both because the securities typically
are traded in lower volume and because the issuers
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<PAGE> 25
typically are subject to a greater degree to changes in earnings and prospects.
Fixed-Income Securities -- Investors should be aware that even though
interest-bearing securities are investments which promise a stable stream of
income, the prices of such securities are inversely affected by changes in
interest rates and, therefore, are subject to the risk of market price
fluctuations. Long-term securities are affected to a greater extent by interest
rates than shorter-term securities. The values of fixed-income securities also
may be affected by changes in the credit rating or financial condition of the
issuing entities. Once the rating of a portfolio security has been changed to a
rating below investment grade, the particular LifePath Master Portfolio
considers all circumstances deemed relevant in determining whether to continue
to hold the security. Certain securities that may be purchased by the LifePath
Master Portfolio, such as those rated "Baa" by Moody's and "BBB" by S&P, Fitch
and Duff, may be subject to such risk with respect to the issuing entity and to
greater market fluctuations than certain lower yielding, higher rated
fixed-income securities. Securities which are rated "Baa" by Moody's are
considered medium-grade obligations; they are neither highly protected nor
poorly secured, and are considered by Moody's to have speculative
characteristics. Securities rated "BBB" by S&P are regarded as having adequate
capacity to pay interest and repay principal, and, while such debt securities
ordinarily exhibit adequate protection parameters, adverse economic conditions
or changing circumstances are more likely to lead to a weakened capacity to pay
interest and repay principal for securities in this category than in higher
rated categories. Securities rated "BBB" by Fitch are considered investment
grade and of satisfactory credit quality; however, adverse changes in economic
conditions and circumstances are more likely to have an adverse impact on these
securities and, therefore, impair timely payment. Securities rated "BBB" by Duff
have below average protection factors but nonetheless are considered sufficient
for prudent investment. If a security held by a LifePath Master Portfolio is
downgraded to a rating below investment grade, such Master Portfolio may
continue to hold the security until such time as the Adviser determines it to be
advantageous for the LifePath Master Portfolio to sell the security. If such a
policy would cause a LifePath Master Portfolio to have 5% or more of its net
assets invested in securities that have been downgraded below investment grade,
the Master Portfolio promptly would seek to dispose of such securities in an
orderly manner. See "Appendix -- Portfolio Securities -- Ratings" and "Appendix"
in the Statement of Additional Information.
Foreign Securities -- Foreign securities markets generally are not as
developed or efficient as those in the United States. Securities of some
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<PAGE> 26
foreign issuers are less liquid and more volatile than securities of comparable
U.S. issuers. Similarly, volume and liquidity in most foreign securities markets
are less than in the United States, and, at times, volatility of price can be
greater than in the United States. In addition, there may be less publicly
available information about a non-U.S. issuer, and non-U.S. issuers generally
are not subject to uniform accounting and financial reporting standards,
practices and requirements comparable to those applicable to U.S. issuers. See
"Appendix -- Portfolio Securities -- Bank Obligations."
Because evidences of ownership of such securities usually are held outside
the United States, each Master Portfolio will be subject to additional risks
which include possible adverse political and economic developments, possible
seizure or nationalization of foreign deposits and possible adoption of
governmental restrictions which might adversely affect the payment of principal
and interest on the foreign securities or might restrict the payment of
principal and interest to investors located outside the country of the issuers,
whether from currency blockage or otherwise. Custodial expenses for a portfolio
of non-U.S. securities generally are higher than for a portfolio of U.S.
securities.
Since the LifePath Master Portfolios may purchase foreign securities in
currencies of foreign countries, the value of these assets as measured in U.S.
dollars may be affected favorably or unfavorably by changes in currency rates
and exchange control regulations. Some currency exchange costs generally are
incurred when a LifePath Master Portfolio changes investments from one country
to another.
Furthermore, some of these securities may be subject to brokerage or stamp
taxes levied by foreign governments, which have the effect of increasing the
cost of such investment and reducing the realized gain or increasing the
realized loss on such securities at the time of sale. Income received by a
Master Portfolio from sources within foreign countries may be reduced by
withholding and other taxes imposed by such countries. Tax conventions between
certain countries and the United States, however, may reduce or eliminate such
taxes. All such taxes paid by a Master Portfolio reduce its net income available
for distribution to its shareholders.
Foreign Currency Exchange -- Currency exchange rates may fluctuate
significantly over short periods of time. They generally are determined by the
forces of supply and demand in the foreign exchange markets and the relative
merits of investments in different countries, actual or perceived changes in
interest rates and other complex factors, as seen from an international
perspective. Currency exchange rates also can be affected
18
<PAGE> 27
unpredictably by the intervention of U.S. or foreign governments or central
banks, or by the failure to intervene, or by currency controls or political
developments in the United States or abroad. The LifePath Master Portfolios
intend to engage in foreign currency transactions to maintain the same foreign
currency exposure as the relevant foreign securities index through which the
Master Portfolios seek foreign equity market exposure, but not as part of a
defensive strategy to protect against fluctuations in exchange rates.
Foreign currency transactions may occur on a spot (i.e., cash) basis at the
rate prevailing in the currency exchange market or on a forward basis. A forward
currency exchange contract involves an obligation to purchase or sell a specific
currency at a set price on a future date which must be more than two days from
the date of the contract. The forward foreign currency market offers less
protection against default than is available when trading currencies on an
exchange, since a forward currency contract is not guaranteed by an exchange or
clearinghouse. Therefore, a default on a forward currency contract could deprive
a LifePath Master Portfolio of unrealized profits or force such Master Portfolio
to cover its commitments for purchase or resale, if any, at the current market
price.
Foreign Futures Transactions -- Unlike trading on domestic futures
exchanges, trading on foreign futures exchanges is not regulated by the
Commodity Futures Trading Commission (the "CFTC") and generally is subject to
greater risks than trading on domestic exchanges. For example, some foreign
exchanges are principal markets so that no common clearing facility exists and
an investor may look only to the broker for performance of the contract. The
Adviser, however, considers on an ongoing basis the creditworthiness of such
counterparties. In addition, any profits that a LifePath Master Portfolio might
realize in trading could be eliminated by adverse changes in the exchange rate;
adverse exchange rate changes also could cause a Master Portfolio to incur
losses. Transactions on foreign exchanges may include both futures contracts
which are traded on domestic exchanges and those which are not.
Other Investment Considerations -- Asset allocation and modeling strategies
are employed by the Adviser for other investment companies and accounts advised
or sub-advised by the Adviser. If these strategies indicate particular
securities should be purchased or sold, at the same time, by a LifePath Master
Portfolio and one or more of these investment companies or accounts, available
investments or opportunities for sales will be allocated equitably to each by
the Adviser. In some cases, this procedure may adversely affect the size of the
position obtained for or disposed of by a LifePath Master Portfolio or the price
paid or received by such LifePath Master Portfolio.
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<PAGE> 28
Under normal market conditions, the portfolio turnover rate for each
LifePath Master Portfolio is not expected to exceed 100%. A portfolio turnover
rate of 100% would occur, for example, if all of a LifePath Master Portfolio'
securities were replaced within one year. Higher portfolio turnover rates are
likely to result in comparatively greater brokerage commissions. In addition,
short-term gains realized from portfolio transactions are taxable to
shareholders as ordinary income. Portfolio turnover will not be a limiting
factor in making investment decisions.
MANAGEMENT OF THE FUNDS
GENERAL -- The Company has not retained the services of an investment
adviser because each Fund's assets are invested in a Master Portfolio that has
retained investment advisory services (see "Master Portfolio Investment Adviser"
below).
BOARD OF DIRECTORS -- The business and affairs of the Company are managed
under the direction of its Board of Directors. The Company's Directors are also
the Master Portfolio's Trustees. The Company's Directors also serve as the
Trustees of Stagecoach Trust, another open-end investment company whose LifePath
Fund series are wholly invested in the Master Portfolios. The Company's Board,
including a majority of the Directors who are not "interested persons" (as that
term is defined in the 1940 Act) of the Company, has adopted procedures to
address potential conflicts of interest that may arise as a result of the
structure of the Boards. See "Management of the Company" in the Statement of
Additional Information. The Statement of Additional Information also contains
the name and general business experience of each Director.
MASTER PORTFOLIO INVESTMENT ADVISER -- Wells Fargo Bank serves as
investment adviser and WFNIA serves as investment sub-adviser to the LifePath
Master Portfolios. On June 21, 1995, Wells Fargo & Co. and The Nikko Securities
Co., Ltd. signed a definitive agreement to sell their joint venture interest in
WFNIA to Barclays Bank PLC ("Barclays") or certain of its affiliates (the
"Acquisition"). The Acquisition, which is subject to the approval of the
appropriate regulatory authorities, is tentatively scheduled to close on or
about December 31, 1995. Wells Fargo Bank is a wholly owned subsidiary of Wells
Fargo & Company located at 420 Montgomery Street, San Francisco, California
94105. Wells Fargo Bank, one of the largest banks in the United States, was
founded in 1852 and is the oldest bank in the western United States. As of
September 30, 1995, various divisions and affiliates of Wells Fargo Bank
(including WFNIA) provided investment advisory services for approximately $239
billion of domestic and international assets of individuals, trusts, estates and
institutions.
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Pursuant to an Investment Advisory Agreement with MIP, which agreement would
terminate by its terms on the consummation of the Acquisition, Wells Fargo Bank
provides investment guidance and policy direction subject to the overall
authority of MIP's Board of Trustees and in conformity with Delaware law and the
stated policies of each Master Portfolio.
WFNIA, located at 45 Fremont Street, San Francisco, California 94105, is
engaged by Wells Fargo Bank to provide sub-investment advisory services to each
Master Portfolio. WFNIA is a general partnership owned 50% by a wholly owned
subsidiary of Wells Fargo Bank and 50% by a wholly owned subsidiary of The Nikko
Building Co., Ltd. WFNIA is responsible for managing or providing investment
advice for domestic and international assets aggregating approximately $205
billion as of September 30, 1995. Pursuant to a Sub-Investment Advisory
Agreement, which by its terms would terminate upon the consummation of the
Acquisition, WFNIA, subject to the supervision and approval of Wells Fargo Bank,
provides discretionary investment advisory services for each Master Portfolio's
assets, subject to the overall authority of MIP's Board of Trustees and in
conformity with Delaware law and the stated policies of such Master Portfolio.
Following the Acquisition and subject to the approval of the
interestholders of each Master Portfolio of MIP, BZWGI will be the investment
adviser to each Master Portfolio and the Master Portfolios will not retain a
sub-adviser. The Board of Trustees of MIP has approved the form of the
Investment Advisory Agreement with BZWGI. As a part of the Acquisition, WFNIA
will be merged into one of its current partners, will be renamed BZWGI, and will
become an indirect, wholly owned subsidiary of Barclays. BZWGI will be located
at 45 Fremont Street, San Francisco, California 94105 and will be each Master
Portfolio's investment adviser. Pursuant to Investment Advisory Agreements with
MIP, BZWGI will provide investment guidance and policy direction in connection
with the management of each Master Portfolio's assets, subject to the overall
authority of MIP's Board of Trustees and in conformity with Delaware law and the
stated policies of such Master Portfolio.
Under the terms of the Investment Advisory Agreements, MIP has agreed to
pay a monthly fee at the annual rate of 0.55% of each LifePath Master
Portfolio's average daily net assets. For the fiscal year ended February 28,
1995, MIP paid fees of 0.55% with respect to each LifePath Master Portfolio's
average daily net assets, respectively, to Wells Fargo Bank for advisory
services. Wells Fargo Bank, in turn, paid fees to WFNIA for sub-advisory
services. Each LifePath Fund will bear a pro rata portion of the fees paid by
the corresponding Master Portfolio.
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Barclays is one of the oldest and largest banking and financial services
institutions in the world, with approximately $264 billion in total assets as of
June 30, 1995. Barclays and its affiliates, including BZW Asset Management
("BZWAM"), have considerable experience in managing fund assets and had
approximately $35 billion in assets of quantitative funds under management, out
of approximately $86 billion of total assets under management as of June 30,
1995. In addition, BZWAM is part of the BZW Division of Barclays, which offers a
full range of investment banking, capital markets and asset management services.
Barclays intends to continue WFNIA's operations with the previous management,
investment professionals, and resources essentially intact.
Wells Fargo Bank, Barclays and their affiliates deal, trade and invest for
their own account in the types of securities in which the Master Portfolio may
invest and may have deposit, loan and commercial banking relationships with the
issuers of securities purchased by a Master Portfolio. WFNIA and BZWGI have each
informed MIP that in making investment decisions the Adviser does not obtain or
use material inside information in its possession.
Each Adviser has adopted a personal investment policy that is consistent
with the 1994 recommendations of the Investment Company Institute's Advisory
Group on Personal Investing (see the Statement of Additional Information).
ADMINISTRATOR AND DISTRIBUTOR -- Stephens, located at 111 Center Street,
Little Rock, Arkansas 72201, serves as the Company's administrator pursuant to
an Administration Agreement with the Company. Under the Administration
Agreement, Stephens generally supervises all aspects of the operation of the
Company other than providing investment advice, subject to the overall authority
of the Board of Directors. The administrative services provided to the LifePath
Funds also include coordination of the other services provided to the LifePath
Funds, compilation of information for reports to the Securities and Exchange
Commission and state securities commissions, preparation of proxy statements and
shareholder reports, and general supervision of data compilation in connection
with preparing periodic reports to the Company's Board of Directors and
officers. Stephens also furnishes office space and certain facilities to conduct
the Company's business and compensates the Company's Directors, officers and
employees who are affiliated with Stephens. In addition, except as noted below,
Stephens has assumed all ordinary expenses incurred by a LifePath Fund other
than the fees payable by such Fund pursuant to the Company's various service
contracts. For providing administrative services to the Company, the Company has
agreed to pay Steph-
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ens a monthly fee at the annual rate of 0.10% of each LifePath Fund's average
daily net assets.
Stephens also serves as the Company's principal underwriter within the
meaning of the 1940 Act and as distributor of each Fund's shares pursuant to a
Distribution Agreement with the Company. The Distribution Agreement provides
that Stephens acts as agent for the Company for the sale of Fund shares and may
enter into Selling Agreements with Selling Agents that wish to make available
shares of the Funds to their respective customers.
Financial institutions acting as Selling Agents, Shareholder Servicing
Agents, or in certain other capacities may be required to register as dealers
pursuant to applicable state securities laws which may differ from federal law
and any interpretations expressed herein.
Stephens is a full service broker/dealer and investment advisory firm.
Stephens and its predecessor have been providing securities and investment
services for more than 60 years, including discretionary portfolio management
services since 1983. Stephens currently manages investment portfolios for
pension and profit sharing plans, individual investors, foundations, insurance
companies and university endowments.
CUSTODIAN AND TRANSFER AGENT -- Wells Fargo Institutional Trust Company,
N.A. ("WFITC") serves as Custodian of MIP's Master Portfolios. WFITC, a wholly
owned subsidiary of WFNIA, is located at 45 Fremont Street, San Francisco,
California 94105. After the consummation of the Acquisition, BZW Global Trust
Company, N.A. ("BZWGTC") will serve as MIP's Custodian. BZWGTC also will be
located at 45 Fremont Street, San Francisco, California 94105. Neither WFITC nor
BZWGTC will receive a fee from MIP for such services. BZWGTC will be an
indirect, wholly owned subsidiary of Barclays and will be the parent of BZWGI.
WFITC also serves as the Custodian for the Funds, and, after the consummation of
the Acquisition, BZWGTC will serve as the Custodian for the Funds. Neither WFITC
nor BZWGTC receives compensation for providing such services.
Wells Fargo Bank serves as the Company's and MIP's transfer and dividend
disbursing agent (the "Transfer Agent"). The Company has agreed to pay Wells
Fargo Bank, which provides transfer agency services at 525 Market Street, San
Francisco, California 94105, a monthly fee at the annual rate of 0.10% of each
Fund's average daily net assets for transfer agency services. MIP pays no
additional fee for transfer and dividend disbursing agency services.
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<PAGE> 32
SHAREHOLDER SERVICING PLAN -- The Company has adopted a Shareholder
Servicing Plan pursuant to which it may enter into Shareholder Servicing
Agreements with certain financial institutions, securities dealers and other
industry professionals (collectively, "Shareholder Servicing Agents") for the
provision of certain services to Fund shareholders. The services provided may
include personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the Funds, providing reports and other
information, and providing services related to the maintenance of shareholder
accounts. For the services provided pursuant to a Shareholder Servicing
Agreement, the Company may pay each Shareholder Servicing Agent a monthly fee at
the annual rate of up to 0.20% of the average daily value of each LifePath
Fund's shares beneficially owned by customers of the Shareholder Servicing
Agent. The fee payable for such services is intended to be a "service fee" as
defined in Article III, Section 26 of the National Association of Securities
Dealers, Inc.'s Rules of Fair Practice. To date the Company has entered into a
Shareholder Servicing Agreement with Wells Fargo Bank.
The Company understands that a Shareholder Servicing Agent also may impose
certain conditions on its customers, subject to the terms of this Prospectus, in
addition to or different from those imposed by the Company, such as requiring a
minimum initial investment or payment of a separate fee for additional services.
Each Shareholder Servicing Agent is required to agree to disclose any fees it
may directly charge its customers who are Fund shareholders and to notify them
in writing at least 30 days before it imposes any transaction fees.
DISTRIBUTION PLAN -- As of December 31, 1995, Barclays and certain of its
affiliates are scheduled to consummate the Acquisition of WFNIA from Wells Fargo
Bank and others. As part of the purchase price for the Acquisition of WFNIA,
Barclays has agreed to make on-going payments to Wells Fargo Bank at an annual
rate of 0.15% of the aggregate net asset value of the interests in MIP's Master
Portfolios held by retail class shareholders of the LifePath Funds of Stagecoach
Trust. The on-going payments by Barclays to Wells Fargo Bank are part of the
purchase price for Barclays' Acquisition of WFNIA and are intended to compensate
Wells Fargo Bank for the economic loss to it resulting from Wells Fargo Bank's
no longer serving as the primary adviser to the LifePath Master Portfolios.
These payments are not compensation for any future services to be rendered by
Wells Fargo or its affiliates.
Under the rules of the Securities and Exchange Commission, a management
investment company may not engage, directly or indirectly, in financing any
activity that is primarily intended to result in the sale of
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<PAGE> 33
shares issued by such company unless a written plan describing all material
aspects of the financing and otherwise complying with Investment Company Act
Rule 12b-1 is in effect. As a precaution designed to address the possibility
that the on-going payments by Barclays to Wells Fargo Bank described above might
be characterized as payments to finance activities or services that are
primarily intended to result in the sale of interests in the Master Portfolios
of MIP, and that a corresponding amount of the advisory fees payable by the
Master Portfolios could be deemed to be indirect payments by the Master
Portfolios to finance those activities, MIP's Board of Trustees has adopted a
so-called "defensive" Rule 12b-1 Plan for each Master Portfolio of MIP (each, a
"Rule 12b-1 Plan"). Each Rule 12b-1 Plan provides that if any portion of the
advisory fee payable by the relevant Master Portfolio (up to 0.25% of the
average daily net assets of any LifePath Master Portfolio on an annual basis)
were deemed to constitute an indirect payment for activities or services that
are primarily intended to result in the sale of interests in such Master
Portfolio, the payment would be authorized pursuant to the Rule 12b-1 Plan. Each
Rule 12b-1 Plan also provides for quarterly written reports to be submitted to
the Board of Trustees of MIP and for annual consideration by MIP's Board of
Trustees in compliance with Rule 12b-1.
The 12b-1 Plans do not entail any payments by the Master Portfolios in
addition to the advisory fees currently payable and do not increase the fee
levels or other expenses of the Funds or the Master Portfolios. The 12b-1 Plans
are intended to provide additional protection in the event of a challenge to
advisory fee levels due to the on-going payments by Barclays to Wells Fargo
Bank.
EXPENSES -- Under the Administration Agreement, Stephens has agreed to
assume the operating expenses of each LifePath Fund and a pro rata share of the
operating expenses of each LifePath Master Portfolio, except for extraordinary
expenses and those fees and expenses payable pursuant to the various service
contracts described above which are borne by the Company and those expenses
specifically assumed by the Adviser under its contracts with the Funds. The
initial term of the Administration Agreement runs to October 25, 1996;
thereafter it continues for successive one-year periods, subject to approval by
the Company's Board of Directors. For the fiscal year ended February 28, 1995,
the operating expenses for the Institutional Class shares of the LifePath Funds
of Stagecoach Trust were 0.95% of the average daily net assets of the
Institutional Class shares of the respective LifePath Funds of Stagecoach Trust.
Stephens has not assumed the following operating expenses of the LifePath
Master Portfolios: advisory fees, interest, brokerage fees,
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<PAGE> 34
12b-1 fees and commissions, if any, costs of independent pricing services and
any extraordinary expenses.
Stephens has not assumed the following operating expenses of the LifePath
Funds: administration fees, Shareholder Servicing Agent fees, Transfer Agent
fees and expenses and any extraordinary expenses.
HOW TO BUY SHARES
GENERAL
Only the following types of investors are eligible to invest in the Funds:
- Participants in employee benefit plans, including retirement plans, that
have appointed one of the Company's Shareholder Servicing Agents as plan
trustee, plan administrator or other agent, or whose plan trustee, plan
administrator or other agent has a servicing arrangement with a
Shareholder Servicing Agent that permits investments in the Funds.
- Foundations, corporations and other business entities that have a
servicing arrangement with one of the Company's Shareholder Servicing
Agents that permits investments in the Funds and persons who invest
pursuant to an agreement between such an entity and a Shareholder
Servicing Agent.
- Individuals using proceeds which are being rolled over directly from a
qualified employee benefit plan to an Individual Retirement Account
("IRA") pursuant to arrangements between the sponsor or other agent of
the qualified employee benefit plan and a Shareholder Servicing Agent.
Eligible Investors may purchase shares of the Funds in one of the several
ways described below. For more information or additional forms, call
1-800-776-0179. The Company or Stephens may make the Prospectus available in an
electronic format. Upon receipt of a request by an investor or the investor's
representative, the Company or Stephens will transmit or cause to be transmitted
promptly, without charge, a paper copy of the electronic Prospectus.
The minimum initial investment is $100 by the AutoSaver Plan purchase
method (described below), and $1,000 by all other methods or for all other
investors, except that there is no minimum initial investment amount for
employee benefit plans ("Benefit Plans") or IRA investors. All subsequent
investments must be at least $100, except that there is no minimum subsequent
investment amount for Benefit Plans or IRA investors. All investments in a
Fund's shares are subject to a determination by
26
<PAGE> 35
the Company that the investment instructions are complete. If shares are
purchased by a check which does not clear, the Company reserves the right to
cancel the purchase and hold the investor responsible for any losses or fees
incurred. The Company reserves the right in its sole discretion to suspend the
availability of any Fund's shares and to reject any purchase requests.
Certificates for Fund shares are not issued.
Shares of each Fund may be purchased on any day the New York Stock Exchange
("NYSE") is open for business (a "Business Day") at the net asset value per
share next determined after an order in proper form is received by the Transfer
Agent. Net asset value per share is determined as of the close of regular
trading on the NYSE (currently 4:00 p.m., New York time), on each Business Day.
Currently, the weekdays on which the NYSE is closed are: New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day.
The net asset value of a share of the LifePath Funds is the value of total
net assets attributable to such Fund divided by the number of outstanding shares
of that Fund. The value of the net assets is determined daily by adjusting the
net assets per Fund at the beginning of the day by the value of each Fund's
shareholder activity, net investment income and net realized and unrealized
gains or losses for that day. Net investment income is calculated each day by
subtracting from each Fund's daily income a pro rata share of common expenses,
and by assigning fund-specific expenses to each Fund as appropriate. The net
asset value of each Fund is expected to fluctuate daily, is expected to differ,
and is based on the net asset value of the corresponding Master Portfolio in
which the LifePath Fund invests. The Master Portfolio's investments are valued
each Business Day generally by using available market quotations or at fair
value determined in good faith by the Adviser pursuant to guidelines approved by
MIP's Board of Trustees. For further information regarding the methods employed
in valuing each Master Portfolio's investments, see "Determination of Net Asset
Value" in the Statement of Additional Information.
Purchase orders that are received by the Transfer Agent before the close of
regular trading on the NYSE generally are executed on the same day. Orders
received by the Transfer Agent after the close of regular trading on the NYSE
are executed on the next Business Day. The investor's Shareholder Servicing
Agent is responsible for the prompt transmission of the investor's purchase
order to the Transfer Agent on the investor's behalf. Under certain
circumstances, a Shareholder Servicing Agent may establish an earlier deadline
for receipt of orders or an investor's
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<PAGE> 36
order transmitted to a Shareholder Servicing Agent may not be received by the
Transfer Agent on the same day.
Federal regulations require that an investor provide a certified taxpayer
identification number ("TIN") upon opening or reopening an account. See
"Dividends, Distributions and Taxes" for further information concerning this
requirement. Failure to furnish a certified TIN to the Company could subject the
investor to a $50 penalty imposed by the IRS.
BENEFIT PLANS
Shares of each Fund are offered to Benefit Plans that have appointed one of
the Company's Shareholder Servicing Agents as plan trustee, plan administrator
or other agent, or whose plan trustee, plan administrator or other agent has a
servicing arrangement with a Shareholder Servicing Agent that permits
investments in the Funds. Benefit Plans include 401(k) plans and other plans
qualified under Section 401(a) of the Internal Revenue Code of 1986, as amended
(the "Code"), health and welfare plans and executive deferred compensation
plans. For additional information about Benefit Plans that may be eligible to
invest in Fund shares, prospective investors should contact a Shareholder
Servicing Agent.
Fund investments by participants in 401(k) plans are typically made by
payroll deductions arranged between participants and their employers.
Participants in the MasterWorks program are included in this group. Participants
also may make direct contributions to their accounts in special circumstances
such as the transfer of a rollover amount from another 401(k) plan or from a
rollover IRA. Investors should contact their employer's benefits department for
more information about contribution methods.
IRAS, KEOGHS AND OTHER INDIVIDUAL RETIREMENT PLANS
An investor may be entitled to invest in a Fund's shares through a tax-
deferred retirement plan. In addition to offering investments through IRA
rollovers, a Shareholder Servicing Agent may offer other types of tax-deferred
or tax-advantaged plans, including a Keogh retirement plan for self-employed
professional persons, sole proprietors and partnerships. Investors should
contact a Shareholder Servicing Agent for materials describing available plans
and their benefits, provisions and fees.
Application materials for opening an IRA rollover, Keogh plan or other
individual retirement plan can be obtained from a Shareholder Servicing Agent.
Completed retirement plan applications should be returned to the investor's
Shareholder Servicing Agent for approval and processing. If an
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<PAGE> 37
investor's retirement plan application is incomplete or improperly filled out,
there may be a delay before the Fund account is opened. Certain features
described herein, such as the AutoSaver Plan, may not be available to
individuals or entities who invest through a retirement plan. Investors should
consult their Shareholder Servicing Agent.
PURCHASES BY ELIGIBLE INDIVIDUAL AND CORPORATE INVESTORS
Initial Purchases by Wire
1. Telephone toll free 1-800-776-0179. Give the name of the Fund in which
an investment is being made, and the name(s) in which the shares are to be
registered, address, TIN, amount to be wired, name of the wiring bank and name
and telephone number of the person to be contacted in connection with the order.
Some banks may impose wiring fees.
2. Instruct the wiring bank to transmit the specified amount in federal
funds ($1,000 or more) to:
Wells Fargo Bank, N.A.
San Francisco, California
Bank Routing Number: 121000248
Wire Purchase Account Number: 4068-000587
Attention: Stagecoach Inc. (Name of Fund)
Account Name(s): (name(s) in which to be registered)
Account Number: (if investing into an existing account)
3. A completed Account Application should be mailed, or sent by
telefacsimile with the original subsequently mailed, to the following address
immediately after the funds are wired and must be received and accepted by the
Transfer Agent before an account can be opened:
Wells Fargo Bank, N.A.
Stagecoach Shareholder Services
P.O. Box 7066
San Francisco, California 94120-7066
Telefacsimile: 1-415-543-9538
4. Share purchases are effected at the net asset value next determined
after the Account Application is received and accepted.
Initial Purchases by Mail
1. Complete an Account Application. Indicate the services to be used.
2. Mail the Account Application and a check for $1,000 or more, payable to
"Stagecoach Inc. (Name of Fund)," to the address above.
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AutoSaver Plan
The Company's AutoSaver Plan provides eligible individual and corporate
investors with a convenient way to establish and automatically add to a Fund
account on a monthly basis. To participate in the AutoSaver Plan, an investor
must specify an amount ($100 or more) to be withdrawn automatically by the
Transfer Agent on a monthly basis from an account with a bank, which is
designated in the investor's Account Application and which is approved by the
Transfer Agent ("Approved Bank"). Wells Fargo Bank is an Approved Bank. The
Transfer Agent withdraws and uses this amount to purchase Fund shares on the
investor's behalf on or about the fifth Business Day of each month. There are no
separate fees charged to the investor by the Company for participating in the
AutoSaver Plan.
An eligible individual or corporate investor may change an investment
amount, suspend purchases or terminate participation in the AutoSaver Plan at
any time by providing written notice to the Transfer Agent at least five
Business Days prior to any scheduled transaction. Participation in the AutoSaver
Plan is terminated automatically if the investor's Approved Bank account balance
is insufficient to make a scheduled withdrawal, or if either the investor's
Approved Bank account or Fund account is closed.
Additional Purchases
An eligible individual or corporate investor may make additional purchases
of $100 or more by instructing the Fund's Transfer Agent to debit a designated
Approved Bank account by wire by using the procedures described under "Initial
Purchases by Wire" above, or by mail with a check payable to "Stagecoach Inc.
(Name of Fund)" to the above address. An investor must write the Fund account
number on the check and include the detachable stub from the Statement of
Account or include a letter providing the Fund account number.
In-Kind Purchases
At the discretion of the Adviser, shares of a Fund may be purchased in
exchange for securities which are eligible for acquisition by the Master
Portfolio as described in this Prospectus. Securities to be exchanged which are
accepted by a Fund are valued in accordance with the procedures referenced under
"Share Value" in this Prospectus at the time of the next determination of net
asset value after such acceptance. Shares issued by a Fund in exchange for
securities are issued at net asset value determined as of the same time. All
dividends (with the exception of dividends received on securities tendered after
the ex-dividend date), interest, subscription, or other rights pertaining to
such securities shall become the property of the
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<PAGE> 39
Fund and must be delivered to the Fund by the investor upon receipt from the
issuer.
A Fund will only accept securities in exchange for shares issued by the
Fund if: (1) such securities are, at the time of the exchange, eligible to be
included in the Master Portfolio's portfolio and current market quotations are
readily available for such securities; (2) the investor represents and agrees
that all securities offered to be exchanged are not subject to any restrictions
upon their sale by the Fund under the Securities Act of 1933 or under the laws
of the country in which the principal market for such securities exists, or
otherwise; (3) the value of any such security (except U.S. Government
obligations) being exchanged together with other securities of the same issuer
owned by the Master Portfolio will not exceed 5% of the net assets of the Master
Portfolio immediately after the transaction; and (4) such securities are
consistent with the Fund's and the Master Portfolio's investment objection and
policies and otherwise acceptable to the Master Portfolio's Adviser, in its sole
discretion. The requirement for an investor representation described in item (2)
will not apply to the initial investment into the Fund by certain investors,
including employee benefit plans, as described below under "General
Information -- Description of the Company."
A gain or loss for federal income tax purposes may be realized by taxable
investors making in-kind purchases upon the exchange depending upon the cost of
the securities exchanged.
HOW TO REDEEM SHARES
GENERAL
Investors may redeem all or a portion of their shares on any Business Day
without any charge by the Company. The redemption price of the shares is the
next determined net asset value of shares of the relevant Fund calculated after
the Company has received a redemption request in proper form. Redemption
proceeds may be more or less than the amount invested depending on the relevant
Fund's net asset value of shares at the time of purchase and redemption.
The Company remits redemption proceeds from a Fund within seven days after
a redemption order is received in proper form, absent extraordinary
circumstances. Such extraordinary circumstances could include a period during
which an emergency exists as a result of which (a) disposal by the Master
Portfolio in which such Fund invests of securities owned by the Master Portfolio
is not reasonably practicable or (b) it is not reasonably practicable for the
Fund or the relevant Master Portfolio fairly to
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<PAGE> 40
determine the value of its net assets, or a period during which the Securities
and Exchange Commission by order permits deferral of redemptions for the
protection of Fund shareholders. In addition, the Company may defer payment of a
shareholder's redemption until reasonably satisfied that such shareholder's
investments made by check have been collected (which can take up to 15 days from
the purchase date). Payment of redemption proceeds may be made in portfolio
securities, subject to regulation by some state securities commissions.
Telephone redemption or exchange privileges are made available to
shareholders automatically upon opening an account, unless the shareholder
declines the privileges. These privileges authorize the Transfer Agent to act on
telephone instructions from any person representing himself or herself to be the
investor and reasonably believed by the Transfer Agent to be genuine. The
Company requires the Transfer Agent to employ reasonable procedures, such as
requiring a form of personal identification, to confirm that instructions are
genuine and, if it does not follow such procedures, the Company or the Transfer
Agent may be liable for any losses due to unauthorized or fraudulent
instructions. Neither the Company nor the Transfer Agent will be liable for
following telephone instructions reasonably believed to be genuine.
During times of drastic economic or market conditions investors may
experience difficulty in contacting the Transfer Agent by telephone to request a
redemption or exchange of Fund shares. In such cases, investors should consider
using the other redemption procedures made available to such investors. Use of
these other redemption procedures may result in the investor's redemption
request being processed at a later time than it would have been if telephone
redemption had been used. During the delay, a LifePath Fund's net asset value
may fluctuate.
Due to the high cost of maintaining Fund accounts with small balances, the
Company reserves the right to close an individual or corporate investor's
account and send the proceeds to such investor if the balance falls below $1,000
because of a redemption (including a redemption of Fund shares after an investor
has made only the $1,000 minimum initial investment). However, investors will be
given 30 days' notice to make an additional investment to increase their account
balance to $1,000 or more.
Redemption orders that are received by the Transfer Agent before the close
of trading on the NYSE generally are executed at the net asset value determined
as of the close of regular trading on the NYSE on that day. Redemption orders
that are received by the Transfer Agent after the close of trading on the NYSE
are executed on the next Business Day. The investor's Shareholder Servicing
Agent is responsible for the prompt
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transmission of redemption orders to the Fund on the investor's behalf. Under
certain circumstances, a Shareholder Servicing Agent may establish an earlier
deadline for receipt of orders or an investor's order transmitted to a
Shareholder Servicing Agent may not be received by the Transfer Agent on the
same day.
Unless the investor has made other arrangements with the Shareholder
Servicing Agent and the Transfer Agent has been informed of such arrangements,
proceeds of a redemption order made through the investor's Shareholder Servicing
Agent are credited to the account with the Approved Bank that the investor has
designated in the Account Application. If no such account is designated, a check
for the proceeds is mailed to the investor's address of record or, if such
address is no longer valid, the proceeds are credited to the investor's account
with the investor's Shareholder Servicing Agent.
BENEFIT PLANS, IRAS, KEOGHS AND OTHER INDIVIDUAL
RETIREMENT PLANS
Investors in these types of plans are subject to restrictions on
withdrawing their money under the Code. Each type of plan has established
withdrawal procedures that are disclosed to investors at the time of purchase.
Investors may obtain more information by contacting their employer and/or their
Shareholder Servicing Agent. The redemption procedures outlined in the remainder
of this section do not apply to investors in employee benefit plans or
retirement plans, nor do the minimum-balance requirements outlined above.
Investors in these types of plans should contact their Shareholder Servicing
Agent regarding redemption procedures applicable to them.
REDEMPTIONS BY ELIGIBLE INDIVIDUAL AND CORPORATE INVESTORS
Redemptions by Mail
1. Write a letter of instruction. Indicate the dollar amount or number of
Fund shares to be redeemed, the Fund account number and TIN.
2. Sign the letter in exactly the same way the account is registered. If
there is more than one owner of the shares, all owners must sign.
3. If shares to be redeemed have a value of $5,000 or more, or redemption
proceeds are to be paid to someone other than the investor at such investor's
address of record, the signature(s) must be guaranteed by an "eligible guarantor
institution," which generally includes a commercial bank whose deposits are
insured by the Federal Deposit Insurance Corporation ("FDIC") a trust company, a
member firm of a domestic stock
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<PAGE> 42
exchange, a savings association, or a credit union that is authorized by its
charter to provide a signature guarantee. Signature guarantees by notaries
public are not acceptable. Further documentation may be requested from
corporations, administrators, executors, personal representatives, trustees or
custodians.
4. Mail the redemption letter to the Transfer Agent at the mailing address
set forth under "How to Buy Shares -- Initial Purchases By Wire."
Unless other instructions are given in proper form, a check for the
redemption proceeds is sent to the investor's address of record.
Systematic Withdrawal Plan
The Systematic Withdrawal Plan provides an individual or corporate investor
with a convenient way to have Fund shares redeemed from the investor's account
and the proceeds distributed to the investor on a monthly basis. Participation
in the Systematic Withdrawal Plan is permitted if the investor has a Fund
account valued at $10,000 or more as of the date of the election to participate,
the investor has an account at an Approved Bank, dividends and capital gain
distributions are being reinvested automatically, and the investor is not
participating in the AutoSaver Plan at any time while participating in the
Systematic Withdrawal Plan. An investor may specify an amount ($100 or more) to
be distributed by check to the investor's address of record or deposited in the
Approved Bank account designated in the Account Application. The Transfer Agent
redeems sufficient shares and mails or deposits redemption proceeds as
instructed on or about the fifth Business Day prior to the end of each month.
There are no separate fees charged to investors by the Fund for participating in
the Systematic Withdrawal Plan.
An individual or corporate investor may change the withdrawal amount,
suspend withdrawals or terminate the election to participate in the Systematic
Withdrawal Plan at any time by providing written notice to the Transfer Agent at
least five Business Days prior to any scheduled transaction. An investor's
participation in the Systematic Withdrawal Plan will be terminated automatically
if the investor's Fund account balance is insufficient to make a scheduled
withdrawal or if the investor's Fund account or Approved Bank account is closed.
Expedited Redemptions by Letter and Telephone
An individual or corporate investor may request an expedited redemption of
Fund shares by letter, in which case the investor's receipt of redemption
proceeds, but not the Fund's receipt of the investor's redemp-
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tion request, would be expedited. Telephone redemption or exchange privileges
are made available to an investor automatically upon the opening of an account
unless the investor declines the privilege. The investor also may request an
expedited redemption of Fund shares by telephone on any Business Day, in which
case both the investor's receipt of redemption proceeds and the Fund's receipt
of the investor's redemption request would be expedited.
You may telephone an expedited redemption request to the Transfer Agent at
1-800-776-0179;
or:
You may mail an expedited redemption request to the Transfer Agent at the
mailing address set forth under "How to Buy Shares -- Initial Purchases by
Wire."
Upon request, proceeds of expedited redemptions of $5,000 or more are wired
or credited to the Approved Bank account designated in the Account Application.
The Company reserves the right to impose a charge for wiring redemption
proceeds. When proceeds of an investor's expedited redemption are to be paid to
someone else, to an address other than that of record, or to an account with an
Approved Bank that the investor has not predesignated in the Account
Application, the expedited redemption request must be made by letter and the
signature(s) on the letter must be guaranteed, regardless of the amount of the
redemption. If the individual or corporate investor's expedited redemption
request is received by the Transfer Agent on a Business Day, the investor's
redemption proceeds are transmitted to the investor's designated account with an
Approved Bank on the next Business Day (assuming the investor's investment check
has cleared as described above), absent extraordinary circumstances. Such
extraordinary circumstances could include those described above as potentially
delaying redemptions, and also could include situations involving an unusually
heavy volume of wire transfer orders on a national or regional basis or
communication or transmittal delays that could cause a brief delay in the wiring
or crediting of funds. A check for proceeds of less than $5,000 is mailed to the
investor's address of record or, at the investor's election, credited to the
Approved Bank account designated in the investor's Account Application.
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EXCHANGE PRIVILEGE
The exchange privilege enables an investor to purchase, in exchange for
shares of a Fund, shares of one of the other Funds offered by this Prospectus or
shares of a fund offered by the Company pursuant to another prospectus, to the
extent such shares are offered for sale in the investor's state of residence.
The exchange privilege may be expanded or modified in the future. Investors will
be notified of any such change. Before any exchange into a fund offered by
another prospectus, the investor must obtain and should review a copy of the
current prospectus of the fund into which the exchange is being made.
Prospectuses may be obtained from Stephens.
Shares are exchanged at the next determined net asset value; however, a
sales load may be charged with respect to exchanges into a fund sold with a
sales load. No fees currently are charged shareholders directly in connection
with exchanges although the Company reserves the right, upon not less than 60
days' written notice, to charge shareholders a nominal exchange fee in
accordance with rules promulgated by the Securities and Exchange Commission. The
Company reserves the right to limit the number of times shares may be exchanged
and to reject in whole or in part any exchange request into a Fund when
management believes that such action would be in the best interests of the
Fund's other shareholders, such as when management believes such action would be
appropriate to protect such Fund against disruptions in portfolio management
resulting from frequent transactions by those seeking to time market
fluctuations. Any such rejection will be made by management on a prospective
basis only, upon notice to the shareholder given not later than 10 days
following such shareholder's most recent exchange. The exchange privilege may be
modified or terminated at any time upon 60 days' written notice to shareholders.
The exchange of shares of one Fund for shares of another is treated for
federal income tax purposes as a sale of the shares given in exchange by the
shareholder and, therefore, an exchanging shareholder may realize a taxable gain
or loss.
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DIVIDENDS, DISTRIBUTIONS AND TAXES
Each Fund declares and pays dividends from net investment income quarterly.
Each Fund makes distributions from any net realized capital gains once a year,
but may make distributions on a more frequent basis to comply with the
distribution requirements of the Code, in all events in a manner consistent with
the provisions of the 1940 Act. No Fund will make distributions from net
realized capital gains unless capital loss carryovers, if any, have been
utilized or have expired. Dividends are automatically reinvested in additional
Fund shares at net asset value, unless payment in cash has been requested.
Dividends and capital gain distributions have the effect of reducing the
net asset value per share by the amount distributed on the record date. Although
a distribution paid to an investor on newly issued shares shortly after purchase
would represent, in substance, a return of capital, the distribution may consist
of net investment income and, if so, would be taxable to the investor as
ordinary income.
Dividends paid by a Fund derived from net investment income and
distributions from any net realized short-term capital gains of such Fund
generally are taxable to taxable U.S. investors as ordinary income, whether or
not reinvested in additional Fund shares. Distributions from any net realized
long-term capital gains generally are taxable to taxable U.S. investors as
long-term capital gains for federal income tax purposes, regardless of how long
shareholders have held their shares and whether such distributions are received
in cash or reinvested in additional Fund shares. The Code provides that the net
capital gains of an individual generally will not be subject to federal income
tax at a rate in excess of 28%.
Dividends derived from net investment income and distributions from net
realized short-term capital gains paid by a Fund to a foreign investor generally
are subject to U.S. nonresident withholding taxes at the rate of 30%, unless the
foreign investor claims the benefits of a lower rate specified in a tax treaty.
Distributions from net realized long-term capital gains paid by a Fund to a
foreign investor, as well as the proceeds of any redemptions from a foreign
investor's Fund account, regardless of the extent to which gain or loss may be
realized, will not be subject to U.S. nonresident withholding tax. However, such
distributions may be subject to backup withholding, as described below, unless
the foreign investor certifies a non-U.S. residency status.
Notice as to the tax status of an investor's dividends and distributions
will be mailed to such investor annually. Each investor also will receive
periodic summaries of such investor's account which will include informa-
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tion as to dividends and distributions from securities gains, if any, paid
during the year.
If a shareholder fails to certify either that the TIN furnished in
connection with opening an account is correct or that such shareholder has not
received notice from the IRS of being subject to backup withholding as a result
of a failure to properly report taxable dividend or interest income on a federal
income tax return, federal regulations generally require the Company to withhold
("backup withholding") and remit to the U.S. Treasury 31% of dividends,
distributions from net realized securities gains and the proceeds of any
redemption, regardless of the extent to which gain or loss may be realized, paid
to such shareholder. Furthermore, the IRS may notify the Company to institute
backup withholding if the IRS determines a shareholder's TIN is incorrect or if
a shareholder has failed to properly report taxable dividend and interest income
on a federal income tax return.
A TIN is either the social security number or employer identification
number of the record owner of the account. Any tax withheld as a result of
backup withholding does not constitute an additional tax imposed on the record
owner of the account, and may be claimed as a credit on the record owner's
federal income tax return.
MIP is organized as a trust under Delaware law. Under MIP's method of
operation as a partnership, MIP and each Master Portfolio is not subject to any
income tax. However, each investor in a Master Portfolio is allocated its share
(as determined in accordance with the governing instruments of the Master
Portfolio) of such Master Portfolio's ordinary income and capital gain in
determining its income tax liability. The determination of such share will be
made in accordance with the Code and regulations promulgated thereunder.
It is expected that each Fund will qualify as a "regulated investment
company" under the Code so long as such qualification is in the best interests
of its shareholders. Such qualification relieves the Fund of any liability for
federal income tax to the extent its earnings are distributed in accordance with
applicable provisions of the Code. In addition, each Fund is subject to a
non-deductible 4% excise tax, measured with respect to certain undistributed
amounts of taxable investment income and capital gains.
The foregoing discussion regarding dividends, distributions, and taxes is
based on tax laws and regulations which were in effect as of the date of this
Prospectus and summarizes only some of the important federal tax considerations
generally affecting a Fund and its shareholders. It is not
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intended as a substitute for careful tax planning; investors should consult
their tax advisors with respect to their specific tax situations as well as with
respect to state and local taxes. Further tax information is contained in the
Statement of Additional Information.
PERFORMANCE INFORMATION
For purposes of advertising, performance of the LifePath Funds may be
calculated on the basis of average annual total return and/or cumulative total
return of shares. Average annual total return of shares is calculated pursuant
to a standardized formula which assumes that an investment in shares of the Fund
was purchased with an initial payment of $1,000 and that the investment was
redeemed at the end of a stated period of time, after giving effect to the
reinvestment of dividends and distributions during the period. The return of
shares is expressed as a percentage rate which, if applied on a compounded
annual basis, would result in the redeemable value of the investment in shares
at the end of the period. Advertisements of the performance of shares of a
LifePath Fund includes the Fund's average annual total return of shares for one,
five and ten year periods, or for shorter time periods depending upon the length
of time during which such Fund has operated.
Cumulative total return of shares is computed on a per share basis and
assumes the reinvestment of dividends and distributions. Cumulative total return
of shares generally is expressed as a percentage rate which is calculated by
combining the income and principal changes for a specified period and dividing
by the net asset value per share at the beginning of the period. Advertisements
may include the percentage rate of total return of shares or may include the
value of a hypothetical investment in shares at the end of the period which
assumes the application of the percentage rate of total return.
Performance of shares varies from time to time, and past results are not
necessarily representative of future results. Investors should remember that
performance is a function of the type and quality of portfolio securities held
by the Master Portfolio in which the Fund invests and is affected by operating
expenses. Performance information, such as that described above, may not provide
a basis for comparison with other investments or other investment companies
using a different method of calculating performance.
Comparative performance information may be used from time to time in
advertising or marketing a Fund's shares, including data from Lipper Analytical
Services, Inc., Bank Rate Monitor, Bond Buyer 20-Year Bond
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<PAGE> 48
Index, Moody's Bond Survey Bond Index, Lehman Brothers Aggregate Bond Index and
components thereof, IBC/Donoghue's Money Fund Report, Standard & Poor's 500
Stock Index, Wilshire 5000 Index, the Dow Jones Industrial Average, CDA
Investment Technologies, Inc., Wiesenberger Investment Companies Service, Mutual
Fund Values; Mutual Fund Forecaster, Schabacker Investment Management, Inc.,
Morningstar, Inc. and other industry publications.
Additional information about the performance of each Fund will be contained
in the Annual Report for each Fund. The Annual Reports may be obtained by
calling the Company at 1-800-776-0179.
GENERAL INFORMATION
The Funds are five new portfolios among the portfolios that the Company is
currently authorized to issue. The Company was organized as a Maryland
corporation on October 15, 1992, and currently includes the following fourteen
other portfolios: Asset Allocation Fund, S&P 500 Stock Fund, Growth Stock Fund,
U.S. Treasury Allocation Fund, Bond Index Fund, Money Market Fund, Growth and
Income Fund, National Tax-Free Intermediate Income Fund, National Tax-Free Money
Market Mutual Fund, California Tax-Free Intermediate Income Fund, California
Tax-Free Short-Term Income Fund, California Tax-Free Money Market Fund,
Short-Intermediate Term Fund and Overland National Tax-Free Institutional Money
Market Fund. Each LifePath Fund of the Company is composed of one class of
shares and each share has one vote. The Company is authorized to issue an
unlimited number of shares. The Company's principal office is located at 111
Center Street, Little Rock, Arkansas 72201.
The Board of Directors of the Company supervises the Funds' activities and
monitors the Funds' contractual arrangements with various service providers.
Additional information about the Directors and officers of the company is
included in the Funds' SAIs under "Management." A Fund may withdraw its
investment in a Master Portfolio only if the Board of Directors of the Company
determines that it is in the best interests of the Fund and its shareholders to
do so. Upon any such withdrawal, the Board of Directors of the Company would
consider what action might be taken, including the investment of all the assets
of the Fund in another pooled investment entity having the same investment
objective as the Fund or the hiring of an investment adviser to manage the
Fund's assets in accordance with the investment policies described above with
respect to the Master Portfolio. Although the Company is not required to hold
regular annual shareholder meetings, occasional annual or special meetings may
be re-
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<PAGE> 49
quired for purposes such as electing or removing Directors, approving
advisory contracts and changing a Fund's investment objective or fundamental
investment policies.
Under a License Agreement with the Company, Wells Fargo Bank has granted
the Company a non-exclusive license to use the name "Stagecoach". It is
anticipated that subsequent to the consummation of the Acquisition of WFNIA, the
current sub-adviser to each Master Portfolio, the Company's name will be changed
to distinguish more clearly the Company and its Funds from the Stagecoach Family
of Funds and Stagecoach Trust's LifePath Funds. Under a License Agreement, WFNIA
has granted, and BZWGI will grant, the Company a non-exclusive license to use
the name "LifePath". If the License Agreement is terminated, the Company, at the
request of Wells Fargo Bank or BZWGI, will cease using the applicable name(s).
The Transfer Agent maintains a record of each investor's ownership and
sends confirmations and statements of account.
Investor inquiries may be made by writing to the Company at the address
shown on the front cover or by calling the appropriate telephone number.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND IN THE
COMPANY'S OFFICIAL SALES LITERATURE IN CONNECTION WITH THE OFFER OF THE FUNDS'
SHARES AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH, OR TO ANY PERSON TO WHOM, SUCH
OFFERING MAY NOT LAWFULLY BE MADE.
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APPENDIX
PORTFOLIO SECURITIES
To the extent set forth in this Prospectus, each Fund through its
investment in the corresponding Master Series may invest in the securities
described below.
U.S. GOVERNMENT OBLIGATIONS -- U.S. Government obligations include
securities issued or guaranteed as to principal and interest by the U.S.
Government and supported by the full faith and credit of the U.S. Treasury. U.S.
Treasury obligations differ mainly in the length of their maturity. Treasury
bills, the most frequently issued marketable government securities, have a
maturity of up to one year and are issued on a discount basis. U.S. Government
obligations also include securities issued or guaranteed by federal agencies or
instrumentalities, including government-sponsored enterprises. Some obligations
of agencies or instrumentalities of the U.S. Government are supported by the
full faith and credit of the United States or U.S. Treasury guarantees; others,
by the right of the issuer or guarantor to borrow from the U.S. Treasury; still
others by the discretionary authority of the U.S. Government to purchase certain
obligations of the agency or instrumentality; and others, only by the credit of
the agency or instrumentality issuing the obligation. In the case of obligations
not backed by the full faith and credit of the United States, the investor must
look principally to the agency or instrumentality issuing or guaranteeing the
obligation for ultimate repayment, which agency or instrumentality may be
privately owned. There can be no assurance that the U.S. Government would
provide financial support to its agencies or instrumentalities where it is not
obligated to do so. In addition, U.S. Government obligations are subject to
fluctuations in market value due to fluctuations in market interest rates. As a
general matter, the value of debt instruments, including U.S. Government
obligations, declines when market interest rates increase and rises when market
interest rates decrease. Certain types of U.S. Government obligations are
subject to fluctuations in yield or value due to their structure or contract
terms.
FOREIGN GOVERNMENT OBLIGATIONS; SECURITIES OF SUPRANATIONAL
ENTITIES -- Each Master Portfolio, through its investment in money market
instruments, may invest in obligations issued or guaranteed by one or more
foreign governments or any of their political subdivisions, agencies or
instrumentalities that are determined by the Adviser to be of comparable quality
to the other obligations in which such Master Portfolio may invest. Such
securities also include debt obligations of supranational entities.
Supranational entities include international organizations designated or
supported by governmental entities to promote economic reconstruction or
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development and international banking institutions and related government
agencies. Examples include the International Bank for Reconstruction and
Development (the World Bank), the European Coal and Steel Community, the Asian
Development Bank and the InterAmerican Development Bank. The percentage of a
Master Portfolio's assets invested in securities issued by foreign governments
varies depending on the relative yields of such securities, the economic and
financial markets of the countries in which the investments are made and the
interest rate climate of such countries.
BANK OBLIGATIONS -- Each Master Portfolio may invest in bank obligations,
including certificates of deposit, time deposits, bankers' acceptances and other
short-term obligations of domestic banks, foreign subsidiaries of domestic
banks, foreign branches of domestic banks, and domestic and foreign branches of
foreign banks, domestic savings and loan associations and other banking
institutions. With respect to such securities issued by foreign branches of
domestic banks, foreign subsidiaries of domestic banks, and domestic and foreign
branches of foreign banks, a Master Portfolio may be subject to additional
investment risks that are different in some respects from those incurred by a
fund which invests only in debt obligations of U.S. domestic issuers. Such risks
include possible future political and economic developments, the possible
imposition of foreign withholding taxes on interest income payable on the
securities, the possible establishment of exchange controls or the adoption of
other foreign governmental restrictions which might adversely affect the payment
of principal and interest on these securities and the possible seizure or
nationalization of foreign deposits.
Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified period of
time.
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate. Time
deposits which may be held by a Master Portfolio will not benefit from insurance
from the Bank Insurance Fund or the Savings Association Insurance Fund
administered by the FDIC.
Bankers' acceptances are credit instruments evidencing the obligation of a
bank to pay a draft drawn on it by a customer. These instruments reflect the
obligation both of the bank and of the drawer to pay the face amount of the
instrument upon maturity. The other short-term obligations may include
uninsured, direct obligations, bearing fixed, floating or variable interest
rates.
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COMMERCIAL PAPER AND OTHER SHORT-TERM CORPORATE OBLIGATIONS -- Each Master
Portfolio may invest in commercial paper, which consists of short-term,
unsecured promissory notes issued to finance short-term credit needs. The
commercial paper purchased by a LifePath Master Portfolio consists only of
direct obligations which, at the time of their purchase, are (a) rated not lower
than Prime-1 by Moody's, A-1 by S&P, F-1 by Fitch or Duff-1 by Duff, (b) issued
by companies having an outstanding unsecured debt issue currently rated not
lower than Aa3 by Moody's or AA- by S&P, Fitch or Duff, or (c) if unrated,
determined by BZW to be of comparable quality to those rated obligations which
may be purchased by such Master Portfolio.
REPURCHASE AGREEMENTS -- Each Master Portfolio may enter into repurchase
agreements, which involve the acquisition by a Master Portfolio of an underlying
debt instrument, subject to an obligation of the seller to repurchase, and such
Master Portfolio to resell, the instrument at a fixed price usually not more
than one week after its purchase. MIP's custodian or sub-custodian will have
custody of, and will hold in a segregated account, securities acquired by a
Master Portfolio under a repurchase agreement. Repurchase agreements are
considered by the staff of the Securities and Exchange Commission to be loans by
the Master Portfolio entering into them. In an attempt to reduce the risk of
incurring a loss on a repurchase agreement, each Master Portfolio enters into
repurchase agreements only with federally regulated or insured banks or primary
government securities dealers reporting to the Federal Reserve Bank of New York
or their affiliates, or, under certain circumstances, banks with total assets in
excess of $5 billion or domestic broker/dealers with total equity capital in
excess of $100 million, with respect to securities of the type in which such
Master Portfolio may invest or government securities regardless of their
remaining maturities, and requires that additional securities be deposited with
it if the value of the securities purchased should decrease below repurchase
price. The Adviser monitors on an ongoing basis the value of the collateral to
assure that it always equals or exceeds the repurchase price. Certain costs may
be incurred by a Master Portfolio in connection with the sale of the securities
if the seller does not repurchase them in accordance with the repurchase
agreement. In addition, if bankruptcy proceedings are commenced with respect to
the seller of the securities, realization on the securities by a Master
Portfolio may be delayed or limited. Each Master Portfolio considers on an
ongoing basis the creditworthiness of the institutions with which it enters into
repurchase agreements.
UNREGISTERED NOTES -- Each Master Portfolio may purchase unsecured
promissory notes ("Notes") which are not readily marketable and have not been
registered under the Securities Act of 1933, as amended (the
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"1933 Act"), provided such investments are consistent with such Master
Portfolio's goal. No Master Portfolio invests more than 15% of the value of its
net assets in Notes and in other illiquid securities.
FLOATING- AND VARIABLE-RATE OBLIGATIONS -- Each Master Portfolio may
purchase floating- and variable-rate demand notes and bonds, which are
obligations ordinarily having stated maturities in excess of 13 months, but
which permit the holder to demand payment of principal at any time or at
specified intervals not exceeding 13 months. Variable-rate demand notes include
master demand notes which are obligations that permit a Master Portfolio to
invest fluctuating amounts, which may change daily without penalty, pursuant to
direct arrangements between the Master Portfolio, as lender, and the borrower.
The interest rates on these notes fluctuate from time to time. The issuer of
such obligations ordinarily has a corresponding right, after a given period, to
prepay in its discretion the outstanding principal amount of the obligations
plus accrued interest upon a specified number of days' notice to the holders of
such obligations. The interest rate on a floating-rate demand obligation is
based on a known lending rate, such as a bank's prime rate, and is adjusted
automatically each time such rate is adjusted. The interest rate on a
variable-rate demand obligation is adjusted automatically at specified
intervals. Frequently, such obligations are secured by letters of credit or
other credit support arrangements provided by banks. Because these obligations
are direct lending arrangements between the lender and borrower, it is not
contemplated that such instruments generally will be traded. There generally is
no established secondary market for these obligations, although they are
redeemable at face value. Accordingly, where these obligations are not secured
by letters of credit or other credit support arrangements, the Master
Portfolio's right to redeem is dependent on the ability of the borrower to pay
principal and interest on demand. Such obligations frequently are not rated by
credit rating agencies and each Master Portfolio may invest in obligations which
are not so rated only if the Adviser determines that at the time of investment
the obligations are of comparable quality to the other obligations in which such
Master Portfolio may invest. The Adviser, on behalf of each Master Portfolio,
considers on an ongoing basis the creditworthiness of the issuers of the
floating- and variable-rate demand obligations in such Master Portfolio's
portfolio. No Master Portfolio invests more than 15% of the value of its net
assets in illiquid securities including floating- or variable-rate demand
obligations as to which it cannot exercise the demand feature on not more than
seven days' notice if there is no secondary market available for these
obligations.
PARTICIPATION INTERESTS -- Each Master Portfolio may purchase from
financial institutions participation interests in securities in which
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such Master Portfolio may invest. A participation interest gives the Master
Portfolio an undivided interest in the security in the proportion that the
Master Portfolio's participation interest bears to the total principal amount of
the security. These instruments may have fixed, floating or variable rates of
interest. If the participation interest is unrated, or has been given a rating
below that which is permissible for purchase by the Master Portfolio, the
participation interest must be backed by an irrevocable letter of credit or
guarantee of a bank, or the payment obligation otherwise must be collateralized
by U.S. Government obligations, or, in the case of unrated participation
interests, the Adviser must have determined that the instrument is of comparable
quality to those instruments in which such Master Series may invest. Prior to a
Master Portfolio's purchase of any such instrument backed by a letter of credit
or guarantee of a bank, the Adviser evaluates the creditworthiness of the bank,
considering all factors which it deems relevant, which generally may include
review of the bank's cash flow; level of short-term debt; leverage;
capitalization; the quality and depth of management; profitability; return on
assets; and economic factors relative to the banking industry. For certain
participation interests, the Master Portfolio has the right to demand payment,
on not more than seven days' notice, for all or any part of the Master
Portfolio's participation interest in the security, plus accrued interest. As to
these instruments, each Master Portfolio intends to exercise its right to demand
payment only upon a default under the terms of the security, as needed to
provide liquidity to meet redemptions, or to maintain or improve the quality of
its investment portfolio.
MORTGAGE-RELATED SECURITIES -- Each LifePath Master Portfolio may invest in
mortgage-related securities ("MBSs"), which are securities representing
interests in a pool of loans secured by mortgages. The resulting cash flow from
these mortgages is used to pay principal and interest on the securities. MBSs
are assembled for sale to investors by various government-sponsored enterprises
such as the Federal National Mortgage Association ("FNMA") and the Federal Home
Loan Mortgage Corporation ("FHLMC") or are guaranteed by such governmental
agencies as the Government National Mortgage Association ("GNMA"). Regardless of
the type of guarantee, all MBSs are subject to interest rate risk (i.e.,
exposure to loss due to changes in interest rates).
GNMA MBSs include GNMA Mortgage Pass-Through Certificates (also known as
"Ginnie Maes") which are guaranteed as to the full and timely payment of
principal and interest by GNMA and such guarantee is backed by the authority of
GNMA to borrow funds from the U.S. Treasury to make payments under its
guarantee. GNMA is a wholly-owned U.S. Government corporation within the
Department of Housing and
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Urban Development and, as such, GNMA obligations are general obligations of the
United States and are backed by the full faith and credit of the federal
government. In contrast, MBSs issued by FNMA include FNMA Guaranteed Mortgage
Pass-Through Certificates (also known as "Fannie Maes") which are solely the
obligations of FNMA and are neither backed by nor entitled to the full faith and
credit of the United States. FNMA is a government-sponsored enterprise which is
also a private corporation whose stock trades on the NYSE. Fannie Maes are
guaranteed as to timely payment of principal and interest by FNMA. MBSs issued
by FHLMC include FHLMC Mortgage Participation Certificates (also known as
"Freddie Macs" or "PCs"). FHLMC is a government-sponsored enterprise whose MBSs
are solely obligations of FHLMC. Therefore, Freddie Macs are not guaranteed by
the United States or by any Federal Home Loan Bank and do not constitute a debt
or obligation of the United States or of any Federal Home Loan Bank. FHLMC
guarantees timely payment of interest, but only ultimate payment of principal
due under the obligations it issues. FHLMC may, under certain circumstances,
remit the guaranteed payment of principal at any time after default on an
underlying mortgage, but in no event later than one year after the guarantee
becomes payable.
AMERICAN, EUROPEAN AND CONTINENTAL DEPOSITORY RECEIPTS -- Each LifePath
Master Portfolio's assets may be invested in the securities of foreign issuers
in the form of American Depository Receipts ("ADRs") and European Depository
Receipts ("EDRs"). These securities may not necessarily be denominated in the
same currency as the securities into which they may be converted. ADRs are
receipts typically issued by a United States bank or trust company which
evidence ownership of underlying securities issued by a foreign corporation.
EDRs, which are sometimes referred to as Continental Depository Receipts
("CDRs"), are receipts issued in Europe typically by non-United States banks and
trust companies that evidence ownership of either foreign or domestic
securities. Generally, ADRs in registered form are designed for use in the
United States securities markets and EDRs and CDRs in bearer form are designed
for use in Europe. Each LifePath Master Portfolio may invest in ADRs, EDRs and
CDRs through "sponsored" or "unsponsored" facilities. A sponsored facility is
established jointly by the issuer of the underlying security and a depository,
whereas a depository may establish an unsponsored facility without participation
by the issuer of the deposited security. Holders of unsponsored depository
receipts generally bear all the costs of such facilities and the depository of
an unsponsored facility frequently is under no obligation to distribute
shareholder communications received from the issuer of the deposited security or
to pass through voting rights to the holders of such receipts in respect of the
deposited securities.
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CONVERTIBLE SECURITIES -- Each LifePath Master Portfolio may purchase
fixed-income convertible securities, such as bonds or preferred stock, which may
be converted at a stated price within a specified period of time into a
specified number of shares of common stock of the same or a different issuer.
Convertible securities are senior to common stock in a corporation's capital
structure, but usually are subordinated to non-convertible debt securities.
While providing a fixed-income stream (generally higher in yield than the income
from a common stock but lower than that afforded by a non-convertible debt
security), a convertible security also affords an investor the opportunity,
through its conversion feature, to participate in the capital appreciation of
the common stock into which it is convertible.
In general, the market value of a convertible security is the higher of its
"investment value" (i.e., its value as a fixed-income security) or its
"conversion value" (i.e., the value of the underlying shares of common stock if
the security is converted). As a fixed-income security, the market value of a
convertible security generally increases when interest rates decline and
generally decreases when interest rates rise. However, the price of a
convertible security also is influenced by the market value of the security's
underlying common stock. Thus, the price of a convertible security generally
increases as the market value of the underlying stock increases, and generally
decreases as the market value of the underlying stock declines. Investments in
convertible securities generally entail less risk than investments in the common
stock of the same issuer.
WARRANTS -- Each LifePath Master Portfolio may invest generally up to 5% of
its net assets in warrants, except that this limitation does not apply to
warrants acquired in units or attached to securities. A warrant is an instrument
issued by a corporation which gives the holder the right to subscribe to a
specified amount of the corporation's capital stock at a set price for a
specified period of time.
ILLIQUID SECURITIES -- Each Master Portfolio may invest up to 15% of the
value of its net assets in securities as to which a liquid trading market does
not exist, provided such investments are consistent with its investment
objective. Such securities may include securities that are not readily
marketable, such as certain securities that are subject to legal or contractual
restrictions on resale, participation interests that are not subject to the
demand feature described above, floating- and variable-rate demand obligations
as to which the Master Portfolio cannot exercise the related demand feature
described above on not more than seven days' notice and as to which there is no
secondary market and repurchase agreements providing for settlement in more than
seven days after notice.
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Disposing of illiquid securities generally will involve additional costs and
require additional time. However, if a substantial market of qualified
institutional buyers develops pursuant to Rule 144A under the 1933 Act for
certain of these securities held by a Master Portfolio, such Master Portfolio
intends to treat such securities as liquid securities in accordance with
procedures approved by MIP's Board of Trustees. Because it is not possible to
predict with assurance how the market for restricted securities pursuant to Rule
144A will develop, MIP's Board of Trustees has directed the Adviser to monitor
carefully each Master Portfolio's investments in such securities with particular
regard to trading activity, availability of reliable price information and other
relevant information. To the extent that for a period of time, qualified
institutional buyers cease purchasing such restricted securities pursuant to
Rule 144A, a Master Portfolio's investing in such securities may have the effect
of increasing the level of illiquidity in such Master Portfolio's portfolio
during such period.
INVESTMENT COMPANY SECURITIES -- Each Master Portfolio may invest in
securities issued by other investment companies which principally invest in
securities of the type in which such Master Portfolio invests. Under the 1940
Act, a Master Portfolio's investment in such securities currently is limited to,
subject to certain exceptions, (i) 3% of the total voting stock of any one
investment company, (ii) 5% of such Master Portfolio's net assets with respect
to any one investment company and (iii) 10% of such Master Portfolio's net
assets in the aggregate. Investments in the securities of other investment
companies involve duplication of advisory fees and certain other expenses.
RATINGS -- The ratings of Moody's, S&P, Fitch and Duff represent their
opinions as to the quality of the obligations which they undertake to rate. It
should be emphasized, however, that ratings are relative and subjective and,
although ratings may be useful in evaluating the safety of interest and
principal payments, they do not evaluate the market value risk of such
obligations. Therefore, although these ratings may be an initial criterion for
selection of portfolio investments, the Adviser also evaluates such obligations
and the ability of their issuers to pay interest and principal. Each Master
Portfolio relies on the Adviser's judgment, analysis and experience in
evaluating the creditworthiness of an issuer. In this evaluation, the Adviser
takes into consideration, among other things, the issuer's financial resources,
its sensitivity to economic conditions and trends, the quality of the issuer's
management and regulatory matters. It also is possible that a rating agency
might not timely change the rating on a particular issue to reflect subsequent
events. See "Description of the Funds -- Risk Considerations -- Fixed-Income
Securities."
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INVESTMENT TECHNIQUES
STOCK INDEX OPTIONS -- Each LifePath Master Portfolio may purchase and
write (i.e., sell) put and call options on stock indices as a substitute for
comparable market positions in the underlying securities. A stock index
fluctuates with changes in the market values of the stocks included in the
index. The aggregate premiums paid on all options purchased may not exceed 20%
of a LifePath Master Portfolio's total assets and the value of options written
or purchased may not exceed 10% of the value of a LifePath Master Portfolio's
total assets.
The effectiveness of purchasing or writing stock index options depends upon
the extent to which price movements in the LifePath Master Portfolio's portfolio
correlate with price movements of the stock index selected. Because the value of
an index option depends upon movements in the level of the index rather than the
price of a particular stock, whether a LifePath Master Portfolio realizes a gain
or loss from purchasing or writing options on an index depends upon movements in
the level of stock prices in the stock market generally or, in the case of
certain indices, in an industry or market segment, rather than movements in the
price of a particular stock.
When a LifePath Master Portfolio writes an option on a stock index, such
LifePath Master Portfolio places in a segregated account with MIP's custodian
cash or liquid securities in an amount at least equal to the market value of the
underlying stock index and maintains the account while the option is open or
otherwise covers the transaction.
FUTURES TRANSACTIONS -- IN GENERAL -- None of the LifePath Master
Portfolios will be a commodity pool. To the extent permitted by applicable
regulations, each LifePath Master Portfolio is permitted to use futures as a
substitute for a comparable market position in the underlying securities.
A futures contract is an agreement between two parties, a buyer and a
seller, to exchange a particular commodity at a specific price on a specific
date in the future. Futures contracts are traded on exchanges, where the
exchange serves as the ultimate counterparty for all contracts. Consequently,
the only credit risk on futures contracts is the creditworthiness of the
exchange. Futures contracts are, however, subject to market risk (i.e., exposure
to adverse price changes).
Each LifePath Master Portfolio may trade futures contracts and may purchase
and write options on futures contracts in U.S. domestic markets, such as the
Chicago Board of Trade and the International Monetary Market of the Chicago
Mercantile Exchange, or, to the extent permitted under applicable law, on
exchanges located outside the United States, such
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as the London International Financial Futures Exchange, the Deutscher
Aktienindex and the Sydney Futures Exchange Limited. See "Description of the
Funds -- Risk Considerations -- Foreign Futures Transactions."
Each LifePath Master Portfolio's futures transactions must constitute
permissible transactions pursuant to regulations promulgated by the CFTC. In
addition, a LifePath Master Portfolio may not engage in futures transactions if
the sum of the amount of initial margin deposits and premiums paid for unexpired
options on futures contracts, other than those contracts entered into for bona
fide hedging purposes, would exceed 5% of the liquidation value of the Master
Portfolio's assets, after taking into account unrealized profits and unrealized
losses on such contracts; provided, however, that in the case of an option that
is in-the-money at the time of purchase, the in-the-money amount may be excluded
in calculating this 5% liquidation limit. Pursuant to regulations and/or
published positions of the Securities and Exchange Commission, a LifePath Master
Portfolio may be required to segregate cash or high quality money market
instruments in connection with its futures transactions in an amount generally
equal to the entire value of the underlying security.
Initially, when purchasing or selling futures contracts a LifePath Master
Portfolio is required to deposit with the MIP's custodian in the broker's name
an amount of cash or cash equivalents up to approximately 10% of the contract
amount. This amount is subject to change by the exchange or board of trade on
which the contract is traded. Members of such exchange or board of trade may
impose their own higher requirements. This amount is known as "initial margin"
and is in the nature of a performance bond or good faith deposit on the contract
which is returned to the LifePath Master Portfolio upon termination of the
futures position, assuming all contractual obligations have been satisfied.
Subsequent payments to and from the broker, known as "variation margin," are
made daily as the price of the index or securities underlying the futures
contract fluctuates, making the long and short positions in the futures contract
more or less valuable, a process known as "marking-to-market." At any time prior
to the expiration of a futures contract, the LifePath Master Portfolio may elect
to close the position by taking an opposite position, at the then-prevailing
price, thereby terminating its existing position in the contract.
Although each LifePath Master Portfolio may purchase or sell futures
contracts only if there is an active market for such contracts, no assurance can
be given that a liquid market will exist for any particular contract at any
particular time. Many futures exchanges and boards of trade limit the amount of
fluctuation permitted in futures contract prices during a single trading day.
Once the daily limit has been reached in a particular contract,
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no trades may be made that day at a price beyond that limit or trading may be
suspended for specified periods during the trading day. Futures contract prices
could move to the limit for several consecutive trading days with little or no
trading, thereby preventing prompt liquidation of futures positions and
potentially subjecting the relevant LifePath Master Portfolio to substantial
losses. If it is not possible, or the LifePath Master Portfolio determines not
to close a futures position in anticipation of adverse price movements, it will
be required to make daily cash payments of variation margin.
An option on a futures contract gives the purchaser the right, in return
for the premium paid, to assume a position in a futures contract (a long
position if the option is a call and a short position if the option is a put) at
a specified exercise price at any time during the option exercise period. The
writer (i.e., seller) of the option is required upon exercise to assume an
offsetting futures position (a short position if the option is a call and a long
position if the option is a put). Upon exercise of the option, the assumption of
offsetting futures positions by both the writer and the holder of the option
will be accompanied by delivery of the accumulated cash balance in the writer's
futures margin account in the amount by which the market price of the futures
contract, at exercise, exceeds (in the case of a call) or is less than (in the
case of a put) the exercise price of the option on the futures contract.
STOCK INDEX FUTURES AND OPTIONS ON STOCK INDEX FUTURES -- Each LifePath
Master Portfolio may purchase and sell stock index futures contracts and options
on stock index futures contracts.
A stock index future obligates the seller to deliver (and the purchaser to
take), effectively, an amount of cash equal to a specific dollar amount times
the difference between the value of a specific stock index at the close of the
last trading day of the contract and the price at which the agreement is made.
No physical delivery of the underlying stocks in the index is made. With respect
to stock indices that are permitted investments, each LifePath Master Portfolio
intends to purchase and sell futures contracts on the stock index for which it
can obtain the best price with consideration also given to liquidity.
INTEREST RATE FUTURES CONTRACTS AND OPTIONS ON INTEREST RATE FUTURES
CONTRACTS -- Each LifePath Master Portfolio may invest in interest rate futures
contracts and options on interest rate futures contracts as a substitute for a
comparable market position in the underlying securities.
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Each LifePath Master Portfolio also may write options on interest rate
futures contracts as part of closing purchase transactions to terminate its
options positions. No assurance can be given that such closing transactions can
be effected or concerning the degree of correlation between price movements in
the options on interest rate futures and price movements in the LifePath Master
Portfolio's portfolio securities which are the subject of the transaction.
INTEREST RATE AND INDEX SWAPS -- Each LifePath Master Portfolio may enter
into interest rate and index swaps in pursuit of its investment objective.
Interest rate swaps involve the exchange by a LifePath Master Portfolio with
another party of their respective commitments to pay or receive interest (for
example, an exchange of floating-rate payments for fixed-rate payments). Index
swaps involve the exchange by a LifePath Master Portfolio with another party of
cash flows based upon the performance of an index or a portion of an index
(usually including dividends or income). In each case, the exchange commitments
can involve payments to be made in the same currency or in different currencies.
Each LifePath Master Portfolio usually enters into swaps on a net basis. In
so doing, only the net difference of the payment obligations is exchanged
between the counterparties. If a LifePath Master Portfolio enters into a swap,
it maintains a segregated account in an amount equivalent to the gross value of
its payment obligations unless the contract provides otherwise. If the other
party to such a transaction defaults on a swap, the Master Portfolio has
contractual remedies pursuant to the agreements related to the transaction. In
such a case, the LifePath Master Portfolio's risk of loss consists of the net
amount of payments that the LifePath Master Portfolio contractually is entitled
to receive.
The use of interest rate and index swaps is a highly specialized activity
which involves investment techniques different from those associated with
ordinary portfolio security transactions. There is no limit, except as provided
below, on the amount of swap transactions that may be entered into by a Master
Portfolio. These transactions generally do not involve the delivery of
securities or other underlying assets or principal. Accordingly, the risk of
loss with respect to swaps generally is limited to the net amount of payments
that the LifePath Master Portfolio is contractually entitled to receive. No
LifePath Master Portfolio invests more than 15% of the value of its net assets
in swaps that are illiquid, and in other illiquid securities.
FOREIGN CURRENCY TRANSACTIONS -- Each LifePath Master Portfolio may engage
in currency exchange transactions either on a spot (i.e., cash) basis at the
rate prevailing in the currency exchange market, or by entering into forward
contracts to purchase or sell currencies. A forward
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currency exchange contract involves an obligation between two parties to
exchange a specific currency at a set price on a future date, which must be more
than two days from the date of the contract. These contracts are entered into in
the interbank market conducted directly between currency traders (typically
commercial banks or other financial institutions) and their customers.
Each LifePath Master Portfolio may combine forward currency exchange
contracts with investments in securities denominated in other currencies.
Each LifePath Master Portfolio also may maintain short positions in forward
currency exchange transactions, which would involve the Master Portfolio
agreeing to exchange an amount of a currency it did not currently own for
another currency at a future date in anticipation of a decline in the value of
the currency sold relative to the currency such Master Portfolio contracted to
receive in the exchange.
LENDING PORTFOLIO SECURITIES -- From time to time, each Master Portfolio
may lend securities from its portfolio to brokers, dealers and other financial
institutions needing to borrow securities to complete certain transactions. Such
loans may not exceed one-third of the value of the relevant Master Portfolio's
total assets. In connection with such loans, each Master Portfolio receives
collateral consisting of cash, U.S. Government obligations or other high-quality
debt instruments which will be maintained at all times in an amount equal to at
least 100% of the current market value of the loaned securities. Each Master
Portfolio can increase its income through the investment of such collateral.
Each Master Portfolio continues to be entitled to receive payments in amounts
equal to the dividends, interest and other distributions payable on the loaned
security and receives interest on the amount of the loan. Such loans are
terminable at any time upon specified notice. A Master Portfolio might
experience risk of loss if the institution with which it has engaged in a
portfolio loan transaction breaches its agreement with such Master Portfolio.
FORWARD COMMITMENTS -- Each Master Portfolio may purchase securities on a
when-issued or forward commitment basis, which means that the price is fixed at
the time of commitment but delivery and payment ordinarily take place a number
of days after the date of the commitment to purchase. A Master Portfolio makes
commitments to purchase such securities only with the intention of actually
acquiring the securities, but the Master Portfolio may sell these securities
before the settlement date if it is deemed advisable. The Master Portfolio will
not accrue income in respect of a security purchased on a forward commitment
basis prior to its stated delivery date.
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Securities purchased on a when-issued or forward commitment basis and
certain other securities held in the Master Portfolio's portfolio are subject to
changes in value (both generally changing in the same way, i.e., appreciating
when interest rates decline and depreciating when interest rates rise) based
upon the public's perception of the creditworthiness of the issuer and changes,
real or anticipated, in the level of interest rates. Securities purchased on a
when-issued or forward commitment basis may expose the relevant Master Portfolio
to risk because they may experience such fluctuations prior to their actual
delivery. Purchasing securities on a when-issued or forward commitment basis can
involve the additional risk that the yield available in the market when the
delivery takes place actually may be higher than that obtained in the
transaction itself. A segregated account of each Master Portfolio consisting of
cash, U.S. Government obligations or other high quality liquid debt securities
at least equal at all times to the amount of the when-issued or forward
commitments is established and maintained at MIP's custodian bank. Purchasing
securities on a forward commitment basis when a Master Portfolio is fully or
almost fully invested may result in greater potential fluctuation in the value
of such Master Series' net assets and its net asset value per share.
BORROWING MONEY -- As a fundamental policy, each Master Portfolio is
permitted to borrow to the extent permitted under the 1940 Act. However, each
Master Portfolio currently intends to borrow money only for temporary or
emergency (not leveraging) purposes, in an amount up to one-third of the value
of its total assets (including the amount borrowed) valued at the lesser of cost
or market, less liabilities (not including the amount borrowed) at the time the
borrowing is made. While borrowings exceed 5% of a Master Portfolio's total
assets, such Master Portfolio will not make any investments.
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SPONSOR, DISTRIBUTOR AND ADMINISTRATOR
Stephens Inc.
Little Rock, Arkansas
INVESTMENT ADVISER
Wells Fargo Bank, N.A.
San Francisco, California
INVESTMENT SUB-ADVISER
Wells Fargo Nikko Investment Advisers
San Francisco, California
CUSTODIAN
Wells Fargo Institutional Trust Company, N.A.
San Francisco, California
TRANSFER AGENT AND DIVIDEND DISBURSING AGENT
Wells Fargo Bank, N.A.
San Francisco, California
LEGAL COUNSEL
Morrison & Foerster
Washington, D.C.
INDEPENDENT AUDITORS
KPMG Peat Marwick LLP
San Francisco, California
For more information about the Funds write or call:
Stagecoach Inc.
c/o Wells Fargo Bank, N.A. -- Transfer Agent
525 Market Street
San Francisco, California 94105
1-800-776-0179
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR ANY OTHER REGULATORY
AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
SILP 11/95
<PAGE> 66
STAGECOACH INC.
c/o Wells Fargo Bank, N.A.
Transfer Agent
525 Market Street
San Francisco, CA 94105
SILP 11/95
<PAGE> 67
________________________________________________________________________________
STAGECOACH LIFEPATH(TM) FUNDS
LifePath 2000(TM) Fund
LifePath 2010(TM) Fund
LifePath 2020(TM) Fund
LifePath 2030(TM) Fund
LifePath 2040(TM) Fund
PART B
STAGECOACH INC.
TELEPHONE 1-800-776-0179
(STATEMENT OF ADDITIONAL INFORMATION)
FEBRUARY ___, 1996
________________________________________________________________________________
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus of
the LifePath 2000 Fund, LifePath 2010 Fund, LifePath 2020 Fund, LifePath 2030
Fund and LifePath 2040 Fund (the "LifePath Funds" or the "Funds") of Stagecoach
Inc. (the "Company"), dated February ___, 1996, as it may be revised from time
to time. Terms not otherwise defined herein are as defined in the Prospectus.
To obtain a copy of the Funds' Prospectus, please write to the Company c/o
Wells Fargo Bank, N.A. -- Shareholder Services, P.O. Box 7033, San Francisco,
California 94120-9517, or call (800) 222-8222.
As described in the Prospectus, each Fund invests all of its assets
in a separate Master Portfolio of Master Investment Portfolio ("MIP") having
the same investment objective as the Fund bearing the corresponding name.
Wells Fargo Bank, N.A. ("Wells Fargo Bank") is investment adviser and Wells
Fargo Nikko Investment Advisers ("WFNIA") is investment sub-adviser to each of
the Master Portfolios of MIP. Following the consummation of the Acquisition by
Barclays Bank, PLC ("Barclays") or its affiliates, of WFNIA, BZW Global
Investors ("BZWGI") will serve as investment adviser to each of the Master
Portfolios of MIP. "Adviser" as used herein may mean Wells Fargo Bank and/or
WFNIA, as required by the context, or, following the consummation of the
Acquisition, BZWGI. Stephens Inc. ("Stephens") serves as the Company's
administrator and as distributor of each Fund's shares.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Introduction ......................................................... B-3
Investment Objectives and Management Policies ........................ B-3
Management of the Company ............................................ B-11
Management Arrangements .............................................. B-14
Purchase and Redemption of Shares .................................... B-16
Determination of Net Asset Value ..................................... B-16
Dividends, Distributions and Taxes ................................... B-18
Capital Stock ........................................................ B-21
Performance Information .............................................. B-22
Portfolio Transactions ............................................... B-23
Information About the Funds .......................................... B-23
Custodian, Transfer and Dividend Disbursing Agent .................... B-24
Counsel .............................................................. B-24
Independent Auditors ................................................. B-24
Financial Information ................................................ B-25
Appendix ............................................................. B-26
Financial Statements ................................................. F-1
</TABLE>
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INTRODUCTION
The Company is a registered investment company consisting of nineteen
series including the Funds. MIP is a registered investment company consisting
of fourteen series including the Master Portfolios. Each Fund invests all of
its assets in the corresponding Master Portfolio of MIP (as illustrated below),
which has the same investment objective as the related Fund.
Fund Corresponding Master Porfolio Trust
- ---- ----------------------------- -----
LifePath 2000 Fund LifePath 2000 Fund Master Portfolio MIP
LifePath 2010 Fund LifePath 2010 Fund Master Portfolio MIP
LifePath 2020 Fund LifePath 2020 Fund Master Portfolio MIP
LifePath 2030 Fund LifePath 2030 Fund Master Portfolio MIP
LifePath 2040 Fund LifePath 2040 Fund Master Portfolio MIP
INVESTMENT OBJECTIVES AND MANAGEMENT POLICIES
General. Each Master Portfolio has the same investment objective as
its related Fund. Each Fund may withdraw its investment in the corresponding
Master Portfolio at any time, if the Board of Directors of the Company
determines that such action is in the best interests of the Fund and its
shareholders. Upon such withdrawal, the Company's Board of Directors would
consider alternative investments, including investing all of the Fund's assets
in another investment company with the same investment objective as the Fund or
hiring an investment adviser to manage the Fund's assets in accordance with the
investment policies and restrictions described in the Fund's Prospectus and
this Statement of Additional Information.
Portfolio Securities
Bank Obligations. Domestic commercial banks organized under federal
law are supervised and examined by the Comptroller of the Currency and are
required to be members of the Federal Reserve System and to have their deposits
insured by the Federal Deposit Insurance Corporation (the "FDIC"). Domestic
banks organized under state law are supervised and examined by state banking
authorities but are members of the Federal Reserve System only if they elect to
join. In addition, state banks whose certificates of deposit ("CDs") may be
purchased by each Master Portfolio are insured by the FDIC (although such
insurance may not be of material benefit to the Master Portfolio, depending on
the principal amount of the CDs of each bank held by the Master Portfolio) and
are subject to federal examination and to a substantial body of federal law and
regulation. As a result of federal or state laws and
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regulations, domestic branches of domestic banks whose CDs may be purchased by
each Master Portfolio generally are required, among other things, to maintain
specified levels of reserves, are limited in the amounts which they can loan to
a single borrower and are subject to other regulations designed to promote
financial soundness. However, not all of such laws and regulations apply to
the foreign branches of domestic banks.
Obligations of foreign branches of domestic banks, foreign
subsidiaries of domestic banks and domestic and foreign branches of foreign
banks, such as CDs and time deposits ("TDs"), may be general obligations of the
parent banks in addition to the issuing branch, or may be limited by the terms
of a specific obligation and/or governmental regulation. Such obligations are
subject to different risks than are those of domestic banks. These risks
include foreign economic and political developments, foreign governmental
restrictions that may adversely affect payment of principal of and interest on
the obligations, foreign exchange controls and foreign withholding and other
taxes on interest income. These foreign branches and subsidiaries are not
necessarily subject to the same or similar regulatory requirements that apply
to domestic banks, such as mandatory reserve requirements, loan limitations,
and accounting, auditing and financial record- keeping requirements. In
addition, less information may be publicly available about a foreign branch of
a domestic bank or about a foreign bank than about a domestic bank.
Obligations of U.S. branches of foreign banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation or by federal or state regulation
as well as governmental action in the country in which the foreign bank has its
head office. A domestic branch of a foreign bank with assets in excess of $1
billion may be subject to reserve requirements imposed by the Federal Reserve
System or by the state in which the branch is located if the branch is licensed
in that state.
In addition, federal branches licensed by the Comptroller of the
Currency and branches licensed by certain states ("State Branches") may be
required to: (1) pledge to the appropriate regulatory authority, by depositing
assets with a designated bank within the relevant state, a certain percentage
of their assets as fixed from time to time by such regulatory authority; and
(2) maintain assets within the relevant state in an amount equal to a specified
percentage of the aggregate amount of liabilities of the foreign bank payable
at or through all of its agencies or branches within the state. The deposits of
federal and State Branches generally must be
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insured by the FDIC if such branches take deposits of less than $100,000.
In view of the foregoing factors associated with the purchase of CDs
and TDs issued by foreign branches of domestic banks, by foreign subsidiaries
of domestic banks, by foreign branches of foreign banks or by domestic branches
of foreign banks, the Adviser carefully evaluates such investments on a
case-by-case basis.
Each Master Portfolio may purchase CDs issued by banks, savings and
loan associations and similar thrift institutions with less than $1 billion in
assets, provided that such institutions are members of the FDIC, and further
provided that such Master Portfolio purchases any such CD in a principal amount
of not more than $100,000, which amount would be fully insured by the Bank
Insurance Fund or the Savings Association Insurance Fund administered by the
FDIC. Interest payments on such a CD are not insured by the FDIC. No Master
Portfolio will own more than one such CD per such issuer.
Management Policies
Stock Index Options. Each LifePath Master Portfolio may purchase and
write put and call options on stock indices. Options on stock indices are
similar to options on stock except that (a) the expiration cycles of stock
index options are monthly, while those of stock options are currently
quarterly, and (b) the delivery requirements are different. Instead of giving
the right to take or make delivery of stock at a specified price, an option on
a stock index gives the holder the right to receive a cash "exercise settlement
amount" equal to (i) the amount, if any, by which the fixed exercise price of
the option exceeds, in the case of a put, or is less than, in the case of a
call, the closing value of the underlying index on the date of exercise,
multiplied by (ii) a fixed "index multiplier." Receipt of this cash amount
depends upon the closing level of the stock index upon which the option is
based being greater than, in the case of a call, or less than, in the case of a
put, the exercise price of the option. The amount of cash received is equal to
such difference between the closing price of the index and the exercise price
of the option expressed in dollars multiplied by a specified multiplier. The
writer of the option is obligated, in return for the premium received, to make
delivery of this amount. The writer may offset a position in stock index
options prior to expiration by entering into a closing transaction on an
exchange, or the writer may let the option expire unexercised.
Futures Contracts and Options on Futures Contracts. Each LifePath
Master Portfolio may enter into futures contracts
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and may purchase and write options thereon. Upon the exercise of an option on
a futures contract, the writer of the option delivers to the holder of the
option the futures position and the accumulated balance in the writer's futures
margin account, which represents the amount by which the market price of the
futures contract exceeds, in the case of a call, or is less than, in the case
of a put, the exercise price of the option on the futures contract. The
potential loss related to the purchase of options on futures contracts is
limited to the premium paid for the option (plus transaction costs). Because
the value of the option is fixed at the time of sale, there are no daily cash
payments to reflect changes in the value of the underlying contract; however,
the value of the option may change daily, and that change would be reflected in
the net asset value of the relevant LifePath Master Portfolio.
Foreign Currency Transactions. If a LifePath Master Portfolio enters
into a foreign currency transaction or forward contract, such Master Portfolio
deposits, if required by applicable regulations, with MIP's custodian cash or
high-grade debt securities in a segregated account of the LifePath Master
Portfolio in an amount at least equal to the value of the Master Portfolio's
total assets committed to the consummation of the forward contract. If the
value of the securities placed in the segregated account declines, additional
cash or securities are placed in the account so that the value of the account
equals the amount of the LifePath Master Portfolio's commitment with respect to
the contract.
At or before the maturity of a forward contract, a LifePath Master
Portfolio either may sell a portfolio security and make delivery of the
currency, or may retain the security and offset its contractual obligation to
deliver the currency by purchasing a second contract pursuant to which such
Master Portfolio obtains, on the same maturity date, the same amount of the
currency which it is obligated to deliver. If the Master Portfolio retains the
portfolio security and engages in an offsetting transaction, such Master
Portfolio, at the time of execution of the offsetting transaction, incurs a
gain or a loss to the extent that movement has occurred in forward contract
prices. Should forward prices decline during the period between the Master
Portfolio's entering into a forward contract for the sale of a currency and the
date it enters into an offsetting contract for the purchase of the currency,
the Master Portfolio will realize a gain to the extent the price of the
currency it has agreed to sell exceeds the price of the currency it has agreed
to purchase. Should forward prices increase, the Master Portfolio will suffer
a loss to the extent the price of the currency it has agreed to purchase
exceeds the price of the currency it has agreed to sell.
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The cost to a LifePath Master Portfolio of engaging in currency
transactions varies with factors such as the currency involved, the length of
the contract period and the market conditions then prevailing. Because
transactions in currency exchange usually are conducted on a principal basis,
no fees or commissions are involved. The Adviser considers on an ongoing basis
the creditworthiness of the institutions with which a LifePath Master Portfolio
enters into foreign currency transactions. The use of forward currency
exchange contracts does not eliminate fluctuations in the underlying prices of
the securities, but it does establish a rate of exchange that can be achieved
in the future. If a devaluation generally is anticipated, the Master Portfolio
may not be able to contract to sell the currency at a price above the
devaluation level it anticipates.
The purchase of options on currency futures allows a LifePath Master
Portfolio, for the price of the premium it must pay for the option, to decide
whether or not to buy (in the case of a call option) or to sell (in the case of
a put option) a futures contract at a specified price at any time during the
period before the option expires.
Future Developments. Each LifePath Master Portfolio may take
advantage of opportunities in the areas of options and futures contracts and
options on futures contracts and any other derivative investments which are not
presently contemplated for use by such Master Portfolio or which are not
currently available but which may be developed, to the extent such
opportunities are both consistent with a LifePath Master Portfolio's investment
objective and legally permissible for the Master Portfolio. Before entering
into such transactions or making any such investment, a LifePath Master
Portfolio would provide appropriate disclosure in its Prospectus or this
Statement of Additional Information.
Lending Portfolio Securities. To a limited extent, each Master
Portfolio may lend its portfolio securities to brokers, dealers and other
financial institutions, provided it receives cash collateral which is
maintained at all times in an amount equal to at least 100% of the current
market value of the securities loaned. By lending its portfolio securities, a
Master Portfolio can increase its income through the investment of the cash
collateral or by receipt of a loan premium from the borrower. For purposes of
this policy, each Master Portfolio considers collateral consisting of U.S.
Government obligations or irrevocable letters of credit issued by banks whose
securities meet the standards for investment by such Master Portfolio to be the
equivalent of cash. From time to time, a Master Portfolio may return to the
borrower, or to a third party which is unaffiliated with MIP, and which is
acting as a
B-7
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"placing broker," a part of the interest earned from the investment of
collateral received in exchange for securities loaned.
The Securities and Exchange Commission currently requires that the
following conditions must be met whenever portfolio securities are loaned: (1)
the Master Portfolio must receive at least 100% cash collateral from the
borrower; (2) the borrower must increase such collateral whenever the market
value of the securities loaned rises above the level of such collateral; (3)
the Master Portfolio must be able to terminate the loan at any time; (4) the
Master Portfolio must receive reasonable interest on the loan, as well as any
dividends, interest or other distributions payable on the loaned securities,
and any increase in market value; (5) the Master Portfolio may pay only
reasonable custodian fees in connection with the loan; and (6) while voting
rights on the loaned securities may pass to the borrower, MIP's Board of
Trustees must terminate the loan and regain the right to vote the securities if
a material event adversely affecting the investment occurs. These conditions
may be subject to future modification.
Investment Restrictions. Each Fund and Master Portfolio has adopted
investment restrictions numbered 1 through 10 as fundamental policies. These
restrictions cannot be changed, as to a Fund or Master Portfolio, without
approval by the holders of a majority (as defined in the Investment Company Act
of 1940, as amended (the "1940 Act")) of the outstanding voting securities of
such Fund or Master Portfolio, as the case may be. Whenever a Fund is
requested to vote on a fundamental policy of the Master Portfolio in which it
invests, such Fund holds a meeting of Fund shareholders and casts its votes as
instructed by such Fund's shareholders. Investment restrictions numbered 11
through 20 are not fundamental policies and may be changed by vote of a
majority of the Trustees of MIP or a majority of the Directors of the Company,
as the case may be, at any time. No Fund or Master Portfolio may:
1. Invest more than 5% of its assets in the obligations of any
single issuer, except that up to 25% of the value of its total assets may be
invested, and securities issued or guaranteed by the U.S. Government or its
agencies or instrumentalities may be purchased, without regard to any such
limitation.
2. Hold more than 10% of the outstanding voting securities of any
single issuer. This Investment Restriction applies only with respect to 75% of
its total assets.
B-8
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3. Invest in commodities, except that each Fund or Master Portfolio
may purchase and sell (i.e., write) options, forward contracts, futures
contracts, including those relating to indices, and options on futures
contracts or indices.
4. Purchase, hold or deal in real estate, or oil, gas or other
mineral leases or exploration or development programs, but each Fund or Master
Portfolio may purchase and sell securities that are secured by real estate or
issued by companies that invest or deal in real estate.
5. Borrow money, except to the extent permitted under the 1940 Act.
For purposes of this investment restriction, a Fund's or Master Portfolio's
entry into options, forward contracts, futures contracts, including those
relating to indices, and options on futures contracts or indices shall not
constitute borrowing to the extent certain segregated accounts are established
and maintained by the Fund or Master Portfolio as described in the Prospectus.
6. Make loans to others, except through the purchase of debt
obligations and the entry into repurchase agreements. However, each Fund or
Master Portfolio may lend its portfolio securities in an amount not to exceed
33-1/3% of the value of its total assets. Any loans of portfolio securities
will be made according to guidelines established by the Securities and Exchange
Commission and the Board of Trustees of MIP or the Board of Directors of the
Company, as the case may be.
7. Act as an underwriter of securities of other issuers, except to
the extent the Fund or Master Portfolio, as the case may be, may be deemed an
underwriter under the Securities Act of 1933, as amended, by virtue of
disposing of portfolio securities.
8. Invest 25% or more of its total assets in the securities of
issuers in any particular industry or group of closely related industries,
except that, in the case of each Fund or Master Portfolio, there shall be no
limitation on the purchase of obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.
9. Issue any senior security (as such term is defined in Section
18(g) of the 1940 Act), except to the extent the activities permitted in
Investment Restriction Nos. 3, 5, 12 and 13 may be deemed to give rise to a
senior security or as otherwise permitted under the rules and regulations or an
exemptive order of the Securities and Exchange Commission.
10. Purchase securities on margin, but each Fund or Master Portfolio
may make margin deposits in connection with
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transactions in options, forward contracts, futures contracts, including those
relating to indices, and options on futures contracts or indices.
11. Invest in the securities of a company for the purpose of
exercising management or control, but each Fund or Master Portfolio will vote
the securities it owns in its portfolio as a shareholder in accordance with its
views.
12. Pledge, mortgage or hypothecate its assets, except to the extent
necessary to secure permitted borrowings and to the extent related to the
purchase of securities on a when-issued or forward commitment basis and the
deposit of assets in escrow in connection with writing covered put and call
options and collateral and initial or variation margin arrangements with
respect to options, forward contracts, futures contracts, including those
relating to indices, and options on futures contracts or indices.
13. Purchase, sell or write puts, calls or combinations thereof,
except as may be described in the Fund's Prospectus and this Statement of
Additional Information.
14. Purchase securities of any company having less than three years'
continuous operations (including operations of any predecessors) if such
purchase would cause the value of its investments in all such companies to
exceed 5% of the value of its total assets.
15. Enter into repurchase agreements providing for settlement in
more than seven days after notice or purchase securities which are illiquid,
if, in the aggregate, more than 15%, in the case of a LifePath Fund and
LifePath Master Portfolio, of the value of its net assets would be so invested.
16. Purchase securities of other investment companies, except to the
extent permitted under the 1940 Act.
17. Purchase, hold or deal in real estate limited partnerships.
18. Purchase warrants that exceed 2% of the value of the Fund's or
Master Portfolio's net assets, if those warrants are not listed on the New York
or American Stock Exchange.
19. Purchase or retain securities of any issuer if the officers or
directors of the Company, its advisers or managers owning beneficially more
than one-half of one percent of the securities of an issuer together own
beneficially more than five percent of the securities of that issuer.
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20. Engage in any short sales other than short sales against the box.
As a fundamental policy, each Fund may invest, notwithstanding any
other investment restriction (whether or not fundamental), all of its assets in
the securities of a single open-end management investment company with
substantially the same fundamental investment objectives, policies and
restrictions as such Fund.
If a percentage restriction is adhered to at the time of investment,
a later change in percentage resulting from a change in values or assets,
except with respect to compliance with Investment Restriction No. 5, will not
constitute a violation of such restriction.
The Company and MIP may make commitments more restrictive than the
restrictions listed above, so as to permit the sale of shares of a Fund in
certain states. Should the Company or MIP determine that a commitment is no
longer in the best interest of the Fund or Master Portfolio and its
shareholders, the Company or MIP reserves the right to revoke the commitment by
terminating the sale of such Fund's shares in the state involved.
MANAGEMENT OF THE COMPANY
Directors and officers of the Company, together with information as
to their principal business occupations during at least the last five years,
are shown below. The address of each, unless otherwise indicated, is 111
Center Street, Little Rock, Arkansas 72201. Each of the Directors and officers
of the Company serves in the identical capacity as an officer and/or Director
of Overland Express Funds, Inc. and Stagecoach Funds, Inc. (all of which
consist of several separately managed investment portfolios) and as a Trustee
and/or officer of Stagecoach Trust, Life & Annuity Trust, Master Investment
Trust, Master Investment Portfolio and Managed Series Investment Trust. Each
Director who is deemed to be an "interested person" of the Company, as defined
in the 1940 Act, is indicated by an asterisk.
<TABLE>
<CAPTION>
Principal Occupations
Name, Address and Age Position During Past 5 Years
- --------------------- -------- ----------------------
<S> <C> <C>
Jack S. Euphrat, 73 Director Private Investor.
415 Walsh Road
Atherton, CA 94027
</TABLE>
B-11
<PAGE> 78
<TABLE>
<S> <C> <C>
*R. Greg Feltus, 44 Director, Senior Vice President
Chairman and of Stephens; Manager
President of Financial Services
Group; President of
Stephens Insurance
Services Inc.; Senior
Vice President of
Stephens Sports
Management Inc.; and
President of
Investors Brokerage
Insurance Inc.
Thomas S. Goho, 53 Director T.B. Rose Faculty
321 Beechcliff Court Fellow - Business,
Winston-Salem, NC 27104 Wake Forest
University, Calloway
School of Business
and Accountancy;
Associate Professor
of Finance of the
School of Business
and Accounting at
Wake Forest
University since
1983.
*Zoe Ann Hines, 46 Director Senior Vice President
of Stephens and
Director of Brokerage
Accounting; and
Secretary of Stephens
Resource Management.
*W. Rodney Hughes, 69 Director Private Investor.
31 Dellwood Court
San Rafael, CA 94901
Robert M. Joses, 77 Director Private Investor.
47 Dowitcher Way
San Rafael, CA 94901
*J. Tucker Morse, 51 Director Private Investor;
10 Legrae Street Real Estate
Charleston, SC 29401 Developer; Chairman
of Renaissance
Properties Ltd.;
President of Morse
Investment
Corporation; and Co-
Managing Partner of
Main Street Ventures.
</TABLE>
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<PAGE> 79
<TABLE>
<S> <C> <C>
Richard H. Blank, Jr., 39 Chief Associate of
Operating Financial Services
Officer, Group of Stephens;
Secretary and Director of Stephens
Treasurer Sports Management
Inc.; and Director of
Capo Inc.
</TABLE>
COMPENSATION TABLE
For the Fiscal Year Ended 1995
<TABLE>
<CAPTION>
Total Compensation
Aggregate Compensation from Registrant
Name and Position from Registrant and Fund Complex
- ----------------- ---------------------- ------------------
<S> <C> <C>
Jack S. Euphrat $8,688 $34,188
Director
*R. Greg Feltus 0 0
Director
Thomas S. Goho 8,688 34,188
Director
*Zoe Ann Hines 0 0
Director
*W. Rodney Hughes 8,688 32,188
Director
Robert M. Joses 8,688 34,188
Director
*J. Tucker Morse 8,688 32,188
Director
</TABLE>
Each of the Directors and officers of the Company serves in an
identical capacity as an officer and/or Director of Overland Express Funds,
Inc. and Stagecoach Funds, Inc. (each of which consist of several separately
managed investment portfolios) and as a Trustee and/or officer of Stagecoach
Trust, Life & Annuity Trust, Master Investment Trust, Master Investment
Portfolio and Managed Series Investment Trust. All of these entities are
open-end management investment companies, and each is considered to be in the
same "fund complex," as such term is defined in Form N-1A under the 1940 Act,
as the Company. Directors of the Company are compensated annually by the
Company and by all registrants in the fund complex for their services as
indicated in the above Compensation Table and also are reimbursed for all
out-of-pocket expenses relating to attendance at board meetings. Currently the
Directors do not
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receive any retirement benefits or deferred compensation from the Company or
any other member of the fund complex.
As of the date of this Statement of Additional Information, Directors
and officers of the Company as a group beneficially owned less than 1% of the
outstanding shares of the Company.
MANAGEMENT ARRANGEMENTS
Investment Advisory Agreement. Wells Fargo Bank provides investment
advisory services to each Master Portfolio pursuant to an Investment Advisory
Agreement dated February 25, 1994 with MIP. Following the Acquisition of WFNIA
by Barclays or its affiliates, BZWGI will provide investment advisory services
to each Master Portfolio pursuant to Investment Advisory Agreements with MIP
dated effective as of the consummation of the Acquisition. Each such
Investment Advisory Agreement will be referred to as the "Advisory Agreement".
As to each Master Portfolio, prior to the consummation of the Acquisition, the
Advisory Agreement will be subject to annual approval by (i) MIP's Board of
Trustees or (ii) vote of a majority (as defined in the 1940 Act) of the
outstanding voting securities of such Master Portfolio, provided that in either
event the continuance also is approved by a majority of MIP's Board of Trustees
who are not "interested persons" (as defined in the 1940 Act) of MIP or the
Adviser, by vote cast in person at a meeting called for the purpose of voting
on such approval. Following the consummation of the Acquisition, the annual
approval of the Advisory Agreement will follow an initial two- year term of
such agreement. As to each Master Portfolio, the Advisory Agreement is
terminable without penalty, on 60 days' written notice, by MIP's Board of
Trustees or by vote of the holders of a majority of such Master Portfolio's
shares or, on not less than 60 days' written notice, by the Adviser. Each
Advisory Agreement terminates automatically, as to the relevant Master
Portfolio, in the event of its assignment (as defined in the 1940 Act).
For its services as investment adviser, the Adviser is entitled to
receive a monthly fee at the annual rate of 0.55% of the average daily value of
the net assets of each Master Portfolio.
Prior to the consummation of the Acquisition, Wells Fargo Bank has
engaged WFNIA to provide sub-investment advisory services to each Master
Portfolio of MIP pursuant to a Sub-Investment Advisory Agreement (the
"Sub-Advisory Agreement") dated February 25, 1994 with Wells Fargo Bank. As to
each Master Portfolio, the Sub-Advisory Agreement is subject to
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<PAGE> 81
annual approval by (i) MIP's Board of Trustees or (ii) vote of a majority (as
defined in the 1940 Act) of the outstanding securities of such Master
Portfolio, provided that in either event the continuance also is approved by a
majority of MIP's Board of Trustees who are not interested persons (as defined
in the 1940 Act) of the Master Portfolio or WFNIA, by vote cast in person at a
meeting called for the purpose of voting on such approval. As to each Master
Portfolio, the Sub-Advisory Agreement is terminable without penalty, on 60
days' written notice, by MIP's Board of Trustees or by vote of the holders of a
majority of such Master Portfolio's interests. The Sub- Advisory Agreement
terminates automatically upon the consummation of the Acquisition or other
assignment (as defined in the 1940 Act). The Sub-Advisory Agreement provides
that Wells Fargo Bank pay WFNIA a monthly fee at the annual rate of 0.40% of
each Master Portfolio's average daily value of net assets.
Administration Agreement. The Company has engaged Stephens to
provide certain administrative services. Pursuant to an Administration
Agreement with the Company with respect to the Funds, Stephens furnishes the
Company clerical help and accounting, data processing, bookkeeping, internal
auditing and legal services and certain other required services, prepares
reports to the shareholders, tax returns, and reports to and filings with the
Securities and Exchange Commission and state Blue Sky authorities, calculates
net asset value and generally supervises all aspects of the Company's
operation, other than providing investment advice.
Under the Administration Agreement, Stephens has agreed to assume the
operating expenses of each Fund and a pro rata share of the operating expenses
of each Master Portfolio, except for expenses in connection with securities'
purchases, sales or other related transactions, extraordinary expenses and fees
and expenses payable pursuant to certain service contracts, as described in the
Prospectus. For its services as administrator, Stephens receives fees at the
annual rate of 0.10% of the average daily value of the net assets of each Fund.
Distribution Agreement. Stephens acts as the exclusive distributor of
each Fund's shares pursuant to a Distribution Agreement (the "Distribution
Agreement") with the Company with respect to the Funds. Shares are sold on a
continuous basis by Stephens as agent, although Stephens is not obliged to sell
any particular amount of shares. No compensation is payable by the Company to
Stephens for its distribution services. The term and termination provisions of
the Distribution Agreement are substantially similar to those of the Agreement
with Adviser discussed above.
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<PAGE> 82
Shareholder Services Agreement. The Company has adopted Shareholder
Services Plans on behalf of each Fund. Pursuant to the Plans, financial
institutions (which may include Wells Fargo Bank, its affiliates, and
affiliates of WFNIA or, after the Acquisition, affiliates of BZWGI) may act as
the shareholder servicing agent (either, as applicable, the "Agent") for each
Fund pursuant to Shareholder Servicing Agreements. Such Agent will agree to
perform certain shareholder liaison services such as answering shareholder
inquiries regarding account status and history, and the manner in which
purchases, exchanges and redemptions of Fund shares may be made.
For its services as the Agent, the Fund may pay fees at the annual
rate of up to 0.20% of the average daily value of the net assets of each Fund.
Transfer and Dividend Disbursing Agent Agreements. Wells Fargo Bank
acts as the Company's Transfer and Dividend Disbursing Agent (the "Transfer
Agent"). The Company has agreed to pay Wells Fargo Bank a monthly fee at the
annual rate of 0.10% of each Fund's average daily value of the net assets for
transfer agency services.
PURCHASE AND REDEMPTION OF SHARES
Terms of Purchase. The Company reserves the right to reject any
purchase order and to change the amount of the minimum investment and
subsequent purchases in the Funds.
Suspension of Redemptions. The right of redemption may be suspended
or the date of payment postponed (a) during any period when the New York Stock
Exchange ("NYSE") is closed (other than customary weekend and holiday closing),
(b) when trading in the markets a Master Portfolio normally utilizes is
restricted, or when an emergency exists as determined by the Securities and
Exchange Commission so that disposal of such Master Portfolio's investments or
determination of its net asset value is not reasonably practicable, or (c) for
such other periods as the Securities and Exchange Commission by order may
permit to protect the Fund's shareholders.
DETERMINATION OF NET ASSET VALUE
LifePath Master Portfolios. The securities of the LifePath Master
Portfolios, including covered call options written by a LifePath Master
Portfolio, are valued at the last sale price on the securities exchange or
national securities market on which such securities primarily are traded.
B-16
<PAGE> 83
Securities not listed on an exchange or national securities market, or
securities in which there were no transactions, are valued at the most recent
bid prices. Portfolio securities which are traded primarily on foreign
securities exchanges generally are valued at the preceding closing values of
such securities on their respective exchanges, except that when an occurrence
subsequent to the time a value was so established is likely to have changed
such value, then the fair value of those securities is determined by
consideration of other factors by or under the direction of MIP's Board of
Trustees or its delegates. Short-term investments are carried at amortized
cost, which approximates market value. Any securities or other assets for
which recent market quotations are not readily available are valued at fair
value as determined in good faith by MIP's Board of Trustees.
Restricted securities, as well as securities or other assets for which
market quotations are not readily available, or are not valued by a pricing
service approved by MIP's Board of Trustees, are valued at fair value as
determined in good faith by or under the direction of MIP's Board of Trustees
or its delegates. MIP's Board of Trustees reviews the method of valuation on a
current basis. In making a good-faith valuation of restricted securities, the
following are generally considered: restricted securities that are, or are
convertible into, securities of the same class of securities for which a public
market exists usually are valued at market value less the same percentage
discount at which such securities were purchased. This discount may be revised
periodically if the Adviser believes that the discount no longer reflects the
value of the restricted securities. Restricted securities not of the same
class as securities for which a public market exists usually are valued
initially at cost. Any subsequent adjustment from cost is based upon
considerations deemed relevant by or under the direction of MIP's Board of
Trustees or its delegates.
Any assets or liabilities initially expressed in terms of foreign
currency are translated into dollars using information provided by pricing
entities, such as Morgan Stanley Capital International or Gelderman Data
Service, or at a quoted market exchange rate as may be determined to be
appropriate by the Adviser. Forward currency contracts are valued at the
current cost of offsetting the contract. Because of the need to obtain prices
as of the close of trading on various exchanges throughout the world, the
calculation of net asset value does not take place contemporaneously with the
determination of prices of the foreign securities held by the LifePath Master
Portfolios. In addition, foreign securities held by a LifePath Master
Portfolio may be traded actively in securities markets which are open for
trading on days when the
B-17
<PAGE> 84
Master Portfolio does not determine its net asset value. Accordingly, there may
be occasions when a LifePath Master Portfolio does not calculate its net asset
value but when the value of such Master Portfolio's portfolio securities is
affected by such trading activity.
Fixed-income securities are valued each business day using available
market quotations or at fair value as determined by one or more independent
pricing services (collectively, the "Service") approved by MIP's Board of
Trustees. The Service may use available market quotations and employ
electronic data processing techniques and/or a matrix system to determine
valuations. The Service's procedures are reviewed by MIP's officers under the
general supervision of MIP's Board of Trustees.
Expenses and fees, including advisory fees, are accrued daily and are
taken into account for the purpose of determining the net asset value of each
LifePath Master Portfolio's shares.
New York Stock Exchange Closings. The holidays on which the NYSE is
closed currently are: New Year's Day, Presidents' Day, Good Friday, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Each Fund intends to qualify each year as a "regulated investment
company" under the Internal Revenue Code of 1986, as amended (the "Code), so
long as such qualification is in the best interests of its shareholders. The
Master Portfolio's assets, income and distributions are managed in such a way
that an investor in the Master Portfolio itself is able to qualify as a
regulated investment company under the Code, assuming that the investor invests
all of its assets in the Master Portfolio. Each Fund invests all of its assets
in the Master Portfolio bearing the corresponding name.
To qualify as a regulated investment company, an entity must derive
at least 90% of its annual gross income from dividends, interest, payments with
respect to loans of securities, gains from the sale or other disposition of
stock, securities or foreign currencies, or other income derived with respect
to its business of investing in such stock, securities or currencies (including
but not limited to gains from options, futures or forward contracts), must
derive less than 30% of its annual gross income from gain on the sale of
securities held for less than three months, and must meet certain asset
diversification and other requirements. Accordingly, a
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<PAGE> 85
regulated investment company may be restricted in the selling of securities
held for less than three months, and in the utilization of certain of the
investment techniques described in the Prospectus. The Code, however, allows a
regulated investment company to net certain offsetting positions making it
easier to satisfy the 30% test. Qualification as a regulated investment
company relieves the entity from any liability for federal income taxes to the
extent that the entity distributes each year at least 90% of its investment
company taxable income (including net investment income and net short-term
capital gain, but not including net long-term capital gain) and complies with
other applicable provisions of the Code. The term "regulated investment
company" does not imply the supervision of management or investment practices
or policies by any government agency.
Any dividend or distribution paid shortly after an investor's purchase
of shares in a regulated investment company may have the effect of reducing the
aggregate net asset value of the investor's shares below the cost of the
investor's investment. Such a distribution would be a return on investment in
an economic sense although taxable as stated in "Dividends, Distributions and
Taxes" in the Prospectus. In addition, the Code provides that if a shareholder
holds shares of a regulated investment company for six months or less and has
received a capital gain dividend with respect to such shares, any loss incurred
on the sale of such shares is treated as a long-term capital loss to the extent
of the capital gain dividend received.
Depending on the composition of a regulated investment company's
income, dividends paid by the regulated investment company from net investment
income may qualify for the dividends-received deduction allowable to certain
U.S. corporate shareholders ("dividends-received deduction"). In general,
dividend income of the regulated investment company distributed to qualifying
corporate shareholders is eligible for the dividends received deduction only to
the extent that (i) the regulated investment company's income consists of
dividends paid by U.S. corporations and (ii) the regulated investment company
would have been entitled to the dividends received deduction with respect to
such dividend income if the regulated investment company were not a regulated
investment company under the Code. The dividends received deduction for
qualifying corporate shareholders may be further reduced if the shares of the
regulated investment company held by such shareholders with respect to which
dividends are received are treated as debt-financed or deemed to have been held
for less than 46 days. In addition, the Code provides other limitations with
respect to the ability of a qualifying corporate shareholder to claim the
dividends received deduction in
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<PAGE> 86
connection with holding shares of a regulated investment company.
An investor will recognize a gain or loss on the sale, redemption or
exchange of shares of a Fund. Pursuant to Section 1091 of the Code, all or a
portion of any loss so recognized may be disallowed if the investor purchases
other substantially identical shares within the 61-day period starting 30 days
before and ending 30 days after the sale, redemption or exchange of such
shares.
Ordinarily, gains and losses realized from portfolio transactions are
treated as capital gain or loss. However, all or a portion of the gain or loss
from the disposition of non- U.S. dollar denominated securities (including debt
instruments, certain financial forward, futures and option contracts, and
certain preferred stock) may be treated as ordinary income or loss under
Section 988 of the Code (relating to the taxation of foreign currency
transactions). In addition, all or a portion of the gain realized from the
disposition of certain market discount bonds is treated as ordinary income
under Section 1276. Finally, all or a portion of the gain realized from
engaging in "conversion transactions" may be treated as ordinary income under
Section 1258. "Conversion transactions" are defined to include certain
forward, futures, option and straddle transactions, transactions marketed or
sold to produce capital gains, or transactions described in Treasury
regulations to be issued in the future.
Under the Code, gain or loss realized by a regulated investment
company from certain financial forward, futures and options transactions is
treated as 60% long-term capital gain or loss and 40% short-term capital gain
or loss under Section 1256 of the Code. Gain or loss may arise upon the
exercise or lapse of such forward contracts, futures and options as well as
from closing transactions. In addition, any such forward contracts, futures or
options remaining unexercised at the end of the regulated investment company's
taxable year are treated as sold for their then fair market value, resulting in
additional gain or loss to the regulated investment company characterized in
the manner described above.
Offsetting positions held by a regulated investment company involving
certain financial forward, futures or option contracts may be considered, for
tax purposes, to constitute "straddles." "Straddles" are defined to include
"offsetting positions" in actively traded personal property. The tax treatment
of "straddles" is governed by Section 1092 of the Code which, in certain
circumstances, overrides or modifies the provisions of Section 1256.
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If a regulated investment company were treated as entering into
"straddles" by reason of its engaging in certain financial forward, futures or
option contracts, such straddles could be characterized as "mixed straddles" if
the futures, forwards, or options comprising a part of such straddles were
governed by Section 1256 of the Code. The regulated investment company may
make one or more elections with respect to "mixed straddles." Depending upon
which election is made, if any, the results with respect to the regulated
investment company may differ. Generally, to the extent the straddle rules
apply to positions established by the regulated investment company, losses
realized by the regulated investment company may be deferred to the extent of
unrealized gain in any offsetting positions. Moreover, as a result of the
straddle and the conversion transaction rules, short-term capital loss on
straddle positions may be recharacterized as long-term capital loss, and
long-term capital gain may be characterized as short-term capital gain or
ordinary income.
Investment by a regulated investment company in securities issued or
acquired at a discount, or providing for deferred interest or for payment of
interest in the form of additional obligations, could under special tax rules
affect the amount, timing and character of distributions to shareholders by
causing the regulated investment company to recognize income prior to the
receipt of cash payments. For example, the regulated investment company could
be required to accrue a portion of the discount (or deemed discount) at which
the securities were issued each year and to distribute such income in order to
maintain its qualification as a regulated investment company. In such case,
the regulated investment company may have to dispose of securities which it
might otherwise have continued to hold, in order to generate cash to satisfy
these distribution requirements.
The foregoing discussion, and the discussions in the Prospectus
applicable to each investor, address only some of the federal tax
considerations generally affecting investments in a Fund. Each investor is
urged to consult the investor's tax adviser regarding specific questions as to
federal, state or local taxes.
CAPITAL STOCK
The Funds are new series of the Company. As of the date of
effectiveness of the Prospectus and this Post-Effective Amendment to the
Registration Statement, these Funds have no Shareholders.
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PERFORMANCE INFORMATION
LifePath Funds. Average annual total return is calculated by
determining the ending redeemable value of an investment purchased with a
hypothetical $1,000 payment made at the beginning of the period (assuming the
reinvestment of dividends and distributions), dividing by the amount of the
initial investment, taking the "n"th root of the quotient (where "n" is the
number of years in the period) and subtracting 1 from the result.
Total return is calculated by subtracting the amount of the net asset
value per share at the beginning of a stated period from the net asset value
per share at the end of the period (after giving effect to the reinvestment of
dividends and distributions during the period), and dividing the result by the
net asset value per Share at the beginning of the period.
The Performance listed below is the performance of the Institutional
Class of shares of Stagecoach Trust's LifePath Funds, is presented for
informational purposes only, and should not be considered as a projection of
the future performance of the Funds. The Institutional Class shares of
Stagecoach Trust's LifePath Funds was substantially similar to the Funds in
operation.
For the fiscal period from March 1, 1994 (commencement of operations)
to February 28, 1995, the average annual total returns on the Institutional
Class shares of Stagecoach Trust's LifePath Funds were as follows:
LifePath 2000 Fund Institutional Class 2.38%
LifePath 2010 Fund Institutional Class 3.53%
LifePath 2020 Fund Institutional Class 4.39%
LifePath 2030 Fund Institutional Class 4.42%
LifePath 2040 Fund Institutional Class 5.55%
For the fiscal period from March 1, 1994 (commencement of operations)
to February 28, 1995, the cumulative total returns on the Institutional Class
shares of Stagecoach Trust's LifePath Funds were as follows:
LifePath 2000 Fund Institutional Class 2.38%
LifePath 2010 Fund Institutional Class 3.53%
LifePath 2020 Fund Institutional Class 4.39%
LifePath 2030 Fund Institutional Class 4.42%
LifePath 2040 Fund Institutional Class 5.55%
From time to time, the Company may use, in advertisements and other
types of literature, information and
B-22
<PAGE> 89
statements: (1) describing the Adviser, and its affiliates and predecessors, as
one of the first investment managers to advise investment accounts using asset
allocation and index strategies; (2) describing the Funds as one of the first
mutual funds to offer a flexible investment strategy designed to change over
specific time horizons; (3) describing the performance for the Institutional
Class shares of Stagecoach Trust's LifePath Funds; and (4) describing the
Adviser as managing in excess of $205 billion in assets as of September 30,
1995 for Fortune 500 companies, governments and other institutions around the
world.
PORTFOLIO TRANSACTIONS
General. The Adviser assumes general supervision over placing orders
on behalf of MIP for the purchase or sale of portfolio securities. Allocation
of brokerage transactions, including their frequency, is made in the best
judgment of Adviser and in a manner deemed fair and reasonable to shareholders.
The primary consideration is prompt execution of orders at the most favorable
net prices.
Master Portfolios. Brokers also are selected because of their ability
to handle special executions such as are involved in large block trades or
broad distributions, provided the primary consideration is met. Portfolio
turnover may vary from year to year, as well as within a year. High turnover
rates over 100% are likely to result in comparatively greater brokerage
expenses. The overall reasonableness of brokerage commissions paid is
evaluated by the Adviser based upon its knowledge of available information as
to the general level of commissions paid by other institutional investors for
comparable services.
Purchases and sales of fixed-income securities usually are principal
transactions. Portfolio securities ordinarily are purchased directly from the
issuer or from an underwriter or market maker. Usually no brokerage
commissions are paid by the Master Portfolios for such purchases and sales.
The prices paid to the underwriters of newly-issued securities usually include
a concession paid by the issuer to the underwriter, and purchases of securities
from market makers may include the spread between the bid and asked prices.
INFORMATION ABOUT THE FUNDS
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and non-assessable.
Shares have no preemptive, subscription or conversion rights and are freely
transferable. Each share has identical voting rights with respect to the Fund
that issues
B-23
<PAGE> 90
it. Rule 18f-2 under the 1940 Act provides that any matter required to be
submitted under the provisions of the 1940 Act or applicable state law or
otherwise to the holders of the outstanding voting securities of an investment
company, such as the Company, will not be deemed to have been effectively acted
upon unless approved by the holders of a majority of the outstanding shares of
each Fund affected by such matter. Rule 18f-2 further provides that a Fund
shall be deemed to be affected by a matter unless it is clear that the
interests of such Fund in the matter are identical or that the matter does not
affect any interest of such Fund. However, the Rule exempts the selection of
independent accountants and the election of Directors from the separate voting
requirements of the Rule.
Each Fund sends annual and semi-annual financial statements to all
its shareholders of record.
CUSTODIAN, TRANSFER AND DIVIDEND DISBURSING AGENT
Wells Fargo Bank acts as the Company's transfer and dividend
disbursing agent and performs such services at 525 Market Street, San
Francisco, California 94105. Wells Fargo Institutional Trust Company, N.A.
acts or, following the consummation of the Acquisition, its anticipated
successor, BZW Global Trust Company, N.A., will act as custodian of each Fund's
investments and each performs or will perform such functions at 45 Fremont
Street, San Francisco, California, 94105.
COUNSEL
Morrison & Foerster, 2000 Pennsylvania Avenue, NW, Suite 5500,
Washington, D.C. 20006-1812, as counsel for the Company, has rendered its
opinion as to certain legal matters regarding the due authorization and valid
issuance of the shares of beneficial interest being sold pursuant to the Funds'
Prospectus.
INDEPENDENT AUDITORS
KPMG Peat Marwick LLP, Three Embarcadero Center, San Francisco,
California 94111, independent auditors, have been selected to serve as
independent auditors for the fiscal year ending February 29, 1996. KPMG Peat
Marwick LLP provides audit services, tax return preparation and assistance and
consultation in connection with review of certain Securities and Exchange
Commission filings.
B-24
<PAGE> 91
FINANCIAL INFORMATION
Included as part of this Statement of Additional Information are the
audited financial statements and schedules for the Institutional Class shares
of Stagecoach Trust's LifePath Funds for the fiscal year ended February 28,
1995 and the semi-annual unaudited financial information for the six months
ended August 31, 1995. The financial statements dated February 28, 1995 have
been audited by KPMG Peat Marwick LLP, independent auditors of Stagecoach
Trust, whose report on Stagecoach Trust dated April 20, 1995 is also included
in this Statement of Additional Information. The audited financial statements
of the Master Portfolios of MIP were audited by its former independent
accountants, Coopers & Lybrand, L.L.P., whose report on the Master Portfolios
of MIP dated as of April 20, 1995 in which they expressed an unqualified
opinion, is also attached to this Statement of Additional Information. The
Annual Report of Stagecoach Inc. filed with the Securities and Exchange
Commission on April 28, 1995 and the Semi-Annual Report of Stagecoach Inc.
filed with the Securities and Exchange Commission on November 6, 1995 are
incorporated herein by reference.
B-25
<PAGE> 92
APPENDIX
Description of certain ratings assigned by Standard & Poor's
Corporation ("S&P"), Moody's Investors Service, Inc. ("Moody's"), Fitch
Investors Service, Inc. ("Fitch"), Duff & Phelps, Inc. ("Duff") and IBCA Inc.
and IBCA Limited ("IBCA"):
S&P
Bond Ratings
AAA
Bonds rated AAA have the highest rating assigned by S&P. Capacity to
pay interest and repay principal is extremely strong.
AA
Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only in small degree.
A
Bonds rated A have a strong capacity to pay interest and repay
principal although they are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in higher
rated categories.
BBB
Bonds rated BBB are regarded as having an adequate capacity to pay
interest and repay principal. Whereas they normally exhibit adequate
protection parameters, adverse economic conditions or changing circumstances
are more likely to lead to a weakened capacity to pay interest and repay
principal for bonds in this category than for bonds in higher rated categories.
S&P's letter ratings may be modified by the addition of a plus (+) or
minus (-) sign designation, which is used to show relative standing within the
major rating categories, except in the AAA (Prime Grade) category.
Commercial Paper Rating
The designation A-1 by S&P indicates that the degree of safety
regarding timely payment is either overwhelming or very strong. Those issues
determined to possess overwhelming safety characteristics are denoted with a
plus sign (+)
B-26
<PAGE> 93
designation. Capacity for timely payment on issues with an A-2 designation is
strong. However, the relative degree of safety is not as high as for issues
designated A-1.
Moody's
Bond Ratings
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 edge." 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 generally are known
as high grade bonds. 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.
B-27
<PAGE> 94
Moody's applies the numerical modifiers 1, 2 and 3 to show relative
standing within the major rating categories, except in the Aaa category. The
modifier 1 indicates a ranking for the security in the higher end of a rating
category; the modifier 2 indicates a mid-range ranking; and the modifier 3
indicates a ranking in the lower end of a rating category.
Commercial Paper Rating
The rating Prime-1 (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of P-1 paper must have a superior capacity for
repayment of short-term promissory obligations, which capacity ordinarily will
be evidenced by leading market positions in well-established industries, high
rates of return on funds employed, conservative capitalization structures with
moderate reliance on debt and ample asset protection, broad margins in earnings
coverage of fixed financial charges and high internal cash generation, and
well- established access to a range of financial markets and assured sources of
alternate liquidity.
Issuers (or related supporting institutions) rated Prime-2 (P-2) have
a strong capacity for repayment of short- term promissory obligations. This
ordinarily will be evidenced by many of the characteristics cited above but to
a lesser degree. Earnings trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
Fitch
Bond Ratings
The ratings represent Fitch's assessment of the issuer's ability to
meet the obligations of a specific debt issue or class of debt. The ratings
take into consideration special features of the issue, its relationship to
other obligations of the issuer, the current financial condition and operative
performance of the issuer and of any guarantor, as well as the political and
economic environment that might affect the issuer's future financial strength
and credit quality.
AAA
Bonds rated AAA are considered to be investment-grade and of the
highest credit quality. The obligor has an exceptionally strong ability to pay
interest and repay principal, which is unlikely to be affected by reasonably
foreseeable events.
B-28
<PAGE> 95
AA
Bonds rated AA are considered to be investment-grade and of very high
credit quality. The obligor's ability to pay interest and repay principal is
very strong, although not quite as strong as for bonds rated AAA. Because
bonds rated in the AAA and AA categories are not significantly vulnerable to
foreseeable future developments, short-term debt of these issuers is generally
rated F-1+.
A
Bonds rated A are considered to be investment-grade and of high
credit quality. The obligor's ability to pay interest and repay principal is
considered to be strong, but may be more vulnerable to adverse changes in
economic conditions and circumstances than for bonds with higher ratings.
BBB
Bonds rated BBB are considered to be investment-grade and of
satisfactory credit quality. The obligor's ability to pay interest and repay
principal is considered to be adequate. Adverse changes in economic conditions
and circumstances, however, are more likely to have an adverse impact on these
bonds and, therefore, impair timely payment. The likelihood that the ratings
of these bonds will fall below investment grade is higher than for bonds with
higher ratings.
Plus (+) and minus (-) signs are used with a rating symbol to
indicate the relative position of a credit within the rating category.
Short-Term Ratings
Fitch's short-term ratings apply to debt obligations that are payable
on demand or have original maturities of up to three years, including
commercial paper, certificates of deposit, medium-term notes, and municipal and
investment notes.
Although the credit analysis is similar to Fitch's bond rating
analysis, the short-term rating places greater emphasis than bond ratings on
the existence of liquidity necessary to meet the issuer's obligations in a
timely manner.
F-1+
Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.
B-29
<PAGE> 96
F-1
Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated
F-1+.
F-2
Good Credit Quality. Issues carrying this rating have a satisfactory
degree of assurance for timely payment, but the margin of safety is not as
great as the F-1+ and F-1 categories.
Duff
Bond Ratings
AAA
Bonds rated AAA are considered highest credit quality. The risk
factors are negligible, being only slightly more than for risk-free U.S.
Treasury debt.
AA
Bonds rated AA are considered high credit quality. Protection factors
are strong. Risk is modest but may vary slightly from time to time because of
economic conditions.
A
Bonds rated A have protection factors which are average but adequate.
However, risk factors are more variable and greater in periods of economic
stress.
BBB
Bonds rated BBB are considered to have below average protection
factors but are still considered sufficient for prudent investment. There is
considerable variability in risk during economic cycles.
Plus (+) and minus (-) signs are used with a rating symbol (except
AAA) to indicate the relative position of a credit within the rating category.
Commercial Paper Rating
The rating Duff-1 is the highest commercial paper rating assigned by
Duff. Paper rated Duff-1 is regarded as having very high certainty of timely
payment with excellent
B-30
<PAGE> 97
liquidity factors which are supported by ample asset protection. Risk factors
are minor. Paper rated Duff-2 is regarded as having good certainty of timely
payment, good access to capital markets and sound liquidity factors and company
fundamentals. Risk factors are small.
IBCA
Bond and Long-Term Ratings
Obligations rated AAA by IBCA have the lowest expectation of
investment risk. Capacity for timely repayment of principal and interest is
substantial, such that adverse changes in business, economic or financial
conditions are unlikely to increase investment risk significantly. Obligations
for which there is a very low expectation of investment risk are rated AA by
IBCA. Capacity for timely repayment of principal and interest is substantial.
Adverse changes in business, economic or financial conditions may increase
investment risk albeit not very significantly.
Commercial Paper and Short-Term Ratings
The designation A1 by IBCA indicates that the obligation is supported
by a very strong capacity for timely repayment. Those obligations rated A1 are
supported by the highest capacity for timely repayment. Obligations rated A2
are supported by a strong capacity for timely repayment, although such capacity
may be susceptible to adverse changes in business, economic or financial
conditions.
International and U.S. Bank Ratings
An IBCA bank rating represents IBCA's current assessment of the
strength of the bank and whether such bank would receive support should it
experience difficulties. In its assessment of a bank, IBCA uses a dual rating
system comprised of Legal Ratings and Individual Ratings. In addition, IBCA
assigns banks Long- and Short-Term Ratings as used in the corporate ratings
discussed above. Legal Ratings, which range in gradation from 1 through 5,
address the question of whether the bank would receive support provided by
central banks or shareholders if it experienced difficulties, and such ratings
are considered by IBCA to be a prime factor in its assessment of credit risk.
Individual Ratings, which range in gradations from A through E, represent
IBCA's assessment of a bank's economic merits and address the question of how
the bank would be viewed if it were entirely independent and could not rely on
support from state authorities or its owners.
B-31
<PAGE> 98
STATEMENT OF ASSETS AND LIABILITIES
February 28, 1995
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020
FUND FUND FUND
- ----------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investments:
In corresponding Master
Series, at market value
(Note 1) $60,312,597 $49,328,919 $81,933,300
Receivables:
Dividends and interest 533,314 358,536 491,442
Fund shares sold 1,336,688 152,250 309,890
Total Assets 62,182,599 49,839,705 82,734,632
LIABILITIES
Payables:
Fund shares redeemed 0 0 0
Due to sponsor and
distributor 36,883 25,461 43,738
Due to Wells Fargo Bank 29,575 22,688 37,382
Total Liabilities 66,458 48,149 81,120
TOTAL NET ASSETS $62,116,141 $49,791,556 $82,653,512
Net assets consist of:
Paid-in capital - Retail
class $54,129,643 $36,136,528 $63,834,565
Paid-in capital -
Institutional class 7,354,528 12,692,554 16,007,463
Undistributed net
investment income 472,022 314,113 416,342
Undistributed net realized
gain (loss) on
investments 114,639 83,416 31,741
Net unrealized
appreciation of
investments 45,309 564,945 2,363,401
TOTAL NET ASSETS $62,116,141 $49,791,556 $82,653,512
COMPUTATION OF NET ASSET
VALUE AND OFFERING PRICE
PER SHARE
Net Assets - Retail class $54,616,805 $36,763,683 $66,035,796
Shares outstanding - Retail
class 5,503,209 3,678,991 6,494,010
Net asset value and offering
price per share - Retail
class $9.92 $9.99 $10.17
Net Assets - Institutional
class $7,499,336 $13,027,873 $16,617,716
Shares outstanding -
Institutional class 754,459 1,299,540 1,634,490
Net asset value and offering
price per share -
Institutional class $9.94 $10.02 $10.17
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
8
<PAGE> 99
STATEMENT OF ASSETS AND LIABILITIES 2/28/95
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
2030 2040
FUND FUND
- -----------------------------------------------------------------
<S> <C> <C>
ASSETS
Investments:
In corresponding Master
Series, at market value
(Note 1) $50,425,647 $66,761,734
Receivables:
Dividends and interest 268,364 274,124
Fund shares sold 190,690 163,034
Total Assets 50,884,701 67,198,892
LIABILITIES
Payables:
Fund shares redeemed 0 420,060
Due to sponsor and
distributor 26,900 36,221
Due to Wells Fargo Bank 22,863 30,019
Total Liabilities 49,763 486,300
TOTAL NET ASSETS $50,834,938 $66,712,592
Net assets consist of:
Paid-in capital - Retail
class $39,469,433 $53,831,397
Paid-in capital -
Institutional class 9,276,241 9,500,629
Undistributed net
investment income 222,289 212,649
Undistributed net realized
gain (loss) on
investments (183,134) 38,771
Net unrealized
appreciation of
investments 2,050,109 3,129,146
TOTAL NET ASSETS $50,834,938 $66,712,592
COMPUTATION OF NET ASSET
VALUE AND OFFERING PRICE
PER SHARE
Net Assets - Retail class $41,153,295 $56,737,041
Shares outstanding - Retail
class 4,044,617 5,471,713
Net asset value and offering
price per share - Retail
class $10.17 $10.37
Net Assets - Institutional
class $9,681,643 $9,975,551
Shares outstanding -
Institutional class 950,599 961,668
Net asset value and offering
price per share -
Institutional class $10.18 $10.37
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
9
<PAGE> 100
STATEMENT OF OPERATIONS
For The Year Ended February 28, 1995
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020
FUND FUND FUND
- ----------------------------------------------------------------------------------
<S> <C> <C> <C>
NET INVESTMENT INCOME
ALLOCATED FROM MASTER
SERIES
Dividends $172,305 $234,457 $630,985
Interest 2,157,324 1,391,008 1,611,548
Expenses (217,676) (158,218) (252,413)
Net Investment Income
Allocated from Master
Series 2,111,953 1,467,247 1,990,120
EXPENSES (NOTE 2)
Administration fees 39,834 28,945 46,153
Shareholder servicing fees 79,669 57,889 92,307
Transfer agency fees 39,834 28,945 46,153
Distribution fees - Retail
Class 90,793 57,878 95,003
Total Expenses 250,130 173,657 279,616
NET INVESTMENT INCOME 1,861,823 1,293,590 1,710,504
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS
ALLOCATED FROM MASTER
SERIES
Net realized gain (loss) on
sale of investments 167,080 298,374 31,741
Net change in unrealized
appreciation of
investments 45,309 564,945 2,363,401
Net Gain On Investments 212,389 863,319 2,395,142
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $2,074,212 $2,156,909 $4,105,646
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
10
<PAGE> 101
STATEMENT OF OPERATIONS 2/28/95
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
2030 2040
FUND FUND
- -----------------------------------------------------------------
<S> <C> <C>
NET INVESTMENT INCOME
ALLOCATED FROM MASTER
SERIES
Dividends $482,604 $772,325
Interest 822,159 456,448
Expenses (156,229) (189,121)
Net Investment Income
Allocated from Master
Series 1,148,534 1,039,652
EXPENSES (NOTE 2)
Administration fees 28,565 34,460
Shareholder servicing fees 57,131 68,921
Transfer agency fees 28,565 34,460
Distribution fees - Retail
Class 59,699 73,409
Total Expenses 173,960 211,250
NET INVESTMENT INCOME 974,574 828,402
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS
ALLOCATED FROM MASTER
SERIES
Net realized gain (loss) on
sale of investments (183,134) 38,771
Net change in unrealized
appreciation of
investments 2,050,109 3,129,146
Net Gain On Investments 1,866,975 3,167,917
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $2,841,549 $3,996,319
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
11
<PAGE> 102
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010
FUND FUND
---------------- ----------------
FOR THE FOR THE
YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 28,
1995 1995
- ----------------------------------------------------------------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations:
Net investment income $1,861,823 $1,293,590
Net realized gain (loss)
on sale of investments 167,080 298,374
Net change in unrealized
appreciation
(depreciation) of
investments 45,309 564,945
Net increase in net assets
resulting from operations 2,074,212 2,156,909
Distributions to
shareholders:
From net investment income
Retail class (1,272,285) (792,655)
Institutional class (117,516) (186,822)
From net realized gain on
sales of investments
Retail class (47,137) (164,665)
Institutional class (5,304) (50,293)
Capital shares transactions:
Proceeds from shares sold
- Retail class 79,821,113 44,016,587
Reinvestment of dividends
- Retail class 1,242,642 938,718
Cost of shares redeemed -
Retail class (26,934,112) (8,818,777)
Net increase in net assets
resulting from capital
share transactions - Retail
class 54,129,643 36,136,528
Proceeds from shares sold
- Institutional class 8,826,786 14,259,774
Reinvestment of dividends
- Institutional class 122,820 237,115
Cost of shares redeemed -
Institutional class (1,605,078) (1,814,335)
Net increase in net assets
resulting from capital
share transactions -
Institutional class 7,344,528 12,682,554
Increase In Net Assets 62,106,141 49,781,556
NET ASSETS:
Beginning net assets $10,000 $10,000
Ending net assets $62,116,141 $49,791,556
SHARES ISSUED AND REDEEMED:
Shares sold - Retail class 8,149,639 4,487,768
Shares issued in
reinvestment of
dividends - Retail class 129,306 97,829
Shares redeemed - Retail
class (2,775,736) (906,606)
Net increase in shares
outstanding - Retail class 5,503,209 3,678,991
Shares sold -
Institutional class 905,140 1,459,857
Shares issued in
reinvestment of
dividends -
Institutional class 12,783 24,706
Shares redeemed -
Institutional class (164,464) (186,023)
Net increase in shares
outstanding - Institutional
class 753,459 1,298,540
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
12
<PAGE> 103
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
FUND FUND FUND
---------------- ---------------- ----------------
FOR THE FOR THE FOR THE
YEAR ENDED YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 28, FEBRUARY 28,
1995 1995 1995
- -----------------------------------------------------------------------------------
<S> <C> <C> <C>
INCREASE IN NET ASSETS
Operations:
Net investment income $1,710,504 $974,574 $828,402
Net realized gain (loss)
on sale of investments 31,741 (183,134) 38,771
Net change in unrealized
appreciation
(depreciation) of
investments 2,363,401 2,050,109 3,129,146
Net increase in net assets
resulting from operations 4,105,646 2,841,549 3,996,319
Distributions to
shareholders:
From net investment income
Retail class (1,059,929) (626,319) (515,015)
Institutional class (234,233) (125,966) (100,738)
From net realized gain on
sales of investments
Retail class 0 0 0
Institutional class 0 0 0
Capital shares transactions:
Proceeds from shares sold
- Retail class 76,248,722 46,409,294 63,522,813
Reinvestment of dividends
- Retail class 1,036,090 620,208 514,110
Cost of shares redeemed -
Retail class (13,450,247) (7,560,069) (10,205,526)
Net increase in net assets
resulting from capital
share transactions - Retail
class 63,834,565 39,469,433 53,831,397
Proceeds from shares sold
- Institutional class 19,610,472 10,945,015 11,844,340
Reinvestment of dividends
- Institutional class 234,233 125,966 100,738
Cost of shares redeemed -
Institutional class (3,847,242) (1,804,740) (2,454,449)
Net increase in net assets
resulting from capital
share transactions -
Institutional class 15,997,463 9,266,241 9,490,629
Increase In Net Assets 82,643,512 50,824,938 66,702,592
NET ASSETS:
Beginning net assets $10,000 $10,000 $10,000
Ending net assets $82,653,512 $50,834,938 $66,712,592
SHARES ISSUED AND REDEEMED:
Shares sold - Retail class 7,760,327 4,756,966 6,450,959
Shares issued in
reinvestment of
dividends - Retail class 107,008 64,274 52,581
Shares redeemed - Retail
class (1,373,325) (776,623) (1,031,827)
Net increase in shares
outstanding - Retail class 6,494,010 4,044,617 5,471,713
Shares sold -
Institutional class 2,005,382 1,121,285 1,198,550
Shares issued in
reinvestment of
dividends -
Institutional class 24,204 13,083 10,318
Shares redeemed -
Institutional class (396,096) (184,769) (248,200)
Net increase in shares
outstanding - Institutional
class 1,633,490 949,599 960,668
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
13
<PAGE> 104
FINANCIAL HIGHLIGHTS
For a share outstanding for the year ended February 28, 1995:
<TABLE>
<CAPTION>
LIFEPATH 2000 FUND LIFEPATH 2010 FUND
---------------------- ----------------------
INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL
CLASS CLASS CLASS CLASS
----------- --------- ----------- ---------
<S> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 10.00 $ 10.00 $ 10.00 $ 10.00
----------- --------- ----------- ---------
Income from investment operations:
Net investment income 0.35 0.34 0.33 0.34
Net realized and unrealized gain/(loss) on
investments (0.12) (0.14) 0.01 (0.02)
----------- --------- ----------- ---------
Total from investment operations 0.23 0.20 0.34 0.32
Less distributions:
Dividends from net investment income (0.28) (0.27) (0.27) (0.28)
Distributions from net realized capital gains (0.01) (0.01) (0.05) (0.05)
----------- --------- ----------- ---------
Total Distributions (0.29) (0.28) (0.32) (0.33)
----------- --------- ----------- ---------
Net Asset Value, end of Period $ 9.94 $ 9.92 $ 10.02 $ 9.99
----------- --------- ----------- ---------
----------- --------- ----------- ---------
Total Return (not annualized) 2.38% 2.10% 3.53% 3.31%
Ratios/Supplemental Data:
Net assets, end of period (000) $7,499 $ 54,617 $ 13,028 $ 36,764
Number of shares outstanding, end of period (000) 754 5,503 1,300 3,679
Ratios to average net assets (annualized):
Ratio of expenses to average net assets(1) 0.95% 1.20% 0.95% 1.20%
Ratio of net investment income to average net
assets(1) 4.89% 4.62% 4.61% 4.40%
Portfolio Turnover(2) -- -- -- --
- -----------------------------------------------------------------------------------------------------
(1) THIS RATIO INCLUDES EXPENSES CHARGED TO THE
MASTER SERIES.
(2) THE FUNDS INVEST ALL OF THEIR ASSETS IN THE
CORRESPONDING MASTER SERIES, HENCE NO
SECURITIES-RELATED ACTIVITY.
</TABLE>
14
<PAGE> 105
FINANCIAL HIGHLIGHTS (Continued)
For a share outstanding for the year ended February 28, 1995:
<TABLE>
<CAPTION>
LIFEPATH 2020 FUND LIFEPATH 2030 FUND
---------------------- ----------------------
INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL
CLASS CLASS CLASS CLASS
----------- --------- ----------- ---------
<S> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 10.00 $ 10.00 $ 10.00 $ 10.00
----------- --------- ----------- ---------
Income from investment operations:
Net investment income 0.30 0.28 0.29 0.26
Net realized gain/(loss) on investments 0.12 0.12 0.14 0.13
----------- --------- ----------- ---------
Total from investment operations 0.42 0.40 0.43 0.39
Less distributions:
Dividends from net investment income (0.25) (0.23) (0.25) (0.22)
Distributions from net realized capital gains 0.00 0.00 0.00 0.00
----------- --------- ----------- ---------
Total from distributions (0.25) (0.23) (0.25) (0.22)
----------- --------- ----------- ---------
Net Asset Value, end of period $ 10.17 $ 10.17 $ 10.18 $ 10.17
----------- --------- ----------- ---------
----------- --------- ----------- ---------
Total Return (not annualized) 4.39% 4.12% 4.42% 4.03%
Ratios/Supplemental Data:
Net assets, end of period (000) $ 16,618 $ 66,036 $ 9,682 $ 41,153
Number of shares outstanding, end of period (000) 1,634 6,494 951 4,045
Ratios to average net assets (annualized):
Ratio of expenses to average net assets(1) 0.95% 1.20% 0.95% 1.20%
Ratio of net investment income to average net
assets(1) 3.88% 3.64% 3.59% 3.35%
Portfolio Turnover(2) -- -- -- --
- -----------------------------------------------------------------------------------------------------
(1) THIS RATIO INCLUDES EXPENSES CHARGED TO THE
MASTER SERIES.
(2) THE FUNDS INVEST ALL OF THEIR ASSETS IN THE
CORRESPONDING MASTER SERIES, HENCE NO
SECURITIES-RELATED ACTIVITY.
</TABLE>
15
<PAGE> 106
FINANCIAL HIGHLIGHTS (Continued)
For a share outstanding for the year ended February 28, 1995:
<TABLE>
<CAPTION>
LIFEPATH 2040 FUND
----------------------
INSTITUTIONAL RETAIL
CLASS CLASS
----------- ---------
<S> <C> <C>
Net Asset Value, beginning of period $ 10.00 $ 10.00
----------- ---------
Income from investment operations:
Net investment income 0.20 0.18
Net realized gain/(loss) on investments 0.34 0.34
----------- ---------
Total from investment operations 0.54 0.52
Less distributions:
Dividends from net investment income (0.17) (0.15)
Distributions from net realized capital gains 0.00 0.00
----------- ---------
Total from distributions (0.17) (0.15)
----------- ---------
Net Asset Value, end of period $ 10.37 $ 10.37
----------- ---------
----------- ---------
Total Return (not annualized) 5.55% 5.26%
Ratios/Supplemental Data:
Net assets, end of period (000) $9,976 $ 56,737
Number of shares outstanding, end of period (000) 962 5,472
Ratios to average net assets (annualized):
Ratio of expenses to average net assets(1) 0.95% 1.20%
Ratio of net investment income to average net assets(1) 2.61% 2.35%
Portfolio Turnover(2) -- --
- ----------------------------------------------------------------------------------------------------
(1) THIS RATIO INCLUDES EXPENSES CHARGED TO THE MASTER SERIES.
(2) THE FUND INVESTS ALL OF ITS ASSETS IN THE CORRESPONDING MASTER SERIES,
HENCE NO SECURITIES-RELATED ACTIVITY.
</TABLE>
16
<PAGE> 107
STAGECOACH TRUST
NOTES TO THE FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION. Stagecoach Trust (the "Trust") is registered under the
Investment Company Act of 1940 (the "1940 Act"), as amended, as an open-end
management investment company. The Trust was organized as a Massachusetts
business trust pursuant to an Agreement and Declaration of Trust dated May 14,
1993. The Trust currently is authorized to issue ten separate diversified funds,
of which the following commenced operations on March 1, 1994: the LifePath 2000
Fund, the LifePath 2010 Fund, the LifePath 2020 Fund, the LifePath 2030 Fund and
the LifePath 2040 Fund (the "Funds"). The following significant accounting
policies are consistently followed by the Trust in the preparation of its
financial statements, and such policies are in conformity with generally
accepted accounting principles for investment companies.
Each Fund offers two classes of shares, an Institutional Class and a Retail
Class. The two classes of shares differ principally in their respective
distribution fees. Shareholders of each class also bear certain expenses that
pertain to that particular class. All shareholders bear the common expenses of
the Fund and earn income from the portfolio, pro rata based on the average daily
net assets of each class. Dividends are declared separately for each class.
Gains are allocated to each class pro rata based upon net assets of each class
on the date of distribution. Neither class has preferential dividend rights;
differences in per share dividend rates are generally due to differences in
separate class expenses, including distribution fees and from the weightings of
pro rata income and gain allocations.
INVESTMENT POLICY AND SECURITY VALUATION
Each Fund invests all of its assets in a separate series (each, a "Master
Series") of Master Investment Portfolio. Each Master Series has the same
investment objective as the Fund bearing the corresponding name. The value of
each Fund's investment in its corresponding Master Series reflects that Fund's
interest in the net assets of that Master Series (99.98%, 99.98%, 99.99%,
99.96%, and 99.98%) for the LifePath 2000, LifePath 2010, LifePath 2020,
LifePath 2030 and LifePath 2040, respectively, at February 28, 1995. The Master
Series invest in a wide range of U.S. and foreign equity, debt securities and
money market instruments. Each Master Series follows an asset allocation
strategy among three
17
<PAGE> 108
STAGECOACH TRUST
NOTES TO THE FINANCIAL STATEMENTS
broad investment classes: equity and debt securities of issuers located
throughout the world and cash in the form of money market instruments. The
securities of the Master Series are valued at the last sale price on the primary
securities exchange or national securities market on which such securities are
traded. Securities not listed on an exchange or national securities market, or
securities in which there were no transactions, are valued at the most recent
bid prices. Debt securities maturing in 60 days or less are valued at amortized
cost, which approximates market value. Any securities, restricted securities or
other assets for which recent market quotations are not readily available are
valued at fair value as determined in good faith in accordance with policies
approved by the Master Portfolio's Board of Trustees.
SECURITY TRANSACTIONS AND REVENUE RECOGNITION
Securities transactions are accounted for by each Master Series on the date
the securities are purchased or sold (trade date). Revenue is recognized by each
Master Series as follows. Dividend income is recognized on the ex-dividend date,
and interest income is recognized on a daily accrual basis. Realized gains or
losses are reported on the basis of identified cost of securities delivered.
Bond discounts and premiums are amortized as required by the Internal Revenue
Code (the "Code").
All net investment income and realized and unrealized capital gains and
losses of each Master Series are allocated pro rata among its respective Funds
in the Master Series.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Each Fund declares and pays dividends from net investment income quarterly.
Each Fund makes distributions from net realized securities gains, if any, once a
year.
FEDERAL INCOME TAXES
Each Fund of the Trust is treated as a separate entity for federal income
tax purposes. It is the policy of each Fund of the Trust to continue to qualify
as a regulated investment company by complying with the provisions applicable to
investment companies, as defined in the Code, and to make distributions of
18
<PAGE> 109
STAGECOACH TRUST
NOTES TO THE FINANCIAL STATEMENTS
investment company taxable income and net capital gain (after reduction for
capital loss carryforwards) sufficient to relieve it from all, or substantially
all, federal income taxes. Accordingly, no provision for federal income taxes
was required. As of February 28, 1995 the LifePath 2020 Fund has capital loss
carryforwards of $179,977 which will expire in the year 2002. The LifePath 2030
Fund has capital loss carryforwards of $311,585 which will expire in the year
2002 and the LifePath 2040 Fund has capital loss carryforwards of $32,220 which
will expire in the year 2002.
ORGANIZATION EXPENSES
Stephens Inc. ("Stephens"), the Funds' administrator, sponsor and
distributor, has incurred all expenses in connection with the Funds'
organization and initial registration.
2. AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES
The Trust has entered into an agreement on behalf of the Funds with Wells
Fargo Bank ("WFB") to provide transfer and dividend disbursing agency services.
For providing the transfer and dividend disbursing agency services, the Trust
has agreed to pay a monthly fee at the annual rate of 0.10% of each Fund's
average daily net assets.
The Trust may enter into (on behalf of the Funds) servicing agreements with
certain financial institutions, securities dealers and other industry
professionals (collectively, "Shareholder Servicing Agents") for the provision
of certain services to Fund shareholders. For the services provided pursuant to
a Shareholder Servicing Agreement, the Trust may pay each Shareholder Servicing
Agent a monthly fee at the annual rate of up to 0.20% of the average daily value
of each Fund's shares owned during the period for which payment is being made by
investors with whom the Shareholder Servicing Agent maintains a servicing
relationship. To date the Trust has entered into a Shareholder Servicing
Agreement only with WFB.
19
<PAGE> 110
STAGECOACH TRUST
NOTES TO THE FINANCIAL STATEMENTS
The Trust has entered into an agreement with Stephens on behalf of the
Retail Class of shares for distribution services and has adopted a Plan of
Distribution pursuant to Rule 12b-1 under the 1940 Act, whereby Stephens may be
compensated for services rendered and expenses incurred. For providing these
services, Stephens is entitled to compensation monthly at an annual rate of
0.25% of the average daily net assets of the Retail Class of shares.
The Trust has also entered into an administration agreement on behalf of the
Funds with Stephens whereby Stephens has agreed to provide administrative
services to the Funds. For providing administrative services, the Trust pays
Stephens a monthly fee at the annual rate of 0.10% of each Fund's average daily
net assets.
Under the Administration Agreement, Stephens has agreed to assume the
operating expenses of each LifePath Fund and a pro rata share of the operating
expenses of each LifePath Master Series, except for extraordinary expenses and
those fees and expenses payable pursuant to the various service contracts
described above which will be borne by the Trust and those expenses specifically
assumed by WFB under its contracts with the Funds.
Certain officers and directors of the Trust are also officers of Stephens.
At February 28, 1995, these officers of Stephens collectively owned less than 1%
of the Funds' outstanding shares.
3. CAPITAL SHARE TRANSACTIONS
As of February 28, 1995, the Trust has authorized an unlimited number of
shares of beneficial interest. Transactions in shares for the year ended
February 28, 1995, for each Fund are disclosed in detail in the Statements of
Changes in Net Assets.
20
<PAGE> 111
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and Board of Trustees
Stagecoach Trust:
We have audited the accompanying statements of assets and liabilities of
Stagecoach Trust (comprising, respectively, LifePath 2000 Fund, LifePath 2010
Fund, LifePath 2020 Fund, LifePath 2030 Fund and LifePath 2040 Fund) as of
February 28, 1995, and the related statements of operations and changes in net
assets and financial highlights for the year then ended. These financial
statements and financial highlights are the responsibility of the Trust's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included verification of securities owned as of
February 28, 1995, by examination and other appropriate audit procedures. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
each of the aforementioned funds of Stagecoach Trust as of February 28, 1995,
the results of their operations, the changes in their net assets and their
financial highlights for the year then ended, in conformity with generally
accepted accounting principles.
/s/ KPMG PEAT MARWICK LLP
SAN FRANCISCO, CALIFORNIA
APRIL 20, 1995
21
<PAGE> 112
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS
PERCENT OF NET ASSETS 20.3% 46.5%
LARGE CAPITALIZATION STOCKS
PERCENT OF NET ASSETS 9.1% 31.2%
Abbott Laboratories 661 $ 23,466 3,266 $ 115,943 8,294
Advanced Micro Devices + 238 7,229 460 13,973 1,156
Aetna Life & Casualty Co 272 14,620 538 28,918 1,364
Ahmanson (H F) & Co 280 5,145 570 10,474 1,483
Air Products & Chemicals Inc 275 13,544 541 26,644 1,353
Airtouch Communications + 438 11,936 1,991 54,255 5,119
Alberto-Culver Co Class B 48 1,368 115 3,278 398
Albertson's Inc 244 7,503 1,043 32,072 2,609
Alcan Aluminium Ltd 568 13,774 1,076 26,093 2,784
Alco Standard Corp 44 2,992 253 17,204 603
Alexander & Alexander Services 1 22 213 4,633 464
Allergan Inc 62 1,790 293 8,460 676
Allied Signal Inc 199 7,562 1,163 44,194 2,910
Alltel Corp 171 4,895 808 23,129 1,965
Aluminum Co of America 460 17,940 906 35,334 2,180
ALZA Corp + 118 2,685 369 8,395 873
Amdahl Corp 227 2,525 517 5,752 1,469
Amerada Hess Corp 238 11,662 460 22,540 1,107
American Brands Inc 503 18,800 993 37,113 2,437
American Electric Power Inc 448 15,176 918 31,097 2,253
American Express Corp 1,241 41,884 2,394 80,798 6,147
American General Corp 550 17,394 936 29,601 2,482
American Greetings Corp Class A 180 5,288 383 11,251 916
American Home Products Corp 244 17,446 1,201 85,872 3,195
American International Group Inc 206 21,373 1,312 136,120 3,268
American Stores Co 375 9,188 707 17,322 1,796
Ameritech Corp 1,383 59,296 2,669 114,433 6,644
Amgen Inc + 58 4,002 568 39,192 1,392
Amoco Corp 1,244 73,707 2,421 143,444 5,977
AMP Inc 59 4,425 402 30,150 1,073
AMR Corp + 183 11,186 360 22,005 923
Andrew Corp + 69 4,002 112 6,496 303
Anheuser-Busch Inc 166 9,358 1,086 61,223 2,695
Apple Computer Inc 280 11,060 570 22,515 1,414
Archer-Daniels-Midland Co 1,278 24,282 2,473 46,987 6,303
Armco Inc + 107 709 451 2,988 1,096
Armstrong World Industries Inc 90 4,118 204 9,333 418
ASARCO Inc 123 3,352 211 5,750 566
Ashland Inc 156 5,051 288 9,324 777
AT & T Corp 1,245 64,429 6,402 331,304 16,197
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
COMMON STOCKS
PERCENT OF NET ASSETS 61.6% 73.8% 88.0%
LARGE CAPITALIZATION STOCKS
PERCENT OF NET ASSETS 47.2% 58.6% 73.7%
Abbott Laboratories $ 294,437 6,427 $ 228,159 12,265 $ 435,408
Advanced Micro Devices + 35,114 878 26,669 1,189 36,116
Aetna Life & Casualty Co 73,315 1,028 55,255 1,423 76,486
Ahmanson (H F) & Co 27,250 1,046 19,220 1,479 27,177
Air Products & Chemicals Inc 66,635 1,034 50,925 1,412 69,541
Airtouch Communications + 139,493 3,984 108,564 7,476 203,721
Alberto-Culver Co Class B 11,343 226 6,441 368 10,488
Albertson's Inc 80,227 1,996 61,377 3,852 118,449
Alcan Aluminium Ltd 67,512 2,008 48,694 2,899 70,301
Alco Standard Corp 41,004 427 29,036 795 54,060
Alexander & Alexander Services 10,092 339 7,373 649 14,116
Allergan Inc 19,520 472 13,629 971 28,038
Allied Signal Inc 110,580 2,311 87,818 4,314 163,932
Alltel Corp 56,248 1,471 42,107 2,841 81,324
Aluminum Co of America 85,020 1,668 65,052 2,374 92,586
ALZA Corp + 19,861 684 15,561 1,215 27,641
Amdahl Corp 16,343 1,110 12,349 1,494 16,621
Amerada Hess Corp 54,243 805 39,445 1,241 60,809
American Brands Inc 91,083 1,817 67,910 2,593 96,913
American Electric Power Inc 76,320 1,677 56,808 2,427 82,215
American Express Corp 207,461 4,638 156,533 6,394 215,798
American General Corp 78,493 1,872 59,202 2,707 85,609
American Greetings Corp Class A 26,908 657 19,299 941 27,642
American Home Products Corp 228,443 2,488 177,892 4,615 329,973
American International Group Inc 339,055 2,564 266,015 4,866 504,848
American Stores Co 44,002 1,270 31,115 1,888 46,256
Ameritech Corp 284,862 5,013 214,932 7,051 302,312
Amgen Inc + 96,048 1,110 76,590 2,047 141,243
Amoco Corp 354,137 4,545 269,291 6,387 378,430
AMP Inc 80,475 873 65,475 1,627 122,025
AMR Corp + 56,418 666 40,709 953 58,252
Andrew Corp + 17,574 199 11,542 423 24,534
Anheuser-Busch Inc 151,931 2,089 117,767 3,917 220,821
Apple Computer Inc 55,853 1,076 42,502 1,481 58,500
Archer-Daniels-Midland Co 119,757 4,730 89,870 6,562 124,678
Armco Inc + 7,261 775 5,134 1,569 10,395
Armstrong World Industries Inc 19,124 366 16,745 481 22,006
ASARCO Inc 15,424 407 11,091 539 14,688
Ashland Inc 25,155 554 17,936 743 24,055
AT & T Corp 838,195 12,502 646,979 23,706 1,226,786
</TABLE>
22 23
<PAGE> 113
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Atlantic Richfield Corp 405 $ 44,398 782 $ 85,727 1,955
Autodesk Inc 84 3,297 220 8,635 450
Automatic Data Processing 73 4,490 606 37,269 1,468
Avery Dennison Corp 148 5,550 282 10,575 632
Avon Products Inc 77 4,331 330 18,563 687
Baker Hughes Inc 371 7,142 654 12,590 1,733
Ball Corp 52 1,703 168 5,502 335
Bally Entertainment Corp + 107 829 293 2,271 422
Baltimore Gas & Electric Co 381 9,382 737 18,149 1,832
Banc One Corp 1,037 30,462 1,966 57,751 4,928
Bank of Boston Corp 260 7,833 528 15,906 1,349
BankAmerica Corp 921 44,323 1,810 87,106 4,480
Bankers Trust N Y Corp 190 11,994 366 23,104 963
Bard (C R) Inc 41 1,097 250 6,688 493
Barnett Banks Inc 245 10,903 492 21,894 1,175
Barrick Gold Corp 307 6,677 1,392 30,276 3,640
Bassett Furniture Industries 25 694 46 1,277 194
Bausch & Lomb Inc 154 5,121 286 9,510 640
Baxter International Inc 709 22,068 1,377 42,859 3,433
Becton Dickenson & Co 177 9,293 331 17,378 813
Bell Atlantic Corp 1,089 58,398 2,134 114,436 5,234
BellSouth Corp 1,244 73,396 2,421 142,839 5,985
Bemis Co Inc 40 1,085 249 6,754 567
Beneficial Corp 142 5,272 251 9,318 673
Bethlehem Steel Corp + 262 4,094 530 8,281 1,380
Beverly Enterprises + 220 2,860 371 4,823 1,014
Biomet Inc + 77 1,246 418 6,766 1,220
Black & Decker Corp 222 5,939 422 11,289 1,022
Block (H & R) Inc 61 2,295 429 16,141 1,050
Boatmen's Bancshares Inc 257 7,967 526 16,306 1,271
Boeing Co 846 39,022 1,645 75,876 4,165
Boise Cascade Corp 67 2,152 205 6,586 429
Boston Scientific Corp + 543 11,742 443 9,580 805
Briggs & Stratton Corp 50 1,738 142 4,935 360
Bristol-Myers Squibb Co 371 23,002 2,068 128,216 5,229
Brown Group Inc 31 1,000 76 2,451 230
Brown-Forman Corp Class B 171 5,536 325 10,522 837
Browning-Ferris Industries Inc 188 5,852 830 25,834 2,056
Bruno's Inc 162 1,650 363 3,698 857
Brunswick Corp 242 4,810 439 8,725 1,036
Burlington Northern Inc 31 1,736 354 19,824 870
Burlington Resources Inc 327 12,590 614 23,639 1,526
Campbell Soup Co 240 10,890 990 44,921 2,545
Capital Cities/ABC Inc 94 8,319 648 57,348 1,580
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Atlantic Richfield Corp $ 214,317 1,414 $ 155,010 2,128 $ 233,282
Autodesk Inc 17,663 34 13,345 68 26,690
Automatic Data Processing 90,282 1,146 70,479 2,134 131,241
Avery Dennison Corp 23,700 98 18,675 690 25,875
Avon Products Inc 38,644 521 29,306 1,097 61,706
Baker Hughes Inc 33,360 1,402 3,870 1,818 34,997
Ball Corp 10,971 228 7,467 383 12,543
Bally Entertainment Corp + 3,271 450 3,488 571 4,425
Baltimore Gas & Electric Co 45,113 1,333 32,825 1,912 47,083
Banc One Corp 144,760 3,668 107,748 5,281 155,129
Bank of Boston Corp 40,639 1,004 30,246 1,328 40,006
BankAmerica Corp 215,600 3,392 163,240 4,745 228,353
Bankers Trust N Y Corp 60,789 679 42,862 1,000 63,125
Bard (C R) Inc 13,188 376 10,058 761 20,357
Barnett Banks Inc 52,288 845 37,603 1,221 54,335
Barrick Gold Corp 79,170 2,823 61,400 5,356 116,493
Bassett Furniture Industries 5,384 116 3,219 199 5,522
Bausch & Lomb Inc 21,280 552 18,354 832 27,664
Baxter International Inc 106,852 2,609 81,205 3,608 112,299
Becton Dickenson & Co 42,683 638 33,495 900 47,250
Bell Atlantic Corp 280,673 3,989 213,910 5,663 303,678
BellSouth Corp 353,115 4,542 267,978 6,409 378,131
Bemis Co Inc 15,380 368 9,982 807 21,890
Beneficial Corp 24,985 514 19,082 634 23,537
Bethlehem Steel Corp + 21,563 1,006 15,719 1,433 22,391
Beverly Enterprises + 13,182 819 10,647 1,101 14,313
Biomet Inc + 19,749 902 14,601 1,701 27,535
Black & Decker Corp 27,339 718 19,207 1,053 28,168
Block (H & R) Inc 39,506 801 30,138 1,630 61,329
Boatmen's Bancshares Inc 39,401 996 30,876 1,323 41,013
Boeing Co 192,111 3,151 145,340 4,357 200,967
Boise Cascade Corp 13,782 377 12,111 491 15,773
Boston Scientific Corp + 17,408 549 11,872 928 20,076
Briggs & Stratton Corp 12,510 248 8,618 414 14,387
Bristol-Myers Squibb Co 324,198 4,127 255,874 7,758 480,996
Brown Group Inc 7,418 115 3,709 245 7,901
Brown-Forman Corp Class B 27,098 615 19,911 857 27,745
Browning-Ferris Industries Inc 63,993 1,584 49,302 2,954 91,943
Bruno's Inc 8,731 681 6,938 967 9,851
Brunswick Corp 20,591 820 16,298 1,288 25,599
Burlington Northern Inc 48,720 685 38,360 1,339 74,984
Burlington Resources Inc 58,751 1,172 45,122 1,694 65,219
Campbell Soup Co 115,479 1,956 88,754 3,739 169,657
Capital Cities/ABC Inc 139,830 1,236 109,386 2,308 204,258
</TABLE>
24 25
<PAGE> 114
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FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Carolina Power & Light Co 406 $ 11,165 784 $ 21,560 1,982
Caterpillar Inc 207 10,686 796 41,094 2,066
CBS Inc 5 323 295 19,028 640
Centex Corp 55 1,403 121 3,086 339
Central & South West Corp 481 11,845 899 22,138 2,374
Ceridian Corp + 27 851 214 6,741 470
Champion International Corp 238 9,788 460 18,918 1,108
Charming Shoppes Inc 205 1,256 549 3,363 1,149
Chase Manhattan Corp 448 16,072 818 29,346 2,253
Chemical Banking Corp Class A 642 25,760 1,142 45,823 2,983
Chevron Corp 1,642 77,995 3,172 150,670 7,869
Chrysler Corp 895 38,933 1,740 75,690 4,314
Chubb Corp 229 18,005 402 31,607 1,064
CIGNA Corp 176 13,332 330 24,998 912
Cincinnati Milacron Inc 59 1,239 174 3,654 292
Cinergy Corp 370 9,158 727 17,993 1,855
Circuit City Stores Inc 43 930 390 8,434 963
Cisco Systems Inc + 249 8,404 1,072 36,180 2,689
Citicorp 977 43,965 1,887 84,915 4,775
Clark Equipment Co + 31 1,659 75 4,013 209
Clorox Co 45 2,717 254 15,335 577
Coastal Corp 258 7,385 502 14,370 1,247
Coca-Cola Co 966 53,130 5,254 288,970 13,250
Colgate-Palmolive Co 83 5,354 589 37,991 1,536
Columbia Gas System Inc + 139 3,614 248 6,448 651
Columbia HCA Healthcare Corp 307 12,702 1,429 59,125 3,770
Comcast Corp Class A 193 3,040 946 14,900 2,431
Community Psychiatric Centers 101 1,174 163 1,895 488
Compaq Computer Corp + 242 8,349 1,066 36,777 2,650
Computer Associates International Inc 113 6,441 689 39,273 1,686
Computer Sciences Corp + 38 1,867 248 12,183 550
ConAgra Inc 234 7,664 985 32,259 2,515
Conrail Inc 190 10,498 366 20,222 965
Consolidated Edison Co 585 16,161 1,116 30,830 2,871
Consolidated Freightways 62 1,473 152 3,610 495
Consolidated Natural Gas Co 238 8,806 460 17,020 1,102
Continental Corp 122 2,364 230 4,456 663
Cooper Industries Inc 278 10,912 568 22,294 1,383
Cooper Tire & Rubber Co 21 588 322 9,016 822
Coors (Adolph) Co Class B 67 1,089 156 2,535 425
CoreStates Financial Corp 377 11,357 709 21,359 1,701
Corning Inc 161 5,172 874 28,077 2,330
CPC International Inc 87 4,655 643 34,401 1,514
Crane Co 52 1,567 168 5,061 336
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
Carolina Power & Light Co $ 54,505 1,417 $ 38,968 2,083 $ 57,283
Caterpillar Inc 106,657 1,632 84,252 3,060 157,973
CBS Inc 41,280 460 29,670 930 59,985
Centex Corp 8,645 234 5,967 344 8,772
Central & South West Corp 58,460 1,691 41,641 2,478 61,021
Ceridian Corp + 14,805 322 10,143 657 20,696
Champion International Corp 45,567 805 33,106 1,170 48,116
Charming Shoppes Inc 7,038 963 5,898 1,356 8,306
Chase Manhattan Corp 80,826 1,677 60,162 2,428 87,105
Chemical Banking Corp Class A 119,693 2,184 87,633 3,291 132,051
Chevron Corp 373,778 5,891 279,823 8,430 400,425
Chrysler Corp 187,659 3,253 141,506 4,549 197,882
Chubb Corp 83,657 783 61,563 1,185 93,171
CIGNA Corp 69,084 646 48,935 924 69,993
Cincinnati Milacron Inc 6,132 253 5,313 510 10,710
Cinergy Corp 45,911 1,381 34,180 2,648 65,538
Circuit City Stores Inc 20,825 738 15,959 1,416 30,621
Cisco Systems Inc + 90,754 2,073 69,964 3,873 130,714
Citicorp 214,875 3,604 162,180 4,973 223,785
Clark Equipment Co + 11,182 140 7,490 243 13,001
Clorox Co 34,836 420 25,358 851 51,379
Coastal Corp 35,695 972 27,824 1,325 37,928
Coca-Cola Co 728,750 10,287 565,785 19,537 1,074,535
Colgate-Palmolive Co 99,072 1,192 76,884 2,223 143,384
Columbia Gas System Inc + 16,926 472 12,272 701 18,226
Columbia HCA Healthcare Corp 155,984 2,875 118,953 5,459 225,866
Comcast Corp Class A 38,288 1,983 31,232 3,646 57,425
Community Psychiatric Centers 5,673 399 4,638 603 7,010
Compaq Computer Corp + 91,425 2,061 71,105 3,897 134,447
Computer Associates International Inc 96,102 1,329 75,753 2,411 137,427
Computer Sciences Corp + 27,019 457 22,450 751 36,893
ConAgra Inc 82,366 1,944 63,666 3,813 124,876
Conrail Inc 53,316 674 37,239 1,005 55,526
Consolidated Edison Co 79,311 2,171 59,974 3,021 83,455
Consolidated Freightways 11,756 362 8,598 421 9,999
Consolidated Natural Gas Co 40,774 805 29,785 1,169 43,253
Continental Corp 12,846 498 9,649 703 13,621
Cooper Industries Inc 54,283 1,090 42,783 1,523 59,778
Cooper Tire & Rubber Co 23,016 698 19,544 1,252 35,056
Coors (Adolph) Co Class B 6,906 344 5,590 543 8,824
CoreStates Financial Corp 51,243 1,270 38,259 1,895 57,087
Corning Inc 74,851 1,847 59,335 3,468 111,410
CPC International Inc 80,999 1,198 64,093 2,236 119,626
Crane Co 10,122 230 6,929 386 11,628
</TABLE>
26 27
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MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Cray Research Inc + 46 $ 776 113 $ 1,907 279
Crown Cork & Seal Co + 230 9,804 454 19,352 1,075
CSX Corp 259 20,137 502 39,031 1,241
Cummins Engine Co Inc 123 5,597 210 9,555 540
Cyprus Amax Minerals 236 6,372 459 12,393 1,130
Dana Corp 248 6,107 493 12,140 1,271
Data General Corp + 62 488 152 1,197 380
Dayton-Hudson Corp 75 5,288 329 23,195 706
Dean Witter Discover & Co 424 17,119 823 33,229 2,064
Deere & Co 226 17,317 400 30,650 1,060
Delta Air Lines Inc 138 8,004 248 14,384 645
Deluxe Corp 120 3,360 320 8,960 895
Detroit Edison Co 382 10,935 689 19,723 1,809
Dial Corp 36 900 359 8,975 905
Digital Equipment Corp + 367 12,295 650 21,775 1,799
Dillard Department Stores Inc Class A 273 7,508 539 14,823 1,351
Disney (Walt) Co 441 23,538 2,130 113,689 5,540
Dominion Resources Inc 420 15,960 819 31,122 2,149
Donnelley (R R) & Sons Co 403 13,803 755 25,859 1,894
Dover Corp 50 2,975 183 10,889 637
Dow Chemical Co 682 45,694 1,350 90,450 3,354
Dow Jones & Co Inc 250 8,844 495 17,511 1,203
Dresser Industries Inc 157 3,238 780 16,088 1,902
DSC Communications Corp + 71 2,556 438 15,768 1,216
Duke Power Co 509 19,978 998 39,172 2,477
Dun & Bradstreet Corp 123 6,365 722 37,364 1,788
DuPont (E I) de Nemours 1,714 96,198 3,286 184,427 7,502
E-Systems Inc 84 3,675 174 7,613 387
Eastern Enterprises 37 976 80 2,110 216
Eastman Chemical Co 20 1,095 320 17,520 895
Eastman Kodak Co 229 11,679 1,405 71,655 3,458
Eaton Corp 83 4,160 260 13,033 754
Echlin Inc 153 5,298 286 9,903 740
Echo Bay Mines Ltd 271 2,439 538 4,842 1,415
Ecolab Inc 60 1,388 292 6,753 707
EG & G Inc 123 1,768 256 3,680 662
Emerson Electric Co 168 11,109 876 57,926 2,291
Engelhard Corp 43 1,134 389 10,260 938
Enron Corp 236 7,788 1,037 34,221 2,643
Enserch Corp 142 1,988 322 4,508 843
Entergy Corp 579 12,955 1,110 24,836 2,807
Exxon Corp 3,126 200,064 6,004 384,256 14,978
Federal Express Corp + 148 9,639 281 18,300 634
Federal Home Loan Mortgage Corp 441 25,578 862 49,996 2,169
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Cray Research Inc + $ 4,708 196 $ 3,308 303 $ 5,113
Crown Cork & Seal Co + 45,822 790 33,674 1,138 48,507
CSX Corp 96,488 996 77,439 1,326 103,097
Cummins Engine Co Inc 24,570 405 18,428 534 24,297
Cyprus Amax Minerals 30,510 802 21,654 1,164 31,428
Dana Corp 31,298 948 23,345 1,304 32,111
Data General Corp + 2,993 351 2,764 495 3,898
Dayton-Hudson Corp 49,773 545 38,423 1,090 76,845
Dean Witter Discover & Co 83,334 1,575 63,591 2,208 89,148
Deere & Co 81,223 827 63,369 1,164 89,192
Delta Air Lines Inc 37,410 457 26,506 651 37,758
Deluxe Corp 25,060 637 17,836 1,245 34,860
Detroit Edison Co 51,783 1,291 36,955 1,913 54,760
Dial Corp 22,625 702 17,550 1,361 34,025
Digital Equipment Corp + 60,267 1,329 44,522 1,731 57,989
Dillard Department Stores Inc Cla ss A 37,153 1,032 28,380 1,431 39,353
Disney (Walt) Co 295,698 4,253 227,004 8,114 433,085
Dominion Resources Inc 81,662 1,568 59,584 2,191 83,258
Donnelley (R R) & Sons Co 64,870 1,377 47,162 2,017 69,082
Dover Corp 37,902 447 26,597 823 48,969
Dow Chemical Co 224,718 2,480 166,160 3,574 239,458
Dow Jones & Co Inc 42,556 860 30,423 1,244 44,007
Dresser Industries Inc 39,229 1,465 30,216 2,759 56,904
DSC Communications Corp + 43,776 925 33,300 1,775 63,900
Duke Power Co 97,222 1,829 71,788 2,663 104,523
Dun & Bradstreet Corp 92,529 1,373 71,053 2,604 134,757
DuPont (E I) de Nemours 421,050 6,218 348,985 9,621 539,979
E-Systems Inc 16,931 358 15,663 406 17,763
Eastern Enterprises 5,697 173 4,563 272 7,174
Eastman Chemical Co 49,001 641 35,095 1,243 68,054
Eastman Kodak Co 176,358 2,712 138,312 5,135 261,885
Eaton Corp 37,794 566 28,371 1,174 58,847
Echlin Inc 25,623 557 19,286 729 25,242
Echo Bay Mines Ltd 12,735 1,084 9,756 1,470 13,230
Ecolab Inc 16,349 541 12,511 988 22,848
EG & G Inc 9,516 498 7,159 739 10,623
Emerson Electric Co 151,492 1,810 119,686 3,404 225,090
Engelhard Corp 24,740 738 19,465 1,491 39,325
Enron Corp 87,219 2,072 68,376 3,820 126,060
Enserch Corp 11,802 579 8,106 881 12,334
Entergy Corp 62,807 2,025 45,309 2,946 65,917
Exxon Corp 958,592 11,358 726,912 16,009 1,024,576
Federal Express Corp + 41,289 534 34,777 715 46,564
Federal Home Loan Mortgage Corp 125,802 1,640 95,120 2,342 135,836
</TABLE>
28 29
<PAGE> 116
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Federal National Mortgage Association 679 $ 52,368 1,322 $ 101,959 2,997
Federal Paper Board Co 124 3,689 211 6,277 541
First Chicago Corp 237 11,998 460 23,288 1,128
First Data Corp 73 3,924 422 22,683 1,097
First Fidelity Bancorp 215 10,858 366 18,483 965
First Interstate Bancorp 195 15,868 370 30,109 970
First Mississippi Corp 35 849 79 1,916 206
First Union Corp 423 18,876 823 36,726 2,163
Fleet Financial Group Inc 366 11,392 599 18,644 1,672
Fleetwood Enterprises Inc 130 2,844 241 5,272 597
Fleming Co Inc 65 1,268 204 3,978 492
Fluor Corp 19 926 319 15,551 894
FMC Corp + -- -- 153 8,951 416
Ford Motor Co 2,530 66,096 4,880 127,490 12,319
Foster Wheeler Corp -- -- 152 4,978 415
FPL Group Inc 483 17,328 901 32,323 2,301
Gannett Co Inc 83 4,565 589 32,395 1,458
Gap Inc 79 2,568 586 19,045 1,531
General Dynamics Corp 161 7,587 292 13,761 781
General Electric Co 1,322 72,545 7,010 384,674 17,670
General Mills Inc 103 6,244 680 41,225 1,650
General Motors Corp 1,880 80,135 3,657 155,880 9,074
General Public Utilities 287 8,682 557 16,849 1,409
General Re Corp 197 25,659 422 54,966 998
General Signal Corp 33 1,184 144 5,166 445
Genuine Parts Co 118 4,587 481 18,699 1,255
Georgia-Pacific Corp 33 2,471 356 26,656 972
Giant Food Inc Class A 154 3,658 287 6,816 771
Giddings & Lewis Inc 60 1,020 175 2,975 358
Gillette Co 162 12,818 871 68,918 2,324
Golden West Financial 162 6,197 293 11,207 783
Goodrich (B F) Co 45 2,003 112 4,984 303
Goodyear Tire & Rubber Co 390 14,381 745 27,472 1,869
Grace (W R) & Co 239 10,755 461 20,745 1,133
Grainger (W W) Inc 39 2,384 249 15,220 546
Great Atlantic & Pacific Tea Co 67 1,290 206 3,966 425
Great Lakes Chemical Corp 75 4,509 229 13,769 686
Great Western Financial Corp 357 6,694 618 11,588 1,659
GTE Corp 2,426 80,968 4,615 154,026 11,668
Halliburton Co 275 10,244 541 20,152 1,378
Handleman Co 59 627 124 1,318 352
Harcourt General Inc 86 3,193 263 9,764 777
Harland (John H) Co 53 1,199 69 1,561 302
Harnischfeger Industries Inc 108 3,011 209 5,826 576
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Federal National Mortgage Association $ 231,144 2,447 $ 188,725 3,819 $ 294,540
Federal Paper Board Co 16,095 407 12,108 537 15,976
First Chicago Corp 57,105 803 40,652 1,235 62,522
First Data Corp 58,964 917 49,289 1,648 88,580
First Fidelity Bancorp 48,733 781 39,441 982 49,591
First Interstate Bancorp 78,934 692 56,312 1,019 82,921
First Mississippi Corp 4,996 218 5,287 239 5,796
First Union Corp 96,524 1,578 70,418 2,253 100,540
Fleet Financial Group Inc 52,041 1,253 39,000 1,846 57,457
Fleetwood Enterprises Inc 13,059 451 9,866 562 12,294
Fleming Co Inc 9,594 371 7,235 482 9,399
Fluor Corp 43,583 640 31,200 1,245 60,694
FMC Corp + 24,336 263 15,386 574 33,579
Ford Motor Co 321,834 9,294 242,806 12,994 339,468
Foster Wheeler Corp 13,591 263 8,613 522 17,096
FPL Group Inc 82,548 1,654 59,337 2,486 89,185
Gannett Co Inc 80,190 1,089 59,895 2,070 113,850
Gap Inc 49,758 1,181 38,383 2,207 71,728
General Dynamics Corp 36,805 590 27,804 811 38,218
General Electric Co 969,641 13,699 751,733 25,995 1,426,476
General Mills Inc 100,031 1,303 78,994 2,370 143,681
General Motors Corp 386,779 6,845 291,768 9,648 411,246
General Public Utilities 42,622 1,034 31,279 1,491 45,103
General Re Corp 129,990 696 90,654 1,126 146,662
General Signal Corp 15,964 380 13,633 676 24,252
Genuine Parts Co 48,788 953 37,048 1,857 72,191
Georgia-Pacific Corp 72,779 698 52,263 1,346 100,782
Giant Food Inc Class A 18,311 523 12,421 758 18,003
Giddings & Lewis Inc 6,086 354 6,018 411 6,987
Gillette Co 183,887 1,740 137,678 3,375 267,047
Golden West Financial 29,950 573 21,917 767 29,338
Goodrich (B F) Co 13,484 274 12,193 308 13,706
Goodyear Tire & Rubber Co 68,919 1,427 52,621 1,993 73,492
Grace (W R) & Co 50,985 811 36,495 1,195 53,775
Grainger (W W) Inc 33,374 362 22,127 821 50,184
Great Atlantic & Pacific Tea Co 8,181 394 7,585 460 8,855
Great Lakes Chemical Corp 41,246 520 31,265 1,088 65,416
Great Western Financial Corp 31,106 1,201 22,519 1,742 32,663
GTE Corp 389,420 8,776 292,899 12,362 412,582
Halliburton Co 51,331 1,034 38,517 1,511 56,285
Handleman Co 3,740 297 3,156 405 4,303
Harcourt General Inc 28,846 670 24,874 1,187 44,067
Harland (John H) Co 6,833 196 4,435 488 11,041
Harnischfeger Industries Inc 16,056 424 11,819 539 15,025
</TABLE>
30 31
<PAGE> 117
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Harris Corp 95 $ 4,275 208 $ 9,360 527
Hartmarx Corp + 81 466 222 1,277 274
Hasbro Inc 229 7,214 403 12,695 989
Heinz (H J) Co 216 8,505 991 39,021 2,523
Helmerich & Payne Inc 43 1,118 136 3,536 257
Hercules Inc 88 3,861 427 18,735 1,165
Hershey Foods Corp 229 11,221 402 19,698 1,039
Hewlett Packard Co 243 27,945 1,018 117,070 2,608
Hilton Hotels Corp 34 2,389 145 10,186 506
Home Depot Inc 335 15,033 1,876 84,186 4,669
Homestake Mining Co 166 2,573 549 8,510 1,422
Honeywell Inc 329 11,967 615 22,371 1,625
Household International Inc 241 10,544 462 20,213 1,140
Houston Industries Inc 329 12,584 615 23,524 1,626
Illinois Tool Works Inc 74 3,321 440 19,745 1,126
Inco Ltd 279 7,498 569 15,292 1,482
Ingersoll-Rand Co 260 8,288 528 16,830 1,343
Inland Steel Industries Inc + 97 2,789 235 6,756 588
Intel Corp 358 28,551 1,658 132,226 4,323
Intergraph Corp + 104 1,274 191 2,340 502
International Business Machines Corp 1,469 110,542 2,845 214,086 7,135
International Flavors & Fragrances 71 3,417 438 21,079 1,122
International Paper Co 292 22,302 580 44,298 1,479
Interpublic Group Cos Inc 82 2,798 359 12,251 747
ITT Corp 281 27,398 471 45,923 1,290
James River Corp 218 5,368 369 9,087 1,013
Jefferson-Pilot Corp 136 7,752 247 14,079 635
Johnson & Johnson 527 29,907 2,634 149,480 6,610
Johnson Controls Inc 96 4,776 209 10,398 529
Jostens Inc 5 104 191 3,987 467
K Mart Corp 1,084 13,821 2,104 26,826 5,610
Kaufman & Broad Home Corp 57 834 122 1,784 330
Kellogg Co 169 9,147 877 47,468 2,292
Kerr-McGee Corp 141 7,103 250 12,594 647
KeyCorp 623 18,067 1,176 34,104 2,689
Kimberly-Clark Corp 107 5,564 684 35,568 1,683
King World Productions + -- -- 104 3,705 393
Knight-Ridder Inc 145 7,957 254 13,938 703
Kroger Co + 65 1,706 482 12,653 1,207
Lilly (Eli) & Co 238 15,946 1,200 80,400 3,011
Limited Inc 286 5,005 1,453 25,428 3,670
Lincoln National Corp 240 9,690 437 17,644 1,159
Liz Claiborne Inc 188 3,032 365 5,886 981
Lockheed Corp 160 12,420 291 22,589 806
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Harris Corp $ 23,715 397 $ 17,865 496 $ 22,320
Hartmarx Corp + 1,576 343 1,972 402 2,312
Hasbro Inc 31,154 838 26,397 1,186 37,359
Heinz (H J) Co 99,343 1,960 77,175 3,711 146,121
Helmerich & Payne Inc 6,682 208 5,408 296 7,696
Hercules Inc 51,114 906 39,751 1,833 80,423
Hershey Foods Corp 50,911 764 37,436 1,084 53,116
Hewlett Packard Co 299,920 2,035 234,025 3,903 448,845
Hilton Hotels Corp 35,547 350 24,588 780 54,795
Home Depot Inc 209,521 3,587 160,967 6,825 306,272
Homestake Mining Co 22,041 1,128 17,484 2,044 31,682
Honeywell Inc 59,109 1,177 42,813 1,710 62,201
Household International Inc 49,875 834 36,488 1,180 51,625
Houston Industries Inc 62,195 1,202 45,977 1,651 63,151
Illinois Tool Works Inc 50,529 932 41,824 1,730 77,634
Inco Ltd 39,829 1,098 29,509 1,477 39,694
Ingersoll-Rand Co 42,808 998 31,811 1,327 42,298
Inland Steel Industries Inc + 16,905 429 12,334 561 16,129
Intel Corp 344,759 3,348 267,003 6,266 499,714
Intergraph Corp + 6,150 397 4,863 616 7,546
International Business Machines Corp 536,909 5,369 404,017 7,470 562,118
International Flavors & Fragrances 53,996 932 44,853 1,680 80,850
International Paper Co 112,959 1,146 87,526 1,635 124,873
Interpublic Group Cos Inc 25,491 659 22,488 1,166 39,790
ITT Corp 125,775 998 97,305 1,485 144,788
James River Corp 24,945 789 19,429 1,085 26,718
Jefferson-Pilot Corp 36,195 457 26,049 614 34,998
Johnson & Johnson 375,118 5,133 291,298 9,719 551,553
Johnson Controls Inc 26,318 404 20,099 503 25,024
Jostens Inc 9,749 445 9,289 661 13,798
K Mart Corp 71,528 4,146 52,862 5,904 75,276
Kaufman & Broad Home Corp 4,826 334 4,885 449 6,567
Kellogg Co 124,055 1,762 95,368 3,403 184,187
Kerr-McGee Corp 32,593 464 23,374 657 33,096
KeyCorp 77,981 2,223 64,467 3,419 99,151
Kimberly-Clark Corp 87,516 1,317 68,484 2,437 126,724
King World Productions + 14,001 266 9,476 579 20,627
Knight-Ridder Inc 38,577 521 28,590 679 37,260
Kroger Co + 31,684 963 25,279 1,744 45,780
Lilly (Eli) & Co 201,737 2,313 154,971 4,451 298,217
Limited Inc 64,225 2,910 50,925 5,480 95,900
Lincoln National Corp 46,795 833 33,632 1,199 48,410
Liz Claiborne Inc 15,819 686 11,062 995 16,044
Lockheed Corp 62,566 589 45,721 863 66,990
</TABLE>
32 33
<PAGE> 118
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Longs Drug Stores Corp 37 $ 1,175 80 $ 2,540 240
Loral Corp 221 9,033 421 17,208 1,021
Lotus Development Corp + 30 1,253 241 10,062 520
Louisiana Land & Exploration Co 83 2,874 173 5,990 386
Louisiana-Pacific Corp 268 7,571 535 15,114 1,386
Lowe's Co Inc 100 3,363 678 22,798 1,620
Luby's Cafeterias Inc 45 1,024 113 2,571 270
M/A-Com Inc + 45 309 112 770 214
Mallinckrodt Group Inc 184 6,026 362 11,856 925
Manor Care Inc 59 1,748 291 8,621 681
Marriott International 123 3,813 485 15,035 1,292
Marsh & McLennan Companies Inc 80 6,560 282 23,124 796
Martin Marietta Inc 242 11,556 488 23,302 1,136
Masco Corp 399 10,025 777 19,522 2,014
Mattel Inc 147 3,289 873 19,533 2,273
Maxus Energy Corp + 285 1,104 570 2,209 1,417
May Co Department Stores Co 635 23,178 1,186 43,289 2,741
Maytag Corp 262 4,323 480 7,920 1,272
MBNA Corp 85 2,242 641 16,906 1,512
McDermott International Inc 144 4,032 252 7,056 680
McDonald's Corp 590 19,618 2,828 94,031 7,246
McDonnell Douglas Corp 282 15,792 521 29,176 1,481
McGraw-Hill Inc 36 2,538 247 17,414 559
MCI Communications 515 10,364 2,740 55,143 7,044
Mead Corp 154 8,432 286 15,659 740
Medtronic Inc 100 6,000 466 27,960 1,174
Mellon Bank Corp 363 13,839 708 26,993 1,791
Melville Corp 260 8,450 528 17,160 1,268
Mercantile Stores Co Inc 90 3,746 154 6,410 417
Merck & Co Inc 972 41,189 5,122 217,045 12,997
Meredith Corp 25 1,216 46 2,237 174
Merrill Lynch & Co Inc 408 16,728 921 37,761 2,370
Micron Technology Inc 88 5,456 406 25,172 1,034
Microsoft Corp + 459 28,917 2,412 151,956 6,066
Millipore Corp 75 3,984 141 7,491 282
Minnesota Mining & Manufacturing Co 367 20,093 1,666 91,214 4,362
Mobil Corp 998 86,826 1,929 167,823 4,812
Monsanto Co 283 22,428 572 45,331 1,316
Moore Corp Ltd 250 4,625 495 9,158 1,204
Morgan (J P) & Co Inc 489 31,541 956 61,662 2,333
Morrison Knudsen Corp 55 426 221 1,713 353
Morton International Inc 82 2,399 638 18,662 1,549
Motorola Inc 451 25,933 2,435 140,013 6,027
NACCO Industries Inc Class A 16 822 38 1,952 150
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Longs Drug Stores Corp $ 7,620 178 $ 5,652 266 $ 8,446
Loral Corp 41,733 812 33,191 1,045 42,714
Lotus Development Corp + 21,710 427 17,827 759 31,688
Louisiana Land & Exploration Co 13,365 262 9,072 399 13,815
Louisiana-Pacific Corp 39,155 1,024 28,928 1,457 41,160
Lowe's Co Inc 54,473 1,297 43,612 2,387 80,263
Luby's Cafeterias Inc 6,143 162 3,686 408 9,282
M/A-Com Inc + 1,471 254 1,746 328 2,255
Mallinckrodt Group Inc 30,294 672 22,008 958 31,375
Manor Care Inc 20,175 489 14,487 985 29,181
Marriott International 40,052 1,007 31,217 1,932 59,892
Marsh & McLennan Companies Inc 65,272 637 52,234 1,107 90,774
Martin Marietta Inc 54,244 835 39,871 1,187 56,679
Masco Corp 50,602 1,446 36,331 2,034 51,104
Mattel Inc 50,858 1,786 39,962 3,365 75,292
Maxus Energy Corp + 5,491 1,065 4,127 2,058 7,975
May Co Department Stores Co 100,047 2,245 81,943 3,513 128,225
Maytag Corp 20,988 1,003 16,550 1,418 23,397
MBNA Corp 39,879 1,194 31,492 2,228 58,764
McDermott International Inc 19,040 523 14,644 666 18,648
McDonald's Corp 240,930 5,599 186,167 10,597 352,350
McDonnell Douglas Corp 82,936 1,088 60,928 1,479 82,824
McGraw-Hill Inc 39,410 389 27,425 796 56,118
MCI Communications 141,761 5,490 110,486 10,279 206,865
Mead Corp 40,515 552 30,222 732 40,077
Medtronic Inc 70,440 884 53,040 1,746 104,760
Mellon Bank Corp 68,282 1,307 49,829 1,896 72,285
Melville Corp 41,210 999 32,468 1,326 43,095
Mercantile Stores Co Inc 17,358 366 15,235 480 19,980
Merck & Co Inc 550,748 10,059 426,250 19,145 811,269
Meredith Corp 8,461 118 5,738 178 8,655
Merrill Lynch & Co Inc 97,170 1,777 72,857 2,508 102,828
Micron Technology Inc 64,108 829 51,398 1,565 97,030
Microsoft Corp + 382,158 4,642 292,446 8,810 555,030
Millipore Corp 14,981 179 9,509 398 21,144
Minnesota Mining & Manufacturing Co 238,820 3,395 185,876 6,355 347,936
Mobil Corp 418,644 3,670 319,290 5,176 450,312
Monsanto Co 104,293 1,075 85,194 1,595 126,404
Moore Corp Ltd 22,274 906 16,761 1,311 24,254
Morgan (J P) & Co Inc 150,479 1,762 113,649 2,508 161,766
Morrison Knudsen Corp 2,736 333 2,581 447 3,464
Morton International Inc 45,308 1,188 34,749 2,224 65,052
Motorola Inc 346,553 4,672 268,640 8,951 514,683
NACCO Industries Inc Class A 7,706 49 2,517 161 8,271
</TABLE>
34 35
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MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Nalco Chemical Co 71 $ 2,441 225 $ 7,734 652
National City Corp 373 10,351 704 19,536 1,850
National Medical Enterprises 416 6,448 766 11,873 1,991
National Semiconductor + 310 5,231 574 9,686 1,538
National Service Industries Inc 137 3,682 247 6,638 564
NationsBank 672 33,516 1,342 66,932 3,312
Navistar International Corp + 181 2,625 359 5,206 902
NBD Bancorp Inc 406 12,637 783 24,371 1,882
New York Times Co Class A 262 5,633 505 10,858 1,254
Newell Co 102 2,435 680 16,235 1,626
Newmont Mining Corp 24 867 299 10,801 860
Niagara Mohawk Power Corp 375 5,578 657 9,773 1,791
NICOR Inc 142 3,515 252 6,237 597
Nike Inc Class B 180 12,938 383 27,528 842
NorAm Energy Corp 264 1,485 628 3,533 1,332
Nordstrom Inc 19 803 319 13,478 894
Norfolk Southern Corp 342 22,615 676 44,701 1,685
Northern States Power Co 167 7,557 322 14,571 823
Northern Telecom Ltd 240 8,190 1,040 35,490 2,605
Northrop Grumman Corp 136 6,035 246 10,916 648
Norwest Corp 808 20,806 1,463 37,672 3,520
Novell Inc + 320 6,505 1,510 30,695 3,764
Nucor Corp 27 1,515 402 22,562 862
NYNEX Corp 1,052 41,291 2,053 80,580 5,135
Occidental Petroleum Corp 786 15,622 1,495 29,713 3,835
Ogden Corp 101 2,159 213 4,553 564
Ohio Edison Co 393 8,253 747 15,687 1,878
ONEOK Inc 47 811 114 1,967 295
Oracle Systems Corp + 462 14,495 1,857 58,248 4,634
Oryx Energy Co 245 2,695 441 4,851 1,139
Oshkosh B'Gosh Inc Class A 26 371 46 656 122
Outboard Marine Corp 35 735 79 1,659 216
Owens Corning Fiberglass + 26 874 213 7,162 493
PACCAR Inc 93 4,092 206 9,064 526
Pacific Enterprises 198 4,851 372 9,114 972
Pacific Gas & Electric Co 1,073 27,496 2,096 53,710 5,330
Pacific Telesis Group 1,064 31,920 2,063 61,890 5,159
PacifiCorp 694 13,273 1,360 26,010 3,530
Pall Corp 78 1,570 468 9,419 1,172
Panhandle Eastern Corp 324 7,290 742 16,695 1,830
Parker Hannifin Corp 135 6,311 246 11,501 622
PECO Energy Co 563 15,060 1,072 28,676 2,750
Penney (J C) Co Inc 588 25,211 1,118 47,934 2,800
Pennzoil Co 130 6,159 242 11,465 618
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Nalco Chemical Co $ 22,413 515 $ 17,703 1,051 $ 36,128
National City Corp 51,338 1,416 39,294 1,964 54,501
National Medical Enterprises 30,861 1,554 24,087 2,124 32,922
National Semiconductor + 25,954 1,083 18,276 1,624 27,405
National Service Industries Inc 15,158 459 12,336 593 15,937
NationsBank 165,186 2,555 127,431 3,541 176,607
Navistar International Corp + 13,079 633 9,179 917 13,297
NBD Bancorp Inc 58,577 1,417 44,104 2,083 64,833
New York Times Co Class A 26,961 884 19,006 1,387 29,821
Newell Co 38,821 1,295 30,918 2,375 56,703
Newmont Mining Corp 31,068 722 26,082 1,269 45,843
Niagara Mohawk Power Corp 26,641 1,324 19,695 1,837 27,325
NICOR Inc 14,776 481 11,905 669 16,558
Nike Inc Class B 60,519 653 46,934 1,009 72,522
NorAm Energy Corp 7,493 1,193 6,711 1,623 9,129
Nordstrom Inc 37,772 639 26,998 1,243 52,517
Norfolk Southern Corp 111,421 1,231 81,400 1,712 113,206
Northern States Power Co 37,241 609 27,557 838 37,920
Northern Telecom Ltd 88,896 1,980 67,568 3,834 130,835
Northrop Grumman Corp 28,755 454 20,146 636 28,223
Norwest Corp 90,640 2,817 72,538 4,375 112,656
Novell Inc + 76,515 2,983 60,639 5,597 113,776
Nucor Corp 48,380 731 41,027 1,281 71,896
NYNEX Corp 201,549 3,837 150,602 5,439 213,481
Occidental Petroleum Corp 76,221 2,838 56,405 4,020 79,898
Ogden Corp 12,056 491 10,495 522 11,158
Ohio Edison Co 39,438 1,433 30,093 2,003 42,063
ONEOK Inc 5,089 197 3,398 307 5,296
Oracle Systems Corp + 145,392 3,554 111,507 6,452 202,416
Oryx Energy Co 12,529 949 10,439 1,294 14,234
Oshkosh B'Gosh Inc Class A 1,739 81 1,154 216 3,078
Outboard Marine Corp 4,536 218 4,578 239 5,019
Owens Corning Fiberglass + 16,577 319 10,726 652 21,924
PACCAR Inc 23,144 395 17,380 494 21,736
Pacific Enterprises 23,814 699 17,126 1,036 25,382
Pacific Gas & Electric Co 136,581 3,956 101,373 5,581 143,013
Pacific Telesis Group 154,770 3,905 117,150 5,492 164,760
PacifiCorp 67,511 2,598 49,687 3,628 69,386
Pall Corp 23,587 943 18,978 1,721 34,635
Panhandle Eastern Corp 41,175 1,381 31,073 1,693 38,093
Parker Hannifin Corp 29,079 453 21,178 634 29,640
PECO Energy Co 73,563 2,043 54,650 2,877 76,960
Penney (J C) Co Inc 120,050 2,076 89,009 3,035 130,126
Pennzoil Co 29,278 371 17,576 563 26,672
</TABLE>
36 37
<PAGE> 120
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Peoples Energy Corp 61 $ 1,601 176 $ 4,620 469
Pep Boys-Manny Moe & Jack 57 1,867 289 9,465 653
Pepsico Inc 599 23,436 3,236 126,609 8,146
Perkin-Elmer Corp 27 773 214 6,126 469
Pfizer Inc 235 19,446 1,296 107,244 3,285
Phelps Dodge Corp 174 9,483 328 17,876 884
Philip Morris Co Inc 676 41,067 3,548 215,541 8,903
Phillips Petroleum Co 158 5,273 1,080 36,045 2,688
Pioneer Hi Bred International Inc 32 1,080 355 11,981 901
Pitney Bowes Inc 102 3,621 680 24,140 1,617
Pittston Services Group 123 3,075 210 5,250 540
Placer Dome Inc 192 3,912 946 19,275 2,453
PNC Bank Corp 586 14,943 1,116 28,458 2,872
Polaroid Corp 132 3,960 243 7,290 594
Potlatch Corp 76 3,278 117 5,046 334
PPG Industries Inc 148 5,439 834 30,650 2,145
Praxair Inc 161 3,643 546 12,353 1,367
Premark International Inc 61 2,638 292 12,629 608
Price/Costco Inc + 556 7,576 866 11,799 2,388
Procter & Gamble Co 523 34,780 2,794 185,801 7,047
Promus Co Inc + 54 1,931 399 14,264 1,008
Providian Corp 251 8,879 496 17,546 1,177
Public Services Enterprise Group 629 18,320 1,206 35,125 3,004
Pulte Corp 48 1,104 115 2,645 387
Quaker Oats Co 136 4,437 544 17,748 1,336
Ralston-Purina Group 51 2,435 396 18,909 1,005
Raychem Corp 125 5,047 212 8,560 492
Raytheon Co 362 25,521 671 47,306 1,570
Reebok International Ltd 95 3,479 320 11,720 798
Reynolds Metals Co 156 7,800 288 14,400 776
Rite Aid Corp 204 5,049 428 10,593 1,036
Roadway Services Inc 93 5,045 207 11,230 424
Rockwell International Corp 561 21,599 1,071 41,234 2,720
Rohm & Haas Co 169 9,485 323 18,128 745
Rollins Environmental Services 131 671 338 1,732 543
Rowan Co Inc + 172 1,075 472 2,950 1,022
Rubbermaid Inc 106 3,352 683 21,600 1,707
Russell Corp 73 2,208 210 6,353 539
Ryan's Family Steak House + 119 922 303 2,348 690
Ryder System Inc 186 4,325 362 8,417 956
SAFECO Corp 160 8,800 291 16,005 782
Safety-Kleen Corp 126 2,079 284 4,686 718
Salomon Inc 269 9,684 511 18,396 1,263
Santa Fe Energy Resources Inc 183 1,647 406 3,654 1,117
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Peoples Energy Corp $ 12,311 366 $ 9,608 420 $ 11,025
Pep Boys-Manny Moe & Jack 21,386 481 15,753 949 31,080
Pepsico Inc 318,712 6,350 248,444 12,021 470,322
Perkin-Elmer Corp 13,425 322 9,217 655 18,749
Pfizer Inc 271,834 2,503 207,123 4,822 399,021
Phelps Dodge Corp 48,178 617 33,627 884 48,178
Philip Morris Co Inc 540,857 6,869 417,292 13,010 790,358
Phillips Petroleum Co 89,712 2,075 69,253 3,958 132,098
Pioneer Hi Bred International Inc 30,409 692 23,355 1,296 43,740
Pitney Bowes Inc 57,404 1,300 46,150 2,348 83,354
Pittston Services Group 13,500 330 8,250 485 12,125
Placer Dome Inc 49,980 1,980 40,343 3,643 74,226
PNC Bank Corp 73,236 2,172 55,386 3,018 76,959
Polaroid Corp 17,820 429 12,870 576 17,280
Potlatch Corp 14,404 222 9,574 355 15,309
PPG Industries Inc 78,829 1,684 61,887 3,241 119,107
Praxair Inc 30,928 1,110 25,114 2,057 46,540
Premark International Inc 26,296 478 20,674 1,017 43,985
Price/Costco Inc + 32,537 1,733 23,612 2,829 38,545
Procter & Gamble Co 468,626 5,436 361,494 10,428 693,462
Promus Co Inc + 36,036 861 30,781 1,558 55,699
Providian Corp 41,636 855 30,246 1,242 43,936
Public Services Enterprise Group 87,492 2,231 64,978 3,143 91,540
Pulte Corp 8,901 213 4,899 320 7,360
Quaker Oats Co 43,587 1,118 36,475 2,078 67,795
Ralston-Purina Group 47,989 762 36,386 1,540 73,535
Raychem Corp 19,865 409 16,513 549 22,166
Raytheon Co 110,685 1,214 85,587 1,710 120,555
Reebok International Ltd 29,227 696 25,491 1,223 44,792
Reynolds Metals Co 38,800 568 28,400 791 39,550
Rite Aid Corp 25,641 814 20,147 1,059 26,210
Roadway Services Inc 23,002 375 20,344 600 32,550
Rockwell International Corp 104,720 1,966 75,691 2,853 109,841
Rohm & Haas Co 41,813 612 34,349 939 52,701
Rollins Environmental Services 2,783 604 3,096 793 4,064
Rowan Co Inc + 6,388 819 5,119 1,057 6,606
Rubbermaid Inc 53,984 1,341 42,409 2,433 76,944
Russell Corp 16,305 404 12,221 484 14,641
Ryan's Family Steak House + 5,348 463 3,588 715 5,541
Ryder System Inc 22,227 673 15,647 1,037 24,110
SAFECO Corp 43,010 570 31,350 762 41,910
Safety-Kleen Corp 11,847 493 8,135 699 11,534
Salomon Inc 45,468 1,001 36,036 1,410 50,760
Santa Fe Energy Resources Inc 10,053 848 7,632 1,149 10,341
</TABLE>
38 39
<PAGE> 121
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Santa Fe Pacific Corp 207 $ 4,399 179 $ 3,804 685
Santa Fe Pacific Gold Corp + 128 1,392 527 5,731 1,338
Sara Lee Corp 413 10,841 1,945 51,056 4,999
SCE Corp 1,110 18,176 2,076 33,995 5,518
Schering-Plough Corp 188 14,735 756 59,252 2,007
Schlumberger Ltd 227 12,911 955 54,316 2,477
Scientific-Atlanta Inc 82 1,917 260 6,078 738
Scott Paper Co 80 6,340 283 22,428 820
Seagram Co Ltd 928 28,536 1,817 55,873 4,500
Sears Roebuck & Co 891 43,882 1,685 82,986 4,284
Service Corp International 224 6,300 398 11,194 1,133
Shared Medical System Corp 40 1,378 133 4,580 253
Shawmut National Corp 281 7,201 571 14,632 1,467
Sherwin Williams Co 227 7,633 426 14,324 1,031
Shoney's Inc + 97 1,067 160 1,760 434
Sigma Aldrich Corp 62 2,263 151 5,512 547
Silicon Graphics Inc + 117 4,051 590 20,429 1,420
Skyline Corp 20 365 41 748 117
Snap-On Inc 124 4,216 212 7,208 492
Sonat Inc 228 6,612 402 11,658 1,038
Southern Co 1,636 33,743 3,167 65,319 7,879
Southwest Airlines Co 75 1,322 607 10,698 1,515
Southwestern Bell Corp 502 20,896 2,422 100,816 6,225
Springs Industries Inc Class A 31 1,221 76 2,993 205
Sprint Corp 877 25,652 1,674 48,965 3,830
SPX Corp 22 336 43 656 121
St Jude Medical Inc 32 1,160 142 5,148 499
St Paul Co Inc 223 10,843 423 20,568 1,008
Stanley Works 129 5,208 215 8,681 516
Stone Container Corp + 33 771 406 9,490 898
Stride Rite Corp 113 1,455 198 2,549 535
Sun Co Inc 262 7,631 530 15,436 1,280
Sun Microsystems Inc + 239 7,648 461 14,752 1,133
SunTrust Banks Inc 290 15,624 578 31,140 1,452
Super Value Inc 176 4,532 330 8,498 882
Sysco Corp 148 4,200 768 21,792 1,903
Tandem Computers Inc + 275 4,675 566 9,622 1,373
Tandy Corp 161 7,205 292 13,067 708
Tektronix Inc 78 2,672 169 5,788 311
Tele-Communication Inc Class A + 462 10,511 2,490 56,648 6,351
Teledyne Inc + 122 2,821 281 6,498 709
Temple-Inland Inc 147 7,185 281 13,734 729
Tenneco Inc 421 19,156 821 37,356 2,102
Texaco Inc 654 41,693 1,276 81,345 3,174
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Santa Fe Pacific Corp $ 14,556 543 $ 11,539 1,156 $ 24,565
Santa Fe Pacific Gold Corp + 14,551 1,052 11,441 1,959 21,304
Sara Lee Corp 131,224 3,899 102,349 7,358 193,148
SCE Corp 90,357 4,061 66,499 5,799 94,959
Schering-Plough Corp 157,299 1,562 122,422 2,905 227,679
Schlumberger Ltd 140,879 1,929 109,712 3,732 212,258
Scientific-Atlanta Inc 17,251 634 14,820 1,114 26,040
Scott Paper Co 64,985 562 44,539 1,113 88,205
Seagram Co Ltd 138,375 3,395 104,396 4,848 149,076
Sears Roebuck & Co 210,987 3,167 155,975 4,481 220,689
Service Corp International 31,866 826 23,231 1,091 30,684
Shared Medical System Corp 8,713 152 5,235 382 13,155
Shawmut National Corp 37,592 1,070 27,419 1,536 39,360
Sherwin Williams Co 34,667 760 25,555 1,080 36,315
Shoney's Inc + 4,774 284 3,124 583 6,413
Sigma Aldrich Corp 19,966 382 13,943 745 27,193
Silicon Graphics Inc + 49,168 1,145 39,646 2,160 74,790
Skyline Corp 2,135 74 1,351 128 2,336
Snap-On Inc 16,728 409 13,906 549 18,666
Sonat Inc 30,102 836 24,244 1,081 31,349
Southern Co 162,504 5,970 123,131 8,405 173,353
Southwest Airlines Co 26,702 1,233 21,732 2,190 38,599
Southwestern Bell Corp 259,116 4,838 201,382 9,125 379,828
Springs Industries Inc Class A 8,072 115 4,528 247 9,726
Sprint Corp 112,028 3,183 93,103 4,903 143,413
SPX Corp 1,845 79 1,205 142 2,166
St Jude Medical Inc 18,089 327 11,854 675 24,469
St Paul Co Inc 49,014 721 35,059 1,057 51,397
Stanley Works 20,834 423 17,079 559 22,570
Stone Container Corp + 20,991 743 17,368 1,399 32,702
Stride Rite Corp 6,888 417 5,369 599 7,712
Sun Co Inc 37,280 987 28,746 1,342 39,086
Sun Microsystems Inc + 36,256 831 26,592 1,195 38,240
SunTrust Banks Inc 78,227 1,043 56,192 1,618 87,170
Super Value Inc 22,712 622 16,017 874 22,506
Sysco Corp 53,998 1,502 42,619 2,772 78,656
Tandem Computers Inc + 23,341 1,039 17,663 1,493 25,381
Tandy Corp 31,683 588 26,313 815 36,471
Tektronix Inc 10,652 225 7,706 460 15,755
Tele-Communication Inc Class A + 144,485 4,856 110,474 9,342 212,531
Teledyne Inc + 16,396 489 11,308 680 15,725
Temple-Inland Inc 35,630 533 26,050 709 34,652
Tenneco Inc 95,641 1,672 76,076 2,149 97,780
Texaco Inc 202,343 2,365 150,769 3,341 212,989
</TABLE>
40 41
<PAGE> 122
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Texas Instruments Inc 36 $ 2,835 358 $ 28,193 999
Texas Utilities Co 570 18,739 1,103 36,261 2,795
Textron Inc 230 12,593 453 24,802 1,069
Thomas & Betts Corp 33 2,199 77 5,130 237
Time Warner Inc 263 10,158 1,550 59,869 3,898
Times Mirror Co Class A 348 6,438 610 11,285 1,618
Timken Co 79 2,834 170 6,099 362
TJX Companies Inc 178 2,403 332 4,482 774
Torchmark Corp 178 7,454 331 13,861 790
Toys R Us Inc + 209 5,826 1,197 33,366 2,982
Transamerica Corp 174 9,505 328 17,917 885
Travelers Inc 817 31,761 1,495 58,118 3,893
Tribune Co 68 3,800 223 12,460 668
Trinova Corp 50 1,350 116 3,132 333
TRW Inc 163 10,717 319 20,974 814
Tyco International Inc 83 4,326 258 13,448 734
U.S. Bancorp 250 6,281 495 12,437 1,208
U.S. Healthcare Inc 108 4,644 685 29,455 1,659
U.S. Life Corp 40 1,525 133 5,071 248
U.S. West Inc 1,144 44,330 2,183 84,591 5,516
Unicom Corp 549 14,000 1,036 26,418 2,632
Union Camp Corp 172 8,858 326 16,789 858
Union Carbide Corp 390 11,164 744 21,297 1,867
Union Electric Co 254 9,620 498 18,862 1,308
Union Pacific Corp 509 26,595 998 52,146 2,447
Unisys Corp + 423 3,754 773 6,860 1,861
United Healthcare Corp 139 5,977 715 30,745 1,788
United States Surgical 149 3,129 282 5,922 740
United Technologies Corp 323 21,439 609 40,422 1,517
Unocal Corp 623 17,678 1,151 32,660 2,964
UNUM Corp 183 7,778 360 15,300 924
Upjohn Co 428 15,087 826 29,117 2,119
USAir Group Inc + 129 758 336 1,974 525
USF & G Corp 224 3,192 399 5,686 1,094
UST Inc 134 3,987 798 23,741 2,052
USX - Marathon Group 702 11,408 1,391 22,604 3,570
USX - US Steel Group 182 6,052 360 11,970 947
Varity Corp + 127 4,636 214 7,811 494
VF Corp 163 8,395 294 15,141 809
Viacom Inc Class B + 272 12,172 1,472 65,872 3,721
Wachovia Corp 425 14,769 824 28,634 2,091
Wal Mart Stores Inc 1,802 42,798 9,365 222,419 23,749
Walgreen Co 90 4,253 479 22,633 1,253
Warner Lambert Co 59 4,506 569 43,457 1,393
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Texas Instruments Inc $ 78,671 701 $ 55,204 1,459 $ 114,896
Texas Utilities Co 91,886 2,014 66,210 2,909 95,633
Textron Inc 58,528 784 42,924 1,186 64,934
Thomas & Betts Corp 15,790 169 11,260 251 16,723
Time Warner Inc 150,560 3,048 117,729 5,718 220,858
Times Mirror Co Class A 29,933 1,183 21,886 1,706 31,561
Timken Co 12,987 326 11,695 366 13,130
TJX Companies Inc 10,449 650 8,775 1,006 13,581
Torchmark Corp 33,081 630 26,381 1,028 43,048
Toys R Us Inc + 83,123 2,287 63,750 4,304 119,974
Transamerica Corp 48,343 619 33,813 861 47,032
Travelers Inc 151,340 2,959 115,031 4,163 161,837
Tribune Co 37,325 510 28,496 1,038 57,998
Trinova Corp 8,991 221 5,967 475 12,825
TRW Inc 53,521 599 39,384 818 53,784
Tyco International Inc 38,260 578 30,128 1,153 60,100
U.S. Bancorp 30,351 860 21,608 1,237 31,080
U.S. Healthcare Inc 71,337 1,319 56,717 2,397 103,071
U.S. Life Corp 9,455 157 5,986 279 10,637
U.S. West Inc 213,745 4,107 159,146 5,884 228,005
Unicom Corp 67,116 1,994 50,847 2,754 70,227
Union Camp Corp 44,187 621 31,982 862 44,393
Union Carbide Corp 53,443 1,326 37,957 1,993 57,050
Union Electric Co 49,541 966 36,587 1,358 51,434
Union Pacific Corp 127,856 1,830 95,618 2,673 139,664
Unisys Corp + 16,516 1,626 14,431 2,406 21,353
United Healthcare Corp 76,884 1,375 59,125 2,641 113,563
United States Surgical 15,540 540 11,340 693 14,553
United Technologies Corp 100,691 1,156 76,730 1,675 111,178
Unocal Corp 84,104 2,223 63,078 3,146 89,268
UNUM Corp 39,270 666 28,305 955 40,588
Upjohn Co 74,695 1,607 56,647 2,276 80,229
USAir Group Inc + 3,084 601 3,531 759 4,459
USF & G Corp 15,590 827 11,785 1,067 15,205
UST Inc 61,047 1,630 48,493 3,041 90,470
USX - Marathon Group 58,013 2,643 42,949 3,685 59,881
USX - US Steel Group 31,488 663 22,045 949 31,554
Varity Corp + 18,031 422 15,403 552 20,148
VF Corp 41,664 594 30,591 819 42,179
Viacom Inc Class B + 166,515 2,900 129,775 5,474 244,962
Wachovia Corp 72,662 1,577 54,801 2,162 75,130
Wal Mart Stores Inc 564,039 18,393 436,834 34,913 829,184
Walgreen Co 59,204 945 44,651 1,823 86,137
Warner Lambert Co 106,390 1,111 84,853 2,051 156,645
</TABLE>
42 43
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MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Wells Fargo & Co 122 $ 19,596 255 $ 40,959 586
Wendy's International Inc 255 3,953 450 6,975 1,109
Western Atlas Inc + 132 5,445 243 10,024 667
Westinghouse Electric Corp 294 4,557 1,439 22,305 3,639
Westvaco Corp 168 6,636 322 12,719 848
Weyerhaeuser Co 510 20,783 974 39,691 2,547
Whirlpool Corp 180 9,788 383 20,826 942
Whitman Corp 60 1,133 378 7,135 1,126
Williams Co Inc 257 7,389 401 11,529 1,139
Winn-Dixie Stores Inc 80 4,480 283 15,848 742
WMX Technologies Inc 422 11,130 1,953 51,510 5,014
Woolworth Corp 331 5,048 617 9,409 1,638
Worthington Industries Inc 33 664 357 7,185 903
Wrigley (Wm) Jr Co 79 3,565 469 21,164 1,207
Xerox Corp 257 28,410 526 58,226 1,271
Yellow Corp 49 1,035 116 2,451 373
Zenith Electronic Corp + 95 772 183 1,487 486
Zurn Industries Inc 22 396 43 774 119
------------- -------------
LARGE CAPITALIZATION STOCKS - VALUE $ 5,615,103 $ 15,432,182
- COST $ 5,466,362 $ 14,784,994
MEDIUM CAPITALIZATION STOCKS
Percent of Net Assets 7.6% 8.5%
3Com Corp + -- $ -- 500 $ 26,063 --
Adaptec Inc + -- -- -- -- --
ADC Telecommunication + 293 16,335 240 13,380 424
Adobe Systems Inc 619 22,129 510 18,233 906
AES Corp 784 14,504 640 11,840 1,148
AFLAC Inc 1,131 42,695 880 33,220 1,578
Airgas Inc + -- -- -- -- --
Albemarle Corp 713 10,160 560 7,980 1,012
Alexander & Baldwin Inc 504 10,962 390 8,483 714
Allegheny Ludlum Corp 772 16,309 610 12,886 1,086
Allegheny Power System Inc 1,284 30,174 1,010 23,735 1,809
Allmerica Property & Casualty Co Inc -- -- -- -- --
Allstate Corp -- -- 700 19,250 --
Altera Corp + 230 13,081 180 10,238 309
Alumax Inc + 489 13,998 380 10,878 673
AMBAC Inc -- -- -- -- --
American Medical Holdings Inc -- -- 500 12,750 --
American National Insurance Co -- -- -- -- --
American Power Conversion + 1,000 17,938 780 13,991 1,394
American Premier Underwriter 504 12,411 390 9,604 713
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ----------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Wells Fargo & Co $ 94,126 514 $ 82,561 652 $ 104,728
Wendy's International Inc 17,190 913 14,152 1,461 22,646
Western Atlas Inc + 27,514 507 20,914 672 27,720
Westinghouse Electric Corp 56,405 2,853 44,222 5,442 84,351
Westvaco Corp 33,496 609 24,056 836 33,022
Weyerhaeuser Co 103,790 1,855 75,591 2,666 108,640
Whirlpool Corp 51,221 663 36,051 910 49,481
Whitman Corp 21,253 848 16,006 1,607 30,332
Williams Co Inc 32,746 793 22,799 1,318 37,893
Winn-Dixie Stores Inc 41,552 563 31,528 1,111 62,216
WMX Technologies Inc 132,246 3,923 103,469 7,347 193,684
Woolworth Corp 24,980 1,250 19,063 1,735 26,459
Worthington Industries Inc 18,173 749 15,074 1,402 28,215
Wrigley (Wm) Jr Co 54,466 895 40,387 1,777 80,187
Xerox Corp 140,831 995 110,237 1,422 157,664
Yellow Corp 7,880 290 6,126 324 6,845
Zenith Electronic Corp + 3,949 384 3,120 670 5,444
Zurn Industries Inc 2,142 76 1,368 135 2,430
------------ ----------- -----------
LARGE CAPITALIZATION STOCKS - VALUE $ 38,877,110 $ 29,681,327 $ 49,078,489
- COST $ 36,982,045 $ 28,123,022 $ 46,324,761
MEDIUM CAPITALIZATION STOCKS
Percent of Net Assets 8.6% 9.7% 9.3%
3Com Corp + $ -- -- $ -- 400 $ 20,850
Adaptec Inc + -- -- -- 500 16,500
ADC Telecommunication + 23,638 304 16,948 280 15,610
Adobe Systems Inc 32,390 651 23,273 615 21,986
AES Corp 21,238 798 14,763 750 13,875
AFLAC Inc 59,570 1,158 43,715 685 25,859
Airgas Inc + -- -- -- 300 7,763
Albemarle Corp 14,421 732 10,431 686 9,776
Alexander & Baldwin Inc 15,530 509 11,071 480 10,440
Allegheny Ludlum Corp 22,942 786 16,604 740 15,633
Allegheny Power System Inc 42,512 1,319 30,997 1,230 28,905
Allmerica Property & Casualty Co Inc -- -- -- 600 11,700
Allstate Corp -- -- -- 1,000 27,500
Altera Corp + 17,574 224 12,740 220 12,513
Alumax Inc + 19,265 493 14,112 470 13,454
AMBAC Inc -- -- -- 300 12,188
American Medical Holdings Inc -- -- -- 700 17,850
American National Insurance Co -- -- -- 100 5,000
American Power Conversion + 25,005 1,009 18,099 960 17,220
American Premier Underwriter 17,558 508 12,510 480 11,820
</TABLE>
44 45
<PAGE> 124
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
American Re Corp + -- $ -- 400 $ 13,650 --
American Water Works Co Inc -- -- -- -- --
Amphenol Corp Class A + -- -- -- -- --
AmSouth Bancorp -- -- -- -- --
Anadarko Petroleum Corp 639 28,036 500 21,938 901
Analog Devices Inc + 801 20,125 630 15,829 1,153
AnnTaylor Stores Inc + 247 8,151 195 6,435 351
Aon Corp 1,090 37,878 860 29,885 1,560
Apache Corp 662 16,550 520 13,000 949
Applied Materials Inc + 900 41,513 720 33,210 1,291
Arco Chemical Co -- -- -- -- --
Argonaut Group Inc -- -- -- -- --
Arrow Electronics Inc + 493 20,460 396 16,434 699
Atlanta Gas & Light Co 269 9,079 220 7,425 399
Atlantic Energy Inc 569 10,811 460 8,740 830
Atmel Corp + 481 16,414 380 12,968 683
AutoZone Inc + -- -- 1,000 26,500 --
Avnet Inc 430 16,663 350 13,563 614
Bancorp Hawaii Inc 474 13,272 360 10,080 657
Bandag Inc -- -- -- -- --
Bandag Inc Class A -- -- -- -- --
Bank of New York Inc + 2,039 68,307 810 27,135 2,903
Bank South Corp -- -- -- -- --
Battle Mountain Gold Co 878 8,341 690 6,555 1,245
Bay Networks Inc + 1,162 36,458 920 28,865 1,650
BayBanks Inc -- -- -- -- --
BB & T Financial Corp -- -- -- -- --
Bear Stearns & Co Inc 1,296 24,300 980 18,375 1,770
Beckman Instruments Inc 294 8,967 250 7,625 450
Bed Bath & Beyond Inc + -- -- -- -- --
Belo (A H) Corp 228 12,854 170 9,584 307
Bergen Brunswig Corp Class A 20 546 16 436 29
Best Buy Co Inc + -- -- -- -- --
Betz Labs Inc 296 13,135 240 10,650 427
Biogen Inc + 359 14,809 280 11,550 491
BMC Software Inc + 278 17,862 220 14,135 383
Bob Evans Farms Inc 468 9,945 360 7,650 652
Bowater Inc 395 13,134 310 10,308 552
Brinker International Inc + 756 15,026 590 11,726 1,071
Brooklyn Union Gas Co 510 12,495 400 9,800 719
Burlington Industries Inc + 729 8,019 577 6,347 1,036
Cabletron Systems Inc + 750 29,719 610 24,171 1,090
Cabot Corp 405 13,770 320 10,880 586
Cadence Design System Inc + 437 11,198 350 8,969 645
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
American Re Corp + $ -- -- $ -- 400 $ 13,650
American Water Works Co Inc -- -- -- 300 8,850
Amphenol Corp Class A + -- -- -- 300 7,388
AmSouth Bancorp -- -- -- 500 14,563
Anadarko Petroleum Corp 39,531 646 28,343 415 18,208
Analog Devices Inc + 28,969 831 20,879 765 19,221
AnnTaylor Stores Inc + 11,583 253 8,349 237 7,821
Aon Corp 54,210 1,125 39,094 650 22,588
Apache Corp 23,725 684 17,100 635 15,875
Applied Materials Inc + 59,547 916 42,251 565 26,061
Arco Chemical Co -- -- -- 100 4,250
Argonaut Group Inc -- -- -- 200 6,150
Arrow Electronics Inc + 29,009 510 21,165 475 19,713
Atlanta Gas & Light Co 13,466 279 9,416 260 8,775
Atlantic Energy Inc 15,770 590 11,210 550 10,450
Atmel Corp + 23,307 494 16,858 463 15,800
AutoZone Inc + -- -- -- 1,000 26,500
Avnet Inc 23,793 459 17,786 415 16,081
Bancorp Hawaii Inc 18,396 477 13,356 435 12,180
Bandag Inc -- -- -- 100 6,000
Bandag Inc Class A -- -- -- 100 5,338
Bank of New York Inc + 97,251 2,088 69,948 1,260 42,210
Bank South Corp -- -- -- 600 11,250
Battle Mountain Gold Co 11,828 895 8,503 845 8,028
Bay Networks Inc + 51,769 1,194 37,462 718 22,527
BayBanks Inc -- -- -- 200 12,550
BB & T Financial Corp -- -- -- 400 12,750
Bear Stearns & Co Inc 33,188 1,330 24,938 740 13,875
Beckman Instruments Inc 13,725 305 9,303 280 8,540
Bed Bath & Beyond Inc + -- -- -- 200 4,850
Belo (A H) Corp 17,307 222 12,515 220 12,403
Bergen Brunswig Corp Class A 796 21 564 19 525
Best Buy Co Inc + -- -- -- 300 6,488
Betz Labs Inc 18,948 307 13,623 305 13,534
Biogen Inc + 20,254 361 14,891 345 14,231
BMC Software Inc + 24,608 288 18,504 270 17,348
Bob Evans Farms Inc 13,855 472 10,030 450 9,563
Bowater Inc 18,354 407 13,533 375 12,469
Brinker International Inc + 21,286 771 15,324 730 14,509
Brooklyn Union Gas Co 17,616 514 12,593 490 12,005
Burlington Industries Inc + 11,396 749 8,239 702 7,722
Cabletron Systems Inc + 43,191 777 30,789 525 20,803
Cabot Corp 19,924 416 14,144 395 13,430
Cadence Design System Inc + 16,528 465 11,916 440 11,275
</TABLE>
46 47
<PAGE> 125
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Callaway Golf Co 298 $ 10,058 290 $ 9,788 529
Cardinal Health Inc 441 21,830 340 16,830 609
Caremark International Inc -- -- -- -- --
CBI Industries 406 9,846 320 7,760 589
Centocor Inc + 546 10,408 440 8,388 781
Central Fidelity Banks Inc 417 11,363 330 8,993 600
Century Telephone Enterprise 567 17,648 460 14,318 828
Chesapeake Corp 256 8,448 200 6,600 361
Chicago & North Western Holdings Corp + -- -- -- -- --
Chiron Corp + 224 13,608 173 10,510 306
Chris-Craft Industries Inc + 296 10,508 240 8,520 452
Cincinnati Financial Corp -- -- 400 22,500 --
Cintas Corp 510 19,380 400 15,200 720
Circus Circus Entertainment Inc + 929 24,386 730 19,163 1,322
Cirrus Logic Corp + 317 10,659 240 8,070 448
Clayton Homes Inc 817 14,604 650 11,619 1,145
Clear Channel Communications Inc + -- -- -- -- --
CMS Energy Corp 921 22,104 740 17,760 1,314
CNA Financial Corp + -- -- -- -- --
Coca-Cola Enterprises 1,412 28,946 1,110 22,755 1,988
Coltec Industries + -- -- -- -- --
Comdisco Inc 411 10,481 330 8,415 594
Comerica Inc 1,289 36,253 1,010 28,406 1,813
Commerce Bancshares Inc -- -- -- -- --
Compass Bankshares Inc -- -- -- -- --
Compuware Corp + -- -- 400 14,700 --
Comsat Corp 510 9,053 400 7,100 719
Conner Peripherals Inc + 545 5,382 430 4,246 780
Conseco Inc -- -- -- -- --
Consolidated Papers Inc 486 23,510 380 18,383 --
Consolidated Stores Corp + -- -- 670
Cordis Corp + 165 10,725 140 9,100 243
Countrywide Credit & Industries Inc -- -- -- -- --
Cox Communications Inc Class A + 190 3,254 333 5,703 884
Cracker Barrel Old Country Store Inc 649 14,724 510 11,571 911
Crestar Financial Corp 402 17,336 320 13,800 585
Crompton & Knowles Corp 550 9,281 440 7,425 785
CUC International Inc + 1,207 42,547 970 34,193 1,755
Cypress Semiconductor + 400 11,350 320 9,080 582
Danaher Corp 600 17,700 480 14,160 862
Dauphin Deposit Corp 360 9,090 270 6,818 492
Dean Foods Co 424 13,144 340 10,540 607
Dell Computer Corp + 405 16,808 330 13,695 587
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Callaway Golf Co $ 17,854 378 $ 12,758 358 $ 12,083
Cardinal Health Inc 30,146 454 22,473 419 20,741
Caremark International Inc -- -- -- 600 10,500
CBI Industries 14,283 419 10,161 395 9,579
Centocor Inc + 14,888 566 10,789 520 9,913
Central Fidelity Banks Inc 16,350 430 11,718 405 11,036
Century Telephone Enterprise 25,772 588 18,302 565 17,586
Chesapeake Corp 11,913 266 8,778 250 8,250
Chicago & North Western Holdings Corp + -- -- -- 400 10,000
Chiron Corp + 18,590 225 13,669 213 12,940
Chris-Craft Industries Inc + 16,046 307 10,899 305 10,828
Cincinnati Financial Corp -- -- -- 300 16,875
Cintas Corp 27,360 515 19,570 490 18,620
Circus Circus Entertainment Inc + 34,703 962 25,253 595 15,619
Cirrus Logic Corp + 15,064 333 11,197 305 10,256
Clayton Homes Inc 20,467 845 15,104 781 13,960
Clear Channel Communications Inc + -- -- -- 100 5,688
CMS Energy Corp 31,536 954 22,896 885 21,240
CNA Financial Corp + -- -- -- 100 7,388
Coca-Cola Enterprises 40,754 1,448 29,684 855 17,528
Coltec Industries + -- -- -- 500 8,563
Comdisco Inc 15,147 424 10,812 395 10,073
Comerica Inc 50,991 1,323 37,209 840 23,625
Commerce Bancshares Inc -- -- -- 300 9,225
Compass Bankshares Inc -- -- -- 300 8,250
Compuware Corp + -- -- -- 400 14,700
Comsat Corp 12,762 514 9,124 490 8,698
Conner Peripherals Inc + 7,703 565 5,579 520 5,135
Conseco Inc -- -- -- 200 7,125
Consolidated Papers Inc -- 490 23,704 270 13,061
Consolidated Stores Corp + 32,411 -- -- 500 9,500
Cordis Corp + 15,795 183 11,895 155 10,075
Countrywide Credit & Industries Inc -- -- -- 800 13,000
Cox Communications Inc Class A + 15,139 647 11,080 433 7,415
Cracker Barrel Old Country Store Inc 20,668 671 15,223 625 14,180
Crestar Financial Corp 25,228 415 17,897 385 16,603
Crompton & Knowles Corp 13,247 570 9,619 530 8,944
CUC International Inc + 61,864 1,250 44,063 780 27,495
Cypress Semiconductor + 16,514 412 11,691 385 10,924
Danaher Corp 25,429 622 18,349 580 17,110
Dauphin Deposit Corp 12,423 362 9,141 345 8,711
Dean Foods Co 18,817 437 13,547 405 12,555
Dell Computer Corp + 24,361 417 17,306 385 15,978
</TABLE>
48 49
<PAGE> 126
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Delmarva Power & Light Co 640 $ 12,720 510 $ 10,136 903
Dentsply International Inc -- -- -- -- --
Department 56 Inc + -- -- -- -- --
Diamond Shamrock R&M Inc 304 7,600 250 6,250 435
Diebold Inc 340 12,028 260 9,198 471
Dole Food Inc 646 16,796 510 13,260 908
Dollar General Corp 482 16,750 380 13,205 684
Dr Pepper / Seven-Up Co Inc + -- -- -- -- --
Duracell International Inc -- -- 500 20,813 --
Eckerd (Jack) Corp + -- -- -- -- --
Edison Brothers Stores Inc -- -- -- -- 347
Edwards (A G) & Sons Inc 655 14,738 520 11,700 917
El Paso Natural Gas Co 398 12,239 320 9,840 556
Electronic Arts Inc + -- -- -- -- --
EMC Corp + 2,058 35,243 1,620 27,743 2,897
Energy Service Co Inc + -- -- -- -- --
Ennis Business Forms Inc -- -- -- -- 247
Enron Oil & Gas Co -- -- -- -- --
Enterra Corp + -- -- -- -- 423
Equifax Inc 805 24,854 650 20,069 1,171
Equitable Co Inc -- -- 100 2,238 --
Equitable of Iowa Co -- -- -- -- --
Equity Residential Properties Trust -- -- -- -- --
Ethyl Corp 1,031 10,568 1,010 10,353 1,829
Exabyte Corp + -- -- -- -- 340
Family Dollar Stores Inc 620 8,060 480 6,240 857
Fastenal Co -- -- -- -- --
Federal Mogul Corp 396 7,722 300 5,850 553
Federal Realty Investment Trust -- -- -- -- --
Federal Signal Corp 498 10,209 390 7,995 707
Federated Department Stores Inc + -- -- 1,000 22,000 --
Ferro Corp 305 7,816 250 6,406 436
FHP International Corp + 424 11,395 340 9,138 603
Fifth Third Bancorp 663 34,145 530 27,295 951
Fingerhut Co 505 8,269 400 6,550 714
Finova Group Inc -- -- -- -- --
First America Bank Corp 647 21,917 510 17,276 909
First American Corp - Tennessee -- -- -- -- --
First Bancorp of Ohio Inc -- -- -- -- --
First Bank System Inc 1,266 49,216 990 38,486 1,789
First Brands Corp 243 9,113 190 7,125 347
First Empire State Corp -- -- -- -- --
First Financial Management Corp 662 45,761 420 29,033 949
First Hawaiian Inc -- -- -- -- --
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Delmarva Power & Light Co $ 17,947 648 $ 12,879 615 $ 12,223
Dentsply International Inc -- -- -- 200 6,650
Department 56 Inc + -- -- -- 200 7,750
Diamond Shamrock R&M Inc 10,875 330 8,250 315 7,875
Diebold Inc 16,662 341 12,063 325 11,497
Dole Food Inc 23,608 668 17,368 625 16,250
Dollar General Corp 23,769 495 17,201 464 16,124
Dr Pepper / Seven-Up Co Inc + -- -- -- 500 16,438
Duracell International Inc -- -- -- 700 29,138
Eckerd (Jack) Corp + -- -- -- 200 5,250
Edison Brothers Stores Inc 5,465 -- -- -- --
Edwards (A G) & Sons Inc 20,633 677 15,233 625 14,063
El Paso Natural Gas Co 17,097 411 12,638 385 11,839
Electronic Arts Inc + -- -- -- 500 10,750
EMC Corp + 49,611 2,107 36,082 1,280 21,920
Energy Service Co Inc + -- -- -- 500 5,875
Ennis Business Forms Inc 3,396 -- -- -- --
Enron Oil & Gas Co -- -- -- 400 8,350
Enterra Corp + 7,614 -- -- -- --
Equifax Inc 36,155 836 25,812 770 23,774
Equitable Co Inc -- -- -- 700 15,663
Equitable of Iowa Co -- -- -- 300 9,975
Equity Residential Properties Trust -- -- -- 200 5,425
Ethyl Corp 18,747 1,308 13,407 1,230 12,608
Exabyte Corp + 6,418 -- -- -- --
Family Dollar Stores Inc 11,141 627 8,151 595 7,735
Fastenal Co -- -- -- 200 9,350
Federal Mogul Corp 10,784 398 7,761 380 7,410
Federal Realty Investment Trust -- -- -- 300 6,338
Federal Signal Corp 14,494 502 10,291 480 9,840
Federated Department Stores Inc + -- -- -- 800 17,600
Ferro Corp 11,173 331 8,482 315 8,072
FHP International Corp + 16,206 436 11,718 409 10,992
Fifth Third Bancorp 48,977 686 35,329 435 22,403
Fingerhut Co 11,692 509 8,335 480 7,860
Finova Group Inc -- -- -- 300 10,050
First America Bank Corp 30,792 669 22,662 625 21,172
First American Corp - Tennessee -- -- -- 300 10,294
First Bancorp of Ohio Inc -- -- -- 300 7,050
First Bank System Inc 69,547 1,284 49,916 920 35,765
First Brands Corp 13,013 252 9,450 230 8,625
First Empire State Corp -- -- -- 100 16,550
First Financial Management Corp 65,600 684 47,282 435 30,069
First Hawaiian Inc -- -- -- 300 8,100
</TABLE>
50 51
<PAGE> 127
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
First Security Corp 516 $ 13,029 420 $ 10,605 750
First Tennessee National Corp 354 14,691 270 11,205 485
First USA Inc -- -- 400 14,750 --
First Virginia Banks Inc 359 12,655 280 9,870 491
Firstar Corp -- -- 400 12,000 --
Fiserv Inc + 417 10,946 330 8,663 599
Flightsafety International 356 15,798 270 11,981 487
Florida Progress Corp 1,015 31,846 800 25,100 1,434
Flowers Industries Inc 404 7,424 320 5,880 586
Food Lion Inc Class A -- -- -- -- --
Food Lion Inc Class B -- -- -- -- --
Forest Labs Inc Class A + 482 24,462 370 18,778 666
Foundation Health Corp + 609 18,194 482 14,400 865
Fourth Financial Corp -- -- -- -- --
Franklin Resources Inc 896 34,720 700 27,125 1,263
Freeport-McMoRan Inc 1,529 27,522 1,180 21,240 2,107
Freeport-McMoRan Copper & Gold Inc 19 399 14 294 26
Frontier Corp 783 17,911 630 14,411 1,122
Fruit of the Loom Inc Class A + 814 19,027 650 15,194 1,154
Fuller (H B) Co -- -- -- -- 225
Fund American Enterprises Inc + -- -- -- -- --
GATX Corp 223 9,951 170 7,586 302
Gaylord Entertainment Co Class A -- -- -- -- --
GEICO Corp -- -- 300 14,663 --
GenCorp Inc -- -- -- -- 485
Genentech Inc + -- -- 400 20,100 --
General Instrument Corp + -- -- 600 19,050 --
General Motors Corp Class E 2,788 106,990 1,030 39,526 3,991
General Motors Corp Class H -- -- 700 26,338 --
General Nutrition Co Inc + -- -- -- -- --
Genzyme Corp - General Division + 263 10,191 210 8,138 367
Genzyme Corp - Tissue Repair + 35 140 -- -- 49
Geon Co + -- -- -- -- --
Georgia Gulf Corp 437 13,110 360 10,800 645
Gibson Greeting Inc -- -- -- -- 244
Glatfelter (P H) Co 486 8,870 380 6,935 669
Glenayre Technologies Inc + -- -- -- -- --
Global Marine Inc + -- -- -- -- 2,515
Goulds Pumps Inc -- -- -- -- 315
GP Financial Corp -- -- -- -- --
Granite Construction Inc -- -- -- -- 180
Green Tree Financial Inc -- -- 500 19,125 --
GTECH Holdings Corp + -- -- -- -- --
Hancock Fabrics -- -- -- -- 342
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
First Security Corp $ 18,938 535 $ 13,509 500 $ 12,625
First Tennessee National Corp 20,128 350 14,525 340 14,110
First USA Inc -- -- -- 500 18,438
First Virginia Banks Inc 17,308 361 12,725 345 12,161
Firstar Corp -- -- -- 600 18,000
Fiserv Inc + 15,724 429 11,261 395 10,369
Flightsafety International 21,611 357 15,842 345 15,309
Florida Progress Corp 44,992 1,039 32,599 980 30,748
Flowers Industries Inc 10,768 416 7,644 385 7,074
Food Lion Inc Class A -- -- -- 2,200 12,375
Food Lion Inc Class B -- -- -- 1,600 9,400
Forest Labs Inc Class A + 33,800 486 24,665 260 13,195
Foundation Health Corp + 25,842 626 18,702 586 17,507
Fourth Financial Corp -- -- -- 300 9,919
Franklin Resources Inc 48,941 913 35,379 565 21,894
Freeport-McMoRan Inc 37,926 1,557 28,026 970 17,460
Freeport-McMoRan Copper & Gold Inc 546 19 399 18 378
Frontier Corp 25,666 797 18,231 750 17,156
Fruit of the Loom Inc Class A + 26,975 844 19,729 780 18,233
Fuller (H B) Co 7,481 -- -- -- --
Fund American Enterprises Inc + -- -- -- 100 7,463
GATX Corp 13,477 217 9,684 210 9,371
Gaylord Entertainment Co Class A -- -- -- 300 7,875
GEICO Corp -- -- -- 400 19,550
GenCorp Inc 6,548 -- -- -- --
Genentech Inc + -- -- -- 300 15,075
General Instrument Corp + -- -- -- 900 28,575
General Motors Corp Class E 153,155 2,876 110,367 1,700 65,238
General Motors Corp Class H -- -- -- 600 22,575
General Nutrition Co Inc + -- -- -- 400 9,600
Genzyme Corp - General Division + 14,221 272 10,540 250 9,688
Genzyme Corp - Tissue Repair + 196 36 144 33 132
Geon Co + -- -- -- 300 8,700
Georgia Gulf Corp 19,350 465 13,950 440 13,200
Gibson Greeting Inc 2,288 -- -- -- --
Glatfelter (P H) Co 12,209 489 8,924 470 8,578
Glenayre Technologies Inc + -- -- -- 200 8,050
Global Marine Inc + 10,374 -- -- -- --
Goulds Pumps Inc 6,773 -- -- -- --
GP Financial Corp -- -- -- 400 9,350
Granite Construction Inc 3,544 -- -- -- --
Green Tree Financial Inc -- -- -- 400 15,300
GTECH Holdings Corp + -- -- -- 400 7,950
Hancock Fabrics 3,933 -- -- -- --
</TABLE>
52 53
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FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Hanna (M A) Co 387 $ 9,433 300 $ 7,313 545
Hannaford Brothers Co 436 11,227 360 9,270 645
Harley-Davidson Inc 818 22,086 650 17,550 1,159
Harsco Corp 269 11,634 210 9,083 374
Hartford Steam Boiler Inspection 230 9,775 180 7,650 309
Hawaiian Electric Industries Inc 292 9,636 240 7,920 423
HBO & Co -- -- -- -- --
Health & Retirement Property Trust -- -- -- -- --
Health Care & Retirement Corp + -- -- -- -- --
Health Care Property Investors Inc -- -- -- -- --
Health Management Associates Inc Class A + -- -- -- -- --
HealthCare Compare Corp + 384 12,192 290 9,208 516
Healthsource Inc + -- -- -- -- --
Healthsouth Rehabilitation Corp + 304 12,236 250 10,063 460
Healthtrust Inc + -- -- 500 18,125 --
Heilig-Meyers Co 524 12,380 410 9,686 734
Hibernia Corp Class A -- -- -- -- --
Hillenbrand Industries Inc -- -- -- -- --
Home Shopping Network Inc + 1,025 9,097 810 7,189 1,444
HON Industries Inc 353 10,590 270 8,100 484
Hormel Foods Corp -- -- -- -- --
Hospitality Franchise Systems Inc + -- -- -- -- --
Host Marriot Corp + -- -- -- -- --
Houghton Mifflin Co 152 6,536 120 5,160 230
Hubbell Inc Class B 366 19,764 283 15,282 504
Humana Inc + -- -- 1,300 30,875 --
Hunt (J B) Transport Services -- -- -- -- 596
Huntington Bancshares Inc -- -- 1,000 18,500 --
IBP Inc 516 16,448 410 13,069 726
ICN Pharmaceuticals Inc -- -- -- -- --
Idaho Power Co 402 10,100 320 8,040 585
IES Industries Inc -- -- -- -- --
Illinois Central Corp 474 16,057 360 12,195 657
Illinova Corp 813 19,004 650 15,194 1,153
IMC Fertilizer Group + 309 14,446 250 11,688 465
Indiana Energy Inc -- -- -- -- 352
Infinity Broadcasting Corp Class A + -- -- -- -- --
Information Resources Inc + -- -- -- -- 403
Informix Corp + 695 26,236 560 21,140 1,009
Integra Financial Corp -- -- -- -- --
Integrated Device Technology Inc + -- -- -- -- --
Intelligent Electronics -- -- -- -- 540
International Dairy Queen Class A + -- -- -- -- 369
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Hanna (M A) Co $ 13,284 400 $ 9,750 375 $ 9,141
Hannaford Brothers Co 16,609 465 11,974 440 11,330
Harley-Davidson Inc 31,293 844 22,788 790 21,330
Harsco Corp 16,176 279 12,067 260 11,245
Hartford Steam Boiler Inspection 13,133 224 9,520 220 9,350
Hawaiian Electric Industries Inc 13,959 303 9,999 280 9,240
HBO & Co -- -- -- 300 11,550
Health & Retirement Property Trust -- -- -- 500 7,250
Health Care & Retirement Corp + -- -- -- 300 9,300
Health Care Property Investors Inc -- -- -- 300 9,000
Health Management Associates Inc Class A + -- -- -- 300 7,988
HealthCare Compare Corp + 16,383 396 12,573 365 11,589
Healthsource Inc + -- -- -- 300 13,050
Healthsouth Rehabilitation Corp + 18,515 330 13,283 315 12,679
Healthtrust Inc + -- -- -- 500 18,125
Heilig-Meyers Co 17,341 544 12,852 500 11,813
Hibernia Corp Class A -- -- -- 1,100 8,525
Hillenbrand Industries Inc -- -- -- 300 8,438
Home Shopping Network Inc + 12,816 1,049 9,310 980 8,698
HON Industries Inc 14,520 354 10,620 335 10,050
Hormel Foods Corp -- -- -- 400 10,700
Hospitality Franchise Systems Inc + -- -- -- 300 8,513
Host Marriot Corp + -- -- -- 1,200 13,200
Houghton Mifflin Co 9,890 155 6,665 145 6,235
Hubbell Inc Class B 27,216 367 19,818 151 8,154
Humana Inc + -- -- -- 1,100 26,125
Hunt (J B) Transport Services 11,622 -- -- -- --
Huntington Bancshares Inc -- -- -- 900 16,650
IBP Inc 23,141 521 16,607 500 15,938
ICN Pharmaceuticals Inc -- -- -- 500 7,188
Idaho Power Co 14,698 415 10,427 385 9,673
IES Industries Inc -- -- -- 300 8,213
Illinois Central Corp 22,256 477 16,158 435 14,736
Illinova Corp 26,951 843 19,705 780 18,233
IMC Fertilizer Group + 21,739 335 15,661 300 14,025
Indiana Energy Inc 6,600 -- -- -- --
Infinity Broadcasting Corp Class A + -- -- -- 300 10,575
Information Resources Inc + 6,095 -- -- -- --
Informix Corp + 38,090 719 27,142 390 14,723
Integra Financial Corp -- -- -- 300 12,825
Integrated Device Technology Inc + -- -- -- 300 11,438
Intelligent Electronics 4,995 -- -- -- --
International Dairy Queen Class A + 6,642 -- -- -- --
</TABLE>
54 55
<PAGE> 129
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
International Game Technology 1,397 $ 19,558 1,100 $ 15,400 1,972
International Multifoods Corp -- -- -- -- 274
International Technology Corp + -- -- -- -- 551
Intuit Inc + -- -- -- -- --
Iowa Illinois Gas & Electric Co 307 6,677 250 5,438 463
IPALCO Enterprises Inc 405 13,314 320 10,520 588
ITEL Corp + -- -- -- -- --
IVAX Corp 930 20,111 740 16,003 1,323
Jacobs Engineering Group Inc + -- -- -- -- 373
Jefferson Smurfit Corp + -- -- 900 17,663 --
John Alden Financial Corp -- -- -- -- --
Kansas City Power & Light Co 667 15,925 530 12,654 955
Kansas City Southern Industries 481 17,737 370 13,644 665
Kaydon Corp -- -- -- -- 250
Kelly Services Inc Class A 406 12,891 320 10,160 589
Kemper Corp 363 14,611 290 11,673 520
Kennametal Inc -- -- -- -- 411
Keystone International Inc 383 7,133 300 5,588 541
KLA Instruments Corp + -- -- -- -- --
Kohls Corp + 393 16,113 310 12,710 552
La Quinta Inns Inc -- -- -- -- --
Lafarge Corp -- -- -- -- --
Laidlaw Inc Class B -- -- -- -- 4,261
Lam Research Corp + -- -- -- -- --
Lancaster Colony Corp 338 11,577 260 8,905 470
Lance Inc -- -- -- -- 478
Lands' End Inc + -- -- -- -- 547
Lawson Products Inc -- -- -- -- 197
Lawter International Inc -- -- -- -- 677
LDDS Communications + 1,308 30,656 1,030 24,141 1,858
Lee Enterprises Inc 249 8,995 -- -- 354
Legent Corp + 373 10,817 300 8,700 531
Leggett & Platt Inc 429 17,535 350 14,306 637
Lehman Brothers Holdings -- -- 800 14,500 --
Leucadia National Corp -- -- -- -- --
LG&E Energy Corp 364 14,151 280 10,885 496
LIN Broadcasting Corp + -- -- 200 25,875 --
Lincoln Telecommunications -- -- -- -- 490
Linear Technology Corp 393 21,419 310 16,895 550
Litton Industries Inc + 501 18,287 390 14,235 708
Loctite Corp 385 17,710 300 13,800 542
Loews Corp -- -- 300 29,138 --
Lone Star Steakhouse & Saloon + -- -- -- -- --
Longview Fibre Co 554 9,834 440 7,810 790
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
International Game Technology $ 27,608 1,417 $ 19,838 1,345 $ 18,830
International Multifoods Corp 5,103 -- -- -- --
International Technology Corp + 1,515 -- -- -- --
Intuit Inc + -- -- -- 100 6,625
Iowa Illinois Gas & Electric Co 10,070 333 7,243 315 6,851
IPALCO Enterprises Inc 19,331 418 13,742 385 12,657
ITEL Corp + -- -- -- 200 6,975
IVAX Corp 28,610 963 20,825 895 19,354
Jacobs Engineering Group Inc + 7,367 -- -- -- --
Jefferson Smurfit Corp + -- -- -- 700 13,738
John Alden Financial Corp -- -- -- 300 8,625
Kansas City Power & Light Co 22,801 690 16,474 645 15,399
Kansas City Southern Industries 24,522 485 17,884 460 16,963
Kaydon Corp 6,875 -- -- -- --
Kelly Services Inc Class A 18,701 419 13,303 385 12,224
Kemper Corp 20,930 365 14,691 345 13,886
Kennametal Inc 11,097 -- -- -- --
Keystone International Inc 10,076 396 7,376 365 6,798
KLA Instruments Corp + -- -- -- 200 11,600
Kohls Corp + 22,632 404 16,564 379 15,539
La Quinta Inns Inc -- -- -- 300 7,463
Lafarge Corp -- -- -- 300 5,363
Laidlaw Inc Class B 34,621 -- -- -- --
Lam Research Corp + -- -- -- 200 8,000
Lancaster Colony Corp 16,098 340 11,645 328 11,234
Lance Inc 8,246 -- -- -- --
Lands' End Inc + 9,094 -- -- -- --
Lawson Products Inc 5,221 -- -- -- --
Lawter International Inc 8,716 -- -- -- --
LDDS Communications + 43,547 1,343 31,477 1,260 29,531
Lee Enterprises Inc 12,788 255 9,212 -- --
Legent Corp + 15,399 386 11,194 355 10,295
Leggett & Platt Inc 26,037 442 18,067 415 16,963
Lehman Brothers Holdings -- -- -- 700 12,688
Leucadia National Corp -- -- -- 200 9,325
LG&E Energy Corp 19,282 366 14,228 345 13,412
LIN Broadcasting Corp + -- -- -- 300 38,813
Lincoln Telecommunications 7,963 -- -- -- --
Linear Technology Corp 29,975 405 22,073 375 20,438
Litton Industries Inc + 25,842 503 18,360 479 17,484
Loctite Corp 24,932 397 18,262 365 16,790
Loews Corp -- -- -- 400 38,850
Lone Star Steakhouse & Saloon + -- -- -- 200 4,950
Longview Fibre Co 14,023 575 10,206 530 9,408
</TABLE>
56 57
<PAGE> 130
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
LSI Logic Corp + 536 $ 29,212 430 $ 23,435 771
LTV Corp + -- -- 800 12,300 --
Lubrizol Corp 729 24,422 560 18,760 1,017
Lukens Inc -- -- -- -- 230
Lyondell Petrochemical 876 21,134 680 16,405 1,217
Magma Power Co + 112 4,319 90 3,471 157
MagneTek Inc + -- -- -- -- 367
Manpower Inc -- -- 600 17,550 --
MAPCO Inc 337 18,409 260 14,203 468
Marion Merrell Dow Inc -- -- 600 14,925 --
Mark IV Industries Inc 474 9,480 370 7,400 658
Marshall & Ilsley Corp 1,058 21,954 840 17,430 1,503
Marvel Entertainment Group Inc + -- -- -- -- --
Maxim Integrated Products Inc + -- -- -- -- --
MAXXAM Inc + -- -- -- -- 128
MBIA Inc -- -- 300 18,600 --
McCormick & Co Inc 888 19,647 700 15,488 1,255
McFrugals Bargains Closeouts + -- -- -- -- 438
McKesson Corp -- -- -- -- --
MCN Corp 616 11,319 500 9,188 930
Measurex Corp -- -- -- -- 286
Media General Inc Class A 280 8,820 220 6,930 410
Meditrust Corp -- -- -- -- --
Mentor Graphics Corp + -- -- -- -- 752
Mercantile Bancorp 436 16,078 370 13,644 669
Mercantile Bankshares 503 10,500 390 8,141 713
Mercury Financial Corp -- -- -- -- --
Mercury General Corp -- -- -- -- --
Meridian Bancorp Inc 635 19,447 490 15,006 897
Meyer (Fred) Inc + -- -- -- -- --
MFS Communications Inc + -- -- -- -- --
MGIC Investment Corp -- -- 400 15,250 --
Michael Foods Inc -- -- -- -- 229
Michaels Stores Inc + -- -- -- -- --
Michigan National Corp -- -- -- -- --
Micro Warehouse Inc + -- -- -- -- --
Microchip Technology Inc + -- -- -- -- --
Mid-American Waste Systems Inc + -- -- -- -- 372
Mid Atlantic Medical Services + -- -- -- -- --
Midlantic Corp Inc -- -- 100 3,075 --
Miller (Herman) Inc 269 5,884 210 4,594 374
Minnesota Power & Light Co 349 9,030 270 6,986 480
Mirage Resorts Inc + 995 23,756 780 18,623 1,389
Modine Manufacturing Co 309 10,120 250 8,188 465
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
LSI Logic Corp + $ 42,020 556 $ 30,302 310 $ 16,895
LTV Corp + -- -- -- 1,100 16,913
Lubrizol Corp 34,070 742 24,857 500 16,750
Lukens Inc 6,584 -- -- -- --
Lyondell Petrochemical 29,360 892 21,520 845 20,386
Magma Power Co + 6,054 116 4,473 107 4,126
MagneTek Inc + 5,322 -- -- -- --
Manpower Inc -- -- -- 500 14,625
MAPCO Inc 25,565 338 18,463 300 16,388
Marion Merrell Dow Inc -- -- -- 900 22,388
Mark IV Industries Inc 13,160 478 9,560 435 8,700
Marshall & Ilsley Corp 31,187 1,083 22,472 1,020 21,165
Marvel Entertainment Group Inc + -- -- -- 400 6,250
Maxim Integrated Products Inc + -- -- -- 300 9,863
MAXXAM Inc + 3,680 -- -- -- --
MBIA Inc -- -- -- 400 24,800
McCormick & Co Inc 27,767 905 20,023 855 18,917
McFrugals Bargains Closeouts + 7,446 -- -- -- --
McKesson Corp -- -- -- 300 11,063
MCN Corp 17,089 670 12,311 600 11,025
Measurex Corp 6,828 -- -- -- --
Media General Inc Class A 12,915 290 9,135 270 8,505
Meditrust Corp -- -- -- 300 9,600
Mentor Graphics Corp + 9,964 -- -- -- --
Mercantile Bancorp 24,669 464 17,110 440 16,225
Mercantile Bankshares 14,884 508 10,605 480 10,020
Mercury Financial Corp -- -- -- 800 12,800
Mercury General Corp -- -- -- 200 6,250
Meridian Bancorp Inc 27,471 642 19,661 605 18,528
Meyer (Fred) Inc + -- -- -- 200 6,375
MFS Communications Inc + -- -- -- 200 6,950
MGIC Investment Corp -- -- -- 600 22,875
Michael Foods Inc 2,748 -- -- -- --
Michaels Stores Inc + -- -- -- 200 6,200
Michigan National Corp -- -- -- 100 10,188
Micro Warehouse Inc + -- -- -- 100 2,875
Microchip Technology Inc + -- -- -- 400 10,100
Mid-American Waste Systems Inc + 2,093 -- -- -- --
Mid Atlantic Medical Services + -- -- -- 400 8,200
Midlantic Corp Inc -- -- -- 500 15,375
Miller (Herman) Inc 8,181 279 6,103 260 5,688
Minnesota Power & Light Co 12,420 350 9,056 335 8,668
Mirage Resorts Inc + 33,162 1,004 23,971 935 22,323
Modine Manufacturing Co 15,229 335 10,971 300 9,825
</TABLE>
58 59
<PAGE> 131
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Molex Inc 851 $ 28,721 675 $ 22,781 1,211
Molex Inc Class A -- -- -- -- --
Montana Power Co 563 13,371 460 10,925 824
Morgan Stanley Group 874 58,886 370 24,929 1,191
Morrison Restaurants + 385 10,299 300 8,025 543
Multimedia Inc + 401 15,238 320 12,160 584
Murphy Oil Corp 493 21,569 380 16,625 677
Mylan Laboratories 869 27,156 680 21,250 1,210
Nabisco Holdings Corp Class A + -- -- -- -- --
Nabors Industries Inc + -- -- -- -- 1,285
National Education Corp + 52 156 118 354 270
National Fuel Gas Co 400 10,900 320 8,720 582
National Gypsum Co + -- -- -- -- --
National Health Labs Inc + 917 12,723 720 9,990 1,310
National Pizza Company + -- -- -- -- 374
National Presto Industries Inc -- -- -- -- 116
NCH Corp -- -- -- -- 124
Nellcor Inc + -- -- -- -- 250
Network Systems Corp + 311 1,749 250 1,406 467
Nevada Power Co 444 9,213 360 7,470 652
New England Electric System 695 22,935 560 18,480 1,008
New Plan Realty Trust -- -- -- -- --
New World Communications Group Inc + -- -- -- -- --
New York State Electric & Gas 772 16,598 610 13,115 1,087
NEXTEL Communications Class A + 1,068 12,950 880 10,670 1,588
Nine West Group Inc + -- -- -- -- --
NIPSCO Industries Inc 702 22,201 560 17,710 1,015
Noble Affiliates Inc 538 13,719 430 10,965 773
Nordson Corp 214 11,931 160 8,920 293
Northeast Utilities 1,340 30,485 1,070 24,343 1,916
Northern Trust Corp 567 19,278 460 15,640 828
Northwest Airlines Corp Class A + -- -- -- -- --
Novacare Corp + -- -- -- -- 975
Novellus Systems Inc + -- -- -- -- --
Octel Communications Corp + -- -- -- -- 365
OEA Inc -- -- -- -- 308
Office Depot Inc + 1,538 35,951 1,250 29,219 2,242
Officemax Inc + -- -- -- -- --
Ohio Casualty Corp -- -- -- -- --
Oklahoma Gas & Electric Co 429 15,176 340 12,028 612
Old Kent Financial Corp -- -- -- -- --
Old National Bancorp -- -- -- -- --
Old Republic International Corp -- -- -- -- --
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Molex Inc $ 40,871 880 $ 29,700 318 $ 10,733
Molex Inc Class A -- -- -- 400 12,700
Montana Power Co 19,570 584 13,870 540 12,825
Morgan Stanley Group 80,244 891 60,031 545 36,719
Morrison Restaurants + 14,525 398 10,647 375 10,031
Multimedia Inc + 22,192 414 15,732 385 14,630
Murphy Oil Corp 29,619 497 21,744 470 20,563
Mylan Laboratories 37,813 885 27,656 535 16,719
Nabisco Holdings Corp Class A + -- -- -- 400 11,100
Nabors Industries Inc + 8,513 29 192 -- --
National Education Corp + 810 212 636 353 1,059
National Fuel Gas Co 15,860 412 11,227 385 10,491
National Gypsum Co + -- -- -- 200 9,850
National Health Labs Inc + 18,176 950 13,181 885 12,279
National Pizza Company + 2,338 284 1,775 -- --
National Presto Industries Inc 4,930 81 3,443 -- --
NCH Corp 7,595 89 5,451 -- --
Nellcor Inc + 8,500 175 5,950 -- --
Network Systems Corp + 2,627 327 1,839 250 1,406
Nevada Power Co 13,529 472 9,794 450 9,338
New England Electric System 33,264 718 23,694 690 22,770
New Plan Realty Trust -- -- -- 500 10,438
New World Communications Group In c + -- -- -- 300 4,725
New York State Electric & Gas 23,371 787 16,921 740 15,910
NEXTEL Communications Class A + 19,255 1,101 13,350 1,025 12,428
Nine West Group Inc + -- -- -- 200 5,625
NIPSCO Industries Inc 32,099 740 23,403 675 21,347
Noble Affiliates Inc 19,712 558 14,229 520 13,260
Nordson Corp 16,335 208 11,596 185 10,314
Northeast Utilities 43,589 1,386 31,532 1,290 29,348
Northern Trust Corp 28,152 588 19,992 565 19,210
Northwest Airlines Corp Class A + -- -- -- 500 12,313
Novacare Corp + 8,409 710 6,124 -- --
Novellus Systems Inc + -- -- -- 200 10,550
Octel Communications Corp + 8,486 270 6,278 -- --
OEA Inc 7,700 223 5,575 -- --
Office Depot Inc + 52,407 1,567 36,629 980 22,908
Officemax Inc + -- -- -- 400 10,000
Ohio Casualty Corp -- -- -- 200 6,750
Oklahoma Gas & Electric Co 21,650 442 15,636 415 14,681
Old Kent Financial Corp -- -- -- 400 12,650
Old National Bancorp -- -- -- 200 7,000
Old Republic International Corp -- -- -- 400 9,900
</TABLE>
60 61
<PAGE> 132
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Olin Corp 235 $ 11,956 180 $ 9,158 339
Olsten Corp 461 15,847 350 12,031 645
Omnicom Group 394 20,931 310 16,469 560
Oregon Steel Mills Inc -- -- -- -- 299
Outback Steakhouse Inc + -- -- -- -- --
Overseas Shipholding Group 393 9,088 310 7,169 550
Owens-Illinois Inc + -- -- -- -- --
Oxford Health Plans Inc + -- -- -- -- --
PacifiCare Health Systems Inc Class A + 289 20,013 240 16,620 420
PacifiCare Health Systems Inc Class B + -- -- -- -- --
Paging Network Inc + -- -- -- -- --
Painewebber Group Inc -- -- -- -- --
Parametric Technology Corp + 610 23,333 480 18,360 871
Parker & Parsley Petroleum 376 6,862 297 5,420 534
Parker Drilling Co + -- -- -- -- 844
Paychex Inc 337 13,817 260 10,660 468
Pentair Inc -- -- -- -- 288
Perrigo Co + 812 11,267 650 9,019 1,152
PetSmart Inc + -- -- -- -- --
PHH Corp 178 6,675 150 5,625 257
Phillips Van Heusen Corp -- -- -- -- 410
Physician Corp of America + -- -- -- -- --
Pinnacle West Capital Corp 941 20,232 750 16,125 1,334
Policy Management Systems Corp + 248 11,191 170 7,671 303
Portland General Corp 540 11,003 430 8,761 775
Potomac Electric Power Co 1,282 24,839 1,010 19,569 1,806
Precision Castparts Corp -- -- -- -- 300
Premier Industrial Corp -- -- -- -- --
Primadonna Resorts Inc + -- -- -- -- --
Progressive Corp Ohio 782 30,400 620 24,103 1,097
Property Trust of America -- -- -- -- --
Provident Life & Accident Insurance Class B + 497 11,680 390 9,165 706
Public Service Company of Colorado 661 20,243 530 16,231 949
Public Service Company of New Mexico + -- -- -- -- 650
Puget Sound Power & Light Co 683 14,770 540 11,678 971
Quaker State Corp -- -- -- -- 419
Qualcomm Inc + -- -- -- -- --
Quantum Corp + -- -- -- -- 690
Questar Corp 427 12,330 340 9,818 610
Ranger Oil Ltd -- -- -- -- 1,508
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Olin Corp $ 17,247 229 $ 11,650 230 $ 11,701
Olsten Corp 22,172 459 15,778 444 15,263
Omnicom Group 29,750 405 21,516 379 20,134
Oregon Steel Mills Inc 4,971 199 3,308 -- --
Outback Steakhouse Inc + -- -- -- 300 7,838
Overseas Shipholding Group 12,719 405 9,366 375 8,672
Owens-Illinois Inc + -- -- -- 900 9,450
Oxford Health Plans Inc + -- -- -- 100 9,100
PacifiCare Health Systems Inc Cla ss A + 29,085 300 20,775 80 5,540
PacifiCare Health Systems Inc Cla ss B + -- -- -- 100 7,025
Paging Network Inc + -- -- -- 300 9,975
Painewebber Group Inc -- -- -- 700 12,163
Parametric Technology Corp + 33,316 621 23,753 385 14,726
Parker & Parsley Petroleum 9,746 386 7,045 362 6,607
Parker Drilling Co + 4,115 619 3,018 -- --
Paychex Inc 19,188 338 13,858 300 12,300
Pentair Inc 12,366 203 8,716 -- --
Perrigo Co + 15,984 842 11,683 780 10,823
PetSmart Inc + -- -- -- 300 10,425
PHH Corp 9,638 197 7,388 175 6,563
Phillips Van Heusen Corp 6,868 290 4,858 -- --
Physician Corp of America + -- -- -- 400 8,900
Pinnacle West Capital Corp 28,681 974 20,941 905 19,458
Policy Management Systems Corp + 13,673 258 11,642 240 10,830
Portland General Corp 15,791 560 11,410 520 10,595
Potomac Electric Power Co 34,991 1,316 25,498 1,230 23,831
Precision Castparts Corp 6,975 213 4,952 -- --
Premier Industrial Corp -- -- -- 400 9,550
Primadonna Resorts Inc + -- -- -- 300 6,975
Progressive Corp Ohio 42,646 797 30,983 450 17,494
Property Trust of America -- -- -- 500 8,375
Provident Life & Accident Insuran ce Class B + 16,591 501 11,774 480 11,280
Public Service Company of Colorad o 29,063 684 20,948 635 19,447
Public Service Company of New Mex ico + 8,369 470 6,051 -- --
Puget Sound Power & Light Co 20,998 706 15,267 655 14,164
Quaker State Corp 6,076 299 4,336 -- --
Qualcomm Inc + -- -- -- 300 8,775
Quantum Corp + 10,178 485 7,154 -- --
Questar Corp 17,614 440 12,705 430 12,416
Ranger Oil Ltd 8,860 1,103 6,480 -- --
</TABLE>
62 63
<PAGE> 133
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FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Rayonier Inc 256 $ 7,680 250 $ 7,500 462
Readers Digest Association Class A -- -- 600 27,600 --
Readers Digest Association Class B -- -- -- -- --
Regions Financial 435 14,355 350 11,550 619
Reliastar Financial Corp -- -- -- -- --
Republic New York Corp -- -- 300 14,963 --
Revco DS Inc + -- -- -- -- --
Reynolds & Reynolds Co Class A 473 13,067 360 9,945 656
Rhone-Poulenc Rorer Inc -- -- 300 12,225 --
RJR Nabisco Holdings Corp + 854 4,804 7,717 43,408 3,526
Rohr Industries Inc + -- -- -- -- 287
Rollins Inc 388 9,797 310 7,828 545
Rouse Co -- -- -- -- --
RPM Inc 623 11,448 490 9,004 859
Ruddick Corp -- -- -- -- 357
Safeway Inc + -- -- -- -- --
Savannah Foods & Industries -- -- -- -- 410
Sbarro Inc -- -- -- -- 319
SCANA Corp 513 22,636 410 18,091 723
Scherer (R P) Corp + -- -- -- -- --
Schulman (A) Inc 403 11,486 320 9,120 586
Schwab (Charles) Corp 626 27,779 490 21,744 862
Scripps (E W) Co -- -- -- -- --
Seagate Technology Inc + 778 18,672 610 14,640 1,093
Seagull Energy Corp + 391 6,598 310 5,231 548
Sealed Air Corp -- -- -- -- 303
Sensormatic Electronics 735 20,856 570 16,174 1,023
Sequa Corp Class A 110 3,094 -- -- 137
Sequent Computer Systems + 340 5,823 -- -- 471
Service Merchandise Co + 771 3,759 -- -- 1,516
Shaw Industries Inc 1,560 24,375 1,230 19,219 2,215
Signet Banking Corp -- -- 500 18,188 --
Simon Property Group Inc -- -- -- -- --
Sizzler International Inc 254 1,619 -- -- 434
Smith International Inc 414 5,537 -- -- 597
Smucker (J M) Co Class A 305 7,168 -- -- 436
Solectron Corp + -- -- -- -- --
Sonoco Products + 941 22,819 740 17,945 1,334
Sotheby's Holdings Inc Class A 611 6,874 -- -- 848
Southdown Inc + 175 2,888 -- -- 253
Southern National Corp -- -- -- -- --
Southern New England Telecom Corp 687 22,757 550 18,219 975
Southern Pacific Rail Corp + -- -- -- -- --
Southland Corp + -- -- -- -- --
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Rayonier Inc $ 13,860 326 $ 9,780 319 $ 9,570
Readers Digest Association Class A -- -- -- 600 27,600
Readers Digest Association Class B -- -- -- 200 8,400
Regions Financial 20,427 464 15,312 440 14,520
Reliastar Financial Corp -- -- -- 300 10,238
Republic New York Corp -- -- -- 400 19,950
Revco DS Inc + -- -- -- 400 7,350
Reynolds & Reynolds Co Class A 18,122 476 13,150 450 12,431
Rhone-Poulenc Rorer Inc -- -- -- 500 20,375
RJR Nabisco Holdings Corp + 19,834 2,557 14,383 7,593 42,711
Rohr Industries Inc + 3,229 207 2,329 -- --
Rollins Inc 13,761 400 10,100 375 9,469
Rouse Co -- -- -- 500 9,875
RPM Inc 15,784 629 11,558 595 10,933
Ruddick Corp 7,274 262 5,338 -- --
Safeway Inc + -- -- -- 300 10,763
Savannah Foods & Industries 5,381 290 3,806 -- --
Sbarro Inc 7,816 219 5,366 -- --
SCANA Corp 31,902 518 22,857 490 21,621
Scherer (R P) Corp + -- -- -- 200 9,175
Schulman (A) Inc 16,701 416 11,856 385 10,973
Schwab (Charles) Corp 38,251 632 28,045 405 17,972
Scripps (E W) Co -- -- -- 200 5,825
Seagate Technology Inc + 26,232 793 19,032 750 18,000
Seagull Energy Corp + 9,248 403 6,801 375 6,328
Sealed Air Corp 12,688 218 9,129 -- --
Sensormatic Electronics 29,028 748 21,225 685 19,437
Sequa Corp Class A 3,853 102 2,869 -- --
Sequent Computer Systems + 8,066 341 5,840 -- --
Service Merchandise Co + 7,391 1,111 5,416 -- --
Shaw Industries Inc 34,609 1,605 25,078 1,000 15,625
Signet Banking Corp -- -- -- 500 18,188
Simon Property Group Inc -- -- -- 300 7,313
Sizzler International Inc 2,767 319 2,034 -- --
Smith International Inc 7,985 427 5,711 -- --
Smucker (J M) Co Class A 10,246 331 7,779 -- --
Solectron Corp + -- -- -- 400 9,650
Sonoco Products + 32,350 974 23,620 905 21,946
Sotheby's Holdings Inc Class A 9,540 623 7,009 -- --
Southdown Inc + 4,175 178 2,937 -- --
Southern National Corp -- -- -- 500 11,188
Southern New England Telecom Corp 32,297 710 23,519 680 22,525
Southern Pacific Rail Corp + -- -- -- 700 12,513
Southland Corp + -- -- -- 1,600 6,650
</TABLE>
64 65
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MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
SouthTrust Corp 871 $ 17,964 680 $ 14,025 1,237
Southwestern Public Service Co 433 12,611 350 10,194 617
St Joe Paper Co -- -- -- -- --
Standard Federal Bank -- -- -- -- --
Standard Register Co 301 5,249 -- -- 432
Stanhome Inc 220 6,160 170 4,760 299
Staples Inc + 621 15,059 510 12,368 895
Star Banc Corp -- -- -- -- --
Starbucks Corp + -- -- -- -- --
State Street Boston Corp 819 26,106 650 20,719 1,185
Sterling Chemicals Inc + 612 6,885 -- -- 849
Stewart & Stevenson Services 364 12,012 280 9,240 495
Stop & Shop Co Inc + -- -- -- -- --
Storage Technology Corp + 478 10,397 370 8,048 662
Stratacom Inc + -- -- -- -- --
Strattec Security Corp + 10 128 28 362 72
Stratus Computer Inc + 261 6,884 210 5,539 366
Structural Dynamics Research + 303 2,235 -- -- 434
Stryker Corp 524 22,794 410 17,835 734
Student Loan Marketing Association -- -- 700 25,813 --
Sunamerica Inc -- -- -- -- --
Sunbeam-Oster Co Inc -- -- -- -- --
Sundstrand Corp 363 16,607 280 12,810 495
Sungard Data Systems Inc + -- -- -- -- --
Superior Industries International Inc 322 8,775 260 7,085 454
Surgical Care Affiliates + 415 8,715 -- -- 598
Sybase Inc + -- -- 300 12,225 --
Sybron International Corp + -- -- -- -- --
Symantec Corp + 378 7,466 -- -- 536
Symbol Technologies Inc + 260 6,793 210 5,486 390
Synovus Financial Corp -- -- -- -- --
T Rowe Price Associates -- -- -- -- --
Tambrands Inc 397 17,170 310 13,408 554
TCA Cable TV Inc 266 6,949 -- -- 371
TECO Energy Inc 1,265 27,198 990 21,285 1,789
Tecumseh Products Co Class A 241 11,267 190 8,883 345
Teleflex Inc 175 6,497 -- -- 254
Telephone & Data Systems Inc 566 25,824 450 20,531 827
Tellabs Inc + -- -- 300 15,600 --
Teradyne Inc + 388 14,114 310 11,276 545
Thermo Electron Corp + 548 25,962 434 20,561 779
Thiokol Inc 216 5,589 -- -- 295
Tidewater Inc 565 11,088 450 8,831 825
Tiffany & Co 163 5,135 -- -- 240
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
SouthTrust Corp $ 25,513 887 $ 18,294 835 $ 17,222
Southwestern Public Service Co 17,970 462 13,456 415 12,087
St Joe Paper Co -- -- -- 100 5,975
Standard Federal Bank -- -- -- 300 8,925
Standard Register Co 7,533 312 5,441 -- --
Stanhome Inc 8,372 214 5,992 210 5,880
Staples Inc + 21,704 640 15,520 592 14,356
Star Banc Corp -- -- -- 300 12,788
Starbucks Corp + -- -- -- 400 9,550
State Street Boston Corp 37,772 850 27,094 490 15,619
Sterling Chemicals Inc + 9,551 624 7,020 -- --
Stewart & Stevenson Services 16,335 365 12,045 345 11,385
Stop & Shop Co Inc + -- -- -- 400 9,700
Storage Technology Corp + 14,399 482 10,484 460 10,005
Stratacom Inc + -- -- -- 200 7,400
Strattec Security Corp + 918 50 632 83 1,056
Stratus Computer Inc + 9,653 271 7,148 250 6,594
Structural Dynamics Research + 3,201 319 2,353 -- --
Stryker Corp 31,929 544 23,664 500 21,750
Student Loan Marketing Association -- -- -- 600 22,125
Sunamerica Inc -- -- -- 300 12,300
Sunbeam-Oster Co Inc -- -- -- 400 9,750
Sundstrand Corp 22,646 365 16,699 345 15,784
Sungard Data Systems Inc + -- -- -- 200 8,250
Superior Industries International Inc 12,372 331 9,020 310 8,448
Surgical Care Affiliates + 12,558 428 8,988 -- --
Sybase Inc + -- -- -- 400 16,300
Sybron International Corp + -- -- -- 300 10,725
Symantec Corp + 10,586 361 7,130 -- --
Symbol Technologies Inc + 10,189 270 7,054 250 6,531
Synovus Financial Corp -- -- -- 600 11,850
T Rowe Price Associates -- -- -- 300 9,600
Tambrands Inc 23,961 409 17,689 385 16,651
TCA Cable TV Inc 9,692 276 7,211 -- --
TECO Energy Inc 38,464 1,284 27,606 1,220 26,230
Tecumseh Products Co Class A 16,129 249 11,641 231 10,799
Teleflex Inc 9,430 194 7,202 -- --
Telephone & Data Systems Inc 37,732 587 26,782 565 25,778
Tellabs Inc + -- -- -- 300 15,600
Teradyne Inc + 19,824 400 14,550 375 13,641
Thermo Electron Corp + 36,905 563 26,672 328 15,539
Thiokol Inc 7,633 210 5,434 -- --
Tidewater Inc 16,191 585 11,481 565 11,088
Tiffany & Co 7,560 180 5,670 -- --
</TABLE>
66 67
<PAGE> 135
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
TIG Holdings Inc -- $ -- $ -- $ -- $ --
Tootsie Roll Industries -- -- -- -- --
Topps Co Inc + 512 3,136 -- -- 722
Tosco Corp 357 10,308 280 8,085 489
Transatlantic Holdings Inc 251 14,433 200 11,500 355
Trinity Industries Inc 422 14,032 340 11,305 605
Triton Energy Corp + -- -- -- -- --
Turner Broadcasting System Inc Class A -- -- -- -- --
Turner Broadcasting System Inc Class B -- -- 800 15,100 --
Tyson Foods Inc Class A 1,594 39,252 1,260 31,028 2,274
U.S. Shoe Corp 502 9,538 390 7,410 712
UAL Corp + -- -- -- -- --
UJB Financial Corp 603 17,035 470 13,278 839
Ultramar Corp -- -- -- -- --
Unifi Inc 768 21,696 600 16,950 1,082
Union Texas Petroleum Holdings Inc -- -- -- -- --
United Asset Management Corp -- -- -- -- --
Unitrin Inc -- -- 300 14,700 --
Universal Corp 381 7,572 300 5,963 539
Universal Foods Corp 279 8,754 220 6,903 409
USG Corp + -- -- -- -- --
Utilicorp United Inc 491 14,178 380 10,973 675
Valero Energy Corp 480 8,580 370 6,614 664
Valspar Corp -- -- -- -- --
Value Health Inc + 435 16,204 345 12,851 619
Vanguard Cellular Systems Class A + 411 10,686 330 8,580 595
Varco International Inc + 292 1,862 -- -- 524
Varian Associates Inc 377 13,808 290 10,621 535
VeriFone Inc + 258 6,579 -- -- 363
Viking Office Products Inc + -- -- -- -- --
Vishay Intertechnology Inc + -- -- -- -- --
Vons Co Inc + 480 9,540 370 7,354 664
Vornado Realty Trust -- -- -- -- --
Vulcan Materials Co -- -- 300 15,975 --
Waban Inc + 365 7,209 -- -- 497
Wallace Computer Services Inc 245 7,626 -- -- 350
Washington Federal Inc -- -- -- -- --
Washington Gas & Light Co 232 8,845 180 6,863 312
Washington Mutual Inc -- -- -- -- --
Washington Post Co Class B 127 32,163 100 25,325 180
Watts Industries Inc Class A 308 7,315 -- -- 464
Wausau Paper Mills Co 314 6,908 253 5,566 458
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
TIG Holdings Inc $ -- -- -- 600 12,450
Tootsie Roll Industries -- -- -- 100 6,700
Topps Co Inc + 4,422 527 3,228 -- --
Tosco Corp 14,120 359 10,366 345 9,962
Transatlantic Holdings Inc 20,413 260 14,950 240 13,800
Trinity Industries Inc 20,116 435 14,464 405 13,466
Triton Energy Corp + -- -- -- 300 9,338
Turner Broadcasting System Inc Class A -- -- -- 600 11,250
Turner Broadcasting System Inc Class B -- -- -- 1,100 20,763
Tyson Foods Inc Class A 55,997 1,649 40,607 1,030 25,364
U.S. Shoe Corp 13,528 507 9,633 480 9,120
UAL Corp + -- -- -- 100 9,475
UJB Financial Corp 23,702 614 17,346 579 16,357
Ultramar Corp -- -- -- 300 7,725
Unifi Inc 30,567 782 22,092 740 20,905
Union Texas Petroleum Holdings Inc -- -- -- 500 9,625
United Asset Management Corp -- -- -- 200 7,425
Unitrin Inc -- -- -- 300 14,700
Universal Corp 10,713 394 7,831 365 7,254
Universal Foods Corp 12,832 289 9,067 270 8,471
USG Corp + -- -- -- 300 7,200
Utilicorp United Inc 19,491 494 14,264 472 13,629
Valero Energy Corp 11,869 484 8,652 460 8,223
Valspar Corp -- -- -- 200 7,150
Value Health Inc + 23,058 447 16,651 419 15,608
Vanguard Cellular Systems Class A + 15,470 427 11,102 390 10,140
Varco International Inc + 3,341 374 2,384 -- --
Varian Associates Inc 19,594 390 14,284 365 13,368
VeriFone Inc + 9,257 268 6,834 -- --
Viking Office Products Inc + -- -- -- 400 12,000
Vishay Intertechnology Inc + -- -- -- 200 10,800
Vons Co Inc + 13,197 484 9,620 460 9,143
Vornado Realty Trust -- -- -- 200 6,850
Vulcan Materials Co -- -- -- 400 21,300
Waban Inc + 9,816 367 7,248 -- --
Wallace Computer Services Inc 10,894 255 7,937 -- --
Washington Federal Inc -- -- -- 400 8,000
Washington Gas & Light Co 11,895 227 8,654 220 8,388
Washington Mutual Inc -- -- -- 600 12,075
Washington Post Co Class B 45,585 133 33,682 25 6,331
Watts Industries Inc Class A 11,020 334 7,933 -- --
Wausau Paper Mills Co 10,076 326 7,172 297 6,534
</TABLE>
68 69
<PAGE> 136
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Weingarten Realty Investors -- $ -- -- $ -- --
Wellman Inc 363 9,801 280 7,560 495
West One Bancorp 381 10,406 300 8,194 539
Western Digital Corp + -- -- -- -- --
Western Publishing Group Inc + 234 2,223 -- -- 313
Wheelabrator Technologies Inc -- -- -- -- --
Willamette Industries Inc 607 32,626 470 25,263 843
Williams-Sonoma Inc + -- -- -- -- --
Wilmingtion Trust Corp 392 9,702 310 7,673 549
Wisconsin Energy Corp 1,148 31,857 920 25,530 1,645
Witco Corp 616 17,633 480 13,740 852
WPL Holdings Inc 341 10,273 260 7,833 473
Xilinx Inc + 249 16,652 200 13,375 353
XOMA Corp + 188 388 -- -- 193
Xtra Corp -- -- -- -- --
York International Corp 402 15,477 320 12,320 559
------------- -------------
MEDIUM CAPITALIZATION STOCKS - VALUE $ 4,652,964 $ 4,230,836
- COST $ 4,437,876 $ 4,150,051
INTERNATIONAL STOCKS
Percent of Net Assets 3.6% 6.8%
Alcatel Alsthom Compagnie Generale d'Electricite
(FR) 4,700 $ 76,375 6,800 $ 110,500 9,000
Allied Irish Banks PLC ADR (IRL) 600 15,750 800 21,000 1,100
Banco Bilbao Vizcaya ADR (SPN) 400 10,700 500 13,375 700
Banco Central Hispanoamericano SA ADR (SPN) 400 4,550 700 7,963 900
Banco Santander SA ADR (SPN) 300 10,763 400 14,350 600
Barclays PLC ADR (UK) 1,100 42,488 1,700 65,663 2,200
BAT Industries PLC ADR (UK) 3,900 51,675 5,700 75,525 7,600
Benetton Group SpA ADR (ITLY) 2,200 42,350 3,100 59,675 4,200
BET PLC ADR (UK) 2,700 17,888 3,900 25,838 5,200
British Airways PLC ADR (UK) 600 37,200 900 55,800 1,200
British Gas PLC ADR (UK) 1,500 69,000 2,100 96,600 2,800
British Petroleum Co PLC ADR (UK) 500 38,250 700 53,550 900
British Steel PLC ADR (UK) 300 7,613 500 12,688 700
British Telecommunications PLC ADR (UK) 1,500 89,625 2,100 125,475 2,800
Broken Hill Proprietory Co Ltd ADR (AUSL) 800 44,000 1,200 66,000 1,400
Coles Myer Ltd ADR (AUSL) 900 23,850 1,400 37,100 1,700
Courtaulds PLC ADR (UK) 8,000 55,000 11,600 79,750 15,400
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Weingarten Realty Investors $ -- -- $ -- 200 $ 7,250
Wellman Inc 13,365 365 9,855 345 9,315
West One Bancorp 14,721 394 10,761 365 9,969
Western Digital Corp + -- -- -- 500 7,500
Western Publishing Group Inc + 2,974 233 2,214 -- --
Wheelabrator Technologies Inc -- -- -- 700 9,625
Willamette Industries Inc 45,311 618 33,218 385 20,694
Williams-Sonoma Inc + -- -- -- 200 4,250
Wilmingtion Trust Corp 13,588 404 9,999 375 9,281
Wisconsin Energy Corp 45,649 1,175 32,606 1,105 30,664
Witco Corp 24,389 622 17,805 595 17,032
WPL Holdings Inc 14,249 343 10,333 325 9,791
Xilinx Inc + 23,607 258 17,254 240 16,050
XOMA Corp + 398 193 398 -- --
Xtra Corp -- -- -- 200 10,050
York International Corp 21,522 414 15,939 385 14,823
------------ ------------ ------------
MEDIUM CAPITALIZATION STOCKS - VALUE $ 7,046,079 $ 4,913,624 $ 6,171,970
- COST $ 6,733,621 $ 4,615,780 $ 5,925,943
INTERNATIONAL STOCKS
Percent of Net Assets 5.8% 5.5% 5.0%
Alcatel Alsthom Compagnie Generale d'Electricite
(FR) $ 146,250 4,700 76,375 5,200 84,500
Allied Irish Banks PLC ADR (IRL) 28,875 600 15,750 600 15,750
Banco Bilbao Vizcaya ADR (SPN) 18,725 400 10,700 400 10,700
Banco Central Hispanoamericano SA ADR (SPN) 10,238 400 4,550 500 5,688
Banco Santander SA ADR (SPN) 21,525 300 10,763 300 10,763
Barclays PLC ADR (UK) 84,975 1,100 42,488 1,300 50,213
BAT Industries PLC ADR (UK) 100,700 3,900 51,675 4,400 58,300
Benetton Group SpA ADR (ITLY) 80,850 2,200 42,350 2,400 46,200
BET PLC ADR (UK) 34,450 2,700 17,888 3,000 19,875
British Airways PLC ADR (UK) 74,400 600 37,200 700 43,400
British Gas PLC ADR (UK) 128,800 1,500 69,000 1,600 73,600
British Petroleum Co PLC ADR (UK) 68,850 500 38,250 500 38,250
British Steel PLC ADR (UK) 17,763 300 7,613 400 10,150
British Telecommunications PLC ADR (UK) 167,300 1,500 89,625 1,600 95,600
Broken Hill Proprietory Co Ltd ADR (AUSL) 77,000 800 44,000 900 49,500
Coles Myer Ltd ADR (AUSL) 45,050 900 23,850 1,000 26,500
Courtaulds PLC ADR (UK) 105,875 8,000 55,000 8,900 61,188
</TABLE>
70 71
<PAGE> 137
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES
<S> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Daimler Benz Aktiengesellschaft ADR (GER) 7,100 $ 344,350 10,200 $ 494,700 13,600
ELF Aquitaine ADR (FR) 3,900 139,913 5,600 200,900 7,500
Fiat SpA ADR (ITLY) + 3,200 61,200 4,600 87,975 6,100
Glaxo Holdings PLC ADR (UK) 3,000 60,375 4,400 88,550 5,800
Grand Metropolitan PLC ADR (UK) 3,100 75,950 4,500 110,250 5,900
Hafslund Nycomed Class B ADR (NOR) 1,100 21,863 1,600 31,800 1,700
Hanson PLC ADR (UK) 3,500 65,625 5,100 95,625 6,700
Hong Kong Telecommunications Ltd ADR (HK) 8,800 160,600 12,800 233,600 16,900
Imperial Chemical Industries PLC ADR (UK) 900 40,163 1,200 53,550 1,400
KLM Royal Dutch Airlines ADR (NETH) + 300 8,775 400 11,700 500
Montedison SpA ADR (ITLY) + 1,400 10,150 2,100 15,225 2,200
National Australia Bank Ltd ADS (AUSL) 800 32,200 1,200 48,300 1,600
News Corporation Ltd ADR (AUSL) 600 10,875 900 16,313 1,100
Novo-Nordisk A/S ADR (DEN) 1,700 42,713 2,400 60,300 2,700
Philips Electronics NV (NETH) 800 26,300 1,100 36,163 1,500
Repsol SA ADR (SPN) 800 22,900 1,100 31,488 1,400
Rhone-Poulenc SA ADR (FR) 1,800 42,975 2,600 62,075 3,400
Royal Dutch Petroleum Co ADR (NETH) 1,339 150,135 2,917 327,069 6,638
RTZ PLC ADR (UK) 1,100 52,113 1,600 75,800 2,200
Smithkline Beecham PLC ADR (UK) 800 31,100 1,200 46,650 1,600
Telecommunications of New Zealand Corp ADR (NZ) 400 22,150 500 27,688 700
Telefonica de Espana ADR (SPN) 1,000 37,500 1,400 52,500 1,700
Total Compagnie Francaise des Petroles SA ADR (FR) 1,600 44,400 2,300 63,825 3,100
Unilever NV (NETH) 305 37,058 783 95,135 1,871
Vodafone Group PLC ADR (UK) 800 24,400 1,100 33,550 1,500
Western Mining Holdings Corp Ltd ADR (AUSL) 700 14,875 1,000 21,250 1,200
Westpac Banking Corp ADR (AUSL) 700 12,864 1,100 20,213 1,400
------------- -------------
INTERNATIONAL STOCKS - VALUE $ 2,230,599 $ 3,363,046
- COST $ 2,245,434 $ 3,378,977
TOTAL COMMON STOCKS - VALUE $12,498,666 $23,026,064
- COST $12,149,672 $22,314,022
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
Daimler Benz Aktiengesellschaft ADR (GER) $ 659,600 7,100 344,350 7,800 378,300
ELF Aquitaine ADR (FR) 269,063 3,900 139,913 4,300 154,263
Fiat SpA ADR (ITLY) + 116,663 3,200 61,200 3,500 66,938
Glaxo Holdings PLC ADR (UK) 116,725 3,000 60,375 3,300 66,413
Grand Metropolitan PLC ADR (UK) 144,550 3,100 75,950 3,400 83,300
Hafslund Nycomed Class B ADR (NOR) 33,788 1,100 21,863 1,200 23,850
Hanson PLC ADR (UK) 125,625 3,500 65,625 3,900 73,125
Hong Kong Telecommunications Ltd ADR (HK) 308,425 8,800 160,600 9,700 177,025
Imperial Chemical Industries PLC ADR (UK) 62,475 900 40,163 900 40,163
KLM Royal Dutch Airlines ADR (NETH) + 14,625 300 8,775 300 8,775
Montedison SpA ADR (ITLY) + 15,950 1,400 10,150 1,700 12,325
National Australia Bank Ltd ADS (AUSL) 64,400 800 32,200 900 36,225
News Corporation Ltd ADR (AUSL) 19,938 600 10,875 700 12,688
Novo-Nordisk A/S ADR (DEN) 67,838 1,700 42,713 1,900 47,738
Philips Electronics NV (NETH) 49,313 800 26,300 900 29,588
Repsol SA ADR (SPN) 40,075 800 22,900 800 22,900
Rhone-Poulenc SA ADR (FR) 81,175 1,800 42,975 2,000 47,750
Royal Dutch Petroleum Co ADR (NETH) 744,286 5,150 577,444 6,903 773,999
RTZ PLC ADR (UK) 104,225 1,100 52,113 1,200 56,850
Smithkline Beecham PLC ADR (UK) 62,200 800 31,100 900 34,988
Telecommunications of New Zealand Corp ADR (NZ) 38,763 400 22,150 400 22,150
Telefonica de Espana ADR (SPN) 63,750 1,000 37,500 1,100 41,250
Total Compagnie Francaise des Petroles SA ADR (FR) 86,025 1,600 44,400 1,800 49,950
Unilever NV (NETH) 227,327 1,315 159,773 2,482 301,563
Vodafone Group PLC ADR (UK) 45,750 800 24,400 800 24,400
Western Mining Holdings Corp Ltd ADR (AUSL) 25,500 700 14,875 800 17,000
Westpac Banking Corp ADR (AUSL) 25,725 700 12,863 800 14,700
------------ ------------ ------------
INTERNATIONAL STOCKS - VALUE $ 4,825,405 $ 2,780,622 $ 3,318,393
- COST $ 4,826,436 $ 2,769,544 $ 3,293,357
TOTAL COMMON STOCKS - VALUE $50,748,594 $37,375,573 $58,568,852
- COST $48,542,102 $35,508,346 $55,544,061
</TABLE>
72 73
<PAGE> 138
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
---------------------------- ---------------------------- -------------
<S> <C> <C> <C> <C> <C>
SECURITY NAME PAR VALUE PAR VALUE PAR
U.S. TREASURY BONDS
Percent of Net Assets 2.2% 6.5%
U.S. Treasury Bonds, 6.25% - 11.75%, 11/15/04 -
08/15/23 1,100,000 $ 1,349,530 2,900,000 $ 3,220,529 9,000,000
TOTAL U.S. TREASURY BONDS - COST $ 1,275,270 $ 3,088,850
U.S. TREASURY NOTES
Percent of Net Assets 63.3% 45.4%
U.S. Treasury Notes, 4.38% - 9.13%, 03/31/96 -
05/15/04 39,650,000 $ 39,040,315 22,300,000 $ 22,429,801 20,180,000
TOTAL U.S. TREASURY NOTES - COST $ 39,459,577 $ 22,726,056
U.S. TREASURY BILLS
Percent of Net Assets 11.9% 3.3%
U.S. Treasury Bills, 4.86% - 5.87% YTM, 03/09/95 -
05/25/95 7,378,000 $ 7,314,809* 1,668,000 $ 1,650,327* 2,484,000
TOTAL U.S. TREASURY BILLS - COST $ 7,313,890 $ 1,650,310
------------- -------------
TOTAL INVESTMENTS - VALUE $60,203,320 $50,326,721
(Notes 1 and 3) - COST** $60,198,409 $49,779,238
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
U.S. TREASURY BONDS
Percent of Net Assets 11.7% 19.3% 11.1%
U.S. Treasury Bonds, 6.25% - 11.75%, 11/15/04 -
08/15/23 $ 9,581,372 8,930,000 $ 9,747,497 7,100,000 $ 7,363,058
TOTAL U.S. TREASURY BONDS - COST $ 9,251,282 $ 9,647,428 $ 7,224,052
U.S. TREASURY NOTES
Percent of Net Assets 24.4% 4.4% 0.4%
U.S. Treasury Notes, 4.38% - 9.13%, 03/31/96 -
05/15/04 $ 20,040,906 2,200,000 $ 2,224,563 300,000 $ 311,250
TOTAL U.S. TREASURY NOTES - COST $ 20,224,697 $ 2,133,744 $ 300,844
U.S. TREASURY BILLS
Percent of Net Assets 3.0% 2.2% 2.4%
U.S. Treasury Bills, 4.86% - 5.87% YTM, 03/09/95
- - 05/25/95 $ 2,451,366 1,142,000 $ 1,128,744 1,610,000 $ 1,589,559
TOTAL U.S. TREASURY BILLS - COST $ 2,451,435 $ 1,128,738 $ 1,589,706
------------ ------------ ------------
TOTAL INVESTMENTS - VALUE $82,822,238 $50,476,377 $67,832,719
(Notes 1 and 3) - COST** $80,469,516 $48,418,256 $64,658,663
</TABLE>
74 75
<PAGE> 139
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
FEBRUARY 28, 1995
Portfolios of Investments
<TABLE>
<CAPTION>
LifePath 2000 LifePath 2010 Lifepath 2020
------------------------ ------------------------ ----------------
Percent Value Percent Value Percent
<S> <C> <C> <C> <C>
TOTAL INVESTMENTS IN SECURITIES 97.7% $60,203,320 101.7% $50,326,721 100.7%
Other Assets and Liabilities,
Net 2.3% 1,430,901 (1.7)% (842,387) (0.7)%
------------ ---------- ------------ ---------- ------
TOTAL NET ASSETS 100.0% $61,634,221 100.0% $49,484,334 100.0%
------------ ---------- ------------ ---------- ------
------------ ---------- ------------ ---------- ------
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- --------------------------- ---------------------------
SECURITY NAME VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C>
TOTAL INVESTMENTS IN SECURITIES $82,822,238 99.7% $50,476,377 101.9% $67,832,719
Other Assets and Liabilities,
Net (579,462) 0.3% 158,096 (1.9)% (1,273,197)
----------- ---------- ----------- ---------- -----------
TOTAL NET ASSETS $82,242,776 100.0% $50,634,473 100.0% $66,559,522
----------- ---------- ----------- ---------- -----------
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
+NON-INCOME EARNING SECURITIES.
*CERTAIN U.S. TREASURY BILLS ARE HELD IN A SEGREGATED ACCOUNT FOR MARGIN
REQUIREMENTS ON FUTURES CONTRACTS. SEE NOTE 1.
**COST FOR FEDERAL INCOME TAX PURPOSES IS THE SAME FOR FINANCIAL STATEMENT
PURPOSES AND NET UNREALIZED APPRECIATION CONSISTS OF:
<TABLE>
<S> <C> <C> <C> <C> <C>
Gross Unrealized Appreciation $ 883,578 $1,442,712
Gross Unrealized Depreciation (878,667) (895,229)
---------- -----------
Net Unrealized Appreciation $ 4,911 $ 547,483
Gross Unrealized Appreciation $3,842,727 $3,026,343 $4,556,908
Gross Unrealized Depreciation (1,490,005) (968,222) (1,382,852)
---------- ---------- ----------
Net Unrealized Appreciation $2,352,722 $2,058,121 $3,174,056
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
76 77
<PAGE> 140
STATEMENT OF ASSETS AND LIABILITIES
February 28, 1995
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020
MASTER SERIES MASTER SERIES MASTER SERIES
- ----------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investments:
In securities, at market
value (see cost below)
(Note 1) $60,203,320 $50,326,721 $82,822,238
Cash 338 3,102 11,277
Receivables:
Dividends and interest 644,370 408,045 558,217
Beneficial interests sold 1,336,688 152,250 309,890
Investment securities sold 2,092,933 2,994,860 2,994,765
Variation margin on
futures contracts 5,400 3,600 0
Total Assets 64,283,049 53,888,578 86,696,387
LIABILITIES
Payables:
Investment securities
purchased 2,061,303 3,982,119 3,893,611
Allocations to beneficial
interest holders 533,402 358,616 491,506
Beneficial interests
redeemed 0 0 0
Due to adviser 54,123 63,509 68,494
Total Liabilities 2,648,828 4,404,244 4,453,611
TOTAL NET ASSETS $61,634,221 $49,484,334 $82,242,776
INVESTMENTS AT COST $60,198,409 $49,779,238 $80,469,516
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
78
<PAGE> 141
STATEMENT OF ASSETS AND LIABILITIES 2/28/95
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
2030 2040
MASTER SERIES MASTER SERIES
- -----------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Investments:
In securities, at market
value (see cost below)
(Note 1) $50,476,377 $67,832,719
Cash 1,348 4,160
Receivables:
Dividends and interest 243,281 270,471
Beneficial interests sold 190,691 163,034
Investment securities sold 2,097,117 1,301,249
Variation margin on
futures contracts 0 0
Total Assets 53,008,814 69,571,633
LIABILITIES
Payables:
Investment securities
purchased 2,063,997 2,262,786
Allocations to beneficial
interest holders 268,421 274,173
Beneficial interests
redeemed 0 420,063
Due to adviser 41,923 55,089
Total Liabilities 2,374,341 3,012,111
TOTAL NET ASSETS $50,634,473 $66,559,522
INVESTMENTS AT COST $48,418,256 $64,658,663
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
79
<PAGE> 142
STATEMENT OF OPERATIONS
For The Year Ended February 28, 1995
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020
MASTER SERIES MASTER SERIES MASTER SERIES
- ----------------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME
Dividends $172,305 $234,457 $630,985
Interest 2,157,823 1,391,512 1,612,077
Total Investment Income 2,330,128 1,625,969 2,243,062
EXPENSES (Note 2)
Advisory fees 217,676 158,218 252,413
Total Expenses 217,676 158,218 252,413
NET INVESTMENT INCOME 2,112,452 1,467,751 1,990,649
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS
Net realized gain (loss) on
sale of investments 118,927 2,805 52,734
Net realized gain (loss) on
sale of futures contracts 48,130 295,721 (21,107)
Net change in unrealized
appreciation of
investments 4,911 547,483 2,352,722
Net change in unrealized
appreciation of futures
contracts 15,075 10,050 0
Net Gain On Investments 187,043 856,059 2,384,349
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $2,299,495 $2,323,810 $4,374,998
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
80
<PAGE> 143
STATEMENT OF OPERATIONS 2/28/95
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
2030 2040
MASTER SERIES MASTER SERIES
- -----------------------------------------------------------------
<S> <C> <C>
INVESTMENT INCOME
Dividends $482,604 $772,325
Interest 822,581 456,762
Total Investment Income 1,305,185 1,229,087
EXPENSES (Note 2)
Advisory fees 156,397 189,121
Total Expenses 156,397 189,121
NET INVESTMENT INCOME 1,148,788 1,039,966
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS
Net realized gain (loss) on
sale of investments (144,351) 140,585
Net realized gain (loss) on
sale of futures contracts (38,856) (102,175)
Net change in unrealized
appreciation of
investments 2,058,121 3,174,056
Net change in unrealized
appreciation of futures
contracts 0 0
Net Gain On Investments 1,874,914 3,212,466
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $3,023,702 $4,252,432
</TABLE>
- ---------------------------------------------------------------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
81
<PAGE> 144
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010
MASTER SERIES MASTER SERIES
---------------- ----------------
FOR THE FOR THE
YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 28,
1995 1995
- ------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE IN NET ASSETS
Operations:
Net investment income $2,112,452 $1,467,751
Net realized gain (loss) on sale of investments 118,927 2,805
Net realized gain (loss) on sale of futures
contracts 48,130 295,721
Net change in unrealized appreciation of investments 4,911 547,483
Net change in unrealized appreciation of futures
contracts 15,075 10,050
Net increase in net assets resulting from operations 2,299,495 2,323,810
Net increase in net assets resulting from beneficial
interests transactions 59,314,726 47,140,524
Increase In Net Assets 61,614,221 49,464,334
NET ASSETS:
Beginning net assets $20,000 $20,000
Ending net assets $61,634,221 $49,484,334
- ------------------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
82
<PAGE> 145
STATEMENT OF CHANGES IN NET ASSETS 2/28/95
<TABLE>
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
MASTER SERIES MASTER SERIES MASTER SERIES
------------- ------------- -------------
FOR THE FOR THE FOR THE
YEAR ENDED YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 28, FEBRUARY 28,
1995 1995 1995
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INCREASE IN NET ASSETS
Operations:
Net investment income $1,990,649 $1,148,788 $1,039,966
Net realized gain (loss) on sale of investments 52,734 (144,351) 140,585
Net realized gain (loss) on sale of futures
contracts (21,107) (38,856) (102,175)
Net change in unrealized appreciation of investments 2,352,722 2,058,121 3,174,056
Net change in unrealized appreciation of futures
contracts 0 0 0
Net increase in net assets resulting from operations 4,374,998 3,023,702 4,252,432
Net increase in net assets resulting from beneficial
interests transactions 77,847,778 47,590,771 62,287,090
Increase In Net Assets 82,222,776 50,614,473 66,539,522
NET ASSETS:
Beginning net assets $20,000 $20,000 $20,000
Ending net assets $82,242,776 $50,634,473 $66,559,522
- --------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
83
<PAGE> 146
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION. Master Investment Portfolio ("Master Portfolio") is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company. Master Portfolio was organized as a Delaware
business trust pursuant to an Agreement and Declaration of Trust dated May 14,
1993 and had no operations prior to March 1, 1994. Master Portfolio is currently
authorized to issue fourteen separate diversified portfolios (the "Master
Series"), of which the following have commenced operations: LifePath 2000 Master
Series, LifePath 2010 Master Series, LifePath 2020 Master Series, LifePath 2030
Master Series, LifePath 2040 Master Series, Asset Allocation Master Series, Bond
Index Master Series, S&P 500 Index Master Series and U.S. Treasury Allocation
Master Series. The following significant accounting policies are consistently
followed by Master Portfolio in the preparation of its financial statements, and
such policies are in conformity with generally accepted accounting principles
for investment companies. The financial statements for the Asset Allocation
Master Series, Bond Index Master Series, S&P 500 Index Master Series and U.S.
Treasury Allocation Master Series are presented separately.
INVESTMENT POLICY AND SECURITY VALUATION
Each Master Series follows an asset allocation strategy among three broad
investment classes: equity and debt securities of issuers located throughout the
world and cash in the form of money market instruments. The securities of the
Master Series are valued at the last sale price on the primary securities
exchange or national securities market on which such securities are traded.
Securities not listed on an exchange or national securities market, or
securities in which there were no transactions, are valued at the most recent
bid prices. Debt securities maturing in 60 days or less are valued at amortized
cost, which approximates market value. Debt securities, other than those
maturing in 60 days or less, are valued at the latest quoted bid price. Any
securities, restricted securities or other assets for which recent market
quotations are not readily available, are valued at fair value as determined in
good faith in accordance with policies approved by the Master Portfolio's Board
of Trustees.
84
<PAGE> 147
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS
SECURITY TRANSACTIONS AND REVENUE RECOGNITION
Securities transactions are accounted for on the date the securities are
purchased or sold (trade date). Dividend income is recognized on the ex-dividend
date, and interest income is recognized on a daily accrual basis. Realized gains
or losses are reported on the basis of identified cost of securities delivered.
Bond discounts and premiums are amortized as required by the Internal Revenue
Code (the "Code").
FEDERAL INCOME TAXES
Each Master Series of the Trust intends to qualify as a partnership for
federal income tax purposes. Each Master Series therefore believes that it will
not be subject to any federal income tax on its income and net capital gains (if
any). However, each investor in a Master Series will be taxable on its allocable
share of the partnership's income and capital gains for purposes of determining
its federal income tax liability. The determination of such share will be made
in accordance with the applicable sections of the Code.
It is intended that each Master Series' assets, income and allocations will
be managed in such a way that a regulated investment company investing in a
Master Series will be able to satisfy the requirements of Subchapter M of the
Code, assuming that an investment company invested all of its assets in the
respective Master Series.
FUTURES CONTRACTS
The Master Series may purchase futures contracts to gain exposure to market
changes, as this may be more efficient or cost effective than actually buying
the securities. A futures contract is an agreement between two parties to buy
and sell a security at a set price on a future date and is exchange traded. Upon
entering into such a contract, a Master Series is required to pledge to the
broker an amount of cash, U.S. Government securities or other high-quality debt
securities equal to the minimum "initial margin" requirements of the exchange.
Pursuant to the contract, the Master Series agrees to receive from or pay to the
broker an amount of cash equal to the daily fluctuation in the value of the
contract. Such receipts or payments are known as "variation margin" and are
recorded by the Master Series as unrealized gains or losses. When the contract
is closed, the
85
<PAGE> 148
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS
Master Series records a realized gain or loss equal to the difference between
the value of the contract at the time it was opened and the value at the time it
was closed. Pursuant to regulations and/or published positions of the Securities
and Exchange Commission, the Master Series are required to segregate cash, U.S.
Government obligations or high quality, liquid debt instruments in connection
with futures transactions in an amount generally equal to the entire contract
amount. Risks of entering into futures contracts include the possibility that
there may be an illiquid market and that a change in the value of the contracts
may not correlate with changes in the value of the underlying securities. As of
February 28, 1995, the following Master Series had futures contracts
outstanding:
<TABLE>
<CAPTION>
NOTIONAL NET
NUMBER OF EXPIRATION CONTRACT UNREALIZED
FUND CONTRACTS TYPE DATE VALUE APPRECIATION
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
LifePath 2000 3 S&P 500 Index March 1995 732,825 15,075
LifePath 2010 2 S&P 500 Index March 1995 488,650 10,050
</TABLE>
The LifePath 2000 Master Series and LifePath 2010 Master Series have pledged
to brokers U.S. Treasury bills for initial margin requirements with a par value
of $35,000 and $25,000, respectively.
2. AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES
The Master Series has entered into an investment advisory agreement on
behalf of the Master Series with Wells Fargo Bank, N.A. ("WFB"). Pursuant to the
agreement, WFB provides investment guidance and policy direction in connection
with the daily portfolio management of each Master Series. WFB has engaged Wells
Fargo Nikko Investment Advisors ("WFNIA") to provide sub-advisory services to
each Master Series. Pursuant to a Sub-Advisory Agreement, WFNIA, subject to the
supervision and approval of WFB, provides investment advisory assistance and the
day-to-day management of each Master Series' assets, subject to the overall
authority of the Master Portfolio's Board of Trustees. For providing these
services, WFNIA will be compensated by WFB. WFB is entitled to be compensated
monthly at an annual rate of 0.55% of the average daily net assets of the Master
Series.
86
<PAGE> 149
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS
In addition, Wells Fargo Institutional Trust Company N.A. ("WFITC"), a
subsidiary of WFNIA, acts as custodian for these Master Series. Custody fees are
paid to WFITC from the sub-advisory fee paid to WFNIA.
In mid-April 1995, it was announced that Wells Fargo Bank and The Nikko
Securities Co., Ltd., which are the co-owners of WFNIA, had begun considering a
variety of potential transactions which could result in a change of ownership or
control of WFNIA. It is not possible at this time to predict whether any such
transaction will occur or if it does, what structure it would take.
ORGANIZATION EXPENSES
Stephens Inc. ("Stephens"), the administrator, sponsor and distributor for
the Master Series has paid all expenses in connection with the Master Series'
organization and initial registration.
Pursuant to the Administration Agreement, Stephens has agreed to assume all
operating expenses of each LifePath Master Series, except for advisory fees,
interest, brokerage fees and commissions, if any, costs of independent pricing
services and any extraordinary expenses.
Certain officers and directors of the Master Portfolio are also officers of
Stephens. At February 28, 1995, these officers of Stephens collectively owned
less than 1% of the Master Series' outstanding shares of beneficial interest.
87
<PAGE> 150
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS
3. INVESTMENT PORTFOLIO TRANSACTIONS
Purchases and sales of investments, exclusive of short-term securities, for
each Master Series for the year ended February 28, 1995, are as follows:
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH LIFEPATH LIFEPATH
AGGREGATE 2000 2010 2020 2030 2040
PURCHASES AND MASTER MASTER MASTER MASTER MASTER
SALES OF: SERIES SERIES SERIES SERIES SERIES
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
U.S. GOVERNMENT
OBLIGATIONS:
Purchases at cost $ 42,306,152 $ 28,661,280 $ 38,299,280 $ 19,911,157 $ 7,524,297
Sales proceeds 1,643,859 2,823,328 8,608,578 7,831,663 0
OTHER SECURITIES:
Purchases at cost 15,763,643 25,357,321 51,544,606 37,705,293 57,108,586
Sales proceeds 3,777,339 3,129,664 3,326,074 2,357,036 1,708,434
- ----------------------------------------------------------------------------------------------------
</TABLE>
4. FINANCIAL HIGHLIGHTS
The portfolio turnover rate, excluding short-term securities, for the Master
Series for the year ended February 28, 1995, are as follows:
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
MASTER SERIES MASTER SERIES MASTER SERIES MASTER SERIES MASTER SERIES
<S> <C> <C> <C> <C> <C>
Portfolio Turnover 17% 24% 28% 40% 5%
- ----------------------------------------------------------------------------------------------
</TABLE>
88
<PAGE> 151
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Trustees of
Master Investment Portfolio:
We have audited the accompanying statements of assets and liabilities,
including the portfolios of investments, of LifePath 2000 Master Series,
LifePath 2010 Master Series, LifePath 2020 Master Series, LifePath 2030 Master
Series, and LifePath 2040 Master Series (each a series of Master Investment
Portfolio) as of February 28, 1995, and the related statements of operations,
the statements of changes in net assets, and the financial highlights for the
year then ended. These financial statements and financial highlights are the
responsibility of Master Investment Portfolio's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
February 28, 1995, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
LifePath 2000 Master Series, LifePath 2010 Master Series, LifePath 2020 Master
Series, LifePath 2030 Master Series, and LifePath 2040 Master Series as of
February 28, 1995, and the results of their operations, the changes in their net
assets, and their financial highlights for the year then ended, in conformity
with generally accepted accounting principles.
/s/ COOPERS & LYBRAND L.L.P.
SAN FRANCISCO, CALIFORNIA
April 20, 1995
<PAGE> 152
LIST OF ABBREVIATIONS
<TABLE>
<S> <C>
ADR -- American Depository Receipt
AUSL -- Australia
DEN -- Denmark
FR -- France
GER -- Germany
HK -- Hong Kong
IRL -- Ireland
ITLY -- Italy
NETH -- Netherlands
NOR -- Norway
NZ -- New Zealand
SPN -- Spain
UK -- United Kingdom
YTM -- Yield to Maturity
</TABLE>
90
89
<PAGE> 153
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
AUGUST 31, 1995
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020
FUND FUND FUND
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------
ASSETS
INVESTMENTS:
In corresponding Master
Series, at market value
(Note 1) $80,305,241 $71,555,514 $118,280,980
Receivables:
Dividends and interest 663,042 494,997 650,792
Fund shares sold 354,143 180,600 199,424
TOTAL ASSETS 81,322,426 72,231,111 119,131,196
LIABILITIES
PAYABLES:
Fund shares redeemed 17,082 0 0
Due to sponsor and
distributor 41,308 30,622 56,827
Due to Wells Fargo Bank 39,409 34,661 57,488
TOTAL LIABILITIES 97,799 65,283 114,315
TOTAL NET ASSETS
$81,224,627 $72,165,828 $119,016,881
NET ASSETS CONSIST OF:
Paid-in capital - Retail
class $65,541,717 $42,984,917 $ 82,915,994
Paid-in capital -
Institutional class 11,214,281 23,166,740 22,917,318
Undistributed net
investment income 582,325 429,714 536,476
Undistributed net realized
gain on investment 961,249 941,405 2,339,044
Net unrealized
appreciation of
investments 2,925,055 4,643,052 10,308,049
TOTAL NET ASSETS $81,224,627 $72,165,828 $119,016,881
COMPUTATION OF NET ASSET
VALUE AND OFFERING PRICE
PER SHARE
Net assets - Retail class $69,339,792 $47,117,202 $ 93,331,506
Shares outstanding - Retail
class 6,614,764 4,325,879 8,258,513
Net asset value and offering
price per share - Retail
class $10.48 $10.89 $11.30
Net assets - Institutional
class $11,884,835 $25,048,626 $ 25,685,375
Shares outstanding -
Institutional class 1,130,400 2,289,137 2,272,713
Net asset value and offering
price per share -
Institutional class $10.51 $10.94 $11.30
- ----------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
6
<PAGE> 154
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
2030 2040
FUND FUND
<S> <C> <C>
- ----------------------------------------------------------------
ASSETS
INVESTMENTS:
In corresponding Master
Series, at market value
(Note 1) $79,590,189 $118,025,705
Receivables:
Dividends and interest 343,798 394,085
Fund shares sold 329,803 309,715
TOTAL ASSETS 80,263,790 118,729,505
LIABILITIES
PAYABLES:
Fund shares redeemed 0 0
Due to sponsor and
distributor 37,983 56,773
Due to Wells Fargo Bank 38,488 55,747
TOTAL LIABILITIES 76,471 112,520
TOTAL NET ASSETS
$80,187,319 $118,616,985
NET ASSETS CONSIST OF:
Paid-in capital - Retail
class $55,038,939 $ 85,131,619
Paid-in capital -
Institutional class 15,282,055 18,289,381
Undistributed net
investment income 267,328 281,565
Undistributed net realized
gain on investment 1,937,166 3,836,129
Net unrealized
appreciation of
investments 7,661,831 11,078,291
TOTAL NET ASSETS $80,187,319 $118,616,985
COMPUTATION OF NET ASSET
VALUE AND OFFERING PRICE
PER SHARE
Net assets - Retail class $62,868,740 $ 97,852,316
Shares outstanding - Retail
class 5,462,978 8,252,829
Net asset value and offering
price per share - Retail
class $11.51 $11.86
Net assets - Institutional
class $17,318,579 $ 20,764,669
Shares outstanding -
Institutional class 1,501,931 1,749,329
Net asset value and offering
price per share -
Institutional class $11.53 $11.87
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
7
<PAGE> 155
STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED AUGUST 31, 1995
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020
FUND FUND FUND
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------
NET INVESTMENT INCOME
ALLOCATED FROM MASTER
SERIES
Dividends $ 231,180 $ 400,633 $ 885,515
Interest 1,776,466 1,063,247 1,174,246
Expenses (194,684) (164,432) (277,263)
NET INVESTMENT INCOME
ALLOCATED FROM MASTER
SERIES 1,812,962 1,299,448 1,782,498
EXPENSES (NOTE 2)
Administration fees 35,554 30,000 50,529
Shareholder servicing fees 71,106 59,998 101,057
Transfer agency fees 35,554 30,000 50,529
Distribution fees - Retail
class 76,930 51,971 100,017
TOTAL EXPENSES 219,144 171,969 302,132
NET INVESTMENT INCOME 1,593,818 1,127,479 1,480,366
REALIZED AND UNREALIZED GAIN
ON INVESTMENTS ALLOCATED
FROM MASTER SERIES
Net realized gain on sale
of investments 846,611 857,989 2,307,303
Net change in unrealized
appreciation of
investments 2,879,746 4,078,107 7,944,648
NET GAIN ON INVESTMENTS 3,726,357 4,936,096 10,251,951
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $5,320,175 $6,063,575 $11,732,317
- ----------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
8
<PAGE> 156
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
2030 2040
FUND FUND
<S> <C> <C>
- ----------------------------------------------------------------
NET INVESTMENT INCOME
ALLOCATED FROM MASTER
SERIES
Dividends $ 672,137 $ 1,068,055
Interest 478,828 263,826
Expenses (180,302) (253,974)
NET INVESTMENT INCOME
ALLOCATED FROM MASTER
SERIES 970,663 1,077,907
EXPENSES (NOTE 2)
Administration fees 32,828 46,181
Shareholder servicing fees 65,656 92,359
Transfer agency fees 32,828 46,181
Distribution fees - Retail
class 64,888 95,815
TOTAL EXPENSES 196,200 280,536
NET INVESTMENT INCOME 774,463 797,371
REALIZED AND UNREALIZED GAIN
ON INVESTMENTS ALLOCATED
FROM MASTER SERIES
Net realized gain on sale
of investments 2,120,300 3,797,359
Net change in unrealized
appreciation of
investments 5,611,723 7,949,143
NET GAIN ON INVESTMENTS 7,732,023 11,746,502
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $8,506,486 $12,543,873
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
9
<PAGE> 157
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
LIFEPATH 2000 FUND
----------------------------------
(UNAUDITED) FOR THE
FOR THE YEAR ENDED
SIX MONTHS ENDED FEBRUARY 28,
AUGUST 31, 1995 1995
<S> <C> <C>
- ----------------------------------------------------------------
INCREASE IN NET ASSETS
OPERATIONS:
Net investment income $ 1,593,818 $ 1,861,823
Net realized gain (loss)
on sale of investments 846,611 167,080
Net change in unrealized
appreciation of
investments 2,879,746 45,309
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 5,320,175 2,074,212
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment income
Retail class (1,289,510) (1,272,285)
Institutional class (194,004) (117,516)
From net realized gain
(loss) on sales of
investments
Retail class 0 (47,137)
Institutional class 0 (5,304)
CAPITAL SHARES TRANSACTIONS:
Proceeds from shares sold
- Retail class 25,039,389 79,821,113
Reinvestment of dividends
- Retail class 1,206,131 1,242,642
Cost of shares redeemed -
Retail class (14,833,448) (26,934,112)
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS - RETAIL
CLASS 11,412,072 54,129,643
Proceeds from shares sold
- Institutional class 5,854,274 8,826,786
Reinvestment of dividends
- Institutional class 194,005 122,820
Cost of shares redeemed -
Institutional class (2,188,526) (1,605,078)
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS -
INSTITUTIONAL CLASS 3,859,753 7,344,528
INCREASE IN NET ASSETS 19,108,486 62,106,141
NET ASSETS:
Beginning net assets 62,116,141 10,000
ENDING NET ASSETS $81,224,627 $62,116,141
SHARES ISSUED AND REDEEMED:
Shares sold - Retail class 2,447,030 8,149,639
Shares issued in
reinvestment of
dividends - Retail class 119,357 129,306
Shares redeemed - Retail
class (1,454,831) (2,775,736)
NET INCREASE IN SHARES
OUTSTANDING - RETAIL CLASS 1,111,556 5,503,209
Shares sold -
Institutional class 570,227 905,140
Shares issued in
reinvestment of
dividends -
Institutional class 19,122 12,783
Shares redeemed -
Institutional class (213,407) (164,464)
NET INCREASE IN SHARES
OUTSTANDING - INSTITUTIONAL
CLASS 375,942 753,459
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
10
<PAGE> 158
<TABLE>
<CAPTION>
LIFEPATH 2010 FUND LIFEPATH 2020 FUND
---------------------------------- ----------------------------------
(UNAUDITED) FOR THE (UNAUDITED) FOR THE
FOR THE YEAR ENDED FOR THE YEAR ENDED
SIX MONTHS ENDED FEBRUARY 28, SIX MONTHS ENDED FEBRUARY 28,
AUGUST 31, 1995 1995 AUGUST 31, 1995 1995
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------
INCREASE IN NET ASSETS
OPERATIONS:
Net investment income $ 1,127,479 $ 1,293,590 $ 1,480,366 $ 1,710,504
Net realized gain (loss)
on sale of investments 857,989 298,374 2,307,303 31,741
Net change in unrealized
appreciation of
investments 4,078,107 564,945 7,944,648 2,363,401
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 6,063,575 2,156,909 11,732,317 4,105,646
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment income
Retail class (719,904) (792,655) (1,069,829) (1,059,929)
Institutional class (291,974) (186,822) (290,402) (234,233)
From net realized gain
(loss) on sales of
investments
Retail class 0 (164,665) 0 0
Institutional class 0 (50,293) 0 0
CAPITAL SHARES TRANSACTIONS:
Proceeds from shares sold
- Retail class 13,390,954 44,016,587 29,443,131 76,248,722
Reinvestment of dividends
- Retail class 706,019 938,718 1,056,694 1,036,090
Cost of shares redeemed -
Retail class (7,248,585) (8,818,777) (11,418,397) (13,450,247)
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS - RETAIL
CLASS 6,848,388 36,136,528 19,081,428 63,834,565
Proceeds from shares sold
- Institutional class 14,264,385 14,259,774 11,040,040 19,610,472
Reinvestment of dividends
- Institutional class 291,974 237,115 290,402 234,233
Cost of shares redeemed -
Institutional class (4,082,172) (1,814,335) (4,420,587) (3,847,242)
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS -
INSTITUTIONAL CLASS 10,474,187 12,682,554 6,909,855 15,997,463
INCREASE IN NET ASSETS 22,374,272 49,781,556 36,363,369 82,643,512
NET ASSETS:
Beginning net assets 49,791,556 10,000 82,653,512 10,000
ENDING NET ASSETS $72,165,828 $49,791,556 $119,016,881 $82,653,512
SHARES ISSUED AND REDEEMED:
Shares sold - Retail class 1,274,137 4,487,768 2,723,538 7,760,327
Shares issued in
reinvestment of
dividends - Retail class 68,203 97,829 99,122 107,008
Shares redeemed - Retail
class (695,452) (906,606) (1,058,158) (1,373,325)
NET INCREASE IN SHARES
OUTSTANDING - RETAIL CLASS 646,888 3,678,991 1,764,502 6,494,010
Shares sold -
Institutional class 1,344,589 1,459,857 1,024,193 2,005,382
Shares issued in
reinvestment of
dividends -
Institutional class 28,017 24,706 27,230 24,204
Shares redeemed -
Institutional class (383,009) (186,023) (413,200) (396,096)
NET INCREASE IN SHARES
OUTSTANDING - INSTITUTIONAL
CLASS 989,597 1,298,540 638,223 1,633,490
- ----------------------------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
11
<PAGE> 159
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
LIFEPATH 2030 FUND
----------------------------------
(UNAUDITED) FOR THE
FOR THE YEAR ENDED
SIX MONTHS ENDED FEBRUARY 28,
AUGUST 31, 1995 1995
<S> <C> <C>
- ----------------------------------------------------------------
INCREASE IN NET ASSETS
OPERATIONS:
Net investment income $ 774,463 $ 974,574
Net realized gain (loss)
on sale of investments 2,120,300 (183,134)
Net change in unrealized
appreciation of
investments 5,611,723 2,050,109
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 8,506,486 2,841,549
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment income
Retail class (573,437) (626,319)
Institutional class (155,986) (125,966)
From net realized gain
(loss) on sales of
investments
Retail class 0 0
Institutional class 0 0
CAPITAL SHARES TRANSACTIONS:
Proceeds from shares sold
- Retail class 20,979,712 46,409,294
Reinvestment of dividends
- Retail class 568,328 620,208
Cost of shares redeemed -
Retail class (5,978,535) (7,560,069)
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS - RETAIL
CLASS 15,569,505 39,469,433
Proceeds from shares sold
- Institutional class 8,122,067 10,945,015
Reinvestment of dividends
- Institutional class 155,987 125,966
Cost of shares redeemed -
Institutional class (2,272,241) (1,804,740)
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS -
INSTITUTIONAL CLASS 6,005,813 9,266,241
INCREASE IN NET ASSETS 29,352,381 50,824,938
NET ASSETS:
Beginning net assets 50,834,938 10,000
ENDING NET ASSETS $80,187,319 $50,834,938
SHARES ISSUED AND REDEEMED:
Shares sold - Retail class 1,913,455 4,756,966
Shares issued in
reinvestment of
dividends - Retail class 52,755 64,274
Shares redeemed - Retail
class (547,849) (776,623)
NET INCREASE IN SHARES
OUTSTANDING - RETAIL CLASS 1,418,361 4,044,617
Shares sold -
Institutional class 743,468 1,121,285
Shares issued in
reinvestment of
dividends -
Institutional class 14,419 13,083
Shares redeemed -
Institutional class (206,555) (184,769)
NET INCREASE IN SHARES
OUTSTANDING - INSTITUTIONAL
CLASS 551,332 949,599
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
12
<PAGE> 160
<TABLE>
<CAPTION>
LIFEPATH 2040 FUND
----------------------------------
(UNAUDITED) FOR THE
FOR THE YEAR ENDED
SIX MONTHS ENDED FEBRUARY 28,
AUGUST 31, 1995 1995
<S> <C> <C>
- ----------------------------------------------------------------
INCREASE IN NET ASSETS
OPERATIONS:
Net investment income $ 797,371 $ 828,402
Net realized gain (loss)
on sale of investments 3,797,359 38,771
Net change in unrealized
appreciation of
investments 7,949,143 3,129,146
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 12,543,873 3,996,319
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment income
Retail class (600,763) (515,015)
Institutional class (127,691) (100,738)
From net realized gain
(loss) on sales of
investments
Retail class 0 0
Institutional class 0 0
CAPITAL SHARES TRANSACTIONS:
Proceeds from shares sold
- Retail class 43,481,496 63,522,813
Reinvestment of dividends
- Retail class 611,139 514,110
Cost of shares redeemed -
Retail class (12,792,413) (10,205,526)
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS - RETAIL
CLASS 31,300,222 53,831,397
Proceeds from shares sold
- Institutional class 11,989,602 11,844,340
Reinvestment of dividends
- Institutional class 127,690 100,738
Cost of shares redeemed -
Institutional class (3,328,540) (2,454,449)
NET INCREASE IN NET ASSETS
RESULTING FROM CAPITAL
SHARE TRANSACTIONS -
INSTITUTIONAL CLASS 8,788,752 9,490,629
INCREASE IN NET ASSETS 51,904,393 66,702,592
NET ASSETS:
Beginning net assets 66,712,592 10,000
ENDING NET ASSETS $118,616,985 $66,712,592
SHARES ISSUED AND REDEEMED:
Shares sold - Retail class 3,867,718 6,450,959
Shares issued in
reinvestment of
dividends - Retail class 55,214 52,581
Shares redeemed - Retail
class (1,141,816) (1,031,827)
NET INCREASE IN SHARES
OUTSTANDING - RETAIL CLASS 2,781,116 5,471,713
Shares sold -
Institutional class 1,070,018 1,198,550
Shares issued in
reinvestment of
dividends -
Institutional class 11,496 10,318
Shares redeemed -
Institutional class (293,852) (248,200)
NET INCREASE IN SHARES
OUTSTANDING - INSTITUTIONAL
CLASS 787,662 960,668
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
13
<PAGE> 161
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD IS AS FOLLOWS:
<TABLE>
<CAPTION>
LIFEPATH 2000 FUND
--------------------------------------------------
INSTITUTIONAL CLASS RETAIL CLASS
------------------------ ------------------------
(UNAUDITED) YEAR (UNAUDITED) YEAR
SIX MONTHS ENDED SIX MONTHS ENDED
ENDED FEBRUARY ENDED FEBRUARY
AUGUST 31, 28, AUGUST 31, 28,
1995 1995 1995 1995
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.94 $10.00 $ 9.92 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.22 0.35 0.22 0.34
Net realized and unrealized gain/(loss) on
investments 0.57 (0.12) 0.56 (0.14)
TOTAL FROM INVESTMENT OPERATIONS 0.79 0.23 0.78 0.20
LESS DISTRIBUTIONS:
Dividends from net investment income (0.22) (0.28) (0.22) (0.27)
Distributions from net realized capital gains 0.00 (0.01) 0.00 (0.01)
TOTAL FROM DISTRIBUTIONS (0.22) (0.29) (0.22) (0.28)
NET ASSET VALUE, END OF PERIOD $10.51 $ 9.94 $10.48 $ 9.92
TOTAL RETURN (NOT ANNUALIZED) 8.04% 2.38% 7.97% 2.10%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000) $11,885 $7,499 $69,340 $54,617
Number of shares outstanding, end of period
(000) 1,130 754 6,615 5,503
RATIOS TO AVERAGE NET ASSETS (ANNUALIZED):
Ratio of expenses to average net assets(1) 0.95% 0.95% 1.20% 1.20%
Ratio of net investment income to average net
assets(1) 4.69% 4.89% 4.44% 4.62%
Portfolio turnover(2) - - - -
- ----------------------------------------------------------------------------------------------------
(1) This ratio includes expenses charged to the
Master Series.
(2) The Funds invest all of their assets in the
corresponding Master Series, hence no
securities-related activity.
</TABLE>
14
<PAGE> 162
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD IS AS FOLLOWS:
<TABLE>
<CAPTION>
LIFEPATH 2010 FUND
------------------------------------------------------
INSTITUTIONAL CLASS RETAIL CLASS
-------------------------- --------------------------
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
AUGUST 31, FEBRUARY 28, AUGUST 31, FEBRUARY 28,
1995 1995 1995 1995
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING
OF PERIOD $10.02 $10.00 $ 9.99 $10.00
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income 0.19 0.33 0.19 0.34
Net realized and
unrealized gain/(loss)
on investments 0.92 0.01 0.90 (0.02)
TOTAL FROM INVESTMENT
OPERATIONS 1.10 0.34 1.09 0.32
LESS DISTRIBUTIONS:
Dividends from net
investment income (0.19) (0.27) (0.19) (0.28)
Distributions from net
realized capital gains 0.00 (0.05) 0.00 (0.05)
TOTAL FROM DISTRIBUTIONS (0.19) (0.32) (0.19) (0.33)
NET ASSET VALUE, END OF
PERIOD $10.94 $10.02 $10.89 $9.99
TOTAL RETURN (NOT
ANNUALIZED) 11.17% 3.53% 11.00% 3.31%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000) $25,049 $13,028 $47,117 $36,764
Number of shares
outstanding, end of
period (000) 2,289 1,300 4,326 3,679
RATIOS TO AVERAGE NET ASSETS
(ANNUALIZED):
Ratio of expenses to
average net assets(1) 0.95% 0.95% 1.20% 1.20%
Ratio of net investment
income to average net
assets(1) 3.92% 4.61% 3.67% 4.40%
Portfolio turnover(2) - - - -
- ------------------------------------------------------------------------------------
(1) This ratio includes
expenses charged to the
Master Series.
(2) The Funds invest all of
their assets in the
corresponding Master
Series, hence no
securities-related
activity.
<CAPTION>
LIFEPATH 2020 FUND
------------------------------------------------------
INSTITUTIONAL CLASS RETAIL CLASS
-------------------------- --------------------------
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
AUGUST 31, FEBRUARY 28, AUGUST 31, FEBRUARY 28,
1995 1995 1995 1995
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING
OF PERIOD $10.17 $10.00 $10.17 $10.00
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income 0.16 0.30 0.15 0.28
Net realized and
unrealized gain/(loss)
on investments 1.13 0.12 1.13 0.12
TOTAL FROM INVESTMENT
OPERATIONS 1.29 0.42 1.28 0.40
LESS DISTRIBUTIONS:
Dividends from net
investment income (0.16) (0.25) (0.15) (0.23)
Distributions from net
realized capital gains 0.00 0.00 0.00 0.00
TOTAL FROM DISTRIBUTIONS (0.16) (0.25) (0.15) (0.23)
NET ASSET VALUE, END OF
PERIOD $11.30 $10.17 $11.30 $10.17
TOTAL RETURN (NOT
ANNUALIZED) 12.79% 4.39% 12.68% 4.12%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000) $25,685 $16,618 $93,332 $66,036
Number of shares
outstanding, end of
period (000) 2,273 1,634 8,259 6,494
RATIOS TO AVERAGE NET ASSETS
(ANNUALIZED):
Ratio of expenses to
average net assets(1) 0.95% 0.95% 1.20% 1.20%
Ratio of net investment
income to average net
assets(1) 3.12% 3.88% 2.87% 3.64%
Portfolio turnover(2) - - - -
- ------------------------------------------------------------------------------------
(1) This ratio includes
expenses charged to the
Master Series.
(2) The Funds invest all of
their assets in the
corresponding Master
Series, hence no
securities-related
activity.
</TABLE>
15
<PAGE> 163
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD IS AS FOLLOWS:
<TABLE>
<CAPTION>
LIFEPATH 2030 FUND
--------------------------------------------------
INSTITUTIONAL CLASS RETAIL CLASS
------------------------ ------------------------
(UNAUDITED) YEAR (UNAUDITED) YEAR
SIX MONTHS ENDED SIX MONTHS ENDED
ENDED FEBRUARY ENDED FEBRUARY
AUGUST 31, 28, AUGUST 31, 28,
1995 1995 1995 1995
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $10.18 $10.00 $10.17 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.13 0.29 0.13 0.26
Net realized and unrealized gain/(loss) on
investments 1.35 0.14 1.34 0.13
TOTAL FROM INVESTMENT OPERATIONS 1.48 0.43 1.47 0.39
LESS DISTRIBUTIONS:
Dividends from net investment income (0.13) (0.25) (0.13) (0.22)
Distributions from net realized capital gains 0.00 0.00 0.00 0.00
TOTAL FROM DISTRIBUTIONS (0.13) (0.25) (0.13) (0.22)
NET ASSET VALUE, END OF PERIOD $11.53 $10.18 $11.51 $10.17
TOTAL RETURN (NOT ANNUALIZED) 14.63% 4.42% 14.51% 4.03%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000) $17,319 $9,682 $62,869 $41,153
Number of shares outstanding, end of period
(000) 1,502 951 5,463 4,045
RATIOS TO AVERAGE NET ASSETS (ANNUALIZED):
Ratio of expenses to average net assets(1) 0.95% 0.95% 1.20% 1.20%
Ratio of net investment income to average net
assets(1) 0.44% 3.59% 2.30% 3.35%
Portfolio turnover(2) - - - -
- ----------------------------------------------------------------------------------------------------
(1) This ratio includes expenses charged to the
Master Series.
(2) The Funds invest all of their assets in the
corresponding Master Series, hence no
securities-related activity.
</TABLE>
16
<PAGE> 164
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD IS AS FOLLOWS:
<TABLE>
<CAPTION>
LIFEPATH 2040 FUND
------------------------------------------------------
INSTITUTIONAL CLASS RETAIL CLASS
-------------------------- --------------------------
(UNAUDITED) (UNAUDITED)
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
AUGUST 31, FEBRUARY 28, AUGUST 31, FEBRUARY 28,
1995 1995 1995 1995
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING
OF PERIOD $10.37 $10.00 $10.37 $10.00
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income 0.10 0.20 0.09 0.18
Net realized and
unrealized gain/(loss)
on investments 1.50 0.34 1.49 0.34
TOTAL FROM INVESTMENT
OPERATIONS 1.60 0.54 1.58 0.52
LESS DISTRIBUTIONS:
Dividends from net
investment income (0.10) (0.17) (0.09) (0.15)
Distributions from net
realized capital gains 0.00 0.00 0.00 0.00
TOTAL FROM DISTRIBUTIONS (0.10) (0.17) (0.09) (0.15)
NET ASSET VALUE, END OF
PERIOD $11.87 $10.37 $11.86 $10.37
TOTAL RETURN (NOT
ANNUALIZED) 15.48% 5.55% 15.33% 5.26%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000) $20,765 $9,976 $97,852 $56,737
Number of shares
outstanding, end of
period (000) 1,749 962 8,253 5,472
RATIOS TO AVERAGE NET ASSETS
(ANNUALIZED):
Ratio of expenses to
average net assets(1) 0.95% 0.95% 1.20% 1.20%
Ratio of net investment
income to average net
assets(1) 1.92% 2.61% 1.68% 2.35%
Portfolio turnover(2) - - - -
- ------------------------------------------------------------------------------------
(1) This ratio includes
expenses charged to the
Master Series.
(2) The Funds invest all of
their assets in the
corresponding Master
Series, hence no
securities-related
activity.
</TABLE>
17
<PAGE> 165
(THIS PAGE INTENTIONALLY LEFT BLANK)
18
<PAGE> 166
STAGECOACH TRUST
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
Stagecoach Trust (the "Trust") is registered under the Investment Company
Act of 1940 (the "1940 Act"), as amended, as an open-end management investment
company. The Trust was organized as a Massachusetts business trust pursuant to
an Agreement and Declaration of Trust dated May 14, 1993. The Trust currently is
authorized to issue ten separate diversified funds, of which the following
commenced operations on March 1, 1994: the LifePath 2000 Fund, the LifePath 2010
Fund, the LifePath 2020 Fund, the LifePath 2030 Fund and the LifePath 2040 Fund
(each, a "Fund," collectively, the "Funds"). The following significant
accounting policies are consistently followed by the Trust in the preparation of
its financial statements, and such policies are in conformity with generally
accepted accounting principles for investment companies.
Each Fund offers two classes of shares, an Institutional Class and a Retail
Class. The two classes of shares differ principally in their respective
distribution fees. Shareholders of each class bear certain expenses that pertain
to that particular class. All shareholders bear the common expenses of the Fund
and earn income from the portfolio, pro rata based on the average daily net
assets of each class. Dividends are declared separately for each class. Gains
are allocated to each class pro rata based upon net assets of each class on the
date of distribution. Neither class has preferential dividend rights;
differences in per share dividend rates are generally due to differences in
separate class expenses, including distribution fees and from the weightings of
pro rata income and gain allocations.
INVESTMENT POLICY AND SECURITY VALUATION
Each Fund invests all of its assets in a separate series (each, a "Master
Series") of Master Investment Portfolio. Each Master Series has the same
investment objective as the Fund bearing the corresponding name. The value of
each Fund's investment in its corresponding Master Series reflects that Fund's
interest in the net assets of that Master Series (99.98%, 99.98%, 99.99%,
99.96%, and 99.98%) for the LifePath 2000, LifePath 2010, LifePath 2020,
LifePath 2030 and LifePath 2040 Funds, respectively, at August 31, 1995. The
Master Series invest in a
19
<PAGE> 167
STAGECOACH TRUST
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
wide range of U.S. and foreign equity, debt securities and money market
instruments. Each Master Series follows an asset allocation strategy among three
broad investment classes: equity and debt securities of issuers located
throughout the world and cash in the form of money market instruments. The
equity securities of the Master Series are valued at their last sale price on
the primary securities exchange or national securities market on which such
securities are traded. Securities not listed on an exchange or national
securities market, or securities in which there were no transactions, are valued
at their most recent bid prices. Debt securities maturing in 60 days or less are
valued at amortized cost, which approximates market value. Debt securities,
other than those maturing in 60 days or less, are valued at the latest quoted
bid price. Any securities, restricted securities or other assets for which
recent market quotations are not readily available are valued at fair value as
determined in good faith in accordance with policies approved by the Master
Portfolio's Board of Trustees.
SECURITY TRANSACTIONS AND INCOME RECOGNITION
Securities transactions are accounted for by each Master Series on the date
the securities are purchased or sold (trade date). Revenue is recognized by each
Master Series as follows: Dividend income is recognized on the ex-dividend date,
and interest income is recognized on a daily accrual basis. Realized gains or
losses are reported on the basis of identified cost of securities delivered.
Bond discounts and premiums are amortized as required by the Internal Revenue
Code of 1986 (the "Code").
All net investment income and realized and unrealized capital gains and
losses of each Master Series are allocated pro rata among its respective Funds.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Each Fund declares and pays dividends from net investment income quarterly.
Each Fund makes distributions from net realized securities gains, if any, once a
year.
FEDERAL INCOME TAXES
Each Fund of the Trust is treated as a separate entity for federal income
tax purposes. It is the policy of each Fund of the Trust to continue to qualify
as a
20
<PAGE> 168
STAGECOACH TRUST
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
regulated investment company by complying with the provisions applicable to
investment companies, as defined in the Code, and to make distributions of
investment company taxable income and net capital gain (after reduction for
capital loss carryforwards) sufficient to relieve it from all, or substantially
all, federal income taxes. Accordingly, no provision for federal income taxes
was required. The LifePath 2020 Fund has a capital loss carryforward of $179,977
which will expire in the year 2002. The LifePath 2030 Fund has a capital loss
carryforward of $311,585 which will expire in the year 2002, and the LifePath
2040 Fund has a capital loss carryforward of $32,220 which will expire in the
year 2002.
ORGANIZATION EXPENSES
Stephens Inc. ("Stephens"), the Funds' administrator, sponsor and
distributor, has incurred all expenses in connection with the Funds'
organization and initial registration.
2. AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES
The Trust has entered into an agreement on behalf of the Funds with Wells
Fargo Bank ("WFB") to provide transfer and dividend disbursing agency services.
For providing the transfer and dividend disbursing agency services, the Trust
has agreed to pay a monthly fee at the annual rate of 0.10% of each Fund's
average daily net assets.
On behalf of the Funds, the Trust may enter into servicing agreements with
certain financial institutions, securities dealers and other industry
professionals (collectively, "Shareholder Servicing Agents") for the provision
of certain services to Fund shareholders. For the services provided pursuant to
a Shareholder Servicing Agreement, the Trust may pay each Shareholder Servicing
Agent a monthly fee at the annual rate of up to 0.20% of the average daily value
of each Fund's shares beneficially owned by customers of the Shareholder
Servicing Agent. The Trust has entered into a Shareholder Servicing Agreement
with WFB.
21
<PAGE> 169
STAGECOACH TRUST
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
The Trust has entered into an agreement with Stephens on behalf of the
Retail Class of shares for distribution services and has adopted a Plan of
Distribution pursuant to Rule 12b-1 under the 1940 Act, whereby Stephens may be
compensated for services rendered and reimbursed for expenses incurred. For
providing these services, Stephens is entitled to receive monthly payments at an
annual rate of 0.25% of the average daily net assets of the Retail Class of
shares.
The Trust has also entered into an administration agreement on behalf of the
Funds with Stephens whereby Stephens has agreed to provide administrative
services to the Funds. For providing administrative services, the Trust pays
Stephens a monthly fee at the annual rate of 0.10% of each Fund's average daily
net assets.
Under the Administration Agreement, Stephens has agreed to assume the
operating expenses of each LifePath Fund and a pro rata share of the operating
expenses of each LifePath Master Series, except for extraordinary expenses and
those fees and expenses payable pursuant to the various service contracts
described above which will be borne by the Trust and those expenses specifically
assumed by WFB under its contracts with the Funds.
Certain officers and directors of the Trust are also officers of Stephens.
At August 31, 1995, these officers of Stephens collectively owned less than 1%
of the Funds' outstanding shares.
3. CAPITAL SHARE TRANSACTIONS
As of August 31, 1995, the Trust has authorized an unlimited number of
shares of beneficial interest. Transactions in shares for the six months ended
August 31, 1995, for each Fund are disclosed in detail in the Statements of
Changes in Net Assets.
22
<PAGE> 170
(THIS PAGE INTENTIONALLY LEFT BLANK)
23
<PAGE> 171
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
Portfolios of Investments (Unaudited)
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
--------------------------- --------------------------- ---------------------------
<S> <C> <C> <C> <C> <C> <C>
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
COMMON STOCKS
PERCENT OF NET ASSETS 22.8% 51.2% 68.7%
LARGE CAP GROWTH STOCKS
PERCENT OF NET ASSETS 3.3% 16.1% 23.2%
AT & T Corp 1,945 $ 109,799 8,751 $ 494,338 20,907 $ 1,181,166
Abbott Laboratories 961 37,239 4,446 172,283 10,509 407,224
Airtouch Communications + 638 20,735 2,701 87,783 6,512 211,640
Albertson's Inc 344 10,965 1,400 44,625 3,308 105,443
Alco Standard Corp 44 3,542 265 21,333 724 58,282
Alexander & Alexander Services 1 23 223 5,157 581 13,436
Allergan Inc 62 1,883 407 12,363 801 24,330
Alltel Corp 271 7,656 1,050 29,663 2,538 71,699
ALZA Corp + 118 2,803 487 11,566 1,105 26,244
American Home Products Corp 344 26,488 1,669 128,513 4,115 316,855
American International Group Inc 609 49,101 2,673 215,511 6,238 502,939
Ameritech Corp 683 35,004 3,100 158,875 7,273 372,741
Amgen Inc + 316 15,129 1,496 71,621 3,488 166,988
AMP Inc 230 9,344 1,160 47,125 2,906 118,056
Andrew Corp + 3 175 177 10,310 469 27,319
Anheuser-Busch Inc 366 20,908 1,444 82,489 3,396 193,997
Applied Materials Inc + 100 10,400 420 43,680 1,291 134,264
Armco Inc + 207 1,294 475 2,969 1,138 7,113
Atlantic Richfield Corp 205 22,371 920 100,395 2,122 231,563
Autodesk Inc 84 3,875 230 10,609 668 30,812
Automatic Data Processing 173 11,245 837 54,405 1,923 124,995
Avery Dennison Corp 48 1,968 295 12,095 655 26,855
Avon Products Inc 77 5,438 345 24,366 914 64,551
Bard (C R) Inc 41 1,271 262 8,122 713 22,103
Barrick Gold Corp 507 12,865 1,970 49,989 4,676 118,654
Bell Atlantic Corp 589 35,193 2,438 145,671 5,815 347,446
Belo (A H) Corp 456 16,017 240 8,430 714 25,079
Bemis Co Inc 40 1,160 261 7,569 687 19,923
Biomet Inc + 77 1,242 644 10,385 1,465 23,623
Block (H & R) Inc 161 6,279 552 21,528 1,391 54,249
Boston Scientific Corp + 143 5,684 876 34,821 1,963 78,029
Bristol-Myers Squibb Co 671 46,047 2,782 190,915 6,728 461,709
Browning-Ferris Industries Inc 288 9,684 1,174 39,476 2,833 95,260
CBS Inc 105 8,374 409 32,618 864 68,904
CPC International Inc 187 11,758 776 48,791 1,971 123,927
CUC International Inc + 210 7,166 955 32,589 2,332 79,580
Cabletron Systems Inc + 50 2,644 410 21,679 990 52,346
Campbell Soup Co 340 15,555 1,345 61,534 3,342 152,897
Capital Cities/ABC Inc 194 22,310 882 101,430 2,040 234,600
Ceridian Corp + 27 1,181 224 9,800 588 25,725
Cincinnati Milacron Inc 59 $ 1,954 182 $ 6,029 405 $ 13,416
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
<S> <C> <C> <C> <C>
SECURITY NAME SHARES VALUE SHARES VALUE
COMMON STOCKS
PERCENT OF NET ASSETS 81.5% 95.7%
LARGE CAP GROWTH STOCKS
PERCENT OF NET ASSETS 27.7% 36.3%
AT & T Corp 16,838 $ 951,254 32,808 $ 1,853,556
Abbott Laboratories 8,552 331,390 16,479 638,561
Airtouch Communications + 5,222 169,715 10,329 335,693
Albertson's Inc 2,666 84,979 5,282 168,364
Alco Standard Corp 542 43,631 1,124 90,482
Alexander & Alexander Services 451 10,429 872 20,165
Allergan Inc 690 20,959 1,303 39,579
Alltel Corp 2,023 57,150 3,838 108,424
ALZA Corp + 907 21,541 1,657 39,354
American Home Products Corp 3,273 252,021 6,372 490,644
American International Group Inc 5,028 405,383 9,742 785,449
Ameritech Corp 5,876 301,145 11,402 584,353
Amgen Inc + 2,794 133,763 5,528 264,653
AMP Inc 2,348 95,388 4,559 185,209
Andrew Corp + 409 23,824 752 43,804
Anheuser-Busch Inc 2,761 157,722 5,350 305,619
Applied Materials Inc + 916 95,264 1,765 183,560
Armco Inc + 1,005 6,281 2,024 12,650
Atlantic Richfield Corp 1,762 192,278 3,401 371,134
Autodesk Inc 553 25,507 1,005 46,356
Automatic Data Processing 1,585 103,025 2,907 188,955
Avery Dennison Corp 615 25,215 1,115 45,715
Avon Products Inc 740 52,263 1,533 108,268
Bard (C R) Inc 590 18,290 1,088 33,728
Barrick Gold Corp 3,721 94,420 7,335 186,126
Bell Atlantic Corp 4,618 275,926 9,062 541,455
Belo (A H) Corp 444 15,596 740 25,993
Bemis Co Inc 582 16,878 1,034 29,986
Biomet Inc + 1,234 19,898 2,361 38,071
Block (H & R) Inc 1,130 44,070 2,283 89,037
Boston Scientific Corp + 1,591 63,242 3,206 127,439
Bristol-Myers Squibb Co 5,369 368,448 10,420 715,073
Browning-Ferris Industries Inc 2,239 75,286 4,455 149,799
CBS Inc 677 53,991 1,462 116,595
CPC International Inc 1,539 96,765 3,112 195,667
CUC International Inc + 1,875 63,984 3,670 125,239
Cabletron Systems Inc + 777 41,084 1,525 80,634
Campbell Soup Co 2,625 120,094 5,067 231,815
Capital Cities/ABC Inc 1,679 193,085 3,288 378,120
Ceridian Corp + 535 23,406 880 38,500
Cincinnati Milacron Inc 363 $ 12,024 727 $ 24,082
</TABLE>
24 25
<PAGE> 172
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Circuit City Stores Inc 143 4,934 512 17,664 1,301 44,885
Cisco Systems Inc + 349 22,903 1,529 100,341 3,590 235,594
Clorox Co 45 3,043 266 17,988 698 47,202
Coca-Cola Co 1,566 100,616 7,041 452,384 16,752 1,076,316
Colgate-Palmolive Co 183 12,444 821 55,828 1,893 128,724
Columbia HCA Healthcare Corp 575 27,025 2,450 115,150 5,843 274,621
Comcast Corp Class A 393 8,400 1,299 27,766 3,124 66,776
Compaq Computer Corp + 342 16,331 1,424 67,996 3,451 164,785
Computer Associates International Inc 213 14,804 925 64,288 2,149 149,356
Computer Sciences Corp + 38 2,290 259 15,605 770 46,393
ConAgra Inc 334 12,650 1,340 50,753 3,212 121,655
Cooper Tire & Rubber Co 121 3,146 441 11,466 1,054 27,404
Corning Inc 261 8,515 1,225 39,966 3,019 98,495
Crane Co 52 1,872 175 6,300 348 12,528
DSC Communications Corp + 171 8,978 663 34,808 1,460 76,650
Darden Restaurants Inc + 203 2,081 915 9,379 2,011 20,613
Deluxe Corp 120 3,750 439 13,719 1,127 35,219
Dial Corp 136 3,264 480 11,520 1,241 29,784
Disney (Walt) Co 641 35,976 2,849 159,900 6,849 384,400
Dover Corp 50 3,988 296 23,606 759 60,530
Dun & Bradstreet Corp 223 12,906 960 55,560 2,254 130,450
Eastman Chemical Co 120 7,755 438 28,306 1,127 72,832
Eastman Kodak Co 429 24,721 1,881 108,393 4,490 258,736
Ecolab Inc 60 1,643 406 11,114 832 22,776
Emerson Electric Co 268 19,129 1,326 94,643 3,079 219,764
Engelhard Corp 214 6,046 765 21,611 1,912 54,014
Enron Corp 336 11,298 1,394 46,873 3,342 112,375
FMC Corp + -- -- 161 12,397 530 40,810
First Data Corp 173 10,099 646 37,710 1,540 89,898
Fluor Corp 119 6,962 437 25,565 1,126 65,871
Foster Wheeler Corp -- -- 160 5,900 429 15,819
Freeport-McMoRan Copper & Gold Inc Class A 38 888 28 655 52 1,215
Freeport-McMoRan Copper & Gold Inc Class B 1,072 25,058 1,187 27,746 2,718 63,533
Gannett Co Inc 183 9,791 820 43,870 1,812 96,942
Gap Inc 179 5,750 819 26,310 1,888 60,652
General Electric Co 2,122 124,933 9,391 552,895 22,437 1,320,978
General Mills Inc 203 10,480 915 47,237 2,111 108,980
Genuine Parts Co 118 4,646 708 27,878 1,603 63,118
Gillette Co 524 21,877 2,440 101,870 5,822 243,069
Grace (W R) & Co 139 9,261 483 32,180 1,272 84,747
Grainger (W W) Inc 39 2,321 260 15,470 666 39,627
Great Lakes Chemical Corp 75 $ 4,959 344 $ 22,747 912 $ 60,306
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Circuit City Stores Inc 1,065 36,743 1,965 67,793
Cisco Systems Inc + 2,845 186,703 5,605 367,828
Clorox Co 535 36,179 1,078 72,900
Coca-Cola Co 13,545 870,266 26,197 1,683,157
Colgate-Palmolive Co 1,532 104,176 3,098 210,664
Columbia HCA Healthcare Corp 4,765 223,955 9,184 431,648
Comcast Corp Class A 2,550 54,506 4,968 106,191
Compaq Computer Corp + 2,833 135,276 5,329 254,460
Computer Associates International Inc 1,674 116,343 3,393 235,814
Computer Sciences Corp + 571 34,403 1,078 64,950
ConAgra Inc 2,613 98,967 5,141 194,715
Cooper Tire & Rubber Co 921 23,946 1,695 44,070
Corning Inc 2,410 78,626 4,784 156,078
Crane Co 339 12,204 600 21,600
DSC Communications Corp + 1,257 65,993 2,333 122,483
Darden Restaurants Inc + 1,647 16,882 3,351 34,348
Deluxe Corp 860 26,875 1,688 52,750
Dial Corp 1,028 24,672 1,908 45,792
Disney (Walt) Co 5,602 314,412 10,789 605,533
Dover Corp 563 44,899 1,152 91,872
Dun & Bradstreet Corp 1,821 105,390 3,591 207,829
Eastman Chemical Co 864 55,836 1,686 108,958
Eastman Kodak Co 3,607 207,853 6,909 398,131
Ecolab Inc 659 18,040 1,322 36,190
Emerson Electric Co 2,472 176,439 4,819 343,956
Engelhard Corp 1,497 42,290 2,910 82,208
Enron Corp 2,642 88,837 5,250 176,531
FMC Corp + 373 28,721 893 68,761
First Data Corp 1,248 72,852 2,404 140,334
Fluor Corp 863 50,486 1,688 98,748
Foster Wheeler Corp 373 13,754 741 27,324
Freeport-McMoRan Copper & Gold Inc Class A 38 888 236 5,517
Freeport-McMoRan Copper & Gold Inc Class B 2,192 51,238 4,152 97,053
Gannett Co Inc 1,528 81,748 2,841 151,994
Gap Inc 1,521 48,862 2,882 92,584
General Electric Co 18,076 1,064,225 35,072 2,064,864
General Mills Inc 1,647 85,026 3,351 172,995
Genuine Parts Co 1,288 50,715 2,520 99,225
Gillette Co 4,704 196,392 9,176 383,098
Grace (W R) & Co 1,039 69,223 1,938 129,119
Grainger (W W) Inc 576 34,272 1,047 62,297
Great Lakes Chemical Corp 739 $ 48,866 1,323 $ 87,483
</TABLE>
26 27
<PAGE> 173
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Harland (John H) Co 53 1,173 176 3,894 414 9,160
Harnischfeger Industries Inc 108 3,969 319 11,723 594 21,830
Harrah's Entertainment Inc + 154 4,909 522 16,639 1,348 42,968
Heinz (H J) Co 316 13,391 1,346 57,037 3,219 136,405
Hercules Inc 188 10,458 653 36,323 1,510 83,994
Hewlett Packard Co 586 46,880 2,850 228,000 6,714 537,120
Hilton Hotels Corp 34 2,261 256 17,024 625 41,563
Home Depot Inc 635 25,321 2,677 106,745 6,245 249,019
Homestake Mining Co 166 2,739 780 12,870 1,776 29,304
Illinois Tool Works Inc 174 10,658 665 40,731 1,471 90,099
Intel Corp 1,016 62,357 4,602 282,448 10,970 673,284
International Flavors & Fragrances 171 8,187 663 31,741 1,465 70,137
Interpublic Group Cos Inc 82 3,188 476 18,505 1,077 41,868
Johnson & Johnson 827 57,063 3,578 246,882 8,561 590,709
Jostens Inc 5 120 301 7,224 585 14,040
Kellogg Co 269 18,158 1,227 82,823 2,879 194,333
Kimberly-Clark Corp 207 13,222 920 58,765 2,145 137,012
King World Productions + -- -- 212 8,056 508 19,304
Kroger Co + 165 5,383 608 19,836 1,453 47,404
Lilly (Eli) & Co 338 27,674 1,665 136,322 3,825 313,172
Limited Inc 486 8,991 2,033 37,611 4,710 87,135
Lockheed Martin Corp 202 12,297 1,108 67,450 2,631 160,162
Lowe's Co Inc 200 6,650 913 30,357 2,082 69,227
MBNA Corp 185 6,568 874 31,027 1,970 69,935
Manor Care Inc 59 1,910 305 9,874 805 26,062
Marsh & McLennan Companies Inc 80 6,590 399 32,868 925 76,197
Marriott International 123 4,367 713 25,312 1,641 58,256
Mattel Inc 247 7,163 1,223 35,467 2,960 85,840
McDonald's Corp 890 32,485 3,884 141,766 9,118 332,807
McGraw-Hill Inc 36 2,835 258 20,318 678 53,393
Medtronic Inc 100 9,438 592 55,870 1,519 143,356
Merck & Co Inc 1,572 78,404 6,903 344,287 16,388 817,352
Microsoft Corp + 759 70,208 3,242 299,885 7,693 711,603
Micron Technology Inc 276 21,218 1,158 89,021 2,748 211,253
Millipore Corp 50 1,744 294 10,253 584 20,367
Minnesota Mining & Manufacturing Co 567 30,972 2,360 128,915 5,526 301,858
Morton International Inc 182 5,915 871 28,308 1,906 61,945
Motorola Inc 751 56,137 3,266 244,134 7,756 579,761
Nalco Chemical Co 71 2,485 340 11,900 879 30,765
Newell Co 202 5,050 915 22,875 2,087 52,175
Newmont Mining Corp 124 5,394 518 22,533 1,094 47,589
Northern Telecom Ltd 340 12,495 1,397 51,340 3,304 121,422
Novell Inc + 520 9,360 1,992 35,856 4,808 86,544
Nucor Corp 127 $ 6,223 521 $ 25,529 1,196 $ 58,604
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Harland (John H) Co 305 6,748 604 13,364
Harnischfeger Industries Inc 537 19,735 960 35,280
Harrah's Entertainment Inc + 1,090 34,744 2,210 70,444
Heinz (H J) Co 2,629 111,404 4,937 209,205
Hercules Inc 1,238 68,864 2,393 133,111
Hewlett Packard Co 5,412 432,960 10,466 837,280
Hilton Hotels Corp 563 37,440 1,005 66,833
Home Depot Inc 5,113 203,881 9,957 397,035
Homestake Mining Co 1,466 24,189 2,815 46,448
Illinois Tool Works Inc 1,264 77,420 2,288 140,140
Intel Corp 8,826 541,696 17,158 1,053,072
International Flavors & Fragrances 1,163 55,679 2,237 107,096
Interpublic Group Cos Inc 880 34,210 1,606 62,433
Johnson & Johnson 6,912 476,928 13,249 914,181
Jostens Inc 457 10,968 884 21,216
Kellogg Co 2,324 156,870 4,616 311,580
Kimberly-Clark Corp 1,662 106,160 3,319 212,001
King World Productions + 376 14,288 698 26,524
Kroger Co + 1,196 39,020 2,404 78,431
Lilly (Eli) & Co 3,095 253,403 6,001 491,332
Limited Inc 3,810 70,485 7,263 134,366
Lockheed Martin Corp 2,154 131,125 4,184 254,701
Lowe's Co Inc 1,741 57,888 3,269 108,694
MBNA Corp 1,536 54,528 3,004 106,642
Manor Care Inc 707 22,889 1,217 39,400
Marsh & McLennan Companies Inc 757 62,358 1,445 119,032
Marriott International 1,342 47,641 2,495 88,573
Mattel Inc 2,348 68,092 4,479 129,891
McDonald's Corp 7,394 269,881 14,355 523,958
McGraw-Hill Inc 503 39,611 1,022 80,483
Medtronic Inc 1,216 114,760 2,404 226,878
Merck & Co Inc 13,210 658,849 25,490 1,271,314
Microsoft Corp + 6,204 573,870 12,109 1,120,083
Micron Technology Inc 2,214 170,201 4,334 333,176
Millipore Corp 472 16,461 920 32,085
Minnesota Mining & Manufacturing Co 4,512 246,468 8,671 473,653
Morton International Inc 1,529 49,693 3,000 97,500
Motorola Inc 6,235 466,066 12,252 915,837
Nalco Chemical Co 734 25,690 1,387 48,545
Newell Co 1,639 40,975 3,356 83,900
Newmont Mining Corp 946 41,151 1,713 74,516
Northern Telecom Ltd 2,750 101,063 5,164 189,777
Novell Inc + 3,886 69,948 7,487 134,766
Nucor Corp 955 $ 46,795 1,926 $ 94,374
</TABLE>
28 29
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MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Oracle Systems Corp + 562 22,550 2,352 94,374 5,702 228,793
Oryx Energy Co + 245 3,308 565 7,628 1,280 17,280
Owens Corning Fiberglass + 26 1,021 323 12,678 710 27,868
PPG Industries Inc 248 10,602 1,181 50,488 2,728 116,622
Pall Corp 78 1,706 594 12,994 1,517 33,184
Pep Boys-Manny Moe & Jack 57 1,568 303 8,333 777 21,368
Pepsico Inc 999 45,205 4,413 199,688 10,455 473,089
Perkin-Elmer Corp 27 921 224 7,644 586 19,997
Pfizer Inc 770 38,019 3,532 174,393 8,316 410,603
Philip Morris Co Inc 1,076 80,297 4,740 353,723 11,139 831,248
Phillips Petroleum Co 358 11,769 1,438 47,274 3,490 114,734
Pioneer Hi Bred International Inc 132 5,676 474 20,382 1,134 48,762
Pitney Bowes Inc 202 8,206 815 33,109 1,978 80,356
Placer Dome Inc 292 7,629 1,299 33,936 3,146 82,189
Praxair Inc 161 4,186 777 20,202 1,820 47,320
Premark International Inc 61 3,195 306 16,027 833 43,628
Procter & Gamble Co 823 57,096 3,847 266,886 9,114 632,284
Quaker Oats Co 136 4,726 774 26,897 1,788 62,133
Ralston-Purina Group 151 7,852 518 26,936 1,344 69,888
Reebok International Ltd 95 3,373 438 15,549 1,030 36,565
Rubbermaid Inc 206 6,129 919 27,340 2,170 64,558
St Jude Medical Inc + 32 1,908 252 15,026 617 36,789
Santa Fe Pacific Gold Corp 128 1,552 756 9,167 1,689 20,479
Sara Lee Corp 613 17,011 2,652 73,593 6,287 174,464
Schering-Plough Corp 476 22,194 2,096 97,726 4,962 231,353
Schlumberger Ltd 327 21,092 1,309 84,431 3,172 204,594
Scientific-Atlanta Inc 82 1,640 377 7,540 968 19,360
Scott Paper Co 160 7,420 800 37,100 1,998 92,657
Shared Medical System Corp 40 1,475 138 5,089 262 9,661
Shoney's Inc + 97 1,128 170 1,976 451 5,243
Sigma Aldrich Corp 62 2,976 262 12,576 667 32,016
Silicon Graphics Inc + 217 9,168 922 38,955 2,075 87,669
Southwest Airlines Co 175 4,528 839 21,709 1,871 48,412
Stone Container Corp + 33 718 526 11,441 1,233 26,818
Sysco Corp 248 7,130 1,009 29,009 2,374 68,253
Tektronix Inc 78 3,559 176 8,030 423 19,299
Tele-Communication Inc Class A + 762 14,097 3,627 67,100 8,591 158,934
Teledyne Inc 22 526 294 7,026 732 17,493
Tellabs Inc + 100 4,675 500 23,375 1,200 56,100
Texas Instruments Inc 272 20,366 1,058 79,218 2,470 184,941
Time Warner Inc 463 19,504 2,135 89,937 5,046 212,563
Tribune Co 68 4,556 338 22,646 894 59,898
Trinova Corp 50 1,838 123 4,520 344 12,642
Tyco International Inc 83 $ 4,907 475 $ 28,084 963 $ 56,937
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Oracle Systems Corp + 4,574 183,532 8,871 355,949
Oryx Energy Co + 1,079 14,567 2,039 27,527
Owens Corning Fiberglass + 531 20,842 1,175 46,119
PPG Industries Inc 2,244 95,931 4,350 185,963
Pall Corp 1,275 27,891 2,480 54,250
Pep Boys-Manny Moe & Jack 698 19,195 1,281 35,228
Pepsico Inc 8,371 378,788 16,227 734,272
Perkin-Elmer Corp 434 14,810 876 29,894
Pfizer Inc 6,782 334,861 12,966 640,196
Philip Morris Co Inc 9,008 672,222 17,451 1,302,281
Phillips Petroleum Co 2,748 90,341 5,392 177,262
Pioneer Hi Bred International Inc 916 39,388 1,740 74,820
Pitney Bowes Inc 1,643 66,747 3,128 127,075
Placer Dome Inc 2,547 66,540 4,966 129,737
Praxair Inc 1,448 37,648 2,928 76,128
Premark International Inc 696 36,453 1,250 65,469
Procter & Gamble Co 7,327 508,311 14,180 983,738
Quaker Oats Co 1,455 50,561 2,747 95,458
Ralston-Purina Group 1,090 56,680 2,192 113,984
Reebok International Ltd 819 29,075 1,764 62,622
Rubbermaid Inc 1,686 50,159 3,416 101,626
St Jude Medical Inc + 540 32,198 900 53,663
Santa Fe Pacific Gold Corp 1,388 16,830 2,726 33,053
Sara Lee Corp 5,133 142,441 9,905 274,864
Schering-Plough Corp 3,930 183,236 7,706 359,292
Schlumberger Ltd 2,597 167,507 5,057 326,177
Scientific-Atlanta Inc 855 17,100 1,553 31,060
Scott Paper Co 1,566 72,623 3,102 143,855
Shared Medical System Corp 258 9,514 494 18,216
Shoney's Inc + 396 4,604 804 9,347
Sigma Aldrich Corp 496 23,808 971 46,608
Silicon Graphics Inc + 1,684 71,149 3,233 136,594
Southwest Airlines Co 1,573 40,701 3,064 79,281
Stone Container Corp + 1,068 23,229 2,046 44,501
Sysco Corp 1,953 56,149 3,766 108,273
Tektronix Inc 333 15,193 676 30,843
Tele-Communication Inc Class A + 6,927 128,150 13,557 250,805
Teledyne Inc 606 14,482 1,105 26,407
Tellabs Inc + 900 42,075 1,800 84,150
Texas Instruments Inc 1,954 146,306 3,914 293,061
Time Warner Inc 4,054 170,775 7,812 329,081
Tribune Co 729 48,843 1,372 91,924
Trinova Corp 329 12,091 590 21,683
Tyco International Inc 798 $ 47,182 1,591 $ 94,068
</TABLE>
30 31
<PAGE> 175
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
UST Inc 234 6,377 1,043 28,422 2,631 71,695
USAir Group Inc + 129 1,048 351 2,852 751 6,102
U.S. Healthcare Inc 208 6,656 921 29,472 2,121 67,872
Unocal Corp 323 9,407 1,309 38,125 3,265 95,093
Viacom Inc Class B + 472 22,951 1,951 94,867 4,760 231,455
WMX Technologies Inc 622 18,271 2,661 78,167 6,403 188,088
Wal Mart Stores Inc 2,902 71,462 12,778 314,658 30,346 747,270
Walgreen Co 380 9,310 1,412 34,594 3,202 78,449
Warner Lambert Co 159 14,370 799 72,210 1,746 157,795
Whitman Corp 60 1,200 601 12,020 1,367 27,340
Winn-Dixie Stores Inc 80 4,760 400 23,800 971 57,775
Worthington Industries Inc 33 660 477 9,540 1,139 22,780
Wrigley (Wm) Jr Co 179 8,077 695 31,362 1,552 70,034
LARGE CAP GROWTH STOCKS - VALUE $ 2,626,863 $ 11,544,995 $ 27,471,549
- COST $ 2,326,091 $ 9,749,950 $ 23,196,437
LARGE CAP VALUE STOCKS
PERCENT OF NET ASSETS 7.1% 17.2% 22.0%
AMR Corp + 183 $ 12,902 478 $ 33,699 955 $ 67,328
Advanced Micro Devices + 344 11,610 683 23,051 1,395 47,081
Aetna Life & Casualty Co 372 25,389 665 45,386 1,511 103,126
Ahmanson (H F) & Co 380 9,025 698 16,578 1,532 36,385
Air Products & Chemicals Inc 375 20,109 668 35,822 1,500 80,438
Alberto-Culver Co Class B 48 1,368 222 6,327 410 11,685
Alcan Aluminium Ltd 668 21,794 1,429 46,621 2,977 97,125
Allied Signal Inc 499 22,143 1,826 81,029 3,721 165,119
Allstate Corp 1,304 44,173 2,780 94,173 5,960 201,895
Aluminum Co of America 560 31,990 1,148 65,580 2,354 134,472
Amerada Hess Corp 338 16,013 582 27,572 1,245 58,982
Amdahl Corp + 327 2,984 745 6,798 1,518 13,852
American Brands Inc 603 25,326 1,141 47,922 2,521 105,882
American Electric Power Inc 548 18,701 1,162 39,653 2,429 82,890
American Express Corp 1,441 58,180 3,114 125,728 6,589 266,031
American General Corp 650 22,913 1,285 45,296 2,667 94,012
American Greetings Corp Class A 280 8,610 501 15,406 947 29,120
American Stores Co 475 13,953 941 27,642 1,955 57,428
Amoco Corp 1,444 92,055 3,139 200,111 6,583 419,666
Apple Computer Inc 380 16,340 798 34,314 1,563 67,209
Archer-Daniels-Midland Co 1,762 29,292 3,350 55,690 7,158 118,999
Armstrong World Industries Inc 90 5,164 213 12,221 534 30,638
ASARCO Inc 123 3,982 221 7,155 584 18,907
Ashland Inc 156 5,109 402 13,166 802 26,266
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
UST Inc 2,086 56,844 3,944 107,474
USAir Group Inc + 620 5,038 1,187 9,644
U.S. Healthcare Inc 1,664 53,248 3,279 104,928
Unocal Corp 2,595 75,579 4,957 144,373
Viacom Inc Class B + 3,800 184,775 7,457 362,597
WMX Technologies Inc 5,158 151,516 9,996 293,633
Wal Mart Stores Inc 24,534 604,150 47,492 1,169,491
Walgreen Co 2,658 65,121 4,972 121,814
Warner Lambert Co 1,449 130,953 2,720 245,820
Whitman Corp 1,078 21,560 2,161 43,220
Winn-Dixie Stores Inc 783 46,589 1,549 92,166
Worthington Industries Inc 974 19,480 1,849 36,980
Wrigley (Wm) Jr Co 1,227 55,368 2,337 105,457
LARGE CAP GROWTH STOCKS - VALUE $ 22,158,637 $ 42,990,902
- COST $ 18,718,654 $ 36,620,203
LARGE CAP VALUE STOCKS
PERCENT OF NET ASSETS 25.8% 27.5%
AMR Corp + 788 $ 55,554 1,288 $ 90,804
Advanced Micro Devices + 1,106 37,328 1,633 55,114
Aetna Life & Casualty Co 1,161 79,238 1,874 127,901
Ahmanson (H F) & Co 1,181 28,049 1,832 43,510
Air Products & Chemicals Inc 1,167 62,580 1,864 99,957
Alberto-Culver Co Class B 334 9,519 481 13,709
Alcan Aluminium Ltd 2,375 77,484 3,701 120,745
Allied Signal Inc 2,990 132,681 4,659 206,743
Allstate Corp 4,686 158,738 9,533 322,930
Aluminum Co of America 1,821 104,025 2,955 168,804
Amerada Hess Corp 933 44,201 1,483 70,257
Amdahl Corp + 1,245 11,361 1,848 16,863
American Brands Inc 1,976 82,992 3,085 129,570
American Electric Power Inc 1,932 65,930 3,011 102,750
American Express Corp 5,189 209,506 8,125 328,047
American General Corp 2,133 75,188 3,301 116,360
American Greetings Corp Class A 779 23,954 1,175 36,131
American Stores Co 1,513 44,444 2,353 69,119
Amoco Corp 5,192 330,990 8,214 523,643
Apple Computer Inc 1,311 56,373 1,936 83,248
Archer-Daniels-Midland Co 5,757 95,713 8,898 147,928
Armstrong World Industries Inc 377 21,630 598 34,310
ASARCO Inc 420 13,598 658 21,303
Ashland Inc 672 22,008 971 31,800
</TABLE>
32 33
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MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Baker Hughes Inc 471 $ 10,598 888 $ 19,980 1,892 $ 42,570
Ball Corp 52 1,768 175 5,950 447 15,198
Bally Entertainment Corp + 107 1,297 304 3,686 742 8,997
Baltimore Gas & Electric Co 481 12,626 872 22,890 1,993 52,316
Banc One Corp 1,137 38,232 2,462 82,785 5,197 174,749
Bank of Boston Corp 360 15,840 653 28,732 1,494 65,736
Bank of New York Inc 539 23,447 1,210 52,635 2,503 108,881
BankAmerica Corp 1,121 63,337 2,298 129,837 4,934 278,771
Bankers Trust N Y Corp 190 13,086 485 33,404 995 68,531
Barnett Banks Inc 245 13,996 615 35,132 1,315 75,119
Bassett Furniture Industries 25 619 50 1,238 200 4,950
Bausch & Lomb Inc 154 6,122 400 15,900 765 30,409
Baxter International Inc 809 31,551 1,744 68,016 3,651 142,389
Becton Dickenson & Co 177 9,978 448 25,256 843 47,524
BellSouth Corp 1,444 99,275 3,139 215,806 6,591 453,131
Beneficial Corp 142 6,976 363 17,832 695 34,142
Bethlehem Steel Corp + 362 5,294 656 9,594 1,426 20,855
Beverly Enterprises + 220 2,915 591 7,831 1,250 16,563
Black & Decker Corp 322 10,425 542 17,547 1,157 37,458
Boatmen's Bancshares Inc 457 16,909 751 27,787 1,614 59,718
Boeing Co 946 60,308 2,126 135,533 4,507 287,321
Boise Cascade Corp 167 7,160 314 13,463 645 27,654
Briggs & Stratton Corp 50 1,894 149 5,643 372 14,090
Brown-Forman Corp Class B 271 10,027 442 16,354 866 32,042
Brown Group Inc 31 566 80 1,460 238 4,344
Bruno's Inc 7 72 13 133 28 287
Brunswick Corp 342 6,883 562 11,310 1,276 25,680
Burlington Northern Inc 131 9,072 574 39,750 1,205 83,446
Burlington Resources Inc 427 17,454 744 30,411 1,679 68,629
CIGNA Corp 176 17,028 447 43,247 942 91,139
CSX Corp 259 21,368 627 51,728 1,384 114,180
Carolina Power & Light Co 506 15,496 1,021 31,268 2,047 62,689
Caterpillar Inc 307 20,607 1,241 83,302 2,645 177,546
Centex Corp 55 1,609 128 3,744 352 10,296
Central & South West Corp 581 14,235 1,144 28,028 2,553 62,549
Champion International Corp 238 13,477 582 32,956 1,247 70,611
Charming Shoppes Inc 305 1,601 574 3,014 1,292 6,783
Chase Manhattan Corp 548 31,510 1,061 61,008 2,328 133,860
Chemical Banking Corp Class A 742 43,222 1,500 87,375 3,185 185,526
Chevron Corp 1,842 89,107 4,027 194,806 8,640 417,960
Chrysler Corp 1,095 58,993 2,324 125,206 4,861 261,886
Chubb Corp 229 20,896 523 47,724 1,100 100,375
Cinergy Corp 470 12,044 962 24,651 2,017 51,686
Citicorp 1,177 78,123 2,480 164,610 5,239 347,739
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Baker Hughes Inc 1,482 $ 33,345 2,182 $ 49,095
Ball Corp 337 11,458 497 16,898
Bally Entertainment Corp + 464 5,626 692 8,391
Baltimore Gas & Electric Co 1,577 41,396 2,379 62,449
Banc One Corp 4,089 137,493 6,466 217,419
Bank of Boston Corp 1,136 49,984 1,777 78,188
Bank of New York Inc 1,988 86,478 3,160 137,460
BankAmerica Corp 3,902 220,463 6,115 345,498
Bankers Trust N Y Corp 802 55,238 1,336 92,017
Barnett Banks Inc 974 55,640 1,565 89,401
Bassett Furniture Industries 120 2,970 206 5,099
Bausch & Lomb Inc 570 22,658 959 38,120
Baxter International Inc 2,893 112,827 4,637 180,843
Becton Dickenson & Co 659 37,151 1,132 63,817
BellSouth Corp 5,189 356,744 8,136 559,350
Beneficial Corp 530 26,036 858 42,149
Bethlehem Steel Corp + 1,138 16,643 1,683 24,614
Beverly Enterprises + 1,045 13,846 1,540 20,405
Black & Decker Corp 843 27,292 1,392 45,066
Boatmen's Bancshares Inc 1,327 49,099 2,071 76,627
Boeing Co 3,552 226,440 5,612 357,765
Boise Cascade Corp 488 20,923 709 30,398
Briggs & Stratton Corp 357 13,521 427 16,173
Brown-Forman Corp Class B 735 27,195 1,089 40,293
Brown Group Inc 221 4,033 253 4,617
Bruno's Inc 22 226 34 349
Brunswick Corp 948 19,079 1,532 30,832
Burlington Northern Inc 910 63,018 1,485 102,836
Burlington Resources Inc 1,310 53,546 2,052 83,876
CIGNA Corp 767 74,207 1,257 121,615
CSX Corp 1,127 92,978 1,774 146,355
Carolina Power & Light Co 1,663 50,929 2,555 78,247
Caterpillar Inc 2,089 140,224 3,264 219,096
Centex Corp 343 10,033 458 13,397
Central & South West Corp 1,947 47,702 3,165 77,543
Champion International Corp 933 52,831 1,512 85,617
Charming Shoppes Inc 994 5,219 1,604 8,421
Chase Manhattan Corp 1,831 105,283 2,910 167,325
Chemical Banking Corp Class A 2,557 148,945 4,002 233,117
Chevron Corp 6,784 328,176 10,727 518,919
Chrysler Corp 3,858 207,850 6,111 329,230
Chubb Corp 909 82,946 1,425 130,031
Cinergy Corp 1,625 41,641 2,515 64,447
Citicorp 4,121 273,531 6,552 434,889
</TABLE>
34 35
<PAGE> 177
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Coastal Corp 358 $ 11,725 627 $ 20,534 1,390 $ 45,523
Columbia Gas System Inc + 139 4,900 360 12,690 672 23,688
Community Psychiatric Centers + 101 1,187 273 3,208 606 7,121
Conrail Inc 190 12,778 485 32,616 997 67,048
Consolidated Edison Co 785 22,176 1,472 41,584 3,069 86,699
Consolidated Freightways 162 4,192 261 6,753 610 15,784
Consolidated Natural Gas Co 338 13,055 582 22,480 1,241 47,934
Cooper Industries Inc 378 14,364 695 26,410 1,431 54,378
Coors (Adolph) Co Class B 67 1,139 265 4,505 541 9,197
CoreStates Financial Corp 477 17,649 942 34,854 1,860 68,820
Cray Research Inc + 46 1,070 119 2,767 290 6,743
Crown Cork & Seal Co + 330 14,850 575 25,875 1,212 54,540
Cummins Engine Co Inc 123 4,828 220 8,635 557 21,862
Cyprus Amax Minerals 336 9,408 581 16,268 1,268 35,504
Dana Corp 348 10,397 616 18,403 1,312 39,196
Data General Corp + 62 605 161 1,570 595 5,801
Dayton-Hudson Corp 75 5,484 445 32,541 934 68,299
Dean Witter Discover & Co 524 26,724 1,064 54,264 2,235 113,985
Deere & Co 226 19,323 521 44,546 1,096 93,708
Delta Air Lines Inc 138 10,264 360 26,775 666 49,534
Detroit Edison Co 482 14,761 923 28,267 1,869 57,238
Digital Equipment Corp + 467 19,497 884 36,907 1,958 81,747
Dillard Department Stores Inc Class A 373 11,516 666 20,563 1,498 46,251
Dominion Resources Inc 520 18,785 1,060 38,293 2,321 83,846
Donnelley (R R) & Sons Co 503 19,114 991 37,658 2,058 78,204
Dow Chemical Co 782 57,868 1,716 126,984 3,669 271,506
Dow Jones & Co Inc 350 12,819 618 22,634 1,244 45,562
Dresser Industries Inc 257 6,168 1,121 26,904 2,374 56,976
DuPont (E I) de Nemours 1,596 104,339 3,448 225,413 7,285 476,257
Duke Power Co 609 24,741 1,247 50,659 2,662 108,144
EG & G Inc 123 2,337 369 7,011 685 13,015
Eastern Enterprises 37 1,133 85 2,603 225 6,891
Eaton Corp 83 4,492 477 25,818 984 53,259
Echlin Inc 153 5,279 400 13,800 765 26,393
Echo Bay Mines Ltd 371 3,849 765 7,937 1,462 15,168
Enserch Corp 242 3,963 438 7,172 871 14,263
Entergy Corp 679 16,296 1,464 35,136 3,001 72,024
Exxon Corp 3,526 242,413 7,798 536,113 16,394 1,127,088
FPL Group Inc 583 22,664 1,145 44,512 2,479 96,371
Federal Express Corp + 148 10,619 394 28,270 757 54,315
Federal Home Loan Mortgage Corp 541 34,759 1,105 70,996 2,344 150,602
Federal National Mortgage Association 779 74,297 1,687 160,898 3,610 344,304
Federal Paper Board Co 124 4,914 321 12,720 559 22,150
First Chicago Corp 237 15,020 582 36,884 1,166 73,895
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Coastal Corp 1,103 $ 36,123 1,673 $ 54,791
Columbia Gas System Inc + 487 17,167 824 29,046
Community Psychiatric Centers + 412 4,841 724 8,507
Conrail Inc 797 53,598 1,341 90,182
Consolidated Edison Co 2,441 68,958 3,828 108,141
Consolidated Freightways 473 12,239 638 16,508
Consolidated Natural Gas Co 933 36,037 1,511 58,362
Cooper Industries Inc 1,124 42,712 1,776 67,488
Coors (Adolph) Co Class B 355 6,035 560 9,520
CoreStates Financial Corp 1,512 55,944 2,359 87,283
Cray Research Inc + 204 4,743 415 9,649
Crown Cork & Seal Co + 916 41,220 1,479 66,555
Cummins Engine Co Inc 418 16,407 653 25,630
Cyprus Amax Minerals 929 26,012 1,506 42,168
Dana Corp 1,078 32,205 1,649 49,264
Data General Corp + 362 3,530 611 5,957
Dayton-Hudson Corp 765 55,941 1,227 89,724
Dean Witter Discover & Co 1,725 87,975 2,786 142,086
Deere & Co 953 81,482 1,403 119,957
Delta Air Lines Inc 572 42,543 875 65,078
Detroit Edison Co 1,534 46,979 2,380 72,888
Digital Equipment Corp + 1,572 65,631 2,396 100,033
Dillard Department Stores Inc Class A 1,165 35,969 1,783 55,050
Dominion Resources Inc 1,819 65,711 2,770 100,066
Donnelley (R R) & Sons Co 1,623 61,674 2,487 94,506
Dow Chemical Co 2,862 211,788 4,501 333,074
Dow Jones & Co Inc 989 36,222 1,589 58,197
Dresser Industries Inc 1,916 45,984 2,953 70,872
DuPont (E I) de Nemours 5,738 375,122 9,066 592,690
Duke Power Co 2,090 84,906 3,356 136,338
EG & G Inc 515 9,785 864 16,416
Eastern Enterprises 179 5,482 282 8,636
Eaton Corp 787 42,596 1,314 71,120
Echlin Inc 574 19,803 956 32,982
Echo Bay Mines Ltd 1,118 11,599 1,722 17,866
Enserch Corp 699 11,446 1,013 16,588
Entergy Corp 2,392 57,408 3,750 90,000
Exxon Corp 12,926 888,663 20,475 1,407,656
FPL Group Inc 1,909 74,212 3,071 119,385
Federal Express Corp + 551 39,534 941 67,517
Federal Home Loan Mortgage Corp 1,893 121,625 3,024 194,292
Federal National Mortgage Association 2,828 269,721 4,444 423,847
Federal Paper Board Co 420 16,643 756 29,957
First Chicago Corp 930 58,939 1,477 93,605
</TABLE>
36 37
<PAGE> 178
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
First Fidelity Bancorp 215 $ 14,056 485 $ 31,707 1,099 $ 71,847
First Interstate Bancorp 195 18,623 488 46,604 1,002 95,691
First Mississippi Corp 35 1,159 84 2,783 314 10,401
First Union Corp 523 26,215 1,065 53,383 2,236 112,080
Fleet Financial Group Inc 466 17,242 931 34,447 1,828 67,636
Fleetwood Enterprises Inc 130 2,551 252 4,946 616 12,089
Fleming Co Inc 165 4,806 213 6,204 508 14,796
Ford Motor Co 3,030 92,794 6,422 196,674 13,543 414,754
Fruit of the Loom Inc Class A + 214 5,029 450 10,575 954 22,419
GTE Corp 2,826 103,502 6,043 221,325 12,767 467,591
General Dynamics Corp 161 8,473 407 21,418 807 42,468
General Motors Corp 2,180 102,460 4,636 217,892 9,887 464,689
General Public Utilities 387 11,078 684 19,580 1,557 44,569
General Re Corp 197 29,279 542 80,555 1,132 168,244
General Signal Corp 33 1,172 255 9,053 663 23,537
Georgia-Pacific Corp 133 11,970 576 51,840 1,207 108,630
Giant Food Inc Class A 154 4,793 401 12,481 796 24,776
Giddings & Lewis Inc 60 983 183 2,997 473 7,745
Golden West Financial 162 7,736 408 19,482 808 38,582
Goodrich (B F) Co 45 2,678 118 7,021 314 18,683
Goodyear Tire & Rubber Co 490 19,600 981 39,240 2,032 81,280
Great Atlantic & Pacific Tea Co 167 4,739 215 6,101 541 15,351
Great Western Financial Corp 457 10,682 850 19,869 1,814 42,402
Halliburton Co 375 15,891 668 28,307 1,525 64,622
Handleman Co 59 561 132 1,254 467 4,437
Harcourt General Inc 86 3,580 480 19,980 908 37,796
Harris Corp 95 5,474 217 12,505 544 31,348
Hasbro Inc 329 10,651 524 16,965 1,126 36,454
Helmerich & Payne Inc 43 1,231 142 4,065 367 10,505
Hershey Foods Corp 229 13,711 523 31,315 1,175 70,353
Honeywell Inc 429 18,769 746 32,638 1,679 73,456
Household International Inc 341 19,139 585 32,833 1,280 71,840
Houston Industries Inc 429 18,179 846 35,849 1,780 75,428
ITT Corp 281 33,615 696 83,259 1,434 171,542
Inco Ltd 379 13,265 697 24,395 1,530 53,550
Ingersoll-Rand Co 360 13,635 653 24,732 1,387 52,533
Inland Steel Industries Inc 97 2,655 346 9,472 606 16,589
Intergraph Corp + 104 1,287 202 2,500 722 8,935
International Business Machines Corp 1,669 172,533 3,584 370,496 7,679 793,817
International Paper Co 392 32,095 810 66,319 1,631 133,538
James River Corp 218 7,576 489 16,993 1,047 36,383
Jefferson-Pilot Corp 136 8,551 258 16,222 655 41,183
Johnson Controls Inc 96 5,844 219 13,332 546 33,238
K Mart Corp 1,384 18,857 2,812 38,314 5,999 81,736
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
First Fidelity Bancorp 805 $ 52,627 1,320 $ 86,295
First Interstate Bancorp 815 77,833 1,254 119,757
First Mississippi Corp 224 7,420 348 11,528
First Union Corp 1,830 91,729 2,834 142,054
Fleet Financial Group Inc 1,493 55,241 2,307 85,359
Fleetwood Enterprises Inc 464 9,106 683 13,404
Fleming Co Inc 382 11,126 599 17,446
Ford Motor Co 10,697 327,596 16,859 516,307
Fruit of the Loom Inc Class A + 744 17,484 1,780 41,830
GTE Corp 10,161 372,147 16,001 586,037
General Dynamics Corp 609 32,049 1,039 54,677
General Motors Corp 7,768 365,096 12,292 577,724
General Public Utilities 1,168 33,434 1,844 52,785
General Re Corp 820 121,873 1,364 202,725
General Signal Corp 493 17,502 701 24,886
Georgia-Pacific Corp 923 83,070 1,493 134,370
Giant Food Inc Class A 640 19,920 885 27,546
Giddings & Lewis Inc 364 5,961 527 8,630
Golden West Financial 591 28,220 995 47,511
Goodrich (B F) Co 281 16,720 420 24,990
Goodyear Tire & Rubber Co 1,572 62,880 2,461 98,440
Great Atlantic & Pacific Tea Co 405 11,492 578 16,401
Great Western Financial Corp 1,441 33,683 2,103 49,158
Halliburton Co 1,168 49,494 1,863 78,945
Handleman Co 307 2,917 521 4,950
Harcourt General Inc 792 32,967 1,127 46,911
Harris Corp 409 23,569 614 35,382
Hasbro Inc 964 31,210 1,426 46,167
Helmerich & Payne Inc 215 6,154 408 11,679
Hershey Foods Corp 890 53,289 1,323 79,215
Honeywell Inc 1,315 57,531 2,069 90,519
Household International Inc 962 53,992 1,624 91,147
Houston Industries Inc 1,341 56,825 2,111 89,454
ITT Corp 1,130 135,176 1,734 207,430
Inco Ltd 1,233 43,155 1,930 67,550
Ingersoll-Rand Co 1,130 42,799 1,675 63,441
Inland Steel Industries Inc 542 14,837 782 21,407
Intergraph Corp + 511 6,324 737 9,120
International Business Machines Corp 6,043 624,695 9,538 985,991
International Paper Co 1,283 105,046 2,092 171,283
James River Corp 813 28,252 1,323 45,974
Jefferson-Pilot Corp 472 29,677 836 52,564
Johnson Controls Inc 416 25,324 621 37,803
K Mart Corp 4,681 63,779 7,312 99,626
</TABLE>
38 39
<PAGE> 179
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Kaufman & Broad Home Corp 57 $ 762 130 $ 1,739 444 $ 5,939
Kerr-McGee Corp 141 7,755 362 19,910 668 36,740
KeyCorp 723 22,413 1,434 44,454 3,090 95,790
Knight-Ridder Inc 145 8,156 266 14,963 625 35,156
Laidlaw Inc Class B 881 7,929 1,692 15,228 3,661 32,949
Lincoln National Corp 340 14,620 560 24,080 1,298 55,814
Liz Claiborne Inc 188 4,277 483 10,988 1,013 23,046
Loews Corp 200 26,275 400 52,550 800 105,100
Longs Drug Stores Corp 37 1,369 85 3,145 249 9,213
Loral Corp 221 12,100 541 29,620 1,156 63,291
Louisiana Land & Exploration Co 83 3,175 181 6,923 400 15,300
Louisiana-Pacific Corp 368 8,740 662 15,723 1,433 34,034
Luby's Cafeterias Inc 45 894 119 2,365 280 5,565
MCI Communications 1,115 26,830 4,192 100,870 9,009 216,779
Mallinckrodt Group Inc 284 10,686 480 18,060 1,057 39,770
Masco Corp 499 13,972 1,015 28,420 2,081 58,268
May Co Department Stores Co 735 31,146 1,545 65,469 3,244 137,465
Maytag Corp 362 5,611 706 10,943 1,417 21,964
McDermott International Inc 144 3,276 365 8,304 702 15,971
McDonnell Douglas Corp 382 30,656 749 60,107 1,530 122,783
Mead Corp 154 9,452 400 24,550 765 46,952
Mellon Bank Corp 463 21,935 943 44,675 1,952 92,476
Melville Corp 360 12,015 653 21,794 1,412 47,126
Mercantile Stores Co Inc 90 4,129 263 12,065 532 24,406
Meredith Corp 50 1,963 198 7,772 360 14,130
Merrill Lynch & Co Inc 508 29,274 1,066 61,428 2,349 135,361
Mobil Corp 1,098 104,585 2,423 230,791 5,177 493,109
Monsanto Co 383 36,337 700 66,413 1,464 138,897
Moore Corp Ltd 350 7,306 619 12,922 1,345 28,077
Morgan (J P) & Co Inc 589 42,923 1,201 87,523 2,512 183,062
Morrison Knudsen Corp 55 426 229 1,775 367 2,844
NBD Bancorp Inc 506 18,090 1,020 36,465 2,147 76,755
NACCO Industries Inc Class A 16 920 40 2,300 154 8,855
National City Corp 473 14,072 940 27,965 1,913 56,912
National Semiconductor + 410 11,583 803 22,685 1,589 44,889
National Service Industries Inc 137 3,973 259 7,511 685 19,865
NationsBank 772 47,382 1,708 104,829 3,626 222,546
Navistar International Corp + 181 2,353 477 6,201 1,034 13,442
New York Times Co Class A 262 6,517 629 15,646 1,295 32,213
Niagara Mohawk Power Corp 475 5,700 891 10,692 1,951 23,412
NICOR Inc 142 3,639 264 6,765 719 18,424
Nike Inc Class B 180 16,673 500 46,313 972 90,032
NorAm Energy Corp 364 2,594 658 4,688 1,584 11,286
Nordstrom Inc 119 4,909 537 22,151 1,126 46,448
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Kaufman & Broad Home Corp 343 $ 4,588 464 $ 6,206
Kerr-McGee Corp 579 31,845 881 48,455
KeyCorp 2,495 77,345 3,830 118,730
Knight-Ridder Inc 537 30,206 803 45,169
Laidlaw Inc Class B 2,802 25,218 4,280 38,520
Lincoln National Corp 961 41,323 1,543 66,349
Liz Claiborne Inc 809 18,405 1,131 25,730
Loews Corp 600 78,825 1,000 131,375
Longs Drug Stores Corp 184 6,808 275 10,175
Loral Corp 837 45,826 1,383 75,719
Louisiana Land & Exploration Co 372 14,229 514 19,661
Louisiana-Pacific Corp 1,157 27,479 1,709 40,589
Luby's Cafeterias Inc 269 5,346 421 8,367
MCI Communications 7,079 170,338 11,228 270,174
Mallinckrodt Group Inc 795 29,912 1,193 44,887
Masco Corp 1,594 44,632 2,507 70,196
May Co Department Stores Co 2,619 110,980 4,026 170,602
Maytag Corp 1,135 17,593 1,667 25,839
McDermott International Inc 539 12,262 791 17,995
McDonnell Douglas Corp 1,223 98,146 1,834 147,179
Mead Corp 569 34,922 959 58,859
Mellon Bank Corp 1,551 73,479 2,363 111,947
Melville Corp 1,130 37,714 1,674 55,870
Mercantile Stores Co Inc 377 17,295 596 27,342
Meredith Corp 244 9,577 468 18,369
Merrill Lynch & Co Inc 1,833 105,627 2,895 166,824
Mobil Corp 4,088 389,382 6,557 624,554
Monsanto Co 1,210 114,799 1,848 175,329
Moore Corp Ltd 1,036 21,627 1,556 32,482
Morgan (J P) & Co Inc 1,918 139,774 3,094 225,475
Morrison Knudsen Corp 343 2,658 563 4,363
NBD Bancorp Inc 1,663 59,452 2,554 91,306
NACCO Industries Inc Class A 51 2,933 165 9,488
National City Corp 1,561 46,440 2,332 69,377
National Semiconductor + 1,320 37,290 1,980 55,935
National Service Industries Inc 474 13,746 715 20,735
NationsBank 2,837 174,121 4,467 274,162
Navistar International Corp + 755 9,815 1,152 14,976
New York Times Co Class A 1,014 25,223 1,532 38,109
Niagara Mohawk Power Corp 1,467 17,604 2,202 26,424
NICOR Inc 497 12,736 793 20,321
Nike Inc Class B 775 71,784 1,242 115,040
NorAm Energy Corp 1,230 8,764 2,080 14,820
Nordstrom Inc 862 35,558 1,285 53,006
</TABLE>
40 41
<PAGE> 180
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Norfolk Southern Corp 342 $ 24,197 808 $ 57,166 1,741 $ 123,176
Northern States Power Co 167 7,118 438 18,670 851 36,274
Northrop Grumman Corp 136 8,279 258 15,706 668 40,665
Norwest Corp 1,008 30,366 2,036 61,335 4,248 127,971
NYNEX Corp 1,252 56,340 2,653 119,385 5,610 252,450
Occidental Petroleum Corp 986 21,446 1,969 42,826 4,165 90,589
Ogden Corp 201 4,673 325 7,556 684 15,903
Ohio Edison Co 493 10,661 983 21,257 2,041 44,137
ONEOK Inc 47 1,028 120 2,625 406 8,881
Outboard Marine Corp 35 748 84 1,796 324 6,926
PECO Energy Co 663 17,652 1,425 37,941 2,942 78,331
PNC Bank Corp 786 20,633 1,472 38,640 2,969 77,936
PACCAR Inc 93 4,604 215 10,643 542 26,829
Pacific Enterprises 298 7,152 492 11,808 1,106 26,544
Pacific Gas & Electric Co 1,273 36,599 2,698 77,568 5,710 164,163
Pacific Telesis Group 1,264 35,866 2,664 75,591 5,635 159,893
PacifiCorp 894 16,204 1,727 31,302 3,748 67,933
Panhandle Eastern Corp 424 10,600 977 24,425 1,992 49,800
Parker Hannifin Corp 202 8,004 487 19,297 1,013 40,140
Penney (J C) Co Inc 688 31,132 1,474 66,699 3,097 140,139
Pennzoil Co 130 5,720 253 11,132 637 28,028
Peoples Energy Corp 161 4,387 184 5,014 484 13,189
Phelps Dodge Corp 174 11,027 445 28,202 914 57,925
Pittston Services Group 123 3,121 220 5,583 557 14,134
Polaroid Corp 132 5,759 254 11,081 613 26,742
Potlatch Corp 76 3,012 224 8,876 346 13,710
Price/Costco Inc + 556 9,383 1,212 20,453 2,569 43,352
Providian Corp 351 13,470 619 23,754 1,318 50,578
Public Services Enterprise Group 829 22,798 1,564 43,010 3,205 88,138
Pulte Corp 48 1,296 122 3,294 398 10,746
Raychem Corp 125 5,484 322 14,128 610 26,764
Raytheon Co 362 29,277 800 64,700 1,621 131,098
Republic New York Corp 200 11,250 300 16,875 400 22,500
Reynolds Metals Co 156 9,321 403 24,079 802 47,920
Rite Aid Corp 304 8,512 548 15,344 1,071 29,988
Roadway Services Inc 93 5,115 216 11,880 540 29,700
Rockwell International Corp 661 29,580 1,323 59,204 2,811 125,792
Rohm & Haas Co 169 10,098 439 26,230 873 52,162
Rowan Co Inc + 272 2,210 492 3,998 958 7,784
Russell Corp 173 4,758 220 6,050 556 15,290
Ryan's Family Steak House + 119 893 316 2,370 712 5,340
Ryder System Inc 286 6,936 481 11,664 1,089 26,408
SBC Communication Inc 1,002 50,726 3,756 190,148 8,059 407,987
SCEcorp 1,410 23,441 2,782 46,251 5,904 98,154
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Norfolk Southern Corp 1,371 $ 96,998 2,173 $ 153,740
Northern States Power Co 729 31,074 1,068 45,524
Northrop Grumman Corp 469 28,550 858 52,231
Norwest Corp 3,409 102,696 5,316 160,145
NYNEX Corp 4,462 200,790 7,032 316,440
Occidental Petroleum Corp 3,331 72,449 5,162 112,274
Ogden Corp 506 11,765 744 17,298
Ohio Edison Co 1,578 34,124 2,473 53,479
ONEOK Inc 305 6,672 420 9,188
Outboard Marine Corp 224 4,788 348 7,439
PECO Energy Co 2,309 61,477 3,678 97,927
PNC Bank Corp 2,342 61,478 3,725 97,781
PACCAR Inc 407 20,147 612 30,294
Pacific Enterprises 823 19,752 1,274 30,576
Pacific Gas & Electric Co 4,484 128,915 7,078 203,493
Pacific Telesis Group 4,431 125,730 6,985 198,199
PacifiCorp 2,982 54,049 4,657 84,408
Panhandle Eastern Corp 1,525 38,125 2,361 59,025
Parker Hannifin Corp 752 29,798 1,234 48,897
Penney (J C) Co Inc 2,445 110,636 3,842 173,851
Pennzoil Co 484 21,296 784 34,496
Peoples Energy Corp 377 10,273 536 14,606
Phelps Dodge Corp 738 46,771 1,216 77,064
Pittston Services Group 443 11,241 604 15,327
Polaroid Corp 443 19,326 697 30,407
Potlatch Corp 331 13,116 468 18,545
Price/Costco Inc + 1,991 33,598 3,218 54,304
Providian Corp 984 37,761 1,587 60,901
Public Services Enterprise Group 2,504 68,860 4,054 111,485
Pulte Corp 321 8,667 433 11,691
Raychem Corp 422 18,515 669 29,352
Raytheon Co 1,251 101,175 2,066 167,088
Republic New York Corp 500 28,125 900 50,625
Reynolds Metals Co 686 40,989 1,019 60,885
Rite Aid Corp 839 23,492 1,298 36,344
Roadway Services Inc 387 21,285 618 33,990
Rockwell International Corp 2,231 99,837 3,554 159,042
Rohm & Haas Co 732 43,737 1,070 63,933
Rowan Co Inc + 845 6,866 1,296 10,530
Russell Corp 416 11,440 602 16,555
Ryan's Family Steak House + 579 4,343 839 6,293
Ryder System Inc 797 19,327 1,273 30,870
SBC Communication Inc 6,305 319,191 10,032 507,870
SCEcorp 4,694 78,038 7,204 119,767
</TABLE>
42 43
<PAGE> 181
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
SAFECO Corp 160 $ 10,340 406 $ 26,238 808 $ 52,217
Safety-Kleen Corp 226 3,051 398 5,373 743 10,031
St Paul Co Inc 223 12,098 543 29,458 1,143 62,008
Salomon Inc 369 14,160 636 24,407 1,407 53,994
Santa Fe Energy Resources Inc + 283 2,689 528 5,016 1,155 10,973
Santa Fe Pacific Corp 507 14,386 914 25,935 2,047 58,084
Seagram Co Ltd 1,128 41,736 2,305 85,285 4,955 183,335
Sears Roebuck & Co 1,191 38,559 2,468 79,902 5,130 166,084
Service Corp International 324 11,340 619 21,665 1,270 44,433
Shawmut National Corp 381 12,335 800 25,900 1,717 55,588
Sherwin Williams Co 227 8,144 546 19,588 1,167 41,866
Snap-On Inc 124 5,084 222 9,102 510 20,910
Sonat Inc 328 10,414 523 16,605 1,174 37,275
Southern Co 2,036 43,011 4,122 87,077 8,750 184,844
Springs Industries Inc Class A 31 1,337 80 3,450 312 13,455
Sprint Corp 1,077 38,234 2,157 76,574 4,574 162,377
Stanley Works 129 5,708 326 14,426 634 28,055
Stride Rite Corp 113 1,271 210 2,363 756 8,505
Sun Co Inc 262 6,976 655 17,439 1,425 37,941
Sun Microsystems Inc + 339 19,620 583 33,741 1,272 73,617
SunTrust Banks Inc 290 17,799 706 43,331 1,501 92,124
Super Value Inc 276 8,177 447 13,242 912 27,018
TJX Companies Inc 178 2,225 450 5,625 905 11,313
TRW Inc 163 12,694 434 33,798 841 65,493
Tandem Computers Inc + 375 4,594 693 8,489 1,521 18,632
Tandy Corp 261 16,215 507 31,497 933 57,963
Temple-Inland Inc 147 7,607 394 20,390 752 38,916
Tenet Healthcare Corp + 716 11,367 1,416 22,479 2,660 42,228
Tenneco Inc 521 25,269 1,164 56,454 2,378 115,333
Texaco Inc 754 48,822 1,638 106,061 3,382 218,985
Texas Utilities Co 670 23,283 1,457 50,631 2,989 103,868
Textron Inc 230 15,755 574 39,319 1,106 75,761
Thomas & Betts Corp 33 2,228 82 5,535 245 16,538
Times Mirror Co Class A 348 10,658 740 22,663 1,471 45,049
Timken Co 79 3,565 177 7,987 375 16,922
Torchmark Corp 278 11,120 448 17,920 920 36,800
Toys R Us Inc + 409 10,634 1,761 45,786 3,693 96,018
Transamerica Corp 174 11,832 445 30,260 914 62,152
Travelers Inc 917 44,016 1,971 94,608 4,226 202,848
USX - Marathon Group 902 18,604 1,859 38,342 3,889 80,211
UNUM Corp 183 8,784 477 22,896 954 45,792
USF & G Corp 324 5,873 620 11,238 1,331 24,124
USX - US Steel Group 282 9,236 478 15,655 1,079 35,337
Unicom Corp 649 18,253 1,387 39,009 2,821 79,341
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
SAFECO Corp 689 $ 44,527 990 $ 63,979
Safety-Kleen Corp 610 8,235 926 12,501
St Paul Co Inc 846 45,896 1,396 75,733
Salomon Inc 1,133 43,479 1,758 67,463
Santa Fe Energy Resources Inc + 875 8,313 1,390 13,205
Santa Fe Pacific Corp 1,587 45,031 2,424 68,781
Seagram Co Ltd 3,905 144,485 6,118 226,366
Sears Roebuck & Co 4,071 131,799 6,342 205,322
Service Corp International 1,052 36,820 1,531 53,585
Shawmut National Corp 1,306 42,282 2,091 67,696
Sherwin Williams Co 885 31,749 1,319 47,319
Snap-On Inc 422 17,302 668 27,388
Sonat Inc 862 27,369 1,420 45,085
Southern Co 6,964 147,115 10,903 230,326
Springs Industries Inc Class A 221 9,531 355 15,309
Sprint Corp 3,686 130,853 5,662 201,001
Stanley Works 436 19,293 680 30,090
Stride Rite Corp 532 5,985 821 9,236
Sun Co Inc 1,119 29,793 1,791 47,685
Sun Microsystems Inc + 959 55,502 1,539 89,070
SunTrust Banks Inc 1,178 72,300 1,872 114,894
Super Value Inc 743 22,011 1,107 32,795
TJX Companies Inc 772 9,650 1,140 14,250
TRW Inc 718 55,914 1,048 81,613
Tandem Computers Inc + 1,173 14,369 1,845 22,601
Tandy Corp 806 50,073 1,243 77,221
Temple-Inland Inc 550 28,463 934 48,335
Tenet Healthcare Corp + 2,003 31,798 3,594 57,055
Tenneco Inc 1,926 93,411 2,932 142,202
Texaco Inc 2,742 177,545 4,259 275,770
Texas Utilities Co 2,381 82,740 3,712 128,992
Textron Inc 910 62,335 1,427 97,750
Thomas & Betts Corp 175 11,813 359 24,233
Times Mirror Co Class A 1,221 37,393 1,765 54,053
Timken Co 335 15,117 480 21,660
Torchmark Corp 751 30,040 1,160 46,400
Toys R Us Inc + 2,867 74,542 4,470 116,220
Transamerica Corp 740 50,320 1,193 81,124
Travelers Inc 3,354 160,992 5,309 254,832
USX - Marathon Group 3,129 64,536 4,816 99,330
UNUM Corp 788 37,824 1,188 57,024
USF & G Corp 1,153 20,898 1,807 32,752
USX - US Steel Group 885 28,984 1,284 42,051
Unicom Corp 2,257 63,478 3,552 99,900
</TABLE>
44 45
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MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Union Camp Corp 172 $ 9,783 443 $ 25,196 887 $ 50,448
Union Carbide Corp 490 17,395 879 31,205 1,829 64,930
Union Electric Co 354 12,611 622 22,159 1,351 48,129
Union Pacific Corp 609 39,890 1,247 81,679 2,732 178,946
Unisys Corp + 523 4,184 1,014 8,112 2,233 17,864
United Healthcare Corp 239 10,098 1,053 44,489 2,255 95,274
U.S. Bancorp 350 10,019 618 17,690 1,249 35,753
United States Surgical 149 3,781 396 10,049 763 19,361
U.S. West Inc 1,344 58,464 2,891 125,759 6,205 269,918
United Technologies Corp 323 26,930 739 61,614 1,669 139,153
Upjohn Co 528 22,374 1,067 45,214 2,291 97,081
U.S. Life Corp 40 1,725 138 5,951 258 11,126
VF Corp 163 8,924 409 22,393 836 45,771
Varity Corp + 127 5,779 225 10,238 512 23,296
Wachovia Corp 525 20,869 1,065 42,334 2,262 89,915
Wells Fargo & Co 122 22,738 367 68,400 808 150,591
Wendy's International Inc 355 6,967 574 11,265 1,351 26,513
Western Atlas Inc + 132 5,990 356 16,154 689 31,263
Westinghouse Electric Corp 594 8,093 2,218 30,220 4,778 65,100
Westvaco Corp 168 7,413 438 19,327 876 38,654
Weyerhaeuser Co 610 28,060 1,323 60,858 2,732 125,672
Whirlpool Corp 180 9,810 501 27,305 973 53,029
Willamette Industries Inc 607 41,731 370 25,438 943 64,831
Williams Co Inc 357 13,075 623 22,817 1,377 50,433
Woolworth Corp 431 5,765 849 11,355 1,793 23,981
Xerox Corp 357 43,108 651 78,608 1,415 170,861
Yellow Corp 49 692 123 1,737 385 5,438
Zenith Electronic Corp + 95 808 192 1,632 503 4,276
Zurn Industries Inc 22 481 46 1,006 224 4,900
LARGE CAP VALUE STOCKS - VALUE $ 5,689,576 $ 12,343,153 $ 26,142,667
- COST $ 4,975,034 $ 10,899,992 $ 22,808,541
MEDIUM CAP GROWTH STOCKS
PERCENT OF NET ASSETS 2.9% 3.0% 3.4%
ADC Telecommunication + 586 $ 22,708 380 $ 14,725 948 $ 36,735
Adaptec Inc + -- -- 300 12,750 700 29,750
Adobe Systems Inc 619 31,569 410 20,910 1,006 51,306
Adtran Inc + -- -- -- -- -- --
Airgas Inc + -- -- -- -- -- --
Allegheny Ludlum Corp 772 16,212 510 10,710 1,186 24,906
Alliance Semiconductor Corp -- -- -- -- -- --
Altera Corp + 460 28,808 260 16,283 718 44,965
America Online Inc -- -- 200 13,175 -- --
American Power Conversion + 1,000 $ 16,750 680 $ 11,390 1,494 $ 25,025
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Union Camp Corp 741 $ 42,144 1,194 $ 67,909
Union Carbide Corp 1,470 52,185 2,261 80,266
Union Electric Co 1,096 39,045 1,605 57,178
Union Pacific Corp 2,191 143,511 3,366 220,473
Unisys Corp + 1,677 13,416 2,685 21,480
United Healthcare Corp 1,823 77,022 2,830 119,568
U.S. Bancorp 989 28,310 1,582 45,285
United States Surgical 557 14,134 919 23,320
U.S. West Inc 4,942 214,977 7,792 338,952
United Technologies Corp 1,293 107,804 2,031 169,335
Upjohn Co 1,759 74,538 2,855 120,981
U.S. Life Corp 264 11,385 389 16,776
VF Corp 613 33,562 1,049 57,433
Varity Corp + 435 19,793 673 30,622
Wachovia Corp 1,828 72,663 2,840 112,890
Wells Fargo & Co 629 117,230 1,076 200,540
Wendy's International Inc 1,043 20,469 1,608 31,557
Western Atlas Inc + 523 23,731 896 40,656
Westinghouse Electric Corp 3,652 49,759 5,725 78,003
Westvaco Corp 729 32,167 1,066 47,037
Weyerhaeuser Co 2,116 97,336 3,360 154,560
Whirlpool Corp 785 42,783 1,244 67,798
Willamette Industries Inc 618 42,488 1,185 81,469
Williams Co Inc 1,020 37,358 1,659 60,761
Woolworth Corp 1,389 18,578 2,096 28,034
Xerox Corp 1,127 136,085 1,770 213,728
Yellow Corp 299 4,223 437 6,173
Zenith Electronic Corp + 496 4,216 791 6,724
Zurn Industries Inc 80 1,750 241 5,272
LARGE CAP VALUE STOCKS - VALUE $ 20,595,797 $ 32,521,921
- COST $ 18,223,488 $ 29,202,617
MEDIUM CAP GROWTH STOCKS
PERCENT OF NET ASSETS 4.3% 5.8%
ADC Telecommunication + 608 $ 23,560 1,360 $ 52,700
Adaptec Inc + 600 25,500 1,100 46,750
Adobe Systems Inc 651 33,201 1,215 61,965
Adtran Inc + -- -- 200 6,250
Airgas Inc + -- -- 400 11,000
Allegheny Ludlum Corp 786 16,506 740 15,540
Alliance Semiconductor Corp -- -- 250 9,781
Altera Corp + 448 28,056 940 58,868
America Online Inc 200 13,175 500 32,938
American Power Conversion + 1,009 $ 16,901 1,460 $ 24,455
</TABLE>
46 47
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MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Amphenol Corp Class A + -- -- -- -- -- --
Anadarko Petroleum Corp 639 30,512 400 19,100 1,001 47,798
Analog Devices Inc + 801 27,735 530 18,351 1,253 43,385
Apria Healthcare Group Inc + -- -- -- -- -- --
Arrow International Inc -- -- -- -- -- --
Ascend Communication Inc -- -- 200 12,900 -- --
Atmel Corp + 962 30,423 560 17,710 1,566 49,525
AutoZone Inc + 1,000 26,875 800 21,500 1,600 43,000
BMC Software Inc + 556 23,700 440 18,755 766 32,651
Battle Mountain Gold Co 878 8,670 590 5,826 1,345 13,282
Bay Networks Inc + 1,162 55,195 820 38,950 1,750 83,125
Bed Bath & Beyond Inc + -- -- -- -- -- --
Best Buy Co Inc + -- -- -- -- -- --
Betz Labs Inc 296 12,395 240 10,050 427 17,881
BIC Corp -- -- -- -- -- --
Biogen Inc + 359 19,655 280 15,330 491 26,882
Boyd Gaming Corp + -- -- -- -- -- --
Brinker International Inc + 756 12,663 490 8,208 1,171 19,614
Broderbund Software Inc + -- -- 100 7,363 -- --
Cadence Design System Inc + 437 15,841 250 9,063 745 27,006
Callaway Golf Co 596 9,238 480 7,440 1,158 17,949
Cardinal Health Inc 441 23,594 240 12,840 709 37,932
Centocor Inc + 546 6,620 340 4,123 881 10,682
Chiron Corp + 224 20,104 173 15,527 306 27,464
Cirrus Logic Corp + 634 34,553 380 20,710 996 54,282
Cintas Corp + 510 19,253 300 11,325 820 30,955
Circus Circus Entertainment Inc + 929 30,425 630 20,633 1,422 46,571
Clear Channel Communications Inc + -- -- -- -- -- --
Coleman Co Inc + -- -- -- -- -- --
Coltec Industries + -- -- -- -- -- --
Compuware Corp + -- -- 300 6,788 600 13,575
Consolidated Stores Corp + -- -- 300 6,600 100 2,200
Cordis Corp + 165 12,746 140 10,815 243 18,772
Cracker Barrel Old Country Store Inc 649 13,223 410 8,354 1,011 20,599
Credit Acceptance Corp + -- -- -- -- -- --
Crompton & Knowles Corp 550 8,319 340 5,143 885 13,386
Cypress Semiconductor + 400 18,250 220 10,038 682 31,116
Danaher Corp 600 19,800 380 12,540 962 31,746
Dell Computer Corp + 405 31,185 230 17,710 687 52,899
Dentsply International Inc -- -- -- -- -- --
Department 56 Inc + -- -- -- -- -- --
Diebold Inc 340 15,853 260 12,123 471 21,960
Dollar General Corp 602 15,803 375 9,844 955 25,069
Duracell International Inc 600 $ 26,775 400 $ 17,850 700 $ 31,238
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Amphenol Corp Class A + -- -- 400 9,800
Anadarko Petroleum Corp 646 30,847 1,115 53,241
Analog Devices Inc + 831 28,773 1,665 57,651
Apria Healthcare Group Inc + -- -- 700 19,600
Arrow International Inc -- -- 100 4,100
Ascend Communication Inc 200 12,900 400 25,800
Atmel Corp + 988 31,246 1,726 54,585
AutoZone Inc + 1,500 40,313 2,800 75,250
BMC Software Inc + 576 24,552 1,040 44,330
Battle Mountain Gold Co 895 8,838 1,645 16,244
Bay Networks Inc + 1,194 56,715 2,318 110,105
Bed Bath & Beyond Inc + -- -- 400 10,925
Best Buy Co Inc + -- -- 500 13,625
Betz Labs Inc 307 12,856 605 25,334
BIC Corp -- -- 100 3,975
Biogen Inc + 361 19,765 745 40,789
Boyd Gaming Corp + -- -- 500 7,250
Brinker International Inc + 771 12,914 1,530 25,628
Broderbund Software Inc + 200 14,725 300 22,088
Cadence Design System Inc + 465 16,856 840 30,450
Callaway Golf Co 756 11,718 1,116 17,298
Cardinal Health Inc 454 24,289 619 33,117
Centocor Inc + 566 6,863 1,220 14,793
Chiron Corp + 225 20,194 413 37,067
Cirrus Logic Corp + 666 36,297 1,310 71,395
Cintas Corp + 515 19,441 590 22,273
Circus Circus Entertainment Inc + 962 31,506 1,995 65,336
Clear Channel Communications Inc + -- -- 200 14,925
Coleman Co Inc + -- -- 100 3,775
Coltec Industries + -- -- 900 13,500
Compuware Corp + 400 9,050 700 15,838
Consolidated Stores Corp + 500 11,000 1,000 22,000
Cordis Corp + 183 14,137 355 27,424
Cracker Barrel Old Country Store Inc 671 13,672 1,325 26,997
Credit Acceptance Corp + -- -- 300 6,450
Crompton & Knowles Corp 570 8,621 1,030 15,579
Cypress Semiconductor + 412 18,798 885 40,378
Danaher Corp 622 20,526 580 19,140
Dell Computer Corp + 417 32,109 485 37,345
Dentsply International Inc -- -- 400 14,900
Department 56 Inc + 200 8,850 400 17,700
Diebold Inc 341 15,899 625 29,141
Dollar General Corp 618 16,223 980 25,725
Duracell International Inc 700 $ 31,238 1,300 $ 58,013
</TABLE>
48 49
<PAGE> 184
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
EMC Corp + 2,058 42,189 1,320 27,060 3,197 65,539
Eckerd (Jack) Corp Del + -- -- -- -- -- --
Electronic Arts Inc + -- -- 200 7,600 100 3,800
Enron Oil & Gas Co 1,000 23,250 -- -- -- --
Equifax Inc 805 31,294 550 21,381 1,271 49,410
Ethyl Corp 1,031 11,212 810 8,809 2,029 22,065
Fastenal Co -- -- -- -- -- --
Federal Signal Corp 498 10,769 290 6,271 807 17,451
First USA Inc 400 18,400 300 13,800 700 32,200
Forest Labs Inc Class A + 482 21,570 270 12,083 766 34,279
Foundation Health Corp + 609 21,087 382 13,227 965 33,413
Franklin Resources Inc + 896 49,280 600 33,000 1,363 74,965
Freeport McMoRan Inc + 1,529 8,601 980 5,513 2,307 12,977
Gateway 2000 Inc + -- -- -- -- -- --
General Instrument Corp + 600 21,900 500 18,250 900 32,850
General Nutrition Co Inc + -- -- 200 8,350 600 25,050
Georgia Gulf Corp 437 14,476 260 8,613 745 24,678
Glenayre Technologies Inc -- -- 300 19,575 450 29,363
Global Marine Inc + -- -- 800 5,400 2,715 18,326
Green Tree Financial Inc 500 29,125 400 23,300 800 46,600
GTECH Holdings Corp + -- -- 200 5,800 100 2,900
Guidant Corp + -- -- -- -- -- --
HBO & Co -- -- 200 11,000 400 22,000
Harley- Davidson Inc 818 22,700 550 15,263 1,259 34,937
Health Care Property Investors Inc -- -- 200 6,475
HealthCare Compare Corp + 384 14,448 290 10,911 516 19,415
Health Management Associates Inc Class A -- -- 200 6,700 100 3,350
Healthsource Inc + -- -- 200 8,000 -- --
Hillenbrand Industries Inc -- -- 200 5,925 -- --
HON Industries Inc 353 10,414 270 7,965 484 14,278
Hormel Foods Corp -- -- 200 4,800 100 2,400
Hospitality Franchise Systems Inc -- -- 300 14,063 -- --
Houghton Mifflin Co 152 7,429 120 5,865 230 11,241
Humana Inc + 1,200 21,900 1,100 20,075 1,900 34,675
ICN Pharmaceuticals Inc -- -- -- -- -- --
Illinois Central Corp 474 18,190 260 9,978 757 29,050
Infinity Broadcasting Corp Class A + -- -- 200 7,175 600 21,525
Informix Corp + 1,390 38,920 920 25,760 2,218 62,104
Integrated Device Technology Inc + -- -- 200 11,525 400 23,050
International Game Technology 1,397 19,907 900 12,825 2,172 30,951
Intuit Inc + -- -- 200 8,613 -- --
IVAX Corp 930 23,831 640 16,400 1,423 36,464
Jefferson Smurfit Corp + -- -- 800 12,100 1,400 21,175
John Nuveen & Co Inc Class A -- $ -- -- $ -- -- $ --
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
EMC Corp + 2,107 43,194 3,380 69,290
Eckerd (Jack) Corp Del + -- -- 400 14,650
Electronic Arts Inc + 400 15,200 800 30,400
Enron Oil & Gas Co -- -- 700 16,275
Equifax Inc 836 32,500 1,670 64,921
Ethyl Corp 1,308 14,225 1,830 19,901
Fastenal Co 300 9,900 600 19,800
Federal Signal Corp 502 10,856 980 21,193
First USA Inc 600 27,600 1,100 50,600
Forest Labs Inc Class A + 486 21,749 960 42,960
Foundation Health Corp + 626 21,675 886 30,678
Franklin Resources Inc + 913 50,215 1,165 64,075
Freeport McMoRan Inc + 1,557 8,758 3,070 17,269
Gateway 2000 Inc + -- -- 300 7,988
General Instrument Corp + 900 32,850 1,800 65,700
General Nutrition Co Inc + 400 16,700 800 33,400
Georgia Gulf Corp 465 15,403 640 21,200
Glenayre Technologies Inc 300 19,575 750 48,938
Global Marine Inc + 1,700 11,475 3,200 21,600
Green Tree Financial Inc 800 46,600 1,500 87,375
GTECH Holdings Corp + 400 11,600 700 20,300
Guidant Corp + -- -- 300 7,575
HBO & Co 300 16,500 700 38,500
Harley- Davidson Inc 844 23,421 1,690 46,898
Health Care Property Investors Inc 300 9,713 600 19,425
HealthCare Compare Corp + 396 14,900 765 28,783
Health Management Associates Inc Class A 400 13,400 800 26,800
Healthsource Inc + 300 12,000 600 24,000
Hillenbrand Industries Inc 300 8,888 600 17,775
HON Industries Inc 354 10,443 435 12,833
Hormel Foods Corp 400 9,600 800 19,200
Hospitality Franchise Systems Inc 500 23,438 900 42,188
Houghton Mifflin Co 155 7,576 345 16,862
Humana Inc + 1,800 32,850 3,500 63,875
ICN Pharmaceuticals Inc -- -- 926 18,751
Illinois Central Corp 477 18,305 535 20,531
Infinity Broadcasting Corp Class A + 600 21,525 1,250 44,844
Informix Corp + 1,438 40,264 2,880 80,640
Integrated Device Technology Inc + 300 17,288 800 46,100
International Game Technology 1,417 20,192 2,845 40,541
Intuit Inc + 400 17,225 600 25,838
IVAX Corp 963 24,677 2,295 58,809
Jefferson Smurfit Corp + 900 13,613 1,300 19,663
John Nuveen & Co Inc Class A -- $ -- 200 $ 4,725
</TABLE>
50 51
<PAGE> 185
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Jones Apparel Group Inc + -- -- -- -- -- --
KLA Instruments Corp + -- -- 200 17,100 300 25,650
Kohls Corp + 393 18,471 210 9,870 652 30,644
LSI Logic Corp + 1,072 52,796 760 37,430 1,642 80,869
La Quinta Inns Inc -- -- 200 6,000 100 3,000
Laboratory Corp of America Holdings + 660 9,158 418 5,800 1,043 14,472
Lam Research Corp + -- -- 200 12,050 300 18,075
Lancaster Colony Corp 338 11,746 260 9,035 470 16,333
Lear Seating Corp + -- -- -- -- -- --
LIN Broadcasting Corp + 300 38,550 200 25,700 200 25,700
LIN Television Corp + -- -- -- -- -- --
Linear Technology Corp 393 31,833 210 17,010 650 52,650
Loctite Corp 385 18,480 300 14,400 542 26,016
Lone Star Steakhouse & Saloon + -- -- 200 8,025 -- --
Lubrizol Corp 729 22,599 460 14,260 1,117 34,627
Lyondell Petrochemical 876 24,090 580 15,950 1,317 36,218
MGIC Investment Corp 400 22,400 300 16,800 700 39,200
Manpower Inc -- -- 500 14,375 900 25,875
Mark IV Industries Inc 497 11,058 288 6,408 790 17,578
Marvel Entertainment Group Inc + -- -- -- -- -- --
Maxim Integrated Products Inc + -- -- 200 15,250 400 30,500
McCormick & Co Inc 888 19,647 600 13,275 1,355 29,979
McKesson Corp -- -- 200 8,700 400 17,400
Medaphis Corp + -- -- 300 6,938 100 2,313
Mentor Graphics Corp + -- -- 300 5,775 852 16,401
Mercury Financial Corp -- -- 500 11,438 1,200 27,450
Microchip Technology Inc + -- -- 300 11,400 -- --
Micro Warehouse Inc + -- -- 200 9,550 -- --
Mid Atlantic Medical Services + -- -- -- -- -- --
Modine Manufacturing Co 309 9,347 250 7,563 465 14,066
Morrison Restaurants 385 7,556 200 3,925 643 12,619
Multimedia Inc + 401 17,043 220 9,350 684 29,070
Mylan Laboratories 1,303 29,816 870 19,901 1,965 44,949
National Gypsum Co + -- -- 100 5,363 -- --
New World Communications Group Inc + -- -- -- -- -- --
Newmont Gold Co 600 24,900 -- -- -- --
Nine West Group Inc + -- -- -- -- -- --
Noble Affiliates Inc 538 14,862 330 9,116 873 24,117
Nordson Corp 214 12,198 160 9,120 293 16,701
Northwest Airlines Corp Class A + -- -- 500 18,063 700 25,288
Novellus Systems Inc + -- -- 100 7,369 -- --
Office Depot Inc + 1,538 47,870 1,050 32,681 2,442 76,007
Olsten Corp 461 16,711 250 9,063 745 27,006
Omnicom Group 394 $ 24,724 210 $ 13,178 660 $ 41,415
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Jones Apparel Group Inc + -- -- 400 13,900
KLA Instruments Corp + 200 17,100 400 34,200
Kohls Corp + 404 18,988 379 17,813
LSI Logic Corp + 1,312 64,616 2,520 124,110
La Quinta Inns Inc 400 12,000 800 24,000
Laboratory Corp of America Holdings + 684 9,491 937 13,001
Lam Research Corp + 200 12,050 600 36,150
Lancaster Colony Corp 340 11,815 428 14,873
Lear Seating Corp + -- -- 300 8,588
LIN Broadcasting Corp + 300 38,550 500 64,250
LIN Television Corp + -- -- 300 10,950
Linear Technology Corp 405 32,805 775 62,775
Loctite Corp 397 19,056 565 27,120
Lone Star Steakhouse & Saloon + 300 12,038 600 24,075
Lubrizol Corp 742 23,002 1,500 46,500
Lyondell Petrochemical 892 24,530 845 23,238
MGIC Investment Corp 500 28,000 800 44,800
Manpower Inc 700 20,125 1,300 37,375
Mark IV Industries Inc 501 11,147 856 19,046
Marvel Entertainment Group Inc + -- -- 500 7,188
Maxim Integrated Products Inc + 300 22,875 600 45,750
McCormick & Co Inc 905 20,023 1,555 34,404
McKesson Corp 300 13,050 800 34,800
Medaphis Corp + 500 11,563 900 20,813
Mentor Graphics Corp + 600 11,550 1,100 21,175
Mercury Financial Corp 800 18,300 2,100 48,038
Microchip Technology Inc + 400 15,200 700 26,600
Micro Warehouse Inc + 300 14,325 500 23,875
Mid Atlantic Medical Services + -- -- 800 14,900
Modine Manufacturing Co 335 10,134 400 12,100
Morrison Restaurants 398 7,811 575 11,284
Multimedia Inc + 414 17,595 685 29,113
Mylan Laboratories 1,327 30,355 2,652 60,665
National Gypsum Co + 200 10,725 400 21,450
New World Communications Group Inc + -- -- 600 13,950
Newmont Gold Co -- -- 200 8,300
Nine West Group Inc + -- -- 400 17,050
Noble Affiliates Inc 558 15,415 620 17,128
Nordson Corp 208 11,856 285 16,245
Northwest Airlines Corp Class A + 800 28,900 1,500 54,188
Novellus Systems Inc + 200 14,738 300 22,106
Office Depot Inc + 1,567 48,773 2,180 67,853
Olsten Corp 459 16,639 644 23,345
Omnicom Group 405 $ 25,414 779 $ 48,882
</TABLE>
52 53
<PAGE> 186
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Outback Steakhouse Inc + -- -- 200 6,450 100 3,225
Owens-Illinois Inc + -- -- 700 9,538 1,400 19,075
Oxford Health Plans Inc + -- -- 200 9,800 300 14,700
PacifiCare Health Systems Inc Class B + -- -- 100 5,725 -- --
Paging Network Inc + -- -- 200 7,900 -- --
Parametric Technology Corp + 610 33,703 380 20,995 971 53,648
Paychex Inc 505 20,705 290 11,890 802 32,882
Peoplesoft Inc + -- -- -- -- -- --
Perrigo Co + 812 10,962 550 7,425 1,252 16,902
PetSmart Inc + -- -- 300 9,113 700 21,263
Physician Corp of America + -- -- -- -- -- --
Premier Industrial Corp -- -- -- -- -- --
Price (T Rowe) Associates -- -- 200 9,500 -- --
Primadonna Resorts Inc + -- -- -- -- -- --
Promus Hotel Corp + 77 1,588 261 5,383 674 13,901
Qualcomm Inc + -- -- 300 14,625 -- --
RPM Inc 623 12,460 390 7,800 959 19,180
Readers Digest Association Class A 600 27,750 500 23,125 1,000 46,250
Reynolds & Reynolds Co Class A 473 15,195 260 8,353 756 24,287
Rhone-Poulenc Rorer Inc 900 39,825 300 13,275 500 22,125
Rollins Inc 388 9,264 210 5,014 645 15,399
Rouse Co -- -- -- -- -- --
SPS Transaction Services Inc + -- -- -- -- -- --
Safeway Inc + 700 27,563 300 11,813 -- --
Scherer (R P) Corp + -- -- 200 8,600 -- --
Scholastic Inc + -- -- -- -- -- --
Schulman (A) Inc 403 10,680 220 5,830 686 18,179
Schwab (Charles) Corp 939 43,664 635 29,528 1,393 64,775
Sealed Air Corp + -- -- 200 10,550 303 15,983
Sensormatic Electronics 735 15,435 470 9,870 1,123 23,583
Shaw Industries Inc 1,560 23,400 1,030 15,450 2,415 36,225
Simon Property Group Inc -- -- -- -- -- --
Solectron Corp + -- -- 300 10,650 -- --
Sonoco Products 988 26,553 677 18,194 1,500 40,313
Southern National Corp -- -- 600 16,050 1,200 32,100
Southland Corp + -- -- -- -- -- --
Staples Inc + 931 23,857 665 17,041 1,443 36,964
Starbucks Corp + -- -- -- -- -- --
Stop & Shop Co Inc + -- -- 300 7,275 100 2,425
Stratacom Inc + -- -- 300 14,700 -- --
Stryker Corp + 524 21,877 310 12,943 834 34,820
Student Loan Marketing Association 600 32,475 600 32,475 1,000 54,125
Sundstrand Corp 363 24,729 280 19,075 495 33,722
Superior Industries International Inc 322 $ 9,539 260 $ 7,703 454 $ 13,450
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Outback Steakhouse Inc + 400 12,900 700 22,575
Owens-Illinois Inc + 800 10,900 1,500 20,438
Oxford Health Plans Inc + 200 9,800 600 29,400
PacifiCare Health Systems Inc Class B + 200 11,450 400 22,900
Paging Network Inc + 300 11,850 600 23,700
Parametric Technology Corp + 621 34,310 1,185 65,471
Paychex Inc 507 20,787 750 30,750
Peoplesoft Inc + 200 13,800 300 20,700
Perrigo Co + 842 11,367 1,080 14,580
PetSmart Inc + 600 18,225 1,050 31,894
Physician Corp of America + -- -- 800 12,800
Premier Industrial Corp -- -- 600 14,400
Price (T Rowe) Associates 300 14,250 600 28,500
Primadonna Resorts Inc + -- -- 400 8,100
Promus Hotel Corp + 545 11,241 1,055 21,759
Qualcomm Inc + 400 19,500 800 39,000
RPM Inc 629 12,580 1,195 23,900
Readers Digest Association Class A 900 41,625 1,700 78,625
Reynolds & Reynolds Co Class A 476 15,292 950 30,519
Rhone-Poulenc Rorer Inc 400 17,700 1,000 44,250
Rollins Inc 400 9,550 475 11,341
Rouse Co -- -- 700 14,788
SPS Transaction Services Inc + -- -- 200 5,375
Safeway Inc + 300 11,813 600 23,625
Scherer (R P) Corp + 300 12,900 500 21,500
Scholastic Inc + 100 6,125 300 18,375
Schulman (A) Inc 416 11,024 785 20,803
Schwab (Charles) Corp 948 44,082 1,207 56,126
Sealed Air Corp + 218 11,500 400 21,100
Sensormatic Electronics 748 15,708 1,585 33,285
Shaw Industries Inc 1,605 24,075 2,200 33,000
Simon Property Group Inc -- -- 600 14,775
Solectron Corp + 400 14,200 800 28,400
Sonoco Products 1,022 27,466 2,055 55,228
Southern National Corp 1,100 29,425 2,180 58,315
Southland Corp + -- -- 3,100 11,625
Staples Inc + 960 24,600 1,438 36,849
Starbucks Corp + -- -- 400 16,000
Stop & Shop Co Inc + 600 14,550 1,100 26,675
Stratacom Inc + 300 14,700 700 34,300
Stryker Corp + 544 22,712 700 29,225
Student Loan Marketing Association 1,000 54,125 1,800 97,425
Sundstrand Corp 365 24,866 645 43,941
Superior Industries International Inc 331 $ 9,806 410 $ 12,146
</TABLE>
54 55
<PAGE> 187
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Sybase Inc + -- -- 200 6,425 800 25,700
Sybron International Corp + -- -- 200 8,200 -- --
Symantec Corp + 378 10,915 200 5,775 636 18,365
Symbol Technologies Inc + 260 9,035 210 7,298 390 13,553
Synopsys Inc + -- -- 100 5,800 -- --
Talbots Inc -- -- -- -- -- --
Tambrands Inc 397 17,815 210 9,424 654 29,348
Tele-Communications Inc Liberty Media
Group Class A + 190 5,047 906 24,065 2,022 53,708
Tencor Instruments + -- -- 200 8,675 -- --
Teradyne Inc + 776 29,391 420 15,908 1,290 48,859
Thermo Instrument Systems Inc + -- -- -- -- -- --
Thermo Cardiosystems Inc + -- -- -- -- -- --
3Com Corp + 1,000 39,000 800 31,200 1,400 54,600
Tootsie Roll Industries -- -- -- -- -- --
Total System Services Inc -- -- -- -- -- --
TransTexas Gas Corp + -- -- -- -- -- --
TriMas Corp -- -- -- -- -- --
Triton Energy Corp + -- -- 200 10,600 400 21,200
Turner Broadcasting System Inc Class A -- -- 400 12,350 100 3,088
Turner Broadcasting System Inc Class B 900 27,675 700 21,525 1,200 36,900
USG Corp + -- -- -- -- -- --
U.S. Robotics Corp + -- -- 100 14,025 -- --
Unifi Inc 768 19,392 500 12,625 1,182 29,846
Union Texas Petroleum Holdings Inc -- -- 300 5,850 100 1,950
VLSI Technology Inc + -- -- 200 6,600 100 3,300
Valhi Inc -- -- -- -- -- --
Valspar Corp -- -- -- -- -- --
Value Health Inc + 435 15,062 245 8,483 719 24,895
ValuJet Airlines Inc + -- -- -- -- -- --
Varian Associates Inc 377 20,358 290 15,660 535 28,890
Vastar Resources Inc 600 18,750 -- -- -- --
Vencor Inc + -- -- -- -- -- --
Viking Office Products Inc + -- -- 200 7,200 100 3,600
Vishay Intertechnology Inc -- -- 300 12,150 500 20,250
Vornado Realty Trust -- -- -- -- -- --
Western Digital Corp + -- -- 300 6,188 100 2,063
Xilinx Inc + 747 32,028 600 25,725 1,059 45,405
York International Corp 402 17,889 220 9,790 659 29,326
MEDIUM CAP GROWTH STOCKS - VALUE $ 2,345,780 $ 2,145,332 $ 4,084,247
- COST $ 1,776,682 $ 1,761,417 $ 3,232,733
MEDIUM CAP VALUE STOCKS
PERCENT OF NET ASSETS 3.1% 3.1% 3.7%
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Sybase Inc + 600 19,275 1,200 38,550
Sybron International Corp + 300 12,300 500 20,500
Symantec Corp + 361 10,424 800 23,100
Symbol Technologies Inc + 270 9,383 350 12,163
Synopsys Inc + -- -- -- --
Talbots Inc -- -- 300 10,350
Tambrands Inc 409 18,354 885 39,714
Tele-Communications Inc Liberty Media
Group Class A + 1,656 43,987 3,614 95,995
Tencor Instruments + 300 13,013 500 21,688
Teradyne Inc + 800 30,300 1,550 58,706
Thermo Instrument Systems Inc + -- -- 250 6,406
Thermo Cardiosystems Inc + -- -- 200 7,875
3Com Corp + 1,600 62,400 3,000 117,000
Tootsie Roll Industries -- -- 406 16,189
Total System Services Inc -- -- 300 5,850
TransTexas Gas Corp + -- -- 200 3,550
TriMas Corp -- -- 300 6,413
Triton Energy Corp + 300 15,900 800 42,400
Turner Broadcasting System Inc Class A 800 24,700 1,500 46,313
Turner Broadcasting System Inc Class B 1,100 33,825 2,200 67,650
USG Corp + 400 10,850 700 18,988
U.S. Robotics Corp + -- -- 400 56,100
Unifi Inc 782 19,746 1,340 33,835
Union Texas Petroleum Holdings Inc 600 11,700 1,200 23,400
VLSI Technology Inc + 400 13,200 700 23,100
Valhi Inc -- -- 100 775
Valspar Corp -- -- 400 16,000
Value Health Inc + 447 15,477 1,219 42,208
ValuJet Airlines Inc + -- -- 200 5,825
Varian Associates Inc 390 21,060 765 41,310
Vastar Resources Inc -- -- 400 12,500
Vencor Inc + 300 8,888 500 14,813
Viking Office Products Inc + 500 18,000 900 32,400
Vishay Intertechnology Inc 400 16,200 1,020 41,310
Vornado Realty Trust 200 7,425 500 18,563
Western Digital Corp + 500 10,313 1,000 20,625
Xilinx Inc + 774 33,185 1,420 60,883
York International Corp 414 18,423 785 34,933
MEDIUM CAP GROWTH STOCKS - VALUE $ 3,474,209 $ 6,909,224
- COST $ 2,821,638 $ 6,118,056
MEDIUM CAP VALUE STOCKS
PERCENT OF NET ASSETS 4.5% 5.6%
</TABLE>
56 57
<PAGE> 188
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
AFLAC Inc 1,131 $ $46,230 780 $ $31,883 1,678 $ $68,588
Arco Chemical Co 600 28,950 -- -- -- --
AT & T Capital Corp -- -- -- -- -- --
Albemarle Corp 713 11,675 460 7,533 1,112 18,209
Alexander & Baldwin Inc 504 11,466 290 6,598 814 18,519
Alleghany Corp + -- -- -- -- -- --
Allmerica Property & Casualty Co Inc -- -- 400 9,650 100 2,413
Alumax Inc + 489 16,687 280 9,555 773 26,379
AMBAC Inc -- -- 200 8,450 400 16,900
American Financial Group Inc 504 15,561 290 8,954 813 25,101
American National Insurance Co -- -- -- -- -- --
American Re Corp -- -- 300 12,000 600 24,000
American Standard Co Inc + -- -- -- -- -- --
American Water Works Co Inc -- -- -- -- -- --
AmSouth Bancorp -- -- 300 11,213 800 29,900
Aon Corp 1,090 42,510 760 29,640 1,660 64,740
Apache Corp 662 19,281 420 12,233 1,049 30,552
Argonaut Group Inc -- -- -- -- -- --
Arrow Electronics Inc + 493 26,745 296 16,058 799 43,346
Avnet Inc 430 22,145 250 12,875 714 36,771
Bandag Inc -- -- -- -- -- --
Bandag Inc Class A -- -- -- -- -- --
Bank South Corp -- -- 300 6,844 100 2,281
Bankers Life Holding Corp -- -- -- -- -- --
Barnes & Noble + -- -- -- -- -- --
BayBanks Inc -- -- 100 8,025 200 16,050
Bear Stearns & Co Inc 1,360 28,050 829 17,098 2,058 42,446
Beckman Instruments Inc 294 8,416 250 7,156 450 12,881
Bergen Brunswig Corp Class A 20 418 16 334 29 605
Bob Evans Farms Inc 468 8,366 260 4,648 752 13,442
Boise Cascade Office Products Corp + -- -- -- -- -- --
Bowater Inc 395 18,861 210 10,028 652 31,133
Burlington Industries Inc + 729 9,021 477 5,903 1,136 14,058
CBI Industries 406 9,947 220 5,390 689 16,881
CNA Financial Corp + 400 38,350 100 9,588 -- --
Cabot Corp 405 19,491 220 10,588 686 33,014
Capital One Financial Corp -- -- 400 10,400 900 23,400
Caremark International Inc + -- -- 400 8,300 1,000 20,750
Case Corp -- -- -- -- -- --
Central Fidelity Banks Inc 417 13,657 230 7,533 700 22,925
Chesapeake Corp 256 9,312 200 7,275 361 13,131
Chris-Craft Industries Inc + 304 13,680 247 11,115 465 20,925
Cincinnati Financial Corp 400 20,800 320 16,640 600 31,200
Clayton Homes Inc 817 $ 19,302 550 $ 12,994 1,245 $ 29,413
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
AFLAC Inc 1,158 $ $47,333 2,285 $ $93,399
Arco Chemical Co -- -- 200 9,650
AT & T Capital Corp -- -- 100 3,163
Albemarle Corp 732 11,987 1,186 19,421
Alexander & Baldwin Inc 509 11,580 980 22,295
Alleghany Corp + -- -- 100 16,925
Allmerica Property & Casualty Co Inc 700 16,888 1,400 33,775
Alumax Inc + 493 16,824 670 22,864
AMBAC Inc 300 12,675 800 33,800
American Financial Group Inc 508 15,685 580 17,908
American National Insurance Co -- -- 200 11,475
American Re Corp 400 16,000 1,000 40,000
American Standard Co Inc + -- -- 300 8,288
American Water Works Co Inc 300 8,963 500 14,938
AmSouth Bancorp 500 18,688 1,100 41,113
Aon Corp 1,125 43,875 2,050 79,950
Apache Corp 684 19,922 1,235 35,969
Argonaut Group Inc -- -- 200 6,100
Arrow Electronics Inc + 510 27,668 875 47,469
Avnet Inc 459 23,639 815 41,973
Bandag Inc -- -- 200 11,875
Bandag Inc Class A 200 10,975 300 16,463
Bank South Corp 700 15,969 1,200 27,375
Bankers Life Holding Corp -- -- 500 9,500
Barnes & Noble + -- -- 300 11,738
BayBanks Inc 200 16,050 400 32,100
Bear Stearns & Co Inc 1,396 28,793 2,302 47,479
Beckman Instruments Inc 305 8,731 680 19,465
Bergen Brunswig Corp Class A 420 8,768 800 16,700
Bob Evans Farms Inc 472 8,437 950 16,981
Boise Cascade Office Products Corp + -- -- 100 2,838
Bowater Inc 407 19,434 675 32,231
Burlington Industries Inc + 749 9,269 1,302 16,112
CBI Industries 419 10,266 695 17,028
CNA Financial Corp + 100 9,588 200 19,175
Cabot Corp 416 20,020 795 38,259
Capital One Financial Corp 600 15,600 800 20,800
Caremark International Inc + 800 16,600 1,600 33,200
Case Corp -- -- 400 15,100
Central Fidelity Banks Inc 430 14,083 805 26,364
Chesapeake Corp 266 9,676 450 16,369
Chris-Craft Industries Inc + 316 14,220 214 9,630
Cincinnati Financial Corp 600 31,200 1,115 57,980
Clayton Homes Inc 845 $ 19,963 1,081 $ 25,539
</TABLE>
58 59
<PAGE> 189
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Coca-Cola Enterprises 1,412 32,653 910 21,044 2,188 50,598
Comdisco Inc 411 12,536 230 7,015 694 21,167
Comerica Inc 1,289 45,921 810 28,856 2,013 71,713
Commerce Bancshares Inc -- -- 200 7,175 -- --
Compass Bankshares Inc -- -- 200 6,000 100 3,000
Comsat Corp 510 11,858 300 6,975 819 19,042
Conseco Inc -- -- 200 10,050 -- --
Consolidated Papers Inc 486 29,403 280 16,940 770 46,585
Countrywide Credit & Industries Inc -- -- 500 11,000 1,200 26,400
Cox Communications Inc Class A + 213 4,207 274 5,412 1,094 21,607
Crestar Financial Corp 402 22,663 220 12,403 685 38,617
Dauphin Deposit Corp 360 9,900 270 7,425 492 13,530
Dean Foods Co 424 11,236 240 6,360 707 18,736
Diamond Shamrock R&M Inc 304 8,094 250 6,656 435 11,582
Dime Bancorp Inc + -- -- 700 8,488 100 1,213
Dole Food Inc 646 21,157 410 13,428 1,008 33,012
Ensco International Inc + -- -- -- -- -- --
Edwards A G & Sons Inc 655 15,966 420 10,238 1,017 24,789
Equitable Co Inc 900 23,175 400 10,300 900 23,175
Equitable of Iowa Co -- -- 200 7,450 -- --
Equity Residential Properties Trust -- -- -- -- -- --
FHP International Corp + 424 10,494 240 5,940 703 17,399
Federated Department Stores Inc + 900 24,300 800 21,600 1,500 40,500
Ferro Corp 305 8,235 250 6,750 436 11,772
Fifth Third Bancorp 663 37,294 430 24,188 1,051 59,119
Fina Inc Class A -- -- -- -- -- --
Finova Group Inc -- -- 200 8,150 -- --
First American Corp - Tennessee -- -- 200 8,550 -- --
First America Bank Corp 647 28,630 410 18,143 1,009 44,648
First Bank System Inc 1,266 57,761 990 45,169 1,989 90,748
First Brands Corp 243 10,601 190 8,289 347 15,138
First Colony Corp -- -- -- -- -- --
First Empire State Corp -- -- -- -- -- --
First Financial Management Corp 662 59,663 420 37,853 1,049 94,541
First Hawaiian Inc -- -- -- -- -- --
First Security Corp 516 16,254 320 10,080 850 26,775
First Tennessee National Corp 354 18,762 270 14,310 485 25,705
First Virginia Banks Inc 359 14,764 280 11,515 491 20,192
Firstar Corp -- -- 300 11,138 800 29,700
Fiserv Inc + 417 11,885 230 6,555 699 19,922
Firstmerit Corp -- -- -- -- -- --
FlightSafety International Inc 356 15,798 270 11,981 487 21,611
Food Lion Inc Class B -- -- 1,200 6,900 200 1,150
Food Lion Inc Class A -- $ -- 1,400 $ 8,050 3,300 $ 18,975
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Coca-Cola Enterprises 1,448 33,485 1,555 35,959
Comdisco Inc 424 12,932 595 18,148
Comerica Inc 1,323 47,132 2,640 94,050
Commerce Bancshares Inc 400 14,350 800 28,700
Compass Bankshares Inc 400 12,000 700 21,000
Comsat Corp 514 11,951 990 23,018
Conseco Inc 300 15,075 500 25,125
Consolidated Papers Inc 490 29,645 570 34,485
Countrywide Credit & Industries Inc 800 17,600 2,000 44,000
Cox Communications Inc Class A + 727 14,358 1,049 20,718
Crestar Financial Corp 415 23,396 785 44,254
Dauphin Deposit Corp 362 9,955 645 17,738
Dean Foods Co 437 11,581 905 23,983
Diamond Shamrock R&M Inc 330 8,786 415 11,049
Dime Bancorp Inc + 1,100 13,338 2,100 25,463
Dole Food Inc 668 21,877 825 27,019
Ensco International Inc + -- -- 1,000 18,000
Edwards A G & Sons Inc 677 16,502 1,225 29,859
Equitable Co Inc 600 15,450 1,600 41,200
Equitable of Iowa Co 300 11,175 600 22,350
Equity Residential Properties Trust -- -- 200 5,900
FHP International Corp + 436 10,791 909 22,498
Federated Department Stores Inc + 1,400 37,800 2,800 75,600
Ferro Corp 331 8,937 615 16,605
Fifth Third Bancorp 686 38,588 1,035 58,219
Fina Inc Class A -- -- 100 4,625
Finova Group Inc 300 12,225 600 24,450
First American Corp - Tennessee 300 12,825 600 25,650
First America Bank Corp 669 29,603 1,425 63,056
First Bank System Inc 1,584 72,270 3,020 137,788
First Brands Corp 252 10,994 530 23,121
First Colony Corp 400 9,800 700 17,150
First Empire State Corp 100 18,300 100 18,300
First Financial Management Corp 684 61,646 1,335 120,317
First Hawaiian Inc -- -- 400 11,150
First Security Corp 535 16,853 1,100 34,650
First Tennessee National Corp 350 18,550 740 39,220
First Virginia Banks Inc 361 14,846 745 30,638
Firstar Corp 500 18,563 1,300 48,263
Fiserv Inc + 429 12,227 795 22,658
Firstmerit Corp 100 2,675 600 16,050
FlightSafety International Inc 357 15,842 445 19,747
Food Lion Inc Class B 2,100 12,075 3,800 21,850
Food Lion Inc Class A 2,100 $ 12,075 5,200 $ 29,900
</TABLE>
60 61
<PAGE> 190
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Fort Howard Corp + -- -- -- -- -- --
Fourth Financial Corp -- -- 200 7,100 -- --
Franchise Finance Corp -- -- -- -- -- --
GATX Corp 223 11,512 170 8,776 302 15,591
GEICO Corp 400 27,300 300 20,475 200 13,650
Gaylord Entertainment Co Class A -- -- -- -- -- --
Genentech Inc + 100 4,713 300 14,138 600 28,275
General Motors Corp Class E 2,788 129,991 1,530 71,336 4,291 200,068
General Motors Corp Class H 700 27,913 600 23,925 1,100 43,863
Genzyme Corp - General Division + 263 14,695 210 11,734 367 20,506
Glatfelter (P H) Co 486 10,935 280 6,300 769 17,303
Greenpoint Financial Corp -- -- 300 8,325 100 2,775
Hanna (M A) Co 387 10,836 200 5,600 645 18,060
Hannaford Brothers Co 436 11,173 260 6,663 745 19,091
Harsco Corp 269 15,064 210 11,760 374 20,944
Hartford Steam Boiler Inspection 230 10,666 180 8,348 309 14,330
Hawaiian Electric Industries Inc 292 10,549 240 8,670 423 15,281
Healthsouth Corp + 608 14,364 400 9,450 1,020 24,098
Health Care & Retirement Corp + -- -- 200 6,300 -- --
Health & Retire Property Trust -- -- -- -- -- --
Heilig-Meyers Co 524 11,528 310 6,820 834 18,348
Hibernia Corp Class A -- -- 700 7,000 200 2,000
Hillhaven Corp + -- -- -- -- -- --
Host Marriot Corp + -- -- 800 9,200 1,900 21,850
Hubbell Inc Class B 366 21,457 283 16,591 504 29,547
Huntington Bancshares Inc 1,050 23,100 850 18,700 1,670 36,740
IBP Inc 516 25,413 310 15,268 826 40,681
IMC Fertilizer Group 309 19,544 250 15,813 465 29,411
Integra Financial Corp -- -- 200 11,225 400 22,450
International Specialty Products Inc -- -- -- -- -- --
ITEL Corp + -- -- 200 7,550 -- --
Kansas City Southern Industries 481 21,164 270 11,880 765 33,660
Kelly Services Inc Class A 406 11,673 220 6,325 689 19,809
Kemper Corp 363 17,424 290 13,920 520 24,960
Kennametal Inc -- -- 200 7,600 411 15,618
Keystone International Inc 383 7,708 200 4,025 641 12,900
Kimco Realty Corp -- -- -- -- -- --
Komag Inc + -- -- 200 12,450 -- --
LTV Corp -- -- 700 10,938 1,300 20,313
Lafarge Corp -- -- -- -- -- --
Leggett & Platt Inc 429 20,753 250 12,094 737 35,652
Lehman Brothers Holdings -- -- 700 16,625 1,300 30,875
Leucadia National Corp -- -- -- -- -- --
Litton Industries Inc + 501 $ 19,414 290 $ 11,238 808 $ 31,310
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Fort Howard Corp + -- -- 700 11,025
Fourth Financial Corp 300 10,650 600 21,300
Franchise Finance Corp -- -- 200 4,250
GATX Corp 217 11,203 410 21,166
GEICO Corp 300 20,475 500 34,125
Gaylord Entertainment Co Class A -- -- 515 14,291
Genentech Inc + 600 28,275 1,100 51,838
General Motors Corp Class E 2,876 134,094 3,600 167,850
General Motors Corp Class H 1,100 43,863 2,000 79,750
Genzyme Corp - General Division + 272 15,198 150 8,381
Glatfelter (P H) Co 489 11,003 570 12,825
Greenpoint Financial Corp 500 13,875 1,000 27,750
Hanna (M A) Co 400 11,200 575 16,100
Hannaford Brothers Co 465 11,916 640 16,400
Harsco Corp 279 15,624 560 31,360
Hartford Steam Boiler Inspection 224 10,388 420 19,478
Hawaiian Electric Industries Inc 303 10,946 580 20,953
Healthsouth Corp + 660 15,593 830 19,609
Health Care & Retirement Corp + 300 9,450 700 22,050
Health & Retire Property Trust 600 9,225 1,100 16,913
Heilig-Meyers Co 544 11,968 1,000 22,000
Hibernia Corp Class A 1,200 12,000 2,300 23,000
Hillhaven Corp + -- -- 400 11,150
Host Marriot Corp + 1,200 13,800 2,600 29,900
Hubbell Inc Class B 367 21,515 551 32,302
Huntington Bancshares Inc 1,545 33,990 2,990 65,780
IBP Inc 521 25,659 1,000 49,250
IMC Fertilizer Group 335 21,189 500 31,625
Integra Financial Corp 300 16,838 500 28,063
International Specialty Products Inc -- -- 400 3,550
ITEL Corp + 200 7,550 500 18,875
Kansas City Southern Industries 485 21,340 560 24,640
Kelly Services Inc Class A 419 12,046 785 22,569
Kemper Corp 365 17,520 645 30,960
Kennametal Inc 300 11,400 500 19,000
Keystone International Inc 396 7,970 665 13,383
Kimco Realty Corp -- -- 300 12,188
Komag Inc + 200 12,450 400 24,900
LTV Corp 900 14,063 2,200 34,375
Lafarge Corp -- -- 400 8,450
Leggett & Platt Inc 442 21,382 815 39,426
Lehman Brothers Holdings 900 21,375 2,300 54,625
Leucadia National Corp 200 10,650 300 15,975
Litton Industries Inc + 503 $ 19,491 579 $ 22,436
</TABLE>
62 63
<PAGE> 191
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Longview Fibre Co 554 8,933 340 5,483 890 14,351
MBIA Inc 300 20,400 300 20,400 400 27,200
MFS Communications Inc + -- -- -- -- -- --
MGM Grand Inc + -- -- -- -- -- --
Manville Corp + -- -- -- -- -- --
MAPCO Inc 337 17,987 260 13,878 468 24,980
Marshall & Ilsley Corp 1,058 26,715 740 18,685 1,603 40,476
Martin Mareitta Inc -- -- -- -- -- --
Mascotech Inc -- -- -- -- -- --
Media General Inc Class A 280 10,080 220 7,920 410 14,760
Meditrust Corp -- -- 200 6,575 500 16,438
Mercantile Bancorporation 436 19,729 270 12,218 769 34,797
Mercantile Bankshares 503 13,392 290 7,721 813 21,646
Mercury General Corp -- -- -- -- -- --
Meridian Bancorp Inc 635 25,479 390 15,649 997 40,005
Michigan National Corp -- -- 100 10,756 -- --
Midlantic Corp Inc -- -- 300 15,450 700 36,050
Mirage Resorts Inc + 995 34,203 680 23,375 1,489 51,184
Molex Inc 851 36,593 575 24,725 1,311 56,373
Molex Inc Class A -- -- 300 11,850 500 19,750
Morgan Stanley Group 874 75,929 270 23,456 1,291 112,156
Murphy Oil Corp 493 19,967 280 11,340 777 31,469
NGC Corp -- -- -- -- -- --
Nabisco Holdings Corp Class A -- -- 200 5,725 100 2,863
New Plan Realty Trust -- -- 300 6,675 100 2,225
Northern Trust Corp 567 25,515 360 16,200 928 41,760
Officemax Inc + -- -- -- -- -- --
Ohio Casualty Corp -- -- 200 6,650 -- --
Old Kent Financial Corp -- -- 215 8,197 625 23,828
Old National Bancorp -- -- -- -- -- --
Old Republic International Corp -- -- 200 5,525 100 2,763
Olin Corp 235 15,187 180 11,633 339 21,908
PHH Corp 178 7,765 150 6,544 257 11,212
PMI Group Inc -- -- 200 8,900 -- --
PacifiCare Health Systems Inc Class A + 289 15,823 240 13,140 420 22,995
Painewebber Group Inc -- -- 700 13,475 1,300 25,025
Paul Revere Corp -- -- -- -- -- --
Policy Management Systems Corp + 248 12,276 170 8,415 303 14,999
Progressive Corp Ohio 782 34,701 520 23,075 1,197 53,117
Provident Life & Accident Insurance Class
B 497 12,984 290 7,576 806 21,057
Quantum Corp + -- -- 300 7,200 790 18,960
Questar Corp 427 13,024 240 7,320 710 21,655
Quorom Health Group Inc + -- -- -- -- -- --
RJR Nabisco Holdings Corp 1,370 $ 39,045 1,543 $ 43,976 2,305 $ 65,693
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Longview Fibre Co 575 9,272 930 14,996
MBIA Inc 400 27,200 800 54,400
MFS Communications Inc + 200 8,850 400 17,700
MGM Grand Inc + -- -- 300 7,500
Manville Corp + -- -- 500 7,375
MAPCO Inc 338 18,041 500 26,688
Marshall & Ilsley Corp 1,083 27,346 2,120 53,530
Martin Mareitta Inc -- -- 200 3,800
Mascotech Inc -- -- 600 7,875
Media General Inc Class A 290 10,440 370 13,320
Meditrust Corp 500 16,438 900 29,588
Mercantile Bancorporation 464 20,996 1,040 47,060
Mercantile Bankshares 508 13,526 980 26,093
Mercury General Corp -- -- 200 7,550
Meridian Bancorp Inc 642 25,760 1,305 52,363
Michigan National Corp 100 10,756 200 21,513
Midlantic Corp Inc 400 20,600 700 36,050
Mirage Resorts Inc + 1,004 34,513 1,435 49,328
Molex Inc 880 37,840 418 17,974
Molex Inc Class A 300 11,850 900 35,550
Morgan Stanley Group 891 77,406 1,045 90,784
Murphy Oil Corp 497 20,129 970 39,285
NGC Corp -- -- 200 1,900
Nabisco Holdings Corp Class A -- -- 600 17,175
New Plan Realty Trust 600 13,350 1,100 24,475
Northern Trust Corp 588 26,460 1,265 56,925
Officemax Inc + -- -- 600 14,100
Ohio Casualty Corp 300 9,975 600 19,950
Old Kent Financial Corp 420 16,013 1,030 39,269
Old National Bancorp 200 6,850 500 17,125
Old Republic International Corp 500 13,813 1,000 27,625
Olin Corp 229 14,799 530 34,251
PHH Corp 197 8,594 375 16,359
PMI Group Inc 200 8,900 500 22,250
PacifiCare Health Systems Inc Class A + 300 16,425 180 9,855
Painewebber Group Inc 900 17,325 2,200 42,350
Paul Revere Corp -- -- 100 1,750
Policy Management Systems Corp + 258 12,771 340 16,830
Progressive Corp Ohio 797 35,367 850 37,719
Provident Life & Accident Insurance Class
B 501 13,089 380 9,928
Quantum Corp + 485 11,640 900 21,600
Questar Corp 440 13,420 730 22,265
Quorom Health Group Inc + -- -- 500 10,625
RJR Nabisco Holdings Corp 2,451 $ 69,854 4,718 $ 134,463
</TABLE>
64 65
<PAGE> 192
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Ranger Oil Ltd -- -- -- -- 1,508 8,671
Rayonier Inc 256 9,824 250 9,594 462 17,729
Read-Rite Corp + -- -- 300 12,263 -- --
Readers Digest Association Class B -- -- 200 8,400 -- --
Regions Financial 435 17,509 250 10,063 719 28,940
Reliastar Financial Corp -- -- 200 7,600 -- --
Revco DS Inc + -- -- 300 5,925 100 1,975
Riverwood International Group -- -- -- -- -- --
St Joe Paper Co -- -- -- -- -- --
Scripps (E W) Co 600 20,175 200 6,725 100 3,363
Seagate Technology Inc + 778 34,524 510 22,631 1,193 52,939
Security Capital Pacific Trust -- -- 400 7,400 100 1,850
Signet Banking Corp -- -- 400 10,450 100 2,613
Southern Pacific Rail Corp + 900 22,050 400 9,800 100 2,450
SouthTrust Corp 871 22,537 580 15,008 1,337 34,595
Spelling Entertainment Group Inc + -- -- -- -- -- --
Standard Fed Bancorp -- -- 200 7,800 100 3,900
Star Banc Corp -- -- 200 10,600 -- --
State Street Boston Corp 819 30,201 550 20,281 1,285 47,384
Stewart & Stevenson Services 364 11,603 280 8,925 495 15,778
Storage Technology Corp + 559 15,303 335 9,171 884 24,200
Stratus Computer Inc + 261 7,308 210 5,880 366 10,248
Sunamerica Inc + -- -- 200 11,950 300 17,925
Sunbeam-Oster Co Inc -- -- -- -- -- --
Sungard Data Systems Inc + -- -- 300 8,325 100 2,775
Synovus Financial Corp -- -- 400 10,200 1,000 25,500
TIG Holdings Inc -- -- 300 7,688 900 23,063
Tecumseh Products Co Class A 241 11,689 190 9,215 345 16,733
Tele-Communications International Inc
Class A + -- -- -- -- -- --
Terra Industries Inc -- -- -- -- -- --
Thermo Electron Corp + 822 35,449 551 23,762 1,268 54,683
Tidewater Inc 565 13,984 350 8,663 925 22,894
Tosco Corp 357 11,469 280 8,995 489 15,709
Transatlantic Holdings Inc 251 17,570 200 14,000 355 24,850
Trinity Industries Inc 422 13,662 240 7,770 705 22,824
Tyson Foods Inc Class A 1,594 41,046 1,060 27,295 2,474 63,706
UAL Corp + -- -- 100 15,750 100 15,750
UJB Financial Corp 603 20,879 370 12,811 939 32,513
Ultramar Corp -- -- 200 4,725 100 2,363
Union Bank -- -- -- -- -- --
Union Planters Corp -- -- 200 5,925 100 2,963
United Asset Management Corp -- -- 200 7,800 -- --
Unitrin Inc -- $ -- 300 $ 14,100 400 $ 18,800
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Ranger Oil Ltd 1,103 6,342 -- --
Rayonier Inc 326 12,510 619 23,754
Read-Rite Corp + 500 20,438 900 36,788
Readers Digest Association Class B 200 8,400 500 21,000
Regions Financial 464 18,676 940 37,835
Reliastar Financial Corp 400 15,200 700 26,600
Revco DS Inc + 500 9,875 900 17,775
Riverwood International Group -- -- 300 7,800
St Joe Paper Co -- -- 200 12,250
Scripps (E W) Co 300 10,088 600 20,175
Seagate Technology Inc + 793 35,189 1,550 68,781
Security Capital Pacific Trust 600 11,100 1,100 20,350
Signet Banking Corp 700 18,288 1,300 33,963
Southern Pacific Rail Corp + 500 12,250 900 22,050
SouthTrust Corp 887 22,951 1,735 44,893
Spelling Entertainment Group Inc + -- -- 300 3,938
Standard Fed Bancorp 400 15,600 700 27,300
Star Banc Corp 300 15,900 600 31,800
State Street Boston Corp 850 31,344 1,790 66,006
Stewart & Stevenson Services 365 11,634 645 20,559
Storage Technology Corp + 567 15,522 1,125 30,797
Stratus Computer Inc + 271 7,588 550 15,400
Sunamerica Inc + 300 17,925 400 23,900
Sunbeam-Oster Co Inc -- -- 400 6,450
Sungard Data Systems Inc + 400 11,100 800 22,200
Synovus Financial Corp 600 15,300 1,600 40,800
TIG Holdings Inc 500 12,813 1,000 25,625
Tecumseh Products Co Class A 249 12,077 331 16,054
Tele-Communications International Inc
Class A + -- -- 400 6,250
Terra Industries Inc -- -- 800 10,700
Thermo Electron Corp + 844 36,398 1,742 75,124
Tidewater Inc 585 14,479 665 16,459
Tosco Corp 359 11,533 645 20,721
Transatlantic Holdings Inc 260 18,200 240 16,800
Trinity Industries Inc 435 14,083 905 29,299
Tyson Foods Inc Class A 1,649 42,462 1,630 41,973
UAL Corp + 100 15,750 300 47,250
UJB Financial Corp 614 21,260 1,279 44,285
Ultramar Corp 400 9,450 800 18,900
Union Bank -- -- 200 10,250
Union Planters Corp 400 11,850 900 26,663
United Asset Management Corp 300 11,700 600 23,400
Unitrin Inc 300 $ 14,100 700 $ 32,900
</TABLE>
66 67
<PAGE> 193
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Universal Corp 381 8,573 200 4,500 639 14,378
Universal Foods Corp 279 8,858 220 6,985 409 12,986
Valero Energy Corp 480 10,980 270 6,176 764 17,477
Vons Co Inc + 480 10,740 270 6,041 764 17,095
Vulcan Materials Co -- -- 300 15,788 400 21,050
Washington Federal Inc -- -- 200 4,650 100 2,325
Washington Mutual Inc -- -- 400 10,350 900 23,288
Washington Post Co Class B 127 36,497 100 28,738 180 51,728
Weingarten Realty Investors -- -- -- -- -- --
Weis Markets Inc -- -- -- -- -- --
Wellman Inc 363 9,257 280 7,140 495 12,623
West One Bancorp 381 15,573 300 12,263 539 22,032
Western National Corp -- -- -- -- -- --
Wheelabrator Technologies Inc + 1,200 18,750 500 7,813 100 1,563
Wilmingtion Trust Corp 392 11,956 210 6,405 649 19,795
Witco Corp 616 20,482 380 12,635 952 31,654
Xtra Corp -- -- -- -- -- --
Zurich Reinsurance Centre Holdings Inc + -- -- -- -- -- --
MEDIUM CAP VALUE STOCKS - VALUE $ 2,515,195 $ 2,195,720 $ 4,351,948
- COST $ 2,111,602 $ 1,876,987 $ 3,722,606
MEDIUM CAP UTILITY STOCKS
PERCENT OF NET ASSETS 1.0% 0.9% 1.0%
AES Corp + 784 $ 14,504 640 $ 11,840 1,148 $ 21,238
Allegheny Power System Inc 1,284 31,298 1,010 24,619 1,809 44,094
Atlanta Gas Light Co 269 9,919 220 8,113 399 14,713
Atlantic Energy Inc 569 10,811 460 8,740 830 15,770
Brooklyn Union Gas Co 510 12,814 400 10,050 719 18,065
CMS Energy Corp 921 22,680 740 18,223 1,314 32,357
Century Telephone Enterprise 567 15,805 460 12,823 828 23,081
Delmarva Power & Light Co 640 13,920 510 11,093 903 19,640
El Paso Natural Gas Co 398 11,194 320 9,000 556 15,638
Florida Progress Corp 1,015 30,831 800 24,300 1,434 43,558
Frontier Corp 783 21,826 630 17,561 1,122 31,276
Idaho Power Co 402 10,603 320 8,440 585 15,429
Illinova Corp 813 20,427 650 16,331 1,153 28,969
IPALCO Enterprises Inc 405 14,023 320 11,080 588 20,360
Kansas City Power & Light Co 667 14,924 530 11,859 955 21,368
LG&E Energy Corp 364 14,105 280 10,850 496 19,220
MCN Corp 616 11,396 500 9,250 930 17,205
Midamerican Energy Co + 451 6,427 367 5,230 680 9,690
Minnesota Power & Light Co 349 9,379 270 7,256 480 12,900
Mobile Telecommunication Technologies Corp
+ -- $ -- 400 $ 12,300 -- $ --
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Universal Corp 394 8,865 765 17,213
Universal Foods Corp 289 9,176 570 18,098
Valero Energy Corp 484 11,072 960 21,960
Vons Co Inc + 484 10,830 560 12,530
Vulcan Materials Co 300 15,788 700 36,838
Washington Federal Inc 500 11,625 900 20,925
Washington Mutual Inc 500 12,938 1,400 36,225
Washington Post Co Class B 133 38,221 25 7,184
Weingarten Realty Investors 200 7,175 500 17,938
Weis Markets Inc -- -- 200 5,650
Wellman Inc 365 9,308 645 16,448
West One Bancorp 394 16,105 765 31,269
Western National Corp -- -- 700 8,750
Wheelabrator Technologies Inc + 1,000 15,625 1,800 28,125
Wilmingtion Trust Corp 404 12,322 775 23,638
Witco Corp 622 20,682 1,195 39,734
Xtra Corp 200 8,850 400 17,700
Zurich Reinsurance Centre Holdings Inc + -- -- 200 5,900
MEDIUM CAP VALUE STOCKS - VALUE $ 3,582,181 $ 6,661,188
- COST $ 3,103,214 $ 6,042,491
MEDIUM CAP UTILITY STOCKS
PERCENT OF NET ASSETS 1.0% 0.6%
AES Corp + 798 $ 14,763 750 $ 13,875
Allegheny Power System Inc 1,319 32,151 1,230 29,981
Atlanta Gas Light Co 279 10,288 260 9,588
Atlantic Energy Inc 590 11,210 550 10,450
Brooklyn Union Gas Co 514 12,914 490 12,311
CMS Energy Corp 954 23,492 885 21,793
Century Telephone Enterprise 588 16,391 565 15,749
Delmarva Power & Light Co 648 14,094 615 13,376
El Paso Natural Gas Co 411 11,559 385 10,828
Florida Progress Corp 1,039 31,560 980 29,768
Frontier Corp 797 22,216 750 20,906
Idaho Power Co 415 10,946 385 10,154
Illinova Corp 843 21,180 780 19,598
IPALCO Enterprises Inc 418 14,473 385 13,331
Kansas City Power & Light Co 690 15,439 645 14,432
LG&E Energy Corp 366 14,183 345 13,369
MCN Corp 670 12,395 600 11,100
Midamerican Energy Co + 489 6,968 -- --
Minnesota Power & Light Co 350 9,406 335 9,003
Mobile Telecommunication Technologies Corp
+ -- $ -- -- $ --
</TABLE>
68 69
<PAGE> 194
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Montana Power Co 563 12,386 460 10,120 824 18,128
NIPSCO Industries Inc 702 22,991 560 18,340 1,015 33,241
National Fuel Gas Co 400 11,250 320 9,000 582 16,369
Nevada Power Co 444 9,047 360 7,335 652 13,285
New England Electric System 695 24,325 560 19,600 1,008 35,280
New York State Electric & Gas 772 18,625 610 14,716 1,087 26,224
NEXTEL Communications Class A + 1,068 19,091 880 15,730 1,588 28,386
Northeast Utilities 1,340 30,653 1,070 24,476 1,916 43,829
Oklahoma Gas & Electric Co 429 15,176 340 12,028 612 21,650
Pinnacle West Capital Corp 941 23,407 750 18,656 1,334 33,183
Portland General Corp 540 12,960 430 10,320 775 18,600
Potomac Electric Power Co 1,282 27,403 1,010 21,589 1,806 38,603
Public Service Company of Colorado 661 21,400 530 17,159 949 30,724
Puget Sound Power & Light Co 683 14,770 540 11,678 971 20,998
SCANA Corp 1,026 23,855 820 19,065 1,446 33,620
Seagull Energy Corp + 391 7,869 310 6,239 548 11,029
Southern New England Telecom Corp 687 23,100 550 18,494 975 32,784
Southwestern Public Service Co 433 12,990 350 10,500 617 18,510
TECO Energy Inc 1,265 27,356 990 21,409 1,789 38,687
Telephone & Data Systems Inc 566 23,206 450 18,450 827 33,907
Utilicorp United Inc 491 13,318 380 10,308 675 18,309
Vanguard Cellular Systems Class A + 411 11,148 330 8,951 595 16,139
WPL Holdings Inc 341 9,719 260 7,410 473 13,481
Washington Gas Light Co 464 8,874 360 6,885 624 11,934
Wisconsin Energy Corp 1,148 30,853 920 24,725 1,645 44,209
WorldCom Inc + 1,308 44,063 1,030 34,698 1,858 62,591
MEDIUM CAP UTILITY STOCKS - VALUE $ 796,721 $ 646,839 $ 1,138,271
- COST $ 739,484 $ 601,524 $ 1,037,134
SMALL CAP GROWTH STOCKS
PERCENT OF NET ASSETS 0.1% 0.1% 0.3%
Bancorp Hawaii Inc 474 $ 15,879 260 $ 8,710 757 $ 25,360
Breed Technologies Inc -- -- -- -- -- --
Collins & Aikman Corp + -- -- -- -- -- --
Ennis Business Forms Inc -- -- -- -- 247 3,211
Flowers Industries Inc 404 8,333 320 6,600 586 12,086
Geon Co -- -- -- -- -- --
Goulds Pumps Inc -- -- -- -- 315 6,773
Hartmarx Corp + 81 527 230 1,495 389 2,529
Home Shopping Network Inc + 1,025 10,763 810 8,505 1,444 15,162
International Dairy Queen Class A + -- -- -- -- 369 7,795
Jacobs Engineering Group + -- $ -- -- $ -- 373 $ 9,465
Kaydon Corp -- -- -- -- 250 7,625
Lance Inc -- -- -- -- 478 8,604
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Montana Power Co 584 12,848 540 11,880
NIPSCO Industries Inc 740 24,235 675 22,106
National Fuel Gas Co 412 11,588 385 10,828
Nevada Power Co 472 9,617 450 9,169
New England Electric System 718 25,130 690 24,150
New York State Electric & Gas 787 18,986 740 17,853
NEXTEL Communications Class A + 1,101 19,680 1,025 18,322
Northeast Utilities 1,386 31,705 1,290 29,509
Oklahoma Gas & Electric Co 442 15,636 415 14,681
Pinnacle West Capital Corp 974 24,228 905 22,512
Portland General Corp 560 13,440 520 12,480
Potomac Electric Power Co 1,316 28,130 1,230 26,291
Public Service Company of Colorado 684 22,145 635 20,558
Puget Sound Power & Light Co 706 15,267 655 14,164
SCANA Corp 1,036 24,087 980 22,785
Seagull Energy Corp + 403 8,110 375 7,547
Southern New England Telecom Corp 710 23,874 680 22,865
Southwestern Public Service Co 462 13,860 415 12,450
TECO Energy Inc 1,284 27,767 1,220 26,383
Telephone & Data Systems Inc 587 24,067 565 23,165
Utilicorp United Inc 494 13,400 472 12,803
Vanguard Cellular Systems Class A + 427 11,582 390 10,579
WPL Holdings Inc 343 9,776 325 9,263
Washington Gas Light Co 454 8,683 440 8,415
Wisconsin Energy Corp 1,175 31,578 1,105 29,697
WorldCom Inc + 1,343 45,242 1,260 42,446
MEDIUM CAP UTILITY STOCKS - VALUE $ 820,289 $ 762,513
- COST $ 751,367 $ 694,833
SMALL CAP GROWTH STOCKS
PERCENT OF NET ASSETS 0.2% 0.1%
Bancorp Hawaii Inc 477 $ 15,980 935 $ 31,323
Breed Technologies Inc -- -- 100 1,913
Collins & Aikman Corp + -- -- 400 3,450
Ennis Business Forms Inc -- -- -- --
Flowers Industries Inc 416 8,580 385 7,941
Geon Co -- -- 300 7,988
Goulds Pumps Inc -- -- -- --
Hartmarx Corp + 354 2,301 618 4,017
Home Shopping Network Inc + 1,049 11,015 680 7,140
International Dairy Queen Class A + -- -- -- --
Jacobs Engineering Group + -- $ -- -- $ --
Kaydon Corp -- -- -- --
Lance Inc -- -- -- --
</TABLE>
70 71
<PAGE> 195
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Lands End Inc + -- -- -- -- 547 9,504
Lawson Products Inc -- -- -- -- 197 5,565
Lawter International Inc -- -- -- -- 677 7,955
Lee Enterprises Inc 249 9,867 -- -- 354 14,027
Lincoln Telecommunications -- -- -- -- 490 9,065
MagneTek Inc + -- -- -- -- 367 4,633
MAXXAM Inc + -- -- -- -- 128 7,520
Nabors Industries Inc + -- -- -- -- 1,285 11,886
National Education Corp + 52 397 118 900 270 2,059
Nellcor Inc + -- -- -- -- 250 13,000
OEA Inc + -- -- -- -- 308 9,240
Precision Castparts Corp -- -- -- -- 300 10,163
Sbarro Inc -- -- -- -- 319 7,297
Smith International Inc + 414 7,245 -- -- 597 10,448
Sotheby's Holdings Inc 611 8,478 -- -- 848 11,766
Stanhome Inc 220 6,820 170 5,270 299 9,269
Sterling Chemicals Inc + 612 6,350 -- -- 849 8,808
Structural Dynamics Research + 303 5,492 -- -- 434 7,866
Surgical Care Affiliates 415 9,078 -- -- 598 13,081
TCA Cable TV Inc 266 8,412 -- -- 371 11,733
Tiffany & Co 163 6,968 -- -- 240 10,260
Topps Co 512 3,072 -- -- 722 4,332
VeriFone Inc + 258 7,321 -- -- 363 10,300
Wausau Paper Mills Co 314 7,301 253 5,882 458 10,649
Williams-Sonoma Inc + -- -- -- -- -- --
SMALL CAP GROWTH STOCKS - VALUE $ 122,303 $ 37,362 $ 319,036
- COST $ 107,907 $ 35,008 $ 277,453
SMALL CAP VALUE STOCKS
PERCENT OF NET ASSETS 0.2% 0.1% 0.4%
AnnTaylor Stores Inc + 247 $ 4,786 195 $ 3,778 351 $ 6,801
Borders Group Inc + -- -- -- -- -- --
Conner Peripherals Inc + 545 7,289 430 5,751 780 10,433
Crown Vantage Inc + 22 529 49 1,186 105 2,539
Edison Brothers Stores Inc -- -- -- -- 347 1,128
Enterra Corp + -- -- -- -- 423 9,253
Exabyte Corp + -- -- -- -- 340 5,143
Family Dollar Stores Inc 620 11,315 480 8,760 857 15,640
Federal Mogul Corp 396 8,811 300 6,675 553 12,304
Federal Realty Investment Trust -- -- -- -- -- --
Fingerhut Co 505 $ 7,891 400 $ 6,250 714 $ 11,156
Fuller H B Co -- -- -- -- 225 7,706
Fund American Enterprises Inc + -- -- -- -- -- --
GenCorp Inc -- -- -- -- 485 5,759
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Lands End Inc + -- -- -- --
Lawson Products Inc -- -- -- --
Lawter International Inc -- -- -- --
Lee Enterprises Inc 255 10,104 -- --
Lincoln Telecommunications -- -- -- --
MagneTek Inc + -- -- -- --
MAXXAM Inc + -- -- -- --
Nabors Industries Inc + 29 268 -- --
National Education Corp + 212 1,617 -- --
Nellcor Inc + 175 9,100 -- --
OEA Inc + 223 6,690 -- --
Precision Castparts Corp 213 7,215 -- --
Sbarro Inc 219 5,010 -- --
Smith International Inc + 427 7,473 -- --
Sotheby's Holdings Inc 623 8,644 -- --
Stanhome Inc 214 6,634 210 6,510
Sterling Chemicals Inc + 624 6,474 -- --
Structural Dynamics Research + 319 5,782 -- --
Surgical Care Affiliates 428 9,363 -- --
TCA Cable TV Inc 276 8,729 -- --
Tiffany & Co 180 7,695 -- --
Topps Co 527 3,162 -- --
VeriFone Inc + 268 7,605 -- --
Wausau Paper Mills Co 326 7,580 297 6,905
Williams-Sonoma Inc + -- -- 200 3,900
SMALL CAP GROWTH STOCKS - VALUE $ 157,021 $ 81,087
- COST $ 133,822 $ 78,852
SMALL CAP VALUE STOCKS
PERCENT OF NET ASSETS 0.3% 0.1%
AnnTaylor Stores Inc + 253 $ 4,902 237 $ 4,592
Borders Group Inc + -- -- 400 8,100
Conner Peripherals Inc + 565 7,557 520 6,955
Crown Vantage Inc + 81 1,972 132 3,208
Edison Brothers Stores Inc -- -- -- --
Enterra Corp + -- -- -- --
Exabyte Corp + -- -- -- --
Family Dollar Stores Inc 627 11,443 495 9,034
Federal Mogul Corp 398 8,856 380 8,455
Federal Realty Investment Trust -- -- 400 8,750
Fingerhut Co 509 $ 7,953 180 $ 2,813
Fuller H B Co -- -- -- --
Fund American Enterprises Inc + -- -- 100 7,250
GenCorp Inc -- -- -- --
</TABLE>
72 73
<PAGE> 196
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Gibson Greeting Inc -- -- -- -- 244 3,508
Granite Construction Inc -- -- -- -- 180 4,680
Hancock Fabrics -- -- -- -- 342 3,591
Hunt (JB) Transport Services -- -- -- -- 596 9,536
IES Industries Inc -- -- -- -- -- --
Indiana Energy Inc -- -- -- -- 352 7,304
Information Resources Inc + -- -- -- -- 403 5,189
Intelligent Electronics -- -- -- -- 540 4,995
International Multifoods Corp -- -- -- -- 274 6,165
John Alden Financial Corp -- -- -- -- -- --
Lukens Inc -- -- -- -- 230 6,900
MacFrugals Bargains Closeouts + -- -- -- -- 438 7,337
Measurex Corp -- -- -- -- 286 8,437
Meyer (Fred) Inc + -- -- -- -- -- --
Michael Foods Inc -- -- -- -- 229 2,977
Michaels Stores Inc + -- -- -- -- -- --
Miller (Herman) Inc 269 7,061 210 5,513 374 9,818
NCH Corp -- -- -- -- 124 7,099
National Presto Industries Inc -- -- -- -- 116 4,930
Novacare Corp + -- -- -- -- 975 8,044
Octel Communications + -- -- -- -- 365 12,456
Oregon Steel Mills Inc -- -- -- -- 299 5,008
Oshkosh B'Gosh Inc Class A 26 462 49 870 228 4,047
Overseas Shipholding Group 393 8,204 310 6,471 550 11,481
Parker & Parsley Petroleum 376 8,037 297 6,348 534 11,414
Parker Drilling Co + -- -- -- -- 844 4,748
Pentair Corp -- -- -- -- 288 13,104
Petrie Stores Corp -- -- -- -- -- --
Phillips Van Heusen Corp -- -- -- -- 410 6,048
Public Service Company of New Mexico + -- -- -- -- 650 9,913
Quaker State Corp -- -- -- -- 419 6,285
Rohr Industries Inc + -- -- -- -- 287 4,449
Rollins Environmental Services + 131 606 353 1,633 769 3,557
Ruddick Corp -- -- -- -- 357 9,550
SPX Corp 22 333 46 696 226 3,418
Savannah Foods & Industries -- -- -- -- 410 4,408
Sequent Computer Systems + 340 8,033 -- -- 471 11,127
Service Merchandise Co + 771 5,493 -- -- 1,516 10,802
Skyline Corp 20 353 44 776 222 3,913
Smucker (J M) Co Class A 305 6,405 -- -- 436 9,156
Southdown Inc + 175 $ 3,325 -- $ -- 253 $ 4,807
Standard Register Co 301 6,396 -- -- 432 9,180
Teleflex Inc 175 7,066 -- -- 254 10,255
Thiokol Inc 216 7,533 -- -- 295 10,288
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Gibson Greeting Inc -- -- -- --
Granite Construction Inc -- -- -- --
Hancock Fabrics -- -- -- --
Hunt (JB) Transport Services -- -- -- --
IES Industries Inc -- -- 300 7,575
Indiana Energy Inc -- -- -- --
Information Resources Inc + -- -- -- --
Intelligent Electronics -- -- -- --
International Multifoods Corp -- -- -- --
John Alden Financial Corp -- -- 300 6,300
Lukens Inc -- -- -- --
MacFrugals Bargains Closeouts + -- -- -- --
Measurex Corp -- -- -- --
Meyer (Fred) Inc + -- -- 200 4,800
Michael Foods Inc -- -- -- --
Michaels Stores Inc + -- -- 200 3,250
Miller (Herman) Inc 279 7,324 260 6,825
NCH Corp 89 5,095 -- --
National Presto Industries Inc 81 3,443 -- --
Novacare Corp + 710 5,858 -- --
Octel Communications + 270 9,214 -- --
Oregon Steel Mills Inc 199 3,333 -- --
Oshkosh B'Gosh Inc Class A 85 1,509 222 3,941
Overseas Shipholding Group 405 8,454 375 7,828
Parker & Parsley Petroleum 386 8,251 462 9,875
Parker Drilling Co + 619 3,482 -- --
Pentair Corp 203 9,237 -- --
Petrie Stores Corp -- -- 200 775
Phillips Van Heusen Corp 290 4,278 -- --
Public Service Company of New Mexico + 470 7,168 -- --
Quaker State Corp 299 4,485 -- --
Rohr Industries Inc + 207 3,209 -- --
Rollins Environmental Services + 623 2,881 822 3,802
Ruddick Corp 262 7,009 -- --
SPX Corp 83 1,255 248 3,751
Savannah Foods & Industries 290 3,118 -- --
Sequent Computer Systems + 341 8,056 -- --
Service Merchandise Co + 1,111 7,916 -- --
Skyline Corp 78 1,375 133 2,344
Smucker (J M) Co Class A 331 6,951 -- --
Southdown Inc + 178 $ 3,382 -- $ --
Standard Register Co 312 6,630 -- --
Teleflex Inc 194 7,833 -- --
Thiokol Inc 210 7,324 -- --
</TABLE>
74 75
<PAGE> 197
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Varco International Inc + 292 3,212 -- -- 524 5,764
Waban Inc + 365 6,889 -- -- 497 9,381
Wallace Computer Services Inc 245 14,149 -- -- 350 20,213
Watts Industries Inc Class A + 308 7,623 -- -- 464 11,484
Western Publishing Group Inc + 234 2,574 -- -- 313 3,443
SMALL CAP VALUE STOCKS - VALUE $ 144,375 $ 54,707 $ 418,071
- COST $ 141,529 $ 57,923 $ 410,870
MICRO CAP STOCKS
PERCENT OF NET ASSETS 0.0% 0.0% 0.0%
Dave & Buster's Inc + -- $ -- -- $ -- 69 $ 1,186
Genzyme Corp - Tissue Repair + 35 503 -- -- 49 704
International Technology Corp + -- -- -- -- 551 1,791
Mid-American Waste Systems Inc + -- -- -- -- 372 2,000
NPC International Inc -- -- -- -- 374 2,384
Sequa Corp Class A + 110 2,929 -- -- 137 3,648
Sizzler International Inc 254 1,524 -- -- 434 2,604
Strattec Security Corp + 10 145 28 406 72 1,044
XOMA Corp + 188 658 -- -- 193 676
MICRO CAP STOCKS - VALUE $ 5,759 $ 406 $ 16,037
- COST $ 5,426 $ 344 $ 16,698
INTERNATIONAL STOCKS (EXCEPT JAPAN)
PERCENT OF NET ASSETS 3.4% 8.2% 10.9%
Alcatel Alsthom Compagnie Generale
d'Electricite ADR (France) 5,000 $ 100,000 10,900 $ 218,000 23,850 $ 477,000
Allied Irish Banks PLC ADR (Ireland) 600 17,025 1,300 36,888 2,850 80,869
BAT Industries PLC ADR (UK) 4,300 67,725 9,100 143,325 20,000 315,000
BET PLC ADR (UK) 2,900 23,925 6,300 51,975 13,750 113,438
Banco Bilbao Vizcaya ADR (Spain) 300 9,038 800 24,100 1,800 54,225
Banco Central Hispanoamericano SA ADR
(Spain) 400 4,100 900 9,225 2,250 23,063
Banco Santander SA ADR (Spain) 300 12,375 700 28,875 1,550 63,938
Barclays PLC ADR (UK) 1,200 53,550 2,700 120,488 5,850 261,056
Benetton Group SpA ADR (Italy) 2,300 49,738 5,000 108,125 11,000 237,875
British Airways PLC ADR (UK) 700 46,375 1,500 99,375 3,200 212,000
British Petroleum Co PLC ADR (UK) 500 45,063 1,100 99,138 2,450 220,806
British Gas PLC ADR (UK) 1,600 69,000 3,400 146,625 7,550 325,594
British Steel PLC ADR (UK) 300 8,400 800 22,400 1,750 49,000
British Telecommunications PLC ADR (UK) 1,600 $ 100,400 3,400 $ 213,350 7,550 $ 473,763
Broken Hill Proprietory Co Ltd ADR
(Australia) 990 57,544 2,130 123,806 4,370 254,006
Coles Myer Ltd ADR (Australia) 1,024 27,008 2,232 58,869 4,800 126,600
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Varco International Inc + 374 4,114 -- --
Waban Inc + 367 6,927 -- --
Wallace Computer Services Inc 255 14,726 -- --
Watts Industries Inc Class A + 334 8,267 -- --
Western Publishing Group Inc + 233 2,563 -- --
SMALL CAP VALUE STOCKS - VALUE $ 227,350 $ 120,223
- COST $ 219,655 $ 131,690
MICRO CAP STOCKS
PERCENT OF NET ASSETS 0.0% 0.0%
Dave & Buster's Inc + -- $ -- -- $ --
Genzyme Corp - Tissue Repair + 36 518 33 474
International Technology Corp + -- -- -- --
Mid-American Waste Systems Inc + -- -- -- --
NPC International Inc 284 1,811 -- --
Sequa Corp Class A + 102 2,716 -- --
Sizzler International Inc 319 1,914 -- --
Strattec Security Corp + 49 711 -- --
XOMA Corp + 193 676 -- --
MICRO CAP STOCKS - VALUE $ 8,346 $ 474
- COST $ 8,102 $ 152
INTERNATIONAL STOCKS (EXCEPT JAPAN)
PERCENT OF NET ASSETS 13.3% 14.5%
Alcatel Alsthom Compagnie Generale
d'Electricite ADR (France) 19,500 $ 390,000 31,500 $ 630,000
Allied Irish Banks PLC ADR (Ireland) 2,300 65,263 3,750 106,406
BAT Industries PLC ADR (UK) 16,350 257,513 26,400 415,800
BET PLC ADR (UK) 11,250 92,813 18,050 148,913
Banco Bilbao Vizcaya ADR (Spain) 1,500 45,188 2,400 72,300
Banco Central Hispanoamericano SA ADR
(Spain) 1,800 18,450 2,950 30,238
Banco Santander SA ADR (Spain) 1,250 51,563 2,050 84,563
Barclays PLC ADR (UK) 4,750 211,969 7,700 343,613
Benetton Group SpA ADR (Italy) 9,000 194,625 14,500 313,563
British Airways PLC ADR (UK) 2,600 172,250 4,200 278,250
British Petroleum Co PLC ADR (UK) 2,000 180,250 3,250 292,906
British Gas PLC ADR (UK) 6,150 265,219 9,950 429,094
British Steel PLC ADR (UK) 1,400 39,200 2,300 64,400
British Telecommunications PLC ADR (UK) 6,150 $ 385,913 9,950 $ 624,363
Broken Hill Proprietory Co Ltd ADR
(Australia) 3,760 218,550 6,090 353,981
Coles Myer Ltd ADR (Australia) 4,032 106,344 6,490 171,174
</TABLE>
76 77
<PAGE> 198
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Courtaulds PLC ADR (UK) 8,600 65,575 18,600 141,825 40,850 311,481
Daimler Benz Aktiengesellschaft ADR
(Germany) 7,600 376,200 16,400 811,800 35,950 1,779,525
ELF Aquitaine ADR (France) 4,200 153,825 9,000 329,625 19,850 727,006
Fiat SpA ADR (Italy) + 3,400 62,900 7,300 135,050 16,050 296,925
Glaxo Holdings PLC ADR (UK) 3,200 76,000 7,000 166,250 15,300 363,375
Grand Metropolitan PLC ADR (UK) 3,300 84,563 7,200 184,500 15,700 402,313
Hafslund Nycomed Class B ADR (Norway) 1,100 26,400 2,500 60,000 5,000 120,000
Hanson PLC ADR (UK) 3,700 63,363 8,100 138,713 17,800 304,825
Hong Kong Telecommunications Ltd ADR (Hong
Kong) 9,400 168,025 20,400 364,650 44,750 799,906
Imperial Chemical Industries PLC ADR (UK) 900 42,863 2,000 95,250 4,150 197,644
KLM Royal Dutch Airlines ADR (Netherlands)
+ 300 9,938 600 19,875 1,300 43,063
Montedison SpA ADR (Italy) + 1,600 12,000 3,100 23,250 6,650 49,875
National Australia Bank Ltd ADS
(Australia) 900 38,813 1,900 81,938 4,100 176,813
News Corporation Ltd ADR (Australia) 600 13,650 1,300 29,575 3,000 68,250
Novo-Nordisk A/S ADR (Denmark) 1,800 51,300 3,900 111,150 8,050 229,425
Philips Electronics NV (Netherlands) 800 36,000 1,800 81,000 3,950 177,750
RTZ PLC ADR (UK) 1,200 66,300 2,600 143,650 5,700 314,925
Repsol SA ADR (Spain) 900 28,463 1,700 53,763 3,750 118,594
Rhone-Poulenc SA ADR (France) 1,900 39,425 4,200 87,150 9,100 188,825
Royal Dutch Petroleum Co ADR (Netherlands) 839 100,051 1,817 216,677 4,038 481,532
Smithkline Beecham PLC ADR (UK) 900 40,275 1,900 85,025 4,250 190,188
Telecommunications of New Zealand Corp ADR
(New Zealand) 400 25,550 800 51,100 1,850 118,169
Telefonica de Espana ADR (Spain) 1,000 40,625 2,300 93,438 4,800 195,000
Total Compagnie Francaise des Petroles SA
ADR (France) 1,700 50,575 3,700 110,075 8,200 243,950
Unilever NV (Netherlands) 2,505 309,681 5,283 653,111 11,521 1,424,284
U.S. Industries Inc + 195 3,047 305 4,766 450 7,031
Vodafone Group PLC ADR (UK) 900 37,688 1,800 75,375 3,900 163,313
Western Mining Holdings Corp Ltd ADR
(Australia) 800 21,500 1,600 43,000 3,400 91,375
Westpac Banking Corp ADR (Australia) 800 15,000 1,700 31,875 3,800 71,250
INTERNATIONAL STOCKS - VALUE $ 2,750,861 $ 5,928,020 $ 12,944,845
- COST $ 2,642,497 $ 5,746,716 $ 12,796,296
JAPANESE STOCKS
PERCENT OF NET ASSETS 1.7% 2.5% 3.8%
CSK Corp ADR 1,750 $ $46,813 2,150 $ $57,513 5,400 $ $144,450
Canon Inc ADR 500 45,063 650 58,581 1,700 153,213
Fuji Photo Film Co Ltd ADR 700 34,825 900 44,775 2,200 109,450
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Courtaulds PLC ADR (UK) 33,400 254,675 53,700 409,463
Daimler Benz Aktiengesellschaft ADR
(Germany) 29,400 1,455,300 47,450 2,348,775
ELF Aquitaine ADR (France) 16,200 593,325 26,200 959,575
Fiat SpA ADR (Italy) + 13,150 243,275 21,200 392,200
Glaxo Holdings PLC ADR (UK) 12,500 296,875 20,200 479,750
Grand Metropolitan PLC ADR (UK) 12,850 329,281 20,700 530,438
Hafslund Nycomed Class B ADR (Norway) 4,450 106,800 7,150 171,600
Hanson PLC ADR (UK) 14,550 249,169 23,500 402,438
Hong Kong Telecommunications Ltd ADR (Hong
Kong) 36,600 654,225 59,050 1,055,519
Imperial Chemical Industries PLC ADR (UK) 3,550 169,069 5,750 273,844
KLM Royal Dutch Airlines ADR (Netherlands)
+ 1,050 34,781 1,700 56,313
Montedison SpA ADR (Italy) + 5,850 43,875 9,400 70,500
National Australia Bank Ltd ADS
(Australia) 3,350 144,469 5,400 232,875
News Corporation Ltd ADR (Australia) 2,450 55,738 3,950 89,863
Novo-Nordisk A/S ADR (Denmark) 7,000 199,500 11,250 320,625
Philips Electronics NV (Netherlands) 3,250 146,250 5,250 236,250
RTZ PLC ADR (UK) 4,650 256,913 7,500 414,375
Repsol SA ADR (Spain) 3,150 99,619 5,050 159,706
Rhone-Poulenc SA ADR (France) 7,450 154,588 12,000 249,000
Royal Dutch Petroleum Co ADR (Netherlands) 3,300 393,525 5,303 632,383
Smithkline Beecham PLC ADR (UK) 3,500 156,625 5,650 252,838
Telecommunications of New Zealand Corp ADR
(New Zealand) 1,500 95,813 2,450 156,494
Telefonica de Espana ADR (Spain) 4,100 166,563 6,650 270,156
Total Compagnie Francaise des Petroles SA
ADR (France) 6,700 199,325 10,850 322,788
Unilever NV (Netherlands) 9,415 1,163,929 15,232 1,883,056
U.S. Industries Inc + 260 4,063 335 5,234
Vodafone Group PLC ADR (UK) 3,200 134,000 5,150 215,656
Western Mining Holdings Corp Ltd ADR
(Australia) 2,850 76,594 4,600 123,625
Westpac Banking Corp ADR (Australia) 3,100 58,125 5,000 93,750
INTERNATIONAL STOCKS - VALUE $ 10,631,399 $ 17,168,653
- COST $ 10,637,685 $ 17,274,456
JAPANESE STOCKS
PERCENT OF NET ASSETS 4.4% 5.2%
CSK Corp ADR 4,200 $ $112,350 7,400 $ $197,950
Canon Inc ADR 1,300 117,163 2,250 202,781
Fuji Photo Film Co Ltd ADR 1,700 84,575 3,050 151,738
</TABLE>
78 79
<PAGE> 199
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
LIFEPATH 2000 LIFEPATH 2010 2020 2020
--------------------------- --------------------------- ------------ ------------
SECURITY NAME SHARES VALUE SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Hitachi Ltd ADR 400 43,500 550 59,813 1,400 152,250
Honda Motor Co Ltd ADR 1,000 34,875 1,400 48,825 3,450 120,319
Ito Yokado Co Ltd ADR 550 116,325 700 148,050 1,700 359,550
Japan Air Lines Co ADR 8,800 111,100 11,350 143,294 28,400 358,550
Kirin Brewery Co ADR 1,400 147,700 1,800 189,900 4,600 485,300
Kubota Corp ADR 100 13,000 100 13,000 100 13,000
Kyocera Corp ADR 250 44,563 300 53,475 750 133,688
Makita Corp ADR 2,150 33,863 2,850 44,888 7,100 111,825
Matsushita Electric Industrial Co Ltd ADR 250 39,125 250 39,125 650 101,725
Mitsui & Co Ltd ADR 850 134,300 1,150 181,700 2,950 466,100
NEC Corp ADR 950 61,631 1,250 81,094 3,050 197,869
Nippon Telephone & Telegraph ADR 1,800 81,900 2,350 106,925 5,900 268,450
Nissan Motor Co Ltd ADR 2,200 33,275 3,000 45,375 7,550 114,194
Pioneer Electronics Corp 1,750 35,000 2,350 47,000 5,900 118,000
SONY Corp ADR 600 33,075 800 44,100 2,000 110,250
Tokio Marine & Fire Insurance Co ADR 4,200 246,225 5,500 322,438 13,800 809,025
Toyota Motor Corp ADR 1,500 59,063 1,950 76,781 4,850 190,969
JAPANESE STOCKS - VALUE $ 1,395,221 $ 1,806,652 $ 4,518,177
- COST $ 1,405,819 $ 1,821,087 $ 4,574,324
TOTAL COMMON STOCKS - VALUE $ 18,392,654 $ 36,703,186 $ 81,404,848
- COST $ 16,232,071 $ 32,550,948 $ 72,073,092
<CAPTION>
LIFEPATH 2030 LIFEPATH 2040
--------------------------- ---------------------------
SECURITY NAME SHARES VALUE SHARES VALUE
<S> <C> <C> <C> <C>
COMMON STOCKS (CONTINUED)
Hitachi Ltd ADR 1,050 114,188 1,850 201,188
Honda Motor Co Ltd ADR 2,650 92,419 4,650 162,169
Ito Yokado Co Ltd ADR 1,350 285,525 2,350 497,025
Japan Air Lines Co ADR 22,000 277,750 38,500 486,063
Kirin Brewery Co ADR 3,550 374,525 6,200 654,100
Kubota Corp ADR 100 13,000 100 13,000
Kyocera Corp ADR 600 106,950 1,000 178,250
Makita Corp ADR 5,500 86,625 9,700 152,775
Matsushita Electric Industrial Co Ltd ADR 500 78,250 900 140,850
Mitsui & Co Ltd ADR 2,300 363,400 3,950 624,100
NEC Corp ADR 2,350 152,456 4,200 272,475
Nippon Telephone & Telegraph ADR 4,600 209,300 8,050 366,275
Nissan Motor Co Ltd ADR 5,850 88,481 10,300 155,788
Pioneer Electronics Corp 4,600 92,000 8,050 161,000
SONY Corp ADR 1,550 85,444 2,700 148,838
Tokio Marine & Fire Insurance Co ADR 10,700 627,288 18,800 1,102,150
Toyota Motor Corp ADR 3,800 149,625 6,650 261,844
JAPANESE STOCKS - VALUE $ 3,511,314 $ 6,130,359
- COST $ 3,554,040 $ 6,208,862
TOTAL COMMON STOCKS - VALUE $ 65,166,543 $113,346,544
- COST $ 58,171,665 $102,372,212
</TABLE>
80 81
<PAGE> 200
MASTER INVESTMENT PORTFOLIO--LIFEPATH MASTER SERIES
AUGUST 31, 1995
PORTFOLIOS OF INVESTMENTS (UNAUDITED)
<TABLE>
<CAPTION>
LIFEPATH 2000 LIFEPATH 2010 LIFEPATH 2020
-------------------------- -------------------------- -------------
<S> <C> <C> <C> <C> <C>
SECURITY NAME PAR VALUE PAR VALUE PAR
LONG-TERM GOVERNMENT BONDS
PERCENT OF NET ASSETS 6.4% 5.5%
U.S. Treasury Bonds, 6.25% - 11.88%, 11/15/03 -
11/15/24 4,150,000 $ 5,143,654 3,150,000 $ 3,949,123 6,100,000
U.S. TREASURY BONDS - COST $ 5,065,337 $ 3,876,938
INTERMEDIATE-TERM GOVERNMENT NOTES
PERCENT OF NET ASSETS 52.0% 35.9%
U.S. Treasury Notes, 4.38% - 9.13%, 09/30/96 -
02/15/05 41,600,000 $ 41,969,099 25,250,000 $ 25,777,209 23,680,000
U.S. TREASURY NOTES - COST $ 41,285,135 $ 25,354,189
MONEY MARKETS
PERCENT OF NET ASSETS 18.4% 8.7%
U.S. Treasury Bills, 5.20% - 5.54%+, 09/07/95 -
11/24/95 14,998,000 $ 14,853,037 6,324,000 $ 6,267,044 7,143,000
U.S. TREASURY BILLS - COST $ 14,851,611 $ 6,266,466
TOTAL INVESTMENTS - VALUE $80,358,444 $72,696,562
(NOTES 1 AND 3) - COST** $77,434,154 $68,048,541
<CAPTION>
- --------------------------------------------------------------------------------------------------------- -------------
<S> <C> <C> <C> <C> <C>
TOTAL INVESTMENTS IN SECURITIES 99.6% $ 80,358,444 101.3% $ 72,696,562 100.9%
Other Assets and Liabilities, Net 0.4% 293,587 (1.3 )% (940,446) (0.9 )%
----------- ------------ ----------- ------------ -------------
TOTAL NET ASSETS 100.0% $ 80,652,031 100.0% $ 71,756,116 100.0%
----------- ------------ ----------- ------------ -------------
----------- ------------ ----------- ------------ -------------
- -------------------------------------------------------------------------------------------------------------------------
<CAPTION>
LIFEPATH 2020 LIFEPATH 2030 LIFEPATH 2040
------------- -------------------------- --------------------------
<S> <C> <C> <C> <C> <C>
SECURITY NAME VALUE PAR VALUE PAR VALUE
LONG-TERM GOVERNMENT BONDS
PERCENT OF NET ASSETS 5.9% 11.6% 2.7%
U.S. Treasury Bonds, 6.25% - 11.88%, 11/15/03 -
11/15/24 $ 6,970,655 8,130,000 $ 9,311,472 2,750,000 $ 3,159,014
U.S. TREASURY BONDS - COST $ 6,400,271 $ 8,618,027 $ 2,990,987
INTERMEDIATE-TERM GOVERNMENT NOTES
PERCENT OF NET ASSETS 20.3% 3.4% 0.2%
U.S. Treasury Notes, 4.38% - 9.13%, 09/30/96 -
02/15/05 $ 24,129,255 2,800,000 $ 2,744,344 250,000 $ 272,188
U.S. TREASURY NOTES - COST $ 23,696,750 $ 2,727,389 $ 268,523
MONEY MARKETS
PERCENT OF NET ASSETS 6.0% 3.8% 2.7%
U.S. Treasury Bills, 5.20% - 5.54%+, 09/07/95 -
11/24/95 $ 7,078,722 3,057,000 $ 3,028,756 3,269,000 $ 3,233,487*
U.S. TREASURY BILLS - COST $ 7,078,396 $ 3,028,578 $ 3,233,206
TOTAL INVESTMENTS - VALUE $119,583,480 $80,251,115 $120,011,233
(NOTES 1 AND 3) - COST** $109,248,509 $72,545,659 $108,864,928
- ------------------------------------------------
<S> <C> <C> <C> <C> <C>
TOTAL INVESTMENTS IN SECURITIES $ 119,583,480 100.3% $ 80,251,115 101.3% $120,011,233
Other Assets and Liabilities, Net (1,065,466) (0.3 )% (276,831) (1.3 )% (1,546,269)
------------- ----------- ------------ ----------- ------------
TOTAL NET ASSETS $ 118,518,014 100.0% $ 79,974,284 100.0% $118,464,964
------------- ----------- ------------ ----------- ------------
------------- ----------- ------------ ----------- ------------
- -------------------------------------------------------------------------------------------------------------------------
+ NON-INCOME EARNING SECURITIES.
+ YIELD TO MATURITY.
* CERTAIN U.S. TREASURY BILLS ARE PLEDGED AS COLLATERAL FOR SECURITY CONTRACTS. SEE NOTE 1.
** COST FOR FEDERAL INCOME TAX PURPOSES IS THE SAME FOR FINANCIAL STATEMENT PURPOSES AND NET
UNREALIZED APPRECIATION CONSISTS OF:
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Gross Unrealized Appreciation $3,239,625 $5,177,713 $11,522,372
Gross Unrealized Depreciation (315,335) (529,692) (1,187,401)
------------ ------------ ------------
NET UNREALIZED APPRECIATION $2,924,290 $4,648,021 $ 10,334,971
------------ ------------ ------------
------------ ------------ ------------
<CAPTION>
Gross Unrealized Appreciation $8,667,751 $12,841,849
Gross Unrealized Depreciation (962,295) (1,695,544)
------------ ------------
NET UNREALIZED APPRECIATION $7,705,456 $ 11,146,305
------------ ------------
------------ ------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
82 83
<PAGE> 201
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
AUGUST 31, 1995
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020
MASTER SERIES MASTER SERIES MASTER SERIES
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------
ASSETS
INVESTMENTS:
In securities, at market
value (see cost below)
(Note 1) $80,358,444 $72,696,562 $119,583,480
Cash 1,946 3,604 6,036
RECEIVABLES:
Dividends and interest 689,839 438,608 489,168
Beneficial interests sold 354,143 180,600 199,424
Variation margin on
futures contracts 0 0 0
TOTAL ASSETS 81,404,372 73,319,374 120,278,108
LIABILITIES
PAYABLES:
Investment securities
purchased 0 1,004,710 1,003,939
Allocation to beneficial
interest holders 663,136 495,080 650,791
Beneficial interests
redeemed 17,082 0 0
Due to adviser 72,123 63,468 105,364
TOTAL LIABILITIES 752,341 1,563,258 1,760,094
TOTAL NET ASSETS $80,652,031 $71,756,116 $118,518,014
INVESTMENTS AT COST $77,434,154 $68,048,541 $109,248,509
- ----------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
84
<PAGE> 202
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
2030 2040
MASTER SERIES MASTER SERIES
<S> <C> <C>
- ----------------------------------------------------------------
ASSETS
INVESTMENTS:
In securities, at market
value (see cost below)
(Note 1) $80,251,115 $120,011,233
Cash 2,065 4,335
RECEIVABLES:
Dividends and interest 306,496 329,400
Beneficial interests sold 329,803 309,715
Variation margin on
futures contracts 0 1,700
TOTAL ASSETS 80,889,479 120,656,383
LIABILITIES
PAYABLES:
Investment securities
purchased 500,747 1,694,933
Allocation to beneficial
interest holders 343,852 394,128
Beneficial interests
redeemed 0 0
Due to adviser 70,596 102,358
TOTAL LIABILITIES 915,195 2,191,419
TOTAL NET ASSETS $79,974,284 $118,464,964
INVESTMENTS AT COST $72,545,659 $108,864,928
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
85
<PAGE> 203
STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED AUGUST 31, 1995
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020
MASTER SERIES MASTER SERIES MASTER SERIES
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------
INVESTMENT INCOME
Dividends $ 231,215 $ 400,713 $ 885,614
Interest 1,776,738 1,063,437 1,174,378
TOTAL INVESTMENT INCOME 2,007,953 1,464,150 2,059,992
EXPENSES (NOTE 2)
Advisory fees 194,714 164,464 277,294
TOTAL EXPENSES 194,714 164,464 277,294
NET INVESTMENT INCOME 1,813,239 1,299,686 1,782,698
REALIZED AND UNREALIZED GAIN
ON INVESTMENTS
Net realized gain on sale
of investments 819,544 794,570 1,765,492
Net realized gain on sale
of futures contracts 27,030 67,639 542,038
Net change in unrealized
appreciation of
investments 2,919,380 4,100,538 7,982,249
Net change in unrealized
appreciation
(depreciation) of
futures contracts (15,075) (10,050) 0
NET GAIN ON INVESTMENTS 3,750,879 4,952,697 10,289,779
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $5,564,118 $6,252,383 $12,072,477
- ----------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
86
<PAGE> 204
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH
2030 2040
MASTER SERIES MASTER SERIES
<S> <C> <C>
- ----------------------------------------------------------------
INVESTMENT INCOME
Dividends $ 672,254 $ 1,068,190
Interest 478,912 263,859
TOTAL INVESTMENT INCOME 1,151,166 1,332,049
EXPENSES (NOTE 2)
Advisory fees 180,334 254,006
TOTAL EXPENSES 180,334 254,006
NET INVESTMENT INCOME 970,832 1,078,043
REALIZED AND UNREALIZED GAIN
ON INVESTMENTS
Net realized gain on sale
of investments 2,072,718 3,703,158
Net realized gain on sale
of futures contracts 47,954 94,934
Net change in unrealized
appreciation of
investments 5,647,335 7,972,248
Net change in unrealized
appreciation
(depreciation) of
futures contracts 0 50,750
NET GAIN ON INVESTMENTS 7,768,007 11,821,090
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $8,738,839 $12,899,133
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
87
<PAGE> 205
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
LIFEPATH 2000 MASTER SERIES
----------------------------------
(UNAUDITED) FOR THE
FOR THE YEAR ENDED
SIX MONTHS ENDED FEBRUARY 28,
AUGUST 31, 1995 1995
<S> <C> <C>
- ----------------------------------------------------------------
INCREASE IN NET ASSETS
Net investment income $ 1,813,239 $ 2,112,452
Net realized gain (loss)
on sale of investments 819,544 118,927
Net realized gain (loss)
on sale of futures
contracts 27,030 48,130
Net change in unrealized
appreciation of
investments 2,919,380 4,911
Net change in unrealized
appreciation
(depreciation) of
futures contracts (15,075) 15,075
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 5,564,118 2,299,495
NET INCREASE IN NET ASSETS
RESULTING FROM BENEFICIAL
INTERESTS TRANSACTIONS 13,453,692 59,314,726
INCREASE IN NET ASSETS 19,017,810 61,614,221
NET ASSETS:
Beginning net assets 61,634,221 20,000
ENDING NET ASSETS $80,652,031 $61,634,221
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
88
<PAGE> 206
<TABLE>
<CAPTION>
LIFEPATH 2010 MASTER SERIES LIFEPATH 2020 MASTER SERIES
---------------------------------- ----------------------------------
(UNAUDITED) FOR THE (UNAUDITED) FOR THE
FOR THE YEAR ENDED FOR THE YEAR ENDED
SIX MONTHS ENDED FEBRUARY 28, SIX MONTHS ENDED FEBRUARY 28,
AUGUST 31, 1995 1995 AUGUST 31, 1995 1995
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------
INCREASE IN NET ASSETS
Net investment income $ 1,299,686 $ 1,467,751 $ 1,782,698 $ 1,990,649
Net realized gain (loss)
on sale of investments 794,570 2,805 1,765,492 52,734
Net realized gain (loss)
on sale of futures
contracts 67,639 295,721 542,038 (21,107)
Net change in unrealized
appreciation of
investments 4,100,538 547,483 7,982,249 2,352,722
Net change in unrealized
appreciation
(depreciation) of
futures contracts (10,050) 10,050 0 0
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 6,252,383 2,323,810 12,072,477 4,374,998
NET INCREASE IN NET ASSETS
RESULTING FROM BENEFICIAL
INTERESTS TRANSACTIONS 16,019,399 47,140,524 24,202,761 77,847,778
INCREASE IN NET ASSETS 22,271,782 49,464,334 36,275,238 82,222,776
NET ASSETS:
Beginning net assets 49,484,334 20,000 82,242,776 20,000
ENDING NET ASSETS $71,756,116 $49,484,334 $118,518,014 $82,242,776
- ----------------------------------------------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
89
<PAGE> 207
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
LIFEPATH 2030 MASTER SERIES
----------------------------------
(UNAUDITED) FOR THE
FOR THE YEAR ENDED
SIX MONTHS ENDED FEBRUARY 28,
AUGUST 31, 1995 1995
<S> <C> <C>
- ----------------------------------------------------------------
INCREASE IN NET ASSETS
Net investment income $ 970,832 $ 1,148,788
Net realized gain (loss)
on sale of investments 2,072,718 (144,351)
Net realized gain (loss)
on sale of futures
contracts 47,954 (38,856)
Net change in unrealized
appreciation of
investments 5,647,335 2,058,121
Net change in unrealized
appreciation
(depreciation) of
futures contracts 0 0
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 8,738,839 3,023,702
NET INCREASE IN NET ASSETS
RESULTING FROM BENEFICIAL
INTERESTS TRANSACTIONS 20,600,972 47,590,771
INCREASE IN NET ASSETS 29,339,811 50,614,473
NET ASSETS:
Beginning net assets 50,634,473 20,000
ENDING NET ASSETS $79,974,284 $50,634,473
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
90
<PAGE> 208
<TABLE>
<CAPTION>
LIFEPATH 2040 MASTER SERIES
----------------------------------
(UNAUDITED) FOR THE
FOR THE YEAR ENDED
SIX MONTHS ENDED FEBRUARY 28,
AUGUST 31, 1995 1995
<S> <C> <C>
- ----------------------------------------------------------------
INCREASE IN NET ASSETS
Net investment income $ 1,078,043 $ 1,039,966
Net realized gain (loss)
on sale of investments 3,703,158 140,585
Net realized gain (loss)
on sale of futures
contracts 94,934 (102,175)
Net change in unrealized
appreciation of
investments 7,972,248 3,174,056
Net change in unrealized
appreciation
(depreciation) of
futures contracts 50,750 0
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 12,899,133 4,252,432
NET INCREASE IN NET ASSETS
RESULTING FROM BENEFICIAL
INTERESTS TRANSACTIONS 39,006,309 62,287,090
INCREASE IN NET ASSETS 51,905,442 66,539,522
NET ASSETS:
Beginning net assets 66,559,522 20,000
ENDING NET ASSETS $118,464,964 $66,559,522
- ----------------------------------------------------------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
91
<PAGE> 209
(THIS PAGE INTENTIONALLY LEFT BLANK)
92
<PAGE> 210
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
Master Investment Portfolio ("Master Portfolio") is registered under the
Investment Company Act of 1940, as amended, as an open-end management investment
company. Master Portfolio was organized as a Delaware business trust pursuant to
an Agreement and Declaration of Trust dated May 14, 1993 (the "Trust") and had
no operations prior to March 1, 1994. Master Portfolio is currently authorized
to issue fourteen separate diversified portfolios (the "Master Series"), of
which the following have commenced operations: LifePath 2000 Master Series,
LifePath 2010 Master Series, LifePath 2020 Master Series, LifePath 2030 Master
Series, LifePath 2040 Master Series, Asset Allocation Master Series, Bond Index
Master Series, S&P 500 Index Master Series and U.S. Treasury Allocation Master
Series. The following significant accounting policies are consistently followed
by Master Portfolio in the preparation of its financial statements, and such
policies are in conformity with generally accepted accounting principles for
investment companies. The financial statements for the Asset Allocation Master
Series, Bond Index Master Series, S&P 500 Index Master Series and U.S. Treasury
Allocation Master Series are presented separately.
INVESTMENT POLICY AND SECURITY VALUATION
Each Master Series covered by this report follows an asset allocation
strategy among three broad investment classes: equity and debt securities of
issuers located throughout the world and cash in the form of money market
instruments. The equity securities of the Master Series are valued at the last
sale price on the primary securities exchange or national securities market on
which such securities are traded. Securities not listed on an exchange or
national securities market, or securities in which there were no transactions,
are valued at the most recent bid prices. Debt securities maturing in 60 days or
less are valued at amortized cost, which approximates market value. Debt
securities, other than those maturing in 60 days or less, are valued at the
latest quoted bid price. Any securities, restricted securities or other assets
for which recent market quotations are not readily available, are valued at fair
value as determined in good faith in accordance with policies approved by Master
Portfolio's Board of Trustees.
93
<PAGE> 211
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
SECURITY TRANSACTIONS AND INCOME RECOGNITION
Securities transactions are accounted for on the date the securities are
purchased or sold (trade date). Dividend income is recognized on the ex-dividend
date, and interest income is recognized on a daily accrual basis. Realized gains
or losses are reported on the basis of identified cost of securities delivered.
Bond discounts and premiums are amortized as required by the Internal Revenue
Code of 1986 (the "Code").
FEDERAL INCOME TAXES
Each Master Series of the Trust intends to qualify as a partnership for
federal income tax purposes. Each Master Series therefore believes that it will
not be subject to any federal income tax on its income and net capital gains (if
any). However, each investor in a Master Series will be taxable on its allocable
share of the partnership's income and capital gains. The determination of such
share will be made in accordance with the applicable sections of the Code.
It is intended that each Master Series' assets, income and allocations will
be managed in such a way that a regulated investment company investing in a
Master Series will be able to satisfy the requirements of Subchapter M of the
Code, assuming that the investment company invested all of its assets in the
corresponding Master Series.
FUTURES CONTRACTS
The Master Series may purchase futures contracts to gain exposure to market
changes, as this may be more efficient or cost effective than actually buying
the securities. A futures contract is an agreement between two parties to buy
and sell a security at a set price on a future date and is exchange traded. Upon
entering into a futures contract, a Master Series is required to pledge to the
broker an amount of cash, U.S. Government securities or other high-quality debt
securities equal to the minimum "initial margin" requirements of the exchange.
Pursuant to the contract, the Master Series agrees to receive from or pay to the
broker an amount of cash equal to the daily fluctuation in the value of the
contract. Such receipts or payments are known as "variation margin" and are
recorded by the Master Series as unrealized gains or losses. When the contract
is closed, the Master Series records a realized gain or loss equal to the
difference between the
94
<PAGE> 212
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
value of the contract at the time it was opened and the value at the time it was
closed. Pursuant to regulations and/or published positions of the Securities and
Exchange Commission, the Master Series are required to segregate cash, U.S.
Government obligations or high quality, liquid debt instruments in connection
with futures transactions in an amount generally equal to the entire contract
amount. Risks of entering into futures contracts include the possibility that
there may be an illiquid market and that a change in the value of the contracts
may not correlate with changes in the value of the underlying securities. As of
August 31, 1995, the following Master Series had futures contracts outstanding:
<TABLE>
<S> <C> <C> <C> <C> <C>
NOTIONAL NET
NUMBER OF CONTRACT UNREALIZED
MASTER SERIES CONTRACTS TYPE EXPIRATION DATE VALUE APPRECIATION
- ----------------------------------------------------------------------------------------
LifePath 2040 2 S&P 500 Index September 1995 $562,850 $50,750
</TABLE>
The LifePath 2040 Master Series has pledged to brokers U.S. Treasury bills
for initial margin requirements with a par value of $55,000.
2. AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES
Master Portfolio has entered into an investment advisory agreement on behalf
of the Master Series with Wells Fargo Bank, N.A. ("WFB"). Pursuant to the
agreement, WFB provides investment guidance and policy direction in connection
with the daily portfolio management of each Master Series, for which it is
entitled to be compensated by the Master Portfolio monthly at an annual rate of
0.55% of the average daily net assets of each Master Series. WFB has engaged
Wells Fargo Nikko Investment Advisors ("WFNIA") to provide sub-advisory services
to each Master Series. Pursuant to a Sub-Advisory Agreement, WFNIA, subject to
the supervision and approval of WFB, provides investment advisory assistance and
the day-to-day management of each Master Series' assets, subject to the overall
authority of Master Portfolio's Board of Trustees. For providing these services,
WFNIA is entitled to be compensated by WFB monthly at an annual rate of 0.40% of
the average daily net assets of the Master Series.
95
<PAGE> 213
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
In addition, Wells Fargo Institutional Trust Company N.A. ("WFITC"), a
subsidiary of WFNIA, acts as custodian for the Master Series. Custody fees are
paid to WFITC from the sub-advisory fee paid to WFNIA.
On June 21, 1995, Wells Fargo & Co. and The Nikko Securities Co., Ltd.
signed a definitive agreement to sell their partnership interests in WFNIA to
Barclays Bank PLC ("Barclays") of the U.K.. The sale, which is subject to the
approval of appropriate regulatory authorities, is expected to close in the
fourth quarter of 1995.
Barclays is one of the oldest and largest financial institutions in the
world, with approximately $264 billion in total assets at June 30, 1995.
Barclays has indicated an intention to reorganize WFNIA into one of WFNIA's two
current partners, which would be renamed BZW Global Investors. Barclays and its
affiliates have considerable experience in managing fund assets and had
approximately $35 billion of quantitative fund assets under management, as of
June 30, 1995. The BZW Division of Barclays offers a full range of investment
banking, capital markets and asset management services.
Under the Investment Company Act of 1940, this proposed change in control of
WFNIA would result in an assignment and termination of the current Sub-
Investment Advisory Agreements among WFNIA, Wells Fargo Bank and the Master
Series. Subject to approval of the Company's Board of Directors, it is
contemplated that a special meeting of shareholders of the Master Series will be
convened to consider a new Advisory Agreement with WFNIA's successor as the
primary advisor to each Master Series, which will become effective only upon the
change in control of WFNIA. It is not anticipated that the proposed change in
control will change the investment objective or overall investment strategy of
the Master Series.
ORGANIZATION EXPENSES
Stephens Inc. ("Stephens"), the administrator, sponsor and distributor for
the Master Series, has paid all expenses in connection with the Master Series'
organization and initial registration.
96
<PAGE> 214
MASTER INVESTMENT PORTFOLIO
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
Pursuant to the Administration Agreement, Stephens has agreed to assume all
operating expenses of each LifePath Master Series, except for advisory fees,
interest, brokerage fees and commissions, if any, costs of independent pricing
services, and any extraordinary expenses.
Certain officers and directors of Master Portfolio are also officers of
Stephens. As of August 31, 1995, these officers of Stephens collectively owned
less than 1% of the Master Series' outstanding shares of beneficial interest.
3. INVESTMENT PORTFOLIO TRANSACTIONS
Purchases and sales of investments, exclusive of short-term securities, for
each Master Series for the six months ended August 31, 1995, are as follows:
<TABLE>
<S> <C> <C> <C> <C> <C>
LIFEPATH LIFEPATH LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020 2030 2040
AGGREGATE PURCHASES MASTER MASTER MASTER MASTER MASTER
AND SALES OF: SERIES SERIES SERIES SERIES SERIES
- ----------------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT OBLIGATIONS:
Purchases at cost $39,180,313 $16,550,109 $32,074,177 $10,876,711 $ 2,953,078
Sales proceeds 33,980,141 13,528,967 32,039,129 11,721,704 7,732,943
OTHER SECURITIES:
Purchases at cost 6,600,210 12,440,408 31,649,317 31,207,600 62,344,165
Sales proceeds 2,999,486 2,642,297 9,817,851 10,192,691 18,702,479
</TABLE>
4. FINANCIAL HIGHLIGHTS
The portfolio turnover rate, excluding short-term securities, for the Master
Series for each of the following periods are as follows:
<TABLE>
<CAPTION>
LIFEPATH LIFEPATH LIFEPATH LIFEPATH LIFEPATH
2000 2010 2020 2030 2040
MASTER MASTER MASTER MASTER MASTER
PORTFOLIO TURNOVER SERIES SERIES SERIES SERIES SERIES
<S> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
For the Six Months Ended August 31, 1995 (Unaudited) 65% 29% 44% 35% 29%
For the Year Ended February 28, 1995 17% 24% 28% 40% 5%
</TABLE>
97
<PAGE> 215
STAGECOACH INC.
FILE NO. 33-54126; 811-7332
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits.
(a) Financial Statements:
(1) The following unaudited Financial Statements for Stagecoach
Trust's LifePath 2000, LifePath 2010, LifePath 2020, LifePath 2030
and LifePath 2040 Funds (Institutional Shares) are included in
Part B, Item 23:
Portfolio of Investments - August 31, 1995
Statement of Assets and Liabilities - August 31, 1995
Statement of Operations for the period ended August 31, 1995
Statement of Changes in Net Assets for the period ended
August 31, 1995
Financial Highlights for the period ended August 31, 1995
Notes to Financial Statements - August 31, 1995
(2) The following audited Financial Statements for Stagecoach
Trust's LifePath 2000, LifePath 2010, LifePath 2020, LifePath 2030
and LifePath 2040 Funds (Institutional Shares) are included in Part
B, Item 23:
Portfolio of Investments - February 28, 1995
Statement of Assets and Liabilities - February 28, 1995
Statement of Operations for the period ended February 28, 1995
Statement of Changes in Net Assets for the period ended
February 28, 1995
Financial Highlights for the period ended February 28, 1995
Notes to Financial Statements - February 28, 1995
(3) The unaudited Financial Statements for the Company's Asset
Allocation, Bond Index, Growth Stock, Money Market, S&P 500 Stock,
Short-Intermediate Term and U.S. Treasury Allocation Funds, for the
period ended August 31, 1995, are incorporated by reference to the
Company's Semi-Annual Report filed with the Securities and Exchange
Commission on November 6, 1995.
(4) The audited Financial Statements for the Company's Asset
Allocation, Bond Index, Growth Stock, Money Market, S&P 500 Stock,
Short-Intermediate Term and U.S. Treasury Allocation Funds, for the
period ended February 28, 1995, are incorporated by reference to
the Company's Annual Report filed with the Securities and Exchange
Commission on April 28, 1995.
<PAGE> 216
(b) Exhibits:
<TABLE>
<CAPTION>
Exhibit
Number Description
------ -----------
<S> <C>
1 - Restated Articles of Incorporation dated October 31,
1995, filed herewith.
2 - By-Laws, incorporated by reference to Post-Effective
Amendment No. 8 to the Registration Statement, filed
June 27, 1995.
3 - Not applicable
4 - Not applicable
5(a) - Investment Advisory Agreement with Wells Fargo Bank, N.A.
on behalf of the Money Market Fund dated February 1,
1994, incorporated by reference to Post-Effective
Amendment No. 8 to the Registration Statement, filed June
27, 1995.
5(b)(i) - Amended Administration Agreement with Stephens Inc. on
behalf of the Money Market Fund, dated February 1, 1994,
filed herewith.
(b)(ii) - Administration Agreement, dated February 1, 1994, as
amended May 2, 1995, with Stephens Inc. on behalf of the
National Tax-Free Intermediate Income, National Tax-Free
Money Market, California Tax-Free Intermediate Income,
California Tax-Free Short-Term Income, California
Tax-Free Money Market, Overland National Tax-Free
Institutional Money Market, Bond Index, Growth and
Income, Growth Stock, Short-Intermediate Term and S&P 500
Stock Funds, filed herewith.
(b)(iii) - Administration Agreement, dated February 1, 1994, as
amended October 10, 1995, with Stephens Inc. on behalf of
the Asset Allocation, U.S. Treasury Allocation, LifePath
2000, LifePath 2010, LifePath 2020, LifePath 2030 and
LifePath 2040 Funds, filed herewith.
</TABLE>
C-1
<PAGE> 217
<TABLE>
<CAPTION>
Exhibit
Number Description
------ -----------
<S> <C>
6(a) - Amended Distribution Agreement (including the form of
Selling Group Agreement), dated February 1, 1994, with
Stephens Inc. on behalf of each Fund, filed herewith.
(b) - Form of Amended and Restated Distribution Agreement
(including the form of Selling Group Agreement), dated
October ___, 1995, with Stephens Inc. on behalf of each
Fund, filed herewith.
7 - Not applicable.
8(a) - Form of Custody Agreement dated February 2, 1995, with
Wells Fargo Bank, N.A. on behalf of the Asset Allocation
Fund, Bond Index Fund, S&P 500 Stock Fund and U.S.
Treasury Allocation Fund, filed herewith.
(b) - Form of Custody Agreement dated February 1, 1994, with
Wells Fargo Bank, N.A. on behalf of the National Tax-Free
Intermediate Income, National Tax-Free Money Market,
California Tax-Free Intermediate Income, California
Tax-Free Short-Term Income, California Tax-Free Money
Market, Growth and Income, Growth Stock, Money Market and
Short-Intermediate Term Funds, filed herewith.
(c) - Form of Custody Agreement on behalf of the LifePath 2000,
LifePath 2010, LifePath 2020, LifePath 2030 and LifePath
2040 Funds dated November __, 1995, filed herewith.
9(a) - Amended Agency Agreement, dated February 1, 1994, with
Wells Fargo Bank, N.A. on behalf of each Fund, filed
herewith.
(b) - Form of Amendment to the Amended Agency Agreement, dated
November __, 1995, with Wells Fargo Bank, N.A. on behalf
of each Fund, filed herewith.
(c) - Shareholder Servicing Plan for the Growth and Income,
Growth Stock, Short-Intermediate Term, Asset
Allocation, U.S. Treasury Allocation, Bond Index, S&P 500
Stock and National Tax-Free Money Market Mutual Funds,
and Form of Shareholder Servicing Agreement for the
National Tax-Free Money Market Mutual Fund (attached as
Appendix A), incorporated by reference to Post-Effective
Amendment No. 9 to the Registration Statement, filed
July 19, 1995.
(d) - Shareholder Servicing Plan and Form of Shareholder
Servicing Agreement, as approved on October 10, 1995,
for the LifePath 2000, LifePath 2010, LifePath 2020,
LifePath 2030 and LifePath 2040 Funds, filed herewith.
(e) - Cross Indemnification Agreement dated December 30, 1994
by and between Stagecoach Funds, Inc. and Stagecoach Inc.,
filed herewith.
10 - Opinion and Consent of Counsel, filed herewith.
11(a) - Consent of Auditors - KPMG Peat Marwick LLP, filed
herewith.
11(b) - Consent of Independent Accountants - Coopers & Lybrand
L.L.P., filed herewith.
</TABLE>
C-2
<PAGE> 218
<TABLE>
<CAPTION>
Exhibit
Number Description
------ -----------
<S> <C>
12 - Not applicable
13(a) - Investment Letter for the Overland National Tax-Free
Institutional Money Market Fund, incorporated by
reference to Post-Effective Amendment No. 9 to the
Registration Statement, filed July 19, 1995.
(b) - Investment Letter for the National Tax-Free Money Market
Mutual Fund, incorporated by reference to Post-Effective
Amendment No. 9 to the Registration Statement, filed July
19, 1995.
14 - Not applicable
15(a) - Distribution Plan on behalf of the National Tax-Free
Money Market Mutual Fund, incorporated by reference to
Post-Effective Amendment No. 9 to the Registration
Statement, filed July 19, 1995.
(b) - Distribution and Services Plan on behalf of the National
Tax-Free Intermediate Income Fund, filed herewith.
(c) - Distribution and Services Plan on behalf of the National
Tax-Free Money Market Fund, filed herewith.
(d) - Distribution and Services Plan on behalf of the
California Tax-Free Intermediate Income Fund, filed
herewith.
(e) - Distribution and Services Plan on behalf of the
California Tax-Free Short-Term Income Fund, filed
herewith.
(f) - Distribution and Services Plan on behalf of the
California Tax-Free Money Market Fund, filed herewith.
16 - Schedule for Computation of Performance Quotations, to
Be Filed By Amendment.
27(a) - Financial Data Schedule for the Asset Allocation Fund,
incorporated by reference to Post-Effective Amendment
No. 8 to the Registration Statement, filed June 27, 1995.
(b) - Financial Data Schedule for the Bond Index Fund,
incorporated by reference to Post-Effective Amendment
No. 8 to the Registration Statement, filed June 27, 1995.
(c) - Financial Data Schedule for the Growth Stock Fund,
incorporated by reference to Post-Effective Amendment
No. 8 to the Registration Statement, filed June 27, 1995.
(d) - Financial Data Schedule for the Money Market Fund,
incorporated by reference to Post-Effective Amendment
No. 8 to the Registration Statement, filed June 27, 1995.
</TABLE>
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<PAGE> 219
<TABLE>
<CAPTION>
Exhibit
Number Description
------ -----------
<S> <C>
(e) - Financial Data Schedule for the Short-Intermediate Term
Fund, incorporated by reference to Post-Effective
Amendment No. 8 to the Registration Statement, filed
June 27, 1995.
(f) - Financial Data Schedule for the S&P 500 Stock Fund,
incorporated by reference to Post-Effective Amendment No.
8 to the Registration Statement, filed June 27, 1995.
(g) - Financial Data Schedule for the U.S. Treasury Allocation
Fund, incorporated by reference to Post-Effective
Amendment No. 8 to the Registration Statement, filed June
27, 1995.
(h) - Financial Data Schedule for the Overland National Tax-Free
Institutional Money Market Fund, incorporated by
reference to Post-Effective Amendment No. 9 to the
Registration Statement, filed July 19, 1995.
(i) - Financial Data Schedule for the National Tax-Free Money
Market Mutual Fund, incorporated by reference to
Post-Effective Amendment No. 9 to the Registration
Statement, filed July 19, 1995.
</TABLE>
ITEM 25. PERSONS CONTROLLED BY OR UNDER
COMMON CONTROL WITH REGISTRANT
As of November 13, 1995, the Growth Stock Fund and
Short-Intermediate Term Fund each owned 100% of the outstanding beneficial
interests of the Growth Stock Master Series and Short-Intermediate Term Master
Series, respectively, of Managed Series Investment Trust (a management
investment company organized as a Delaware business trust). As of November 13,
1995, the Asset Allocation Fund and U.S. Treasury Allocation Fund each owned
100% of the outstanding beneficial interests of the Asset Allocation Master
Portfolio and U.S. Treasury Allocation Master Portfolio, respectively, of
Master Investment Portfolio ("MIP") (a management investment company organized
as A Delaware business trust). As of November 13, 1995, the S&P 500 Stock Fund
owned 94% of the outstanding beneficial interests of the S&P 500 Index Master
Portfolio of MIP. As of November 13, 1995, the Bond Index Fund, the Marion
Bradley Glass Trust and the Marion Bradley Glass in Partition Trust owned
approximately 33%, 33.5% and 33.5%, respectively, of the outstanding beneficial
interests of the Bond Index Master Portfolio of MIP. As such, each Fund and
each Trust could be considered a controlling person for purposes of the 1940
Act.
Item 26. Number of Holders of Securities.
As of October 27, 1995 the number of record holders of each
class of securities of the Registrant for the following funds were as follows:
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<TABLE>
<CAPTION>
Number of
Title of Class Record Holders
-------------- --------------
<S> <C>
Asset Allocation Fund....................................................... 25,029
Bond Index Fund............................................................. 2,526
Growth Stock Fund........................................................... 13,881
Short-Intermediate Term Fund................................................ 2,165
Money Market Fund........................................................... 17,937
S&P 500 Stock Fund.......................................................... 30,537
U.S. Treasury Allocation Fund............................................... 9,238
Overland National Tax-Free Institutional Money Market Mutual Fund........... 1
National Tax-Free Money Market Mutual Fund.................................. 1
National Tax-Free Intermediate Income Fund.................................. 0
Growth and Income Fund...................................................... 0
California Tax-Free Money Market Fund....................................... 0
California Tax-Free Intermediate Income Fund................................ 0
California Tax-Free Short-Term Income Fund.................................. 0
</TABLE>
Item 27. Indemnification.
The following paragraphs of Article VIII of the Registrant's
Articles of Incorporation provide:
(h) The Corporation shall indemnify (1) its
Directors and officers, whether serving the Corporation or at its
request any other entity, to the full extent required or permitted by
the General Laws of the State of Maryland now or hereafter in force,
including the advance of expenses under the procedures and to the
full extent permitted by law, and (2) its other employees and agents
to such extent as shall be authorized by the Board of Directors or
the Corporation's By-Laws and be permitted by law. The foregoing
rights of indemnification shall not be exclusive of any other rights
to
C-5
<PAGE> 221
which those seeking indemnification may be entitled. The Board of
Directors may take such action as is necessary to carry out these
indemnification provisions and is expressly empowered to adopt,
approve and amend from time to time such By-Laws, resolutions or
contracts implementing such provisions or such further
indemnification arrangements as may be permitted by law. No
amendment of these Articles of Incorporation of the Corporation shall
limit or eliminate the right to indemnification provided hereunder
with respect to acts or omissions occurring prior to such amendment
or repeal. Nothing contained herein shall be construed to authorize
the Corporation to indemnify any Director or officer of the
Corporation against any liability to the Corporation or to any
holders of securities of the Corporation to which he is subject by
reason of willful misfeasance, bad faith, gross negligence, or
reckless disregard of the duties involved in the conduct of his
office. Any indemnification by the Corporation shall be consistent
with the requirements of law, including the 1940 Act.
(i) To the fullest extent permitted by Maryland
statutory and decisional law and the 1940 Act, as amended or
interpreted, no Director or officer of the Corporation shall be
personally liable to the Corporation or its stockholders for money
damages; provided, however, that nothing herein shall be construed to
protect any Director or officer of the Corporation against any
liability to which such Director or officer would otherwise be
subject by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the
conduct of his office. No amendment, modification or repeal of this
Article VIII shall adversely affect any right or protection of a
Director or officer that exists at the time of such amendment,
modification or repeal.
Item 28. Business and Other Connections
of Investment Adviser.
Wells Fargo Bank, N.A. ("Wells Fargo Bank"), a wholly owned
subsidiary of Wells Fargo & Company, serves as investment adviser to all of the
Registrant's investment portfolios, and to certain other registered open-end
management investment companies. Wells Fargo Bank's business is that of a
national banking association with respect to which it conducts a variety of
commercial banking and trust activities.
To the knowledge of Registrant, none of the directors or
executive officers of Wells Fargo Bank, except those set forth below, is or has
been at any time during the past two fiscal years engaged in any other
business, profession, vocation or employment of a substantial nature, except
that certain executive officers also hold various positions with and engage in
business for Wells Fargo & Company. Set forth below are the names and principal
businesses of the directors and executive officers of Wells Fargo Bank who are
or during the past two fiscal years have been engaged in any other business,
profession, vocation or employment of a substantial nature for their own
account or in the capacity of director, officer, employee, partner or trustee.
All the directors of Wells Fargo Bank also serve as directors of Wells Fargo &
Company.
C-6
<PAGE> 222
<TABLE>
<CAPTION>
Name and Position Principal Business(es) and Address(es)
at Wells Fargo Bank During at Least the Last Two Fiscal Years
------------------- -----------------------------------------
<S> <C>
H. Jesse Arnelle Senior Partner of Arnelle & Hastie,
Director 455 Market Street
San Francisco, CA 94105
Director of FPL Group, Inc.
700 Universe Blvd.
P.O. Box 14000
North Palm Beach, FL 33408
William R. Breuner General Partner in Breuner Associates,
Director Breuner Properties and Breuner-
Pavarnick Real Estate Developers.
Retired Chairman of the Board of Directors of
John Breuner Co.
2300 Clayton Road, Suite 1570
Concord, CA 954520
Vice Chairman of the California State
Railroad Museum Foundation
111 I Street
Old Sacramento, CA 95814
William S. Davila President and Director of The Vons
Director Companies, Inc.
618 Michillinda Avenue
Arcadia, CA 91007
Officer of Western Association of Food Chains
825 Colorado Blvd. #203
Los Angeles, CA 90041
Rayburn S. Dezember Director of CalMat Co.
Director 3200 San Fernando Road
Los Angeles, CA 90065
Director of Tejon Ranch Co.
P.O. Box 1000
Lebec, CA 93243
Director of Turner Casting Corp.
P.O. Box 1099
Cudahy, CA 90201
Director of The Bakersfield Californian
P.O. Box 440
1707 I Street
Bakersfield, CA 93302
Director of Kern County Economic
Development Corp.
P.O. Box 1229
2700 M Street, Suite 225
Bakersfield, CA 93301
Chairman of the Board of Trustees
of Whittier College
13406 East Philadelphia Avenue
P.O. Box 634
Whittler, CA 90608
</TABLE>
C-7
<PAGE> 223
<TABLE>
<CAPTION>
Name Principal Business(es) During at
---- Least the Last Two Fiscal Years
--------------------------------
<S> <C>
Paul Hazen Chairman of the Board of Directors of
Chairman of the Wells Fargo & Company
Board of Directors 420 Montgomery Street
San Francisco, CA 94105
Director of Pacific Telesis Group
130 Kearny Street
San Francisco, CA 94108
Director of Phelps Dodge Corp.
2600 North Central Avenue
Phoenix, AZ 85004
Director of Safeway Inc.
Fourth and Jackson Streets
Oakland, CA 94660
Robert K. Jaedicke Accounting Professor and Dean Emeritus
Director of Graduate School of Business,
Stanford University
MBA Admissions Office
Stanford, CA 94305
Director of Homestake Mining Co.
650 California Street
San Francisco, CA 94108
Director of California Water Service Company
1720 North First Street
San Jose, CA 95112
Director of Boise Cascade Corp.
1111 West Jefferson Street
P.O. Box 50
Boise, ID 83728
Director of Enron Corp.
1400 Smith Street
Houston, TX 77002
Director of GenCorp, Inc.
175 Ghent Road
Fairlawn, OH 44333
Paul A. Miller Chairman of Executive Committee and Director of
Director Pacific Enterprises
633 West Fifth Street
Los Angeles, CA 90071
Trustee of Mutual Life Insurance Company of New York
1740 Broadway
New York, NY 10019
Director of Newhall Management Corporation
23823 Valencia Blvd.
Valencia, CA 91355
Trustee of University of Southern California
University Park TGF 200
665 Exposition Blvd.
Los Angeles, CA 90089
Ellen M. Newman President of Ellen Newman Associates
Director 323 Geary Street, Suite 507
San Francisco, CA 94102
Chair of Board of Trustees of
University of California at San Francisco Foundation
250 Executive Park Blvd., Suite 2000
San Francisco, CA 94143
Director of American Conservatory Theater
30 Grant Avenue
San Francisco, CA 94108
Director of California Chamber of Commerce
1201 K Street, 12th Floor
Sacramento, CA 95814
Philip J. Quigley Chairman, Chief Executive Officer and
Director Director of Pacific Telesis Group
130 Kearney Street, Rm. 3700
San Francisco, CA 94108
Director of Varian Associates
3050 Hansen Way
P.O. Box 10800
Palo Alto, CA 94303
Carl E. Reichardt Chairman and Chief Executive Officer of the
Director Board of Directors of Wells Fargo & Company
420 Montgomery Street
San Francisco, CA 94105
Director of Ford Motor Company
The American Road
Dearborn, MI 48121
Director of Hospital Corporation of America,
HCA-Hospital Corp. of America
One Park Plaza
Nashville, TN 37203
Director of Pacific Gas and Electric Company
77 Beale Street
San Francisco, CA 94105
Director of Newhall Management Corporation
23823 Valencia Blvd.
Valencia, CA 91355
</TABLE>
C-8
<PAGE> 224
<TABLE>
<CAPTION>
Name Principal Business(es) During at
---- Least the Last Two Fiscal Years
--------------------------------
<S> <C>
Donald B. Rice President, Chief Operating Officer and Director of
Director Teledyne, Inc
2049 Century Park East
Los Angeles, CA 90067
Director of Vulcan Materials Company
One Metroplex Drive
Birmingham, AL 35209
Retired Secretary of the Air Force
Susan G. Swenson President and Chief Executive Officer of Cellular One
Director 651 Gateway Blvd.
San Francisco, CA 94080
Chang-Lin Tien Chancellor of University of California at Berkeley
Director UC at Berkeley
Berkeley, CA 94720
John A. Young President, Director and Chief Executive of Officer
Director Hewlett-Packard Company
3000 Hanover Street
Palo Alto, CA 94304
Director of Chevron Corporation
225 Bush Street
San Francisco, CA 94104
William F. Zuendt Director of 3 Com Corp.
President 5400 Bayfront Plaza
P.O. Box 58145
Santa Clara, CA 95052
Director of MasterCard International
888 Seventh Avenue
New York, NY 10106
Trustee of Golden Gate University
536 Mission Street
San Francisco, CA 94163
</TABLE>
Wells Fargo Nikko Investment Advisors ("WFNIA") serves as the
sub-adviser to the Asset Allocation Fund, U.S. Treasury Allocation Fund, Bond
Index Fund and S&P 500 Stock Fund, and as adviser or sub-adviser to various
other open-end management investment companies. For additional information, see
"The Funds, the Trust and Management" in the Prospectus and "Management" in the
Statement of Additional Information. For information as to the business,
profession, vocation or employment of a substantial nature of each of the
officers and management committees of WFNIA, reference is made to WFNIA's Form
ADV and Schedules A and D filed under the Investment Advisers Act of 1940, SEC
File No. 801-36479, incorporated herein by reference.
WFNIA is being sold to Barclays Bank PLC or certain of its
affiliates (collectively "Barclays"). Barclays has indicated that it intends to
reorganize WFNIA into one of WFNIA's current general partners that will be
renamed BZW Global Investors ("BZWGI"). BZWGI will be a wholly owned subsidiary
of BZW Global Trust Company, N.A. BZWGI will succeed to WFNIA's business and
operations and will serve as investment adviser to the Company's Money Market
Fund and to each of the Master Portfolios in which the Company's other Funds,
including the LifePath Funds, invest substantially all of their assets, and to
certain other registered open-end management investment companies. Upon
consummation of the sale of WFNIA and the transactions related thereto, Wells
Fargo Bank will serve as sub-investment adviser to the Money Market Fund and to
the Master Portfolios in which the Growth Stock and Short-Intermediate Term
Funds invest substantially all of their assets.
The proposed directors and officers of BZWGI consist primarily
of persons who during the past two years have been active in the investment
management business of WFNIA and, in some cases, of Wells Fargo Institutional
Trust Company, an affiliate of WFNIA. With the exception of Irving Cohen, each
of the directors and executive officers of BZWGI will also have substantial
responsibilities as directors and/or officers of BZW Global Trust, N.A. To the
knowledge of the Registrant, except as set forth below, none of the proposed
directors or executive officers of BZWGI is or has been at any time during the
past two fiscal years engaged in any other business, profession, vocation or
employment of a substantial nature.
C-9
<PAGE> 225
<TABLE>
<CAPTION>
Name and Position Principal Business(es) During at
at BZWGI Least the Last Two Fiscal Years
----------------- --------------------------------
<S> <C>
Lindsay Tomlinson Chief Executive Officer of BZW Investment
Director and Co-Chief Management*
Executive Officer
Irving Cohen Chief Financial Officer and Chief Operating
Director Officer of Barclays Bank PLC, New York
Branch and Chief Operating Officer of Barclays
Group Inc. (USA)**; previously Chief Financial
Officer of Barclays de Zoete Wedd Securities
Inc. (1994)**
Nicolas J. Stuchfield Previously BZW Investment Management/WFNIA
Director Liaison at BZW Services, Ltd.+
Vincent J. Bencivenga Previously Vice President at State Street Bank &
Chief Fiduciary Officer Trust Company++
Alan J. Kisor Previously Executive Vice President of Wells Fargo
Division President, Bank, N.A.+++
MasterWorks
</TABLE>
_______________
* Seal House, 1 Swan Lane, London, United Kingdom EC4R 3UD.
** 222 Broadway, New York, New York 10038.
+ Ebbgate House, 2 Swan Lane, London, United Kingdom EC4R 3TS
++ One Financial Center, Boston, Massachusetts 02111.
+++ 420 Montgomery Street, San Francisco, CA 94163.
Item 29. Principal Underwriters.
(a) Stephens Inc., distributor for the Registrant, does not
presently act as investment adviser for any other registered investment
companies, but does act as principal underwriter for the Overland Express
Funds, Inc., Stagecoach Funds, Inc., Stagecoach Trust, Life & Annuity Trust,
Nations Fund, Inc. and Nations Fund Trust and is the exclusive placement agent
for Master Investment Trust, Master Investment Portfolio and Managed Series
Investment Trust, all of which are registered open-end management investment
companies, and has acted as principal underwriter for the Liberty Term Trust,
Inc. and the Nations Government Income Term Trust 2003, Inc., closed-end
management investment companies and Nations Fund Trust, Nations Funds, Inc.,
Nations Fund Portfolio, Inc. and The Capitol Mutual Funds, which are open-end
management investment companies.
(b) Information with respect to each director and officer
of the principal underwriter is incorporated by reference to Form ADV and
Schedules A and D filed by Stephens Inc. with the Securities and Exchange
Commission pursuant to The Investment Advisers Act of 1940 (SEC File No.
501-15510).
(c) Not applicable.
Item 30. Location of Accounts and Records.
All accounts, books and other documents required to be
maintained by Section 31(a) of the Investment Company Act of 1940 and the Rules
thereunder are maintained at one or more of the following offices: Stagecoach
Inc. maintains those accounts, books and other documents required by Rule
31a-1(b)(4) and (d), and Rule 31a-2(a)(3) and (c) at 111 Center
C-10
<PAGE> 226
Street, Little Rock, Arkansas 72201; Wells Fargo Bank maintains all other
accounts, books or other documents required by Rules 31a-1, 31a-2 and 31a-3,
and copies of most of such documents are also maintained by Stagecoach Inc. at
525 Market Street, San Francisco, California 94163.
Item 31. Management Services.
Other than as set forth under the captions "Description of the
Funds" and "Management of the Funds" in the Prospectus constituting Part A of
this Registration Statement and "Management of the Company" in the Statement of
Additional Information constituting Part B of this Registration Statement, the
Registrant is not a party to any management-related service contract.
Item 32. Undertakings.
(a) Not Applicable
(b) Not Applicable
(c) Insofar as indemnification for liability arising under
the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the provisions set forth
above in response to Item 27, or otherwise, the Registrant has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in such Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
(d) Registrant undertakes to hold a special meeting of its
shareholders for the purpose of voting on the question of removal of a director
or directors if requested in writing by the holders of at least 10% of the
Company's outstanding voting securities, and to assist in communicating with
other shareholders as required by Section 16(c) of the Investment Company Act
of 1940.
(e) Registrant undertakes to furnish each person to whom a
prospectus is delivered with a copy of its most current annual report to
shareholders, upon request and without charge.
C-11
<PAGE> 227
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Amendment to
its Registration Statement on Form N-1A to be signed on its behalf by the
undersigned, thereto duly authorized, in the City of Little Rock, State of
Arkansas on the 28th day of November, 1995.
STAGECOACH INC.
By /s/ Richard H. Blank, Jr.
----------------------------
(Richard H. Blank, Jr.)
Secretary and Treasurer
(Principal Financial Officer)
Pursuant to the requirements of the Securities Act of 1933, this
Post Effective Amendment to the Registration Statement on Form N-1A has been
signed below by the following persons in the capacities and on the date
indicated:
Signature Title
--------- -----
/s/ R. Greg Feltus Director, Chairman and President
------------------------- (Principal Executive Officer)
(R. Greg Feltus)
/s/ Richard H. Blank, Jr. Secretary and Treasurer
------------------------- (Principal Financial Officer)
(Richard H. Blank, Jr.)
/s/ Jack S. Euphrat Director
-------------------------
(Jack S. Euphrat)
/s/ Thomas S. Goho Director
-------------------------
(Thomas S. Goho)
/s/ Zoe Ann Hines Director
-------------------------
(Zoe Ann Hines)
/s/ W. Rodney Hughes Director
-------------------------
(W. Rodney Hughes)
/s/ Robert M. Joses Director
-------------------------
(Robert M. Joses)
/s/ J. Tucker Morse Director
-------------------------
(J. Tucker Morse)
November 28th, 1995
*By /s/ Richard H. Blank, Jr.
-------------------------
(Richard H. Blank, Jr.)
As Attorney-in-Fact
<PAGE> 228
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Amendment to
the Registration Statement on Form N-1A to be signed on its behalf by the
undersigned, thereto duly authorized in the City of Little Rock, State of
Arkansas on the 28th day of November, 1995.
MASTER INVESTMENT PORTFOLIO
By /s/ Richard H. Blank, Jr.
----------------------------
(Richard H. Blank, Jr.)
Secretary and Treasurer
(Principal Financial Officer)
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form N-1A has been signed below by the following
persons in the capacities and on the date indicated:
Signature Title
--------- -----
/s/ R. Greg Feltus Director, Chairman and President
------------------------- (Principal Executive Officer)
(R. Greg Feltus)
/s/ Richard H. Blank, Jr. Secretary and Treasurer
------------------------- (Principal Financial Officer)
(Richard H. Blank, Jr.)
/s/ Jack S. Euphrat Trustee
-------------------------
(Jack S. Euphrat)
/s/ Thomas S. Goho Trustee
-------------------------
(Thomas S. Goho)
/s/ Zoe Ann Hines Trustee
-------------------------
(Zoe Ann Hines)
/s/ W. Rodney Hughes Trustee
-------------------------
(W. Rodney Hughes)
/s/ Robert M. Joses Trustee
-------------------------
(Robert M. Joses)
/s/ J. Tucker Morse Trustee
-------------------------
(J. Tucker Morse)
November 28, 1995
*By /s/ Richard H. Blank, Jr.
-------------------------
(Richard H. Blank, Jr.)
As Attorney-in-Fact
<PAGE> 229
STAGECOACH INC.
FILE NO. 33-54126; 811-7332
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NUMBER DESCRIPTION PAGE NUMBER
<S> <C> <C>
Ex-99.B1 - Restated Articles of Incorporation, dated October 31, 1995
Ex-99.B5(b)(i) - Amended Administration Agreement dated February 1, 1994 with
Stephens Inc. on behalf of the Money Market Fund
Ex-99.B5(b)(ii) - Administration Agreement, dated February 1, 1994, as amended
May 2, 1995 with Stephens Inc. on behalf of the National
Tax-Free Intermediate Income, National Tax-Free Money Market,
California Tax-Free Intermediate Income, California Tax-
Free Short-Term Income, California Tax-Free Money Market,
Overland National Tax-Free Institutional Money Market, Bond
Index, Growth and Income, Growth Stock, Short-Intermediate
Term and S&P 500 Stock Funds
Ex-99.B5(b)(iii) - Administration Agreement, dated February 1, 1994, as amended
October 10, 1995 with Stephens Inc. on behalf of the Asset
Allocation, U.S. Treasury Allocation, LifePath 2000,
LifePath 2010, LifePath 2020, LifePath 2030 and LifePath
2040 Funds, filed herewith.
Ex-99.B6(a) - Amended Distribution Agreement (including Form of Selling
Group Agreement) dated February 1, 1994 with Stephens Inc.
on behalf of each Fund
Ex-99.B6(b) - Form of Amended and Restated Distribution Agreement
(including Form of Selling Group Agreement) dated October
__, 1995 with Stephens Inc. on behalf of each Fund
</TABLE>
<PAGE> 230
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NUMBER DESCRIPTION PAGE NUMBER
<S> <C> <C>
Ex-99.B8(a) - Form of Custody Agreement dated February 2, 1995 with Wells
Fargo Bank, N.A. on behalf of the Asset Allocation, Bond
Index, S&P 500 Stock, and U.S. Treasury Allocation Funds
Ex-99.B8(b) - Form of Custody Agreement dated February 1, 1994, with Wells
Fargo Bank, N.A. on behalf of the National Tax-Free
Intermediate Income, National Tax-Free Money Market,
California Tax-Free Intermediate Income, California Tax-
Free Short-Term Income, California Tax-Free Money Market,
Growth and Income, Growth Stock, Money Market and
Short-Intermediate Term Funds
Ex-99.B8(c) - Form of Custody Agreement on behalf of the LifePath 2000,
LifePath 2010, LifePath 2020 Fund, LifePath 2030 and
LifePath 2040 Funds
Ex-99.B9(a) - Amended Agency Agreement dated February 1, 1994, with Wells
Fargo Bank, N.A. on behalf of each Fund, filed herewith
Ex-99.B9(b) - Form of Amendment to the Amended Agency Agreement dated
November __, 1995, with Wells Fargo Bank, N.A. on behalf of
each Fund
Ex-99.B9(d) - Shareholder Servicing Plan and Form of Shareholder Servicing
Agreement, as approved on October 10, 1995, for the LifePath
2000, LifePath 2010, LifePath 2020, LifePath 2030 and
LifePath 2040 Fund
Ex-99.B9(e) - Cross Indemnification Agreement dated December 30, 1994, by and
between Stagecoach Funds, Inc. and Stagecoach Inc.
Ex-99.B10 - Opinion and Consent of Counsel
Ex-99.B11(a) - Consent of Auditors - KPMG Peat Marwick LLP
Ex-99.B11(b) - Consent of Independent Accountants - Coopers & Lybrand, L.L.P.
</TABLE>
<PAGE> 231
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NUMBER DESCRIPTION PAGE NUMBER
<S> <C> <C>
EX-99.B 15(b) - Distribution and Services Plan on behalf of the National
Tax-Free Intermediate Income Fund
EX-99.B 15(c) - Distribution and Services Plan on behalf of the National
Tax-Free Money Market Fund
EX-99.B 15(d) - Distribution and Services Plan on behalf of the California
Tax-Free Intermediate Income Fund
EX-99.B 15(e) - Distribution and Services Plan on behalf of the California
Tax-Free Short-Term Income Fund
EX-99.B 15(f) - Distribution and Services Plan on behalf of the California
Tax-Free Money Market Fund
</TABLE>
<PAGE> 1
EX-99.B1
RESTATED ARTICLES OF INCORPORATION
of
STAGECOACH INC.
Dated October 31, 1995
WHEREAS, the Board of Directors of STAGECOACH INC. (the
"Corporation") approved the establishment of new series of shares at a meeting
held on October 10, 1995 and Articles Supplementary were filed on October 19,
1995 establishing such new series of shares; and
WHEREAS, the Board of Directors desires to restate the
Corporation's Restated Articles of Incorporation as supplemented (sometimes
referred to herein as the "Charter"); and
WHEREAS, in accordance with the provisions of Section 2-608 of
Maryland General Corporation Law, a majority of the Corporation's entire Board
of Directors approved the restatement of the Charter at the meeting held on
October 10, 1995; and
WHEREAS, the restated Charter sets forth all of the provisions of
the Corporation's Charter currently in effect; and
WHEREAS, the Corporation's Board of Directors has duly authorized
the filing of the restated Charter.
NOW THEREFORE, the undersigned hereby certifies that the following
comprises the Corporation's Restated Articles of Incorporation:
I.
INCORPORATOR
Thomas A. Fox, as incorporator, whose mailing address was 2000
Pennsylvania Avenue, N.W., Suite 5500, Washington, D.C., 20006, being at least
18 years of age, formed the corporation on October 14, 1992 under and by virtue
of the General Laws of the State of Maryland; and such Articles of
Incorporation were filed with the Maryland Department of Assessments and
Taxation on October 15, 1992.
II.
NAME
The name of the Corporation is Stagecoach Inc.
<PAGE> 2
III.
PURPOSES AND POWERS
The purpose or purposes for which the Corporation is formed and
the business or objects to be transacted, carried on and promoted by it are:
(a) To conduct and carry on the business of an open-end
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act").
(b) To hold, invest and reinvest its assets in securities and
other investments including holding part or all of its assets in cash,
including foreign currencies.
(c) To issue and sell shares of its capital stock in such
accounts and on such terms and conditions and for such purposes and for such
amount or kind of consideration (including, without limitation, securities) now
or hereafter permitted by law.
(d) To redeem, purchase or otherwise acquire, hold, dispose of,
resell, transfer, reissue or cancel (all without the vote or consent of the
shareholders of the Corporation) shares of its capital stock, in any manner and
to the extent now or hereafter permitted by law and by these Restated Articles
of Incorporation (the "Articles").
(e) To do any and all such acts or things and to exercise any
and all such further powers or rights as may be necessary, incidental,
relative, conducive, appropriate or desirable for the accomplishment, carrying
out or attainment of the purposes stated in this Article.
The foregoing enumerated purposes and objects shall be in no way
limited or restricted by reference to, or inference from, the terms of any
other clause of this or any other Article of these Articles, and shall each be
regarded as independent; and they are intended to be and shall be construed as
powers as well as purposes and objects of the Corporation and shall be in
addition to, and not in limitation of, the general powers of corporations under
the laws of the State of Maryland.
IV.
PRINCIPAL OFFICE AND PLACE OF BUSINESS
The present address of the principal office of the Corporation in
the State of Maryland is c/o The Corporation Trust Incorporated, 32 South
Street, Baltimore, Maryland, 21202.
2
<PAGE> 3
V.
RESIDENT AGENT
The name and address of the Corporation's resident agent is The
Corporation Trust Incorporated, 32 South Street, Baltimore, Maryland, 21202.
Said resident agent is a Maryland corporation.
VI.
CAPITAL STOCK
(a) The total number of shares of capital stock which the
Corporation shall have the authority to issue is eleven billion nine hundred
million (11,900,000,000) shares of the par value of $.001 per share allocated
to the series as follows. (Such series and any further series of shares from
time to time created by the Board of Directors being referred to individually
herein as a "series").
<TABLE>
<CAPTION>
Series Number of Shares
------ ----------------
<S> <C>
Asset Allocation Fund Series 100,000,000
Bond Index Fund Series 100,000,000
California Tax-Free Intermediate
Income Series 100,000,000
California Tax-Free Money Market Series 2,500,000,000
California Tax-Free Short-Term
Income Series 100,000,000
Growth and Income Series 100,000,000
Growth Stock Fund Series 100,000,000
Money Market Series 3,000,000,000
National Tax-Free Intermediate
Income Series 100,000,000
National Tax-Free Money Market
Mutual Fund Series 2,500,000,000
</TABLE>
3
<PAGE> 4
<TABLE>
<S> <C>
Overland National Tax-Free
Institutional Money Market Series 2,000,000,000
Short-Intermediate Term Fund Series 300,000,000
S&P 500 Stock Fund Series 100,000,000
U.S. Treasury Allocation Fund Series 300,000,000
LifePath 2000 Series: 100,000,000
LifePath 2010 Series: 100,000,000
LifePath 2020 Series: 100,000,000
LifePath 2030 Series: 100,000,000
LifePath 2040 Series: 100,000,000
--------------
Total: 11,900,000,000
</TABLE>
The Board of Directors of the Corporation is hereby empowered to increase or
decrease, from time to time, the total number of shares of capital stock or the
number of shares of capital stock of any class or series that the Corporation
shall have authority to issue without any action by the shareholders.
(b) Any fractional share shall carry proportionately all the
rights of a whole share, excepting any right to receive a certificate
evidencing such fractional share, but including the right to vote and the right
to receive dividends.
(c) All persons who shall acquire stock in the Corporation
shall acquire the same subject to the provisions of these Articles and the
By-Laws of the Corporation.
(d) As used in these Articles, a "series" of shares represents
interests in the same assets, liabilities, income, earnings and profits of the
Corporation; each "class" of shares of a series represents interests in the
same underlying assets, liabilities, income, earnings and profits, but may
differ from other classes of such series with respect to fees and expenses or
such other matters as shall be established by the Board of Directors. The
Board of Directors shall have authority to classify and reclassify any
authorized but unissued shares of capital stock from time to time by setting or
changing in any one or more respects the preferences, conversion or other
rights, voting powers, restrictions, limitations as to dividends,
qualifications or terms or conditions of redemption of the capital stock.
Subject to the provisions of Section (e) of this Article VI and applicable law,
the power of the Board of Directors to classify or reclassify any of
4
<PAGE> 5
the shares of capital stock shall include, without limitation, authority to
classify or reclassify any such stock into one or more series of capital stock
and to divide and classify shares of any series into one or more classes of
such series, by determining, fixing or altering one or more of the following:
1. The distinctive designation of such class or series
and the number of shares to constitute such class or series;
provided that, unless otherwise prohibited by the terms of such
class or series, the number of shares of any class or series may
be decreased by the Board of Directors in connection with any
classification or reclassification of unissued shares and the
number of shares of such class or series may be increased by the
Board of Directors in connection with any such classification or
reclassification, and any shares of any class or series which have
been redeemed, purchased or otherwise acquired by the Corporation
shall remain part of the authorized capital stock and be subject
to classification and reclassification as provided herein;
2. Whether or not and, if so, the rates, amounts and
times at which, and the conditions under which, dividends shall be
payable on shares of such class or series;
3. Whether or not shares of such class or series shall
have voting rights in addition to any general voting rights
provided by law and these Articles and, if so, the terms of such
additional voting rights;
4. The rights of the holders of shares of such class or
series upon the liquidation, dissolution or winding up of the
affairs of, or upon a distribution of the assets of, the
Corporation.
(e) Shares of capital stock of the Corporation shall
have the following preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption:
1. Assets Belonging to a Series. All consideration
received by the Corporation for the issue or sale of stock of any
series of capital stock, together with all assets in which such
consideration is invested and reinvested, income, earnings,
profits and proceeds thereof, including any proceeds derived from
the sale, exchange or liquidation thereof, and any funds or
payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall irrevocably belong to the
series of shares of capital stock with respect to which such
assets, payments or funds were received by the Corporation for all
purposes, subject only to the rights of creditors, and shall be so
handled upon the books of account of the Corporation. Such
consideration, assets, income, earnings, profits and proceeds
thereof, including any proceeds derived from the sale, exchange or
liquidation thereof, and any assets derived from any reinvestment
of such proceeds in whatever form, are herein referred to as
"assets belonging to" such series. Any assets, income, earnings,
profits, and proceeds thereof, funds or payments which are not
readily attributable to any
5
<PAGE> 6
particular series shall be allocable among any one or more of the
series in such manner and on such basis as the Board of Directors,
in its sole discretion, shall deem fair and equitable.
2. Liabilities Belonging to a Series. The assets
belonging to any series of capital stock shall be charged with the
liabilities in respect of such series and shall also be charged
with such series' share of the general liabilities of the
Corporation determined as hereinafter provided. The determination
of the Board of Directors shall be conclusive as to the amount of
such liabilities, including the amount of accrued expenses and
reserves; as to any allocation of the same to a given series; and
as to whether the same are allocable to one or more series. The
liabilities so allocated to a series are herein referred to as
"liabilities belonging to" such series. Any liabilities which are
not readily attributable to any particular series shall be
allocable among any one or more of the series in such manner and
on such basis as the Board of Directors, in its sole discretion,
shall deem fair and equitable.
3. Dividends and Distributions. Shares of each series
of capital stock shall be entitled to such dividends and
distributions, in stock or in cash or both, as may be declared
from time to time by the Board of Directors, acting in its sole
discretion, with respect to such series, provided, however, that
dividends and distributions on shares of a series of capital stock
shall be paid only out of the lawfully available "assets belonging
to" such series as such phrase is defined in Section (e)(1) of
this Article VI.
4. Liquidating Dividends and Distributions. In the
event of the liquidation or dissolution of the Corporation,
shareholders of each series of capital stock shall be entitled to
receive, as a series, out of the assets of the Corporation
available for distribution to shareholders, but other than general
assets not belonging to any particular series of capital stock,
the assets belonging to such series; and the assets so
distributable to the shareholders of any series of capital stock
shall be distributed among such shareholders in proportion to the
number of shares of such series held by them and recorded on the
books of the Corporation. In the event that there are any general
assets not belonging to any particular series of capital stock and
available for distribution, such distribution shall be made to the
holders of stock of all series of capital stock in proportion to
the asset value of the respective series of capital stock
determined as hereinafter provided.
5. Voting. Each shareholder of each series of capital
stock shall be entitled to one vote for each share of capital
stock, irrespective of the class, then standing in his name on the
books of the Corporation, and on any matter submitted to a vote of
shareholders, all shares of capital stock then issued and
outstanding and entitled to vote shall be voted in the aggregate
and not by series except that: (i) when expressly required by law,
shares of capital stock shall be voted by individual class or
series and (ii) only shares of capital stock of the respective
series or class or classes affected by a matter shall be entitled
to vote on such matter. At all meetings of the shareholders, the
holders of one-third of the shares of capital stock of the
Corporation entitled to vote at the meeting, present in person or
by proxy, shall constitute a quorum for the transaction of any
business, except as otherwise provided by statute or by these
Articles. In the absence of a quorum no business may be
transacted, except that the holders of a majority of the shares of
capital stock present in
6
<PAGE> 7
person or by proxy and entitled to vote may adjourn the meeting
from time to time, without notice other than announcement at the
meeting except as otherwise required by these Articles or the
By-Laws, until the holders of the requisite amount of shares of
capital stock shall be present. At any such adjourned meeting at
which a quorum may be present any business may be transacted which
might have been transacted at the meeting as originally called.
The absence from any meeting, in person or by proxy, of holders of
the number of shares of capital stock of the Corporation in excess
of the quorum which may be required by the laws of the State of
Maryland, the 1940 Act, or other applicable statute, these
Articles or the By-Laws, for action upon any given matter shall
not prevent action at such meeting upon any other matter or
matters which may properly come before the meeting, if there shall
be present at the meeting, in person or by proxy, holders of the
number of shares of capital stock of the Corporation required for
action in respect of such other matter or matters.
6. Redemption. To the extent the Corporation has funds
or other property legally available therefor, each holder of
shares of capital stock of the Corporation shall be entitled to
require the Corporation to redeem all or any part of the shares
standing in the name of such holder on the books of the
Corporation, at the redemption price of such shares as in effect
from time to time as may be determined by the Board of Directors
of the Corporation in accordance with the provisions hereof,
subject to the right of the Board of Directors of the Corporation
to suspend the right of redemption of shares of capital stock of
the Corporation or postpone the date of payment of such redemption
price in accordance with provisions of applicable law. Without
limiting the generality of the foregoing, the Corporation shall,
to the extent permitted by applicable law, have the right at any
time to redeem the shares owned by any holder of capital stock of
the Corporation if the value of such shares in the account of such
holder is less than the minimum initial investment amount
applicable to that account as set forth in the Corporation's
current registration statement under the 1940 Act, and subject to
such further terms and conditions as the Board of Directors of the
Corporation may from time to time adopt. The redemption price of
shares of capital stock of the Corporation shall, except as
otherwise provided in this Section (e)(6), be the net asset value
thereof as determined by, or pursuant to methods approved by, the
Board of Directors of the Corporation from time to time in
accordance with the provisions of applicable law, less such
redemption fee or other charge, if any, as may be specified in the
Corporation's current registration statement under the 1940 Act
for that class or series. Payment of the redemption price shall
be made in cash by the Corporation at such time and in such manner
as may be determined from time to time by the Board of Directors
of the Corporation unless, in the opinion of the Board of
Directors, which shall be conclusive, conditions exist which make
payment wholly in cash unwise or undesirable; in such event the
Corporation may make payment wholly or partly by securities or
other property included in the assets belonging or allocable to
the series of the shares redemption of which is being sought, the
value of which shall be determined as provided herein.
7
<PAGE> 8
VII.
DIRECTORS
The number of Directors of the Corporation shall be seven (7),
which number may be, from time to time, increased or decreased pursuant to the
By-Laws of the Corporation, but shall never be less than the minimum number
permitted by the General Laws of the State of Maryland now or hereafter in
force. The names of the Directors who will serve until the first shareholders
meeting or until their successors are elected and qualified are as follows:
Jack S. Euphrat
R. Greg Feltus
Thomas S. Goho
Zoe Ann Hines
W. Rodney Hughes
Robert M. Joses
J. Tucker Morse
VIII.
PROVISIONS FOR DEFINING, LIMITING AND REGULATING
CERTAIN POWERS OF THE CORPORATION AND OF THE
DIRECTORS AND SHAREHOLDERS
The following provisions are hereby adopted for the purpose of
defining, limiting and regulating the powers of the Corporation and of the
Directors and shareholders:
(a) No holder of any stock or any other securities of the
Corporation, whether now or hereafter authorized, shall have any preemptive
right to subscribe for or purchase any stock or any other securities of the
Corporation other than such, if any, as the Board of Directors, in its sole
discretion, may determine and at such price or prices and upon such other terms
as the Board of Directors, in its sole discretion, may fix; and any stock or
other securities which the Board of Directors may determine to offer for
subscription may, as the Board of Directors in its sole discretion shall
determine, be offered to the holders of any class, series or type of stock or
other securities at the time outstanding to the exclusion of the holders of any
or all other classes, series or types of stock or other securities at the time
outstanding.
(b) The Board of Directors of the Corporation shall have power
from time to time and in its sole discretion to determine, in accordance with
sound accounting practice, what constitutes annual or other net income,
profits, earnings, surplus or net assets; to fix and vary from time to time the
amount to be reserved as working capital, or determine that retained earnings
or surplus shall remain in the hands of the Corporation; to set apart out of
any funds of the Corporation such reserve or reserves in such amount or amounts
and for such proper purpose or purposes as it shall determine and to abolish
any such reserve or any part thereof; to distribute
8
<PAGE> 9
and pay distributions or dividends in stock, cash or other securities or
property, out of surplus or any other funds or amounts legally available
therefor, at such times and to the shareholders of record on such dates as it
may from to time determine; and to determine whether and to what extent and at
what times and places and under what conditions and regulations the books,
accounts and documents of the Corporation, or any of them, shall be open to the
inspection of shareholders, except as otherwise provided by statute or by the
By-Laws, and, except as so provided, no shareholder shall have any right to
inspect any book, account or document of the Corporation unless authorized so
to do by resolution of the Board of Directors.
(c) The Board of Directors of the Corporation may establish in
its absolute discretion the basis or method for determining the value of the
assets belonging to any series, and the net asset value of each share of
capital stock of each series and class for purposes of sales, redemptions,
repurchases of shares or otherwise.
(d) Any Director or officer, individually, or any firm of which
any Director or officer may be a member, or any corporation, trust or
association of which any Director or officer may be an officer or Director or
in which any Director or officer may be directly or indirectly interested as
the holder of any amount of its capital stock or otherwise, may be a party to,
or may be financially or otherwise interested in, any contract or transaction
of the Corporation; and any such Director or officer of the Corporation may be
counted in determining the existence of a quorum at the meeting of the Board of
Directors of the Corporation or a committee thereof which shall authorize any
such contract or transaction, and may vote thereat to authorize any such
contract or transaction, and such transaction or contract shall not as a result
be void or voidable provided either
(i) the fact of the common directorship or interest is
disclosed or known to: (a) the Board of Directors or the committee and
the Board or committee authorizes, approves, or ratifies the contract or
transaction by the affirmative vote of a majority of disinterested
Directors, even if the disinterested Directors constitute less than a
quorum; or (b) the shareholders entitled to vote, and the contract or
transaction is authorized, approved, or ratified by a majority of the
votes cast by the shareholders entitled to vote other than the votes of
shares owned of record or beneficially by the interested Director or
corporation, firm, or other entity; or
(ii) the contract or transaction is fair and reasonable to the
Corporation.
In furtherance and not in limitation of the foregoing, the Board
of Directors of the Corporation is expressly authorized to contract for
management services of any nature, with respect to the conduct of the business
of the Corporation with any entity, person or company, incorporated or
unincorporated, on such terms as the Board of Directors may deem desirable.
Any such contract may provide for the rendition of management services of any
nature with respect to the conduct of the business of the Corporation, and for
the management or direction of the business and activities of the Corporation
to such extent as the Board of Directors may determine, whether or not the
contract involves delegation of functions usually or customarily performed by
the Board of Directors or officers of the Corporation or of a corporation
organized
9
<PAGE> 10
under the laws of Maryland. The Board of Directors is further expressly
authorized to contract with any person or company on such terms as the Board of
Directors may deem desirable for the distribution of shares of the Corporation
and to contract for other services, including, without limitation, services as
custodian of the Corporation's assets and as transfer agent for the
Corporation's shares, with any entity(ies), person(s) or company(ies),
incorporated or unincorporated, on such terms as the Directors may deem
desirable. Any entity, person or company which enters into one or more of such
contracts may also perform similar or identical services for other investment
companies and other persons and entities without restriction by reason of the
relationship with the Corporation unless the contract expressly provides
otherwise.
(e) Any contract, transaction, or act of the Corporation or of
the Board of Directors which shall be ratified by a majority of a quorum of the
shareholders having voting powers at any annual meeting, or at any special
meeting called for such purpose, shall so far as permitted by law be as valid
and as binding as though ratified by every shareholder of the Corporation.
(f) Unless the By-Laws otherwise provide, any officer or
employee of the Corporation (other than a Director) may be removed at any time
with or without cause by the Board of Directors or by any committee or superior
officer upon whom such power of removal may be conferred by the By-Laws or by
authority of the Board of Directors.
(g) Notwithstanding any provision of law requiring the
authorization of any action by a greater proportion than a majority of the
total number of shares of any series or class, or of all classes or series of
capital stock, or by the total number of such shares, such action shall be
valid and effective if authorized by the affirmative vote of the holders of a
majority of the total number of shares outstanding and entitled to vote
thereon.
(h) The Corporation shall indemnify (1) its Directors and
officers, whether serving the Corporation or at its request any other entity,
to the full extent required or permitted by the General Laws of the State of
Maryland now or hereafter in force, including the advance of expenses under the
procedures and to the full extent permitted by law, and (2) its other employees
and agents to such extent as shall be authorized by the Board of Directors or
the Corporation's By-Laws and be permitted by law. The foregoing rights of
indemnification shall not be exclusive of any other rights to which those
seeking indemnification may be entitled. The Board of Directors may take such
action as is necessary to carry out these indemnification provisions and is
expressly empowered to adopt, approve and amend from time to time such By-Laws,
resolutions or contracts implementing such provisions or such further
indemnification arrangements as may be permitted by law. No amendment of these
Articles of the Corporation shall limit or eliminate the right to
indemnification provided hereunder with respect to acts or omissions occurring
prior to such amendment or repeal. Nothing contained herein shall be construed
to authorize the Corporation to indemnify any Director or officer of the
Corporation against any liability to the Corporation or to any holders of
securities of the Corporation to which he is subject by reason of willful
misfeasance, bad faith, gross negligence, or reckless disregard of the duties
involved in the conduct of his office. Any indemnification by the Corporation
shall be consistent with the requirements of law, including the 1940 Act.
10
<PAGE> 11
(i) To the fullest extent permitted by Maryland statutory and
decisional law and the 1940 Act, as amended or interpreted, no Director or
officer of the Corporation shall be personally liable to the Corporation or its
stockholders for money damages; provided, however, that nothing herein shall be
construed to protect any Director or officer of the Corporation against any
liability to which such Director or officer would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of his office. No amendment,
modification or repeal of this Article VIII shall adversely affect any right or
protection of a Director or officer that exists at the time of such amendment,
modification or repeal.
(j) In addition to the powers and authority hereinbefore,
hereinafter or by statute expressly conferred upon them, the Board of Directors
may exercise all such powers and do all such acts and things as may be
exercised or done by the Corporation, subject, nevertheless, to the express
provisions of the laws of Maryland, of these Articles and of the By-Laws of the
Corporation.
(k) The Corporation reserves the right from time to time to
make any amendments of its Articles which may now or hereafter be authorized by
law, including any amendments changing the terms or contract rights, as
expressly set forth in its Articles, of any of its outstanding stock by
classification, reclassification or otherwise but no such amendment which
changes such terms or contract rights of any of its outstanding stock shall be
valid unless such amendment shall have been authorized by not less than a
majority of the aggregate number of the votes entitled to be cast thereon, by a
vote at a meeting or in writing with or without a meeting.
(l) The Corporation shall not be required to hold an annual
meeting of shareholders in any year in which the laws of Maryland do not
require that such a meeting be held.
The enumeration and definition of particular powers of the Board
of Directors included in the foregoing shall in no way be limited or restricted
by reference to or inference from the terms of any other clause of this or any
other Article of these Articles, or construed as or deemed by inference or
otherwise in any manner to exclude or limit any powers conferred upon the Board
of Directors under the General Laws of the State of Maryland now or hereafter
in force.
IX.
DURATION OF THE CORPORATION
The duration of the Corporation shall be perpetual.
The Corporation's Charter is not amended by these Restated
Articles of Incorporation, which supersede the Restated Articles of
Incorporation executed as of June 26, 1995 and all Articles Supplementary
thereof.
11
<PAGE> 12
IN WITNESS WHEREOF, the Corporation has caused these presents to
be signed in its name and on its behalf by its President and witnessed by its
Secretary on the 31st day of October, 1995.
WITNESS: STAGECOACH INC.
/s/ Richard H. Blank, Jr. By: R. Greg Feltus
- -------------------------------- --------------------------------
Richard H. Blank, Jr., Secretary R. Greg Feltus, President
THE UNDERSIGNED, President of the Corporation, who executed on
behalf of the Corporation Restated Articles of Incorporation, hereby
acknowledges in the name and on behalf of said Corporation the foregoing
Restated Articles of Incorporation to be the corporate act of said Corporation
and hereby certifies that the matters and facts set forth herein with respect
to the authorization and approval thereof are true in all material respects
under the penalties of perjury.
/s/ R. Greg Feltus
--------------------------------
R. Greg Feltus, President
12
<PAGE> 1
EX-99.B 5(b)(i)
AMENDED ADMINISTRATION AGREEMENT
Money Market Fund
a portfolio of
STAGECOACH INC.
111 Center Street
Little Rock, Arkansas 72201
February 1, 1994
Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
Dear Sirs:
This will confirm the agreement between Stagecoach Inc. (the
"Company"), on behalf of each of its portfolios now or hereafter listed on
Schedule I hereto (each a "Fund"), and Stephens Inc. (the "Administrator") as
follows:
1. The Company is a registered open-end management investment
company currently consisting of thirteen investment portfolios, but which may
from time to time consist of a greater or lesser number of investment
portfolios (the "Funds"). The Company proposes to engage in the business of
investing and reinvesting the assets of the Funds in the manner and in
accordance with the investment objective and restrictions specified in the
Funds' currently effective prospectuses and statements of additional
information incorporated by reference therein relating to the Funds and the
Company (such prospectuses and such statements of additional information being
collectively referred to as the "Prospectuses") included in the Company's
Registration Statement, as amended from time to time (the "Registration
Statement"), filed by the Company under the Investment Company Act of 1940 (the
"Act") and the Securities Act of 1933. Copies of the documents referred to in
the preceding sentence have been furnished to the Administrator. Any
amendments to those documents shall be furnished to the Administrator promptly.
2. The Company is engaging the Administrator to provide the
administrative services specified elsewhere in this agreement, subject to the
overall supervision of the Board of Directors of the Company. Pursuant to an
advisory and services contract between the Company and Wells Fargo Bank, N.A.
(the "Adviser"), on behalf of the Fund, the Company has engaged the Adviser to
manage the investing and reinvesting of the assets of the Fund and to provide
advisory services.
3. The Administrator shall, at its expense, provide the
following administrative services in connection with the operations of the
Company and the Fund: (a) furnishing office
1
<PAGE> 2
space and certain facilities required for conducting the business of the Fund;
(b) general supervision of the operation of the Fund, including coordination of
the services performed by the Company's investment adviser, transfer and
dividend disbursing agent, custodians, independent accountants and legal
counsel; regulatory compliance, including the compilation of information for
documents such as reports to, and filings with, the Securities and Exchange
Commission and state securities commissions; and preparation of proxy
statements and shareholder reports for the Company; (c) the compensation of the
Company's directors, officers and employees who are affiliated with the
Administrator; (d) general supervision relating to the compilation of data
required for the preparation of periodic reports on the performance of its
obligations under this agreement and statements of the Fund that are
distributed to the Company's officers and Board of Directors and the
preparation of such additional reports and information as the Company's Board
of Directors or officers shall reasonably request; and (e) all other
administrative services reasonably necessary for the operation of the Fund,
other than those services that are to be provided by the Adviser pursuant to
the Advisory and Services Contracts and by the Company's transfer and dividend
disbursing agent.
4. Except as provided in each of the Company's Advisory
Contracts, the Administrator shall bear substantially all costs of the
operations of the Fund and of the Company (allocated to the Fund), including
the compensation of its directors who are not affiliated with the Adviser, the
Administrator or any of their affiliates; governmental fees; interest charges;
fees and expenses of its independent auditors, legal counsel, expenses of
preparing and printing any stock certificates, prospectuses, shareholders'
reports, notices, proxy statements and reports to regulatory agencies; travel
expenses of directors, officers and employees; office supplies; insurance
premiums and certain expenses relating to insurance coverage; trade association
membership dues; expenses of shareholders' meetings; expenses relating to the
issuance, registration and qualification of shares of the Fund; and
organizational expenses. Notwithstanding anything to the contrary, the
Administrator shall not be required to bear any cost or expense which a
majority of the disinterested directors of the Company deems to be an
extraordinary expense or brokerage and other expenses connected with the
execution of portfolio transactions. General expenses of the Company are
allocated among the Fund in a manner proportionate to the net assets of the
Fund, on a transactional basis or on such other basis as the Board of Directors
deems equitable.
5. The Administrator shall give the Company the benefit of the
Administrator's best judgment and efforts in rendering services under this
agreement. As an inducement to the Administrator's undertaking to render these
services, the Company agrees that the Administrator shall not be liable under
this agreement for any mistake in judgment or in any other event whatsoever
except for lack of good faith, provided that nothing in this agreement shall be
deemed to protect or purport to protect the Administrator against any liability
to the Company or its shareholders to which the Administrator would otherwise
be subject by reason of willful misfeasance, bad faith or gross negligence in
the performance of the Administrator's duties under this agreement or by reason
of reckless disregard of its obligations and duties hereunder.
6. In consideration of the services to be rendered by the
Administrator under this agreement, the Company shall pay the Administrator a
monthly fee on the first business day of each month, at the annual rate of
0.05% of the average daily value (as determined on each
2
<PAGE> 3
business day at the time set forth in the Prospectuses for determining net
asset value per share) of the Fund's net assets during the preceding month. If
the fee payable to the Administrator pursuant to this paragraph 6 begins to
accrue after the beginning of any month or if this agreement terminates before
the end of any month, the fee for the period from the effective date to the end
of that month or from the beginning of that month to the termination date,
respectively, shall be prorated according to the proportion that the period
bears to the full month in which the effectiveness or termination occurs. For
purposes of calculating the monthly fee, the value of the Fund's net assets
shall be computed in the manner specified in the Prospectus and the Company's
Articles of Incorporation for the computation of the value of the Fund's net
assets in connection with the determination of the net asset value of Fund
shares. For purposes of this agreement, a "business day" is any day the
Company is open for business.
7. If in any fiscal year the total expenses of the Fund
incurred by, or allocated to, the Fund excluding extraordinary expenses of the
Fund, but including the fees provided for in paragraph 6 and those provided for
pursuant to the Fund's Advisory Contract ("includable expenses"), exceed the
most restrictive expense limitation applicable to the Fund imposed by state
securities laws or regulations thereunder, as these limitations may be raised
or lowered from time to time, the Administrator shall waive or reimburse that
portion of the excess derived by multiplying the excess by a fraction, the
numerator of which shall be the percentage at which the excess portion
attributable to the fee payable pursuant to this agreement is calculated under
paragraph 6 hereof, and the denominator of which shall be the sum of such
percentage plus the percentage at which the excess portion attributable to the
fee payable pursuant to the Fund's Advisory Contract is calculated (the
"Applicable Ratio"), but only to the extent of the fee hereunder for the fiscal
year. If the fees payable under this agreement and/or the Fund's Advisory
Contract contributing to such excess portion are calculated at more than one
percentage rate, the Applicable Ratio shall be calculated separately on the
basis of, and applied separately to, the portions of the fees calculated at the
different rates. At the end of each month of the Company's fiscal year, the
Company shall review the includable expenses accrued during that fiscal year to
the end of that period and shall estimate the includable expenses for the
balance of that fiscal year. If as a result of that review and estimation it
appears likely that the includable expenses will exceed the limitations
referred to in this paragraph 7 for a fiscal year with respect to the Fund, the
monthly fee set forth in paragraph 6 payable to the Administrator for such
month shall be reduced, subject to a later adjustment, by an amount equal to
the Applicable Ratio times the pro rata portion (prorated on the basis of the
remaining months of the fiscal year, including the month just ended) of the
amount by which the includable expenses for the fiscal year are expected to
exceed the limitations provided for in this paragraph 7. For purposes of
computing the excess, if any, over the most restrictive applicable expense
limitation, the value of the Fund's net assets shall be computed in the manner
specified in the last sentence of paragraph 6, and any reimbursements required
to be made by the Administrator shall be made once a year promptly after the
end of the Company's fiscal year.
8. This agreement shall become effective on its execution date
and shall thereafter continue in effect for a period of no less than three
years. Thereafter, this agreement may be terminated at any time with respect
to the Company or any Fund, without the payment of any penalty, by a vote of a
majority of the Company's or the Fund's outstanding voting securities (as
defined in the Act) and by a vote of a majority of the Company's entire Board
of Directors on
3
<PAGE> 4
60 days' written notice to the Administrator or by the Administrator with
respect to the Company or the Fund on 60 days' written notice to the Company.
9. Except to the extent necessary to perform the
Administrator's obligations under this agreement, nothing herein shall be
deemed to limit or restrict the right of the Administrator, or any affiliate of
the Administrator, or any employee of the Administrator to engage in any other
business or to devote time and attention to the management or other aspects of
any other business, whether of a similar or dissimilar nature, or to render
services of any kind to any other corporation, firm, individual or association.
10. This agreement shall be governed by and construed in
accordance with the laws of the State of Arkansas.
If the foregoing correctly sets forth the agreement between the
Company and the Administrator, please so indicate by signing and returning to
the Company the enclosed copy hereof.
Very truly yours,
STAGECOACH INC.
on behalf of the
Money Market Fund
By: /s/ Richard H. Blank, Jr.
------------------------------
Name: Richard H. Blank
Title: Chief Operating Officer
ACCEPTED as of the date
set forth above:
STEPHENS INC.
By: /s/ Richard H. Blank, Jr.
------------------------------
Name: Richard H. Blank
Title: Vice President
4
<PAGE> 5
SCHEDULE I
Money Market Fund
<PAGE> 1
EX-99.B 5(b)(ii)
ADMINISTRATION AGREEMENT
for certain portfolios of
STAGECOACH INC.
111 Center Street
Little Rock, Arkansas 72201
February 1, 1994
Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
Dear Sirs:
This will confirm the agreement between the undersigned (the
"Company"), on behalf of each of its portfolios now or hereafter listed on
Schedule I hereto (each, a "Fund"), and Stephens Inc. (the "Administrator") as
follows:
1. The Company is a registered open-end management investment
company currently consisting of thirteen investment portfolios, but which may
from time to time consist of a greater or lesser number of investment
portfolios (the "Funds"). The Company proposes to engage in the business of
investing and reinvesting the assets of the Funds in the manner and in
accordance with the investment objective and restrictions specified in the
Funds' currently effective prospectuses and statements of additional
information incorporated by reference therein relating to the Funds and the
Company (such prospectuses and such statements of additional information being
collectively referred to as the "Prospectuses") included in the Company's
Registration Statement, as amended from time to time (the "Registration
Statement"), filed by the Company under the Investment Company Act of 1940 (the
"Act") and the Securities Act of 1933. Copies of the documents referred to in
the preceding sentence have been furnished to the Administrator. Any
amendments to those documents shall be furnished to the Administrator promptly.
2. The Company is engaging the Administrator to provide the
administrative services specified elsewhere in this agreement, subject to the
overall supervision of the Board of Directors of the Company. Pursuant to an
advisory and services contract between the Company and Wells Fargo Bank, N.A.
(the "Adviser"), on behalf of each Fund, the Company has engaged the Adviser to
manage the investing and reinvesting of the assets of the Funds and to provide
advisory services.
3. The Administrator shall, at its expense, provide the
following administrative services in connection with the operations of the
Company and the Funds: (a) furnishing office space and certain facilities
required for conducting the business of the Funds; (b) general supervision of
the operation of the Funds, including coordination of the services performed by
the Company's investment adviser, transfer and dividend disbursing agent,
custodians, independent
<PAGE> 2
accountants and legal counsel; regulatory compliance, including the compilation
of information for documents such as reports to, and filings with, the
Securities and Exchange Commission and state securities commissions; and
preparation of proxy statements and shareholder reports for the Company; (c)
the compensation of the Company's directors, officers and employees who are
affiliated with the Administrator; (d) general supervision relating to the
compilation of data required for the preparation of periodic reports on the
performance of its obligations under this agreement and statements of the Funds
that are distributed to the Company's officers and Board of Directors and the
preparation of such additional reports and information as the Company's Board
of Directors or officers shall reasonably request; and (e) all other
administrative services reasonably necessary for the operation of the Funds,
other than those services that are to be provided by the Adviser pursuant to
the Advisory and Services Contracts and by the Company's transfer and dividend
disbursing agent.
4. Except as provided in each of the Company's Advisory
Contracts and this agreement, the Fund shall bear all costs of the operations
of the Fund and the Company (allocated to the Fund), including the Fund's pro
rata share of the costs of operations of the Master Series in which it invests;
the compensation of its directors who are not affiliated with the Adviser, the
Administrator or any of their affiliates; advisory and administration fees;
payments for distribution-related expenses pursuant to any Rule 12b-1 Plan,
i.e., a plan of distribution of the Company adopted on behalf of any of the
Funds pursuant to Rule 12b-1 under the Act; payments for shareholder servicing
expenses pursuant to a servicing plan adopted on behalf of any of the Funds;
governmental fees; interest charges; taxes; fees and expenses of its
independent accountants, legal counsel, transfer agent and dividend disbursing
agent; expenses of redeeming shares; expenses of preparing and printing any
stock certificates, prospectuses (except the expense of printing and mailing
prospectuses used for promotional purposes, unless otherwise payable pursuant
to a Rule 12b-1 Plan), shareholders' reports, notices, proxy statements and
reports to regulatory agencies; travel expenses of directors, officers and
employees; office supplies; insurance premiums and certain expenses relating to
insurance coverage; trade association membership dues; brokerage and other
expenses connected with the execution of portfolio securities transactions;
fees and expenses of any custodian, including those for keeping books and
accounts and calculating the net asset value per share of the Funds; expenses
of shareholders' meetings; expenses relating to the issuance, registration and
qualification of shares of the Funds; pricing services, if any; organizational
expenses; and any extraordinary expenses. Expenses attributable to one or
more, but not all, of the Funds are charged against the assets of the relevant
Funds. General expenses of the Company are allocated among the Funds in a
manner proportionate to the net assets of each Fund, on a transactional basis
or on such other basis as the Board of Directors deems equitable.
5. The Administrator shall give the Company the benefit of the
Administrator's best judgment and efforts in rendering services under this
agreement. As an inducement to the Administrator's undertaking to render these
services, the Company agrees that the Administrator shall not be liable under
this agreement for any mistake in judgment or in any other event whatsoever
except for lack of good faith, provided that nothing in this agreement shall be
deemed to protect or purport to protect the Administrator against any liability
to the Company or its shareholders to which the Administrator would otherwise
be subject by reason of willful
2
<PAGE> 3
misfeasance, bad faith or gross negligence in the performance of the
Administrator's duties under this agreement or by reason of reckless disregard
of its obligations and duties hereunder.
6. In consideration of the services to be rendered by the
Administrator under this agreement, the Company shall pay the Administrator a
monthly fee on the first business day of each month, at the annual rate of
0.05% of the average daily value (as determined on each business day at the
time set forth in the Prospectuses for determining net asset value per share)
of each Fund's net assets during the preceding month. If the fee payable to
the Administrator pursuant to this paragraph 6 begins to accrue after the
beginning of any month or if this agreement terminates before the end of any
month, the fee for the period from the effective date to the end of that month
or from the beginning of that month to the termination date, respectively,
shall be prorated according to the proportion that the period bears to the full
month in which the effectiveness or termination occurs. For purposes of
calculating each such monthly fee, the value of each Fund's net assets shall be
computed in the manner specified in the Prospectus and the Company's Articles
of Incorporation for the computation of the value of the Fund's net assets in
connection with the determination of the net asset value of Fund shares. For
purposes of this agreement, a "business day" is any day the Company is open for
business.
7. If in any fiscal year the total expenses of a Fund incurred
by, or allocated to, the Fund excluding extraordinary expenses of the Fund, but
including the fees provided for in paragraph 6 and those provided for pursuant
to the Fund's Advisory and Services Contract ("includable expenses"), exceed
the most restrictive expense limitation applicable to the Fund imposed by state
securities laws or regulations thereunder, as these limitations may be raised
or lowered from time to time, the Administrator shall waive or reimburse that
portion of the excess derived by multiplying the excess by a fraction, the
numerator of which shall be the percentage at which the excess portion
attributable to the fee payable pursuant to this agreement is calculated under
paragraph 6 hereof, and the denominator of which shall be the sum of such
percentage plus the percentage at which the excess portion attributable to the
fee payable pursuant to the Fund's Advisory and Services Contract is calculated
(the "Applicable Ratio"), but only to the extent of the fee hereunder for the
fiscal year. If the fees payable under this agreement and/or the Fund's
Advisory and Services Contract contributing to such excess portion are
calculated at more than one percentage rate, the Applicable Ratio shall be
calculated separately on the basis of, and applied separately to, the portions
of the fees calculated at the different rates. At the end of each month of the
Company's fiscal year, the Company shall review the includable expenses accrued
during that fiscal year to the end of that period and shall estimate the
includable expenses for the balance of that fiscal year. If as a result of
that review and estimation it appears likely that the includable expenses will
exceed the limitations referred to in this paragraph 7 for a fiscal year with
respect to the Fund, the monthly fee set forth in paragraph 6 payable to the
Administrator for such month shall be reduced, subject to a later adjustment,
by an amount equal to the Applicable Ratio times the pro rata portion (prorated
on the basis of the remaining months of the fiscal year, including the month
just ended) of the amount by which the includable expenses for the fiscal year
are expected to exceed the limitations provided for in this paragraph 7. For
purposes of computing the excess, if any, over the most restrictive applicable
expense limitation, the value of the Funds' net assets shall be computed in the
manner specified in the last sentence of paragraph 6, and any reimbursements
required to be made by the Administrator shall be made once a year promptly
after the end of the Company's fiscal year.
3
<PAGE> 4
8. This agreement shall become effective on its execution date
and shall thereafter continue in effect for a period of no less than three
years. Thereafter, this agreement may be terminated at any time with respect
to the Company or any Fund, without the payment of any penalty, by a vote of a
majority of the Company's or the Fund's outstanding voting securities (as
defined in the Act) and by a vote of a majority of the Company's entire Board
of Directors on 60 days' written notice to the Administrator or by the
Administrator with respect to the Company or any Fund on 60 days' written
notice to the Company.
9. Except to the extent necessary to perform the
Administrator's obligations under this agreement, nothing herein shall be
deemed to limit or restrict the right of the Administrator, or any affiliate of
the Administrator, or any employee of the Administrator to engage in any other
business or to devote time and attention to the management or other aspects of
any other business, whether of a similar or dissimilar nature, or to render
services of any kind to any other corporation, firm, individual or association.
10. This agreement shall be governed by and construed in
accordance with the laws of the State of Arkansas.
If the foregoing correctly sets forth the agreement between the
Company and the Administrator, please so indicate by signing and returning to
the Company the enclosed copy hereof.
Very truly yours,
STAGECOACH INC.
By: /s/ Richard H. Blank, Jr.
------------------------------
Name: Richard H. Blank
Title: Chief Operating Officer
ACCEPTED as of the date
set forth above:
STEPHENS INC.
By: /s/ Richard H. Blank, Jr.
------------------------------
Name: Richard H. Blank
Title: Vice President
4
<PAGE> 5
SCHEDULE I
California Tax-Free Intermediate Income Fund
California Tax-Free Money Market Fund
California Tax-Free Short-Term Income Fund
National Tax-Free Intermediate Income Fund
National Tax-Free Money Market Mutual Fund
Overland National Tax-Free Institutional Money Market Fund
Bond Index Fund
Growth and Income Fund
Growth Stock Fund
Short-Intermediate Term Fund
S&P 500 Stock Fund
Approved: October 26, 1993
Approved as Amended: May 2, 1995
<PAGE> 1
EX-99.B 5(b)(iii)
ADMINISTRATION AGREEMENT
for certain portfolios of
STAGECOACH INC.
111 Center Street
Little Rock, Arkansas 72201
February 1, 1994
Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
Dear Sirs:
This will confirm the agreement between Stagecoach Inc. (the
"Company"), on behalf of each of its portfolios now or hereafter listed on
Schedule I hereto (each, a "Fund"), and Stephens Inc. (the "Administrator") as
follows:
1. The Company is a registered open-end management investment
company currently consisting of thirteen investment portfolios, but which may
from time to time consist of a greater or lesser number of investment
portfolios (the "Funds"). The Company proposes to engage in the business of
investing and reinvesting the assets of the Funds in the manner and in
accordance with the investment objective and restrictions specified in the
Funds' currently effective prospectuses and statements of additional
information incorporated by reference therein relating to the Funds and the
Company (such prospectuses and such statements of additional information being
collectively referred to as the "Prospectuses") included in the Company's
Registration Statement, as amended from time to time (the "Registration
Statement"), filed by the Company under the Investment Company Act of 1940 (the
"1940 Act") and the Securities Act of 1933. Copies of the documents referred
to in the preceding sentence have been furnished to the Administrator. Any
amendments to those documents shall be furnished to the Administrator promptly.
2. The Company is engaging the Administrator to provide the
administrative services specified elsewhere in this agreement, subject to the
overall supervision of the Board of Directors of the Company.
3. The Administrator shall, at its expense, provide the
following administrative services in connection with the operations of the
Company and the Funds: (a) furnishing office space and certain facilities
required for conducting the business of the Funds; (b) general supervision of
the operation bof the Funds, including coordination of
<PAGE> 2
the services performed by the Company's investment adviser, transfer and
dividend disbursing agent, custodians, independent accountants and legal
counsel; regulatory compliance, including the compilation of information for
documents such as reports to, and filings with, the Securities and Exchange
Commission and state securities commissions; and preparation of proxy
statements and shareholder reports for the Company; (c) the compensation of the
Company's directors, officers and employees who are affiliated with the
Administrator; (d) general supervision relating to the compilation of data
required for the preparation of periodic reports on the performance of its
obligations under this agreement and statements of the Funds that are
distributed to the Company's officers and Board of Directors and the
preparation of such additional reports and information as the Company's Board
of Directors or officers shall reasonably request; and (e) all other
administrative services reasonably necessary for the operation of the Funds,
other than those services that are to be provided by the Company's transfer and
dividend disbursing agent.
4. Except as provided in this agreement and the Servicing
Plan, the Administrator shall bear substantially all costs of the operations of
the Company (allocated to the Funds) and the Funds, including the compensation
of its directors who are not affiliated with Wells Fargo Bank, N.A. (the
"Adviser"), the Administrator or any of their affiliates; governmental fees;
interest charges; fees and expenses of its independent accountants, legal
counsel, expenses of preparing and printing any stock certificates,
prospectuses, shareholders' reports, notices, proxy statements and reports to
regulatory agencies; travel expenses of directors, officers and employees;
office supplies; insurance premiums and certain expenses relating to insurance
coverage; trade association membership dues; expenses of shareholders'
meetings; expenses relating to the issuance, registration and qualification of
shares of the Funds; and organizational expenses. Notwithstanding anything to
the contrary, the Administrator shall not be required to bear any cost or
expense which a majority of the disinterested directors of the Company deems to
be an extraordinary expense or brokerage and other expenses connected with the
execution of portfolio transactions. General expenses of the Funds are
allocated among the Funds in a manner proportionate to the net assets of each
Fund, on a transactional basis or on such other basis as the Board of Directors
deems equitable.
5. The Administrator shall give the Company the benefit of the
Administrator's best judgment and efforts in rendering services under this
agreement. As an inducement to the Administrator's undertaking to render these
services, the Company agrees that the Administrator shall not be liable under
this agreement for any mistake in judgment or in any other event whatsoever
except for lack of good faith, provided that nothing in this agreement shall be
deemed to protect or purport to protect the Administrator against any liability
to the Company or its shareholders to which the Administrator would otherwise
be subject by reason of willful misfeasance, bad faith or gross negligence in
the performance of the Administrator's duties under this agreement or by reason
of reckless disregard of its obligations and duties hereunder.
<PAGE> 3
6. In consideration of the services to be rendered by the
Administrator under this agreement, the Company shall pay the Administrator a
monthly fee on the first business day of each month, at the annual rate of
0.10% of the average daily value (as determined on each business day at the
time set forth in the Prospectuses for determining net asset value per share)
of each Fund's net assets during the preceding month. If the fee payable to
the Administrator pursuant to this paragraph 6 begins to accrue after the
beginning of any month or if this agreement terminates before the end of any
month, the fee for the period from the effective date to the end of that month
or from the beginning of that month to the termination date, respectively,
shall be prorated according to the proportion that the period bears to the full
month in which the effectiveness or termination occurs. For purposes of
calculating each such monthly fee, the value of each Fund's net assets shall be
computed in the manner specified in the Prospectus and the Company's Articles
of Incorporation for the computation of the value of the Fund's net assets in
connection with the determination of the net asset value of Fund shares. For
purposes of this agreement, a "business day" is any day the Company is open for
business.
7. If in any fiscal year the total expenses of a Fund incurred
by, or allocated to, the Fund excluding extraordinary expenses of the Fund, but
including the fees provided for in paragraph 6 and those fees payable under the
Advisory Contract for each Fund's corresponding Series of the Managed Series
Investment Trust, exceed the most restrictive expense limitation applicable to
the Fund imposed by state securities laws or regulations thereunder, as these
limitations may be raised or lowered from time to time, the Administrator shall
waive or reimburse its pro rata portion of such fees, but only to the extent of
the fee hereunder for the fiscal year. For purposes of computing the excess,
if any, over the most restrictive applicable expense limitation, the value of
the Funds' net assets shall be computed in the manner specified in the last
sentence of paragraph 6, and any reimbursements required to be made by the
Administrator shall be made once a year promptly after the end of the Company's
fiscal year.
8. This agreement shall become effective on its execution date
and shall thereafter continue in effect for a period of no less than three
years. Thereafter, this agreement may be terminated at any time with respect
to the Company or any Fund, without the payment of any penalty, by a vote of a
majority of the Company's or the Fund's outstanding voting securities (as
defined in the Act) and by a vote of a majority of the Company's entire Board
of Directors on 60 days' written notice to the Administrator or by the
Administrator with respect to the Company or any Fund on 60 days' written
notice to the Company.
9. Except to the extent necessary to perform the
Administrator's obligations under this agreement, nothing herein shall be
deemed to limit or restrict the right of the Administrator, or any affiliate of
the Administrator, or any employee of the Administrator to engage in any other
business or to devote time and attention to the management or other aspects of
any other business, whether of a similar or dissimilar nature, or to render
services of any kind to any other corporation, firm, individual or association.
<PAGE> 4
10. This agreement shall be governed by and construed in
accordance with the laws of the State of Arkansas.
If the foregoing correctly sets forth the agreement between the
Company and the Administrator, please so indicate by signing and returning to
the Company the enclosed copy hereof.
Very truly yours,
STAGECOACH INC.
By: /s/ Richard H. Blank, Jr.
------------------------------
Name: Richard H. Blank
Title: Chief Operating Officer
ACCEPTED as of the date
set forth above:
STEPHENS INC.
By: /s/ Richard H. Blank, Jr.
------------------------------
Name: Richard H. Blank
Title: Vice President
<PAGE> 5
SCHEDULE I
Asset Allocation Fund
U.S. Treasury Allocation Fund
LifePath 2000 Series
LifePath 2010 Series
LifePath 2020 Series
LifePath 2030 Series
LifePath 2040 Series
Approved February 1, 1994
Amended October 10, 1995
<PAGE> 1
EX-99.B 6(a)
AMENDED
DISTRIBUTION AGREEMENT
STAGECOACH INC.
111 Center Street
Little Rock, Arkansas 72201
February 1, 1994
Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
Dear Sirs:
This will confirm the agreement between the undersigned (the
"Company"), on behalf of each of its portfolios now or hereafter in effect
(each, a "Fund"), and you ("Distributor") as follows:
1. As the Company's agent, Distributor shall be the exclusive
distributor for the unsold portion of shares of the Fund that are registered
under the Securities Act of 1933 (the "1933 Act").
2. The Company shall sell through Distributor, as the Company's
agent, and deliver, upon the terms set forth herein, Fund shares that
Distributor orders from the Company and for which Distributor has received and
confirmed unconditional purchase orders. All orders from Distributor shall be
subject to acceptance and confirmation by the Company. The Company shall have
the right, at its election, to deliver either shares issued upon original issue
or treasury shares.
3. As the Company's agent, Distributor may sell and distribute
Fund shares in such manner not inconsistent with the provisions hereof as
Distributor may determine from time to time. In that connection Distributor
shall comply with all laws, rules and regulations applicable to it, including,
without limiting the generality of the foregoing, all applicable rules or
regulations under the Investment Company Act of 1940 (the "1940 Act") and of
any securities association registered under the Securities Exchange Act of 1934
(the "1934 Act").
4. The Company reserves the right to sell Fund shares to
purchasers to the extent that it or the transfer agent for Fund shares receives
purchase applications therefor. Distributor's right to accept purchase orders
for Fund shares or to make sales thereof shall not apply to Fund shares that
may be offered by the Company to shareholders for the reinvestment of cash
distributed to
1
<PAGE> 2
shareholders by the Company or Fund shares that may otherwise be offered by the
Company to shareholders, unless Distributor is otherwise notified by the
Company.
5. All shares offered for sale and sold by Distributor shall be
offered for sale and sold by Distributor to or through securities dealers or
banks and other depository institutions having agreements with Distributor
("Servicing Agents") upon the terms and conditions set forth in paragraph 7(b)
hereof or to investors at the price per share (the "offering price", which is
the net asset value per share plus the applicable sales charge, if any)
specified and determined as provided in the Prospectus (the "Prospectus")
included in the Company's Registration Statement, as amended from time to time,
under the 1933 Act and the 1940 Act (the "Registration Statement"), relating to
the offering of its shares for sale. If the offering price is not an exact
multiple of one cent, it shall be adjusted to the nearest full cent. The
Company shall determine and furnish promptly to Distributor a statement of the
offering price at least once on each day on which the Prospectus states the
Company is required to determine the Company's net asset value for the purpose
of pricing purchase orders. Each offering price shall become effective at the
time and shall remain in effect during the period specified in the statement.
Each such statement shall show the basis of its computation. For purposes of
establishing the offering price, the Company shall consider a purchase order to
have been presented to it at the time it was originally entered by Distributor
for transmission to it, provided the original purchase order and Distributor's
fulfilling order to the Company are appropriately time stamped or evidenced to
show the time of original entry and that Distributor's fulfilling order to the
Company is received by the Company within a time deemed by it to be reasonable
after the purchase order was originally entered. Purchases of shares shall be
made for full and fractional shares, carried to the third decimal place.
6. Ownership of Fund shares sold hereunder shall be registered in
such names and denominations as are specified in writing to the Company or to
its agent designated for the purpose. No certificates for shares of the Fund
will be issued.
7. (a) Distributor shall from time to time employ or
associate with it such persons as it believes necessary to assist it in
carrying out its obligations under this agreement. The compensation of such
persons shall be paid by Distributor.
(b) Distributor shall have the right to enter into
servicing agreements with Servicing Agents of its choice for the sale or
marketing of Fund shares at the offering price and upon the terms and
conditions set forth in the Prospectus. Distributor may amend those
agreements, or modify the form of agreement, only upon approval of the Company.
(c) Distributor shall pay all expenses incurred in
connection with its qualification as a dealer or broker under Federal or state
laws.
(d) Distributor shall pay all expenses incurred in
connection with: (i) printing and distributing such number of copies of the
Prospectus as Distributor deems necessary for use in connection with offering
Fund shares to prospective investors, (ii) preparing, printing and distributing
any other literature and advertising deemed appropriate by Distributor for use
in connection with offering Fund shares for sale and (iii) all other expenses
incurred in connection
2
<PAGE> 3
with the sale of Fund shares as contemplated by this agreement, except as
otherwise specifically provided in this agreement. In addition, it is
understood and agreed that, so long as a plan of distribution of a Fund adopted
pursuant to Rule 12b-1 of the 1940 Act (a "Plan") continues in effect, any
expenses incurred by Distributor hereunder in connection with such Fund may be
paid from amounts received by it from such Fund under the Plan. So long as a
Plan continues in effect, Distributor shall be entitled to receive
reimbursement from the Company under the Plan for actual expenses incurred in
connection with the Fund to the extent such expenses are reimbursable under the
Plan and shall be entitled to receive compensation for distribution-related
services to the extent provided for under the Plan. Distributor shall provide
to the Board of Directors of the Company and the Board of Directors shall
review, at least quarterly, a written report of the amounts so expended, the
purposes for which such expenditures were made, the amounts of reimbursements
received and the amounts of compensation received.
(e) The Company shall execute all documents and furnish
any information which may be reasonably necessary in connection with the
qualification of Fund shares of the Company for sale in jurisdictions
designated by Distributor.
8. The Company shall furnish Distributor from time to time, for
use in connection with the sale of Fund shares, such written information with
respect to the Company as Distributor may reasonably request. In each case
such written information shall be signed by an authorized officer of the
Company. The Company represents and warrants that such information, when
signed by one of its officers, shall be true and correct. The Company shall
also furnish to Distributor copies of its reports to its stockholders and such
additional information regarding the Company's financial condition as
Distributor may reasonably request from time to time.
9. The Registration Statement and the Prospectus have been or
will be, as the case may be, carefully prepared in conformity with the 1933
Act, the 1940 Act and the rules and regulations (the "Rules and Regulations")
of the Securities and Exchange Commission (the "SEC"). The Company represents
and warrants to Distributor that the Registration Statement and the Prospectus
contain or will contain all statements required to be stated therein in
accordance with the 1933 Act, the 1940 Act and the Rules and Regulations, that
all statements of fact contained or to be contained therein are or will be true
and correct at the time indicated or the effective date, as the case may be,
and that neither the Registration Statement nor the Prospectus, when it shall
become effective under the 1933 Act or be authorized for use, shall include an
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
to a purchaser of Fund shares. The Company shall from time to time file such
amendment or amendments to the Registration Statement and the Prospectus as, in
the light of future developments, shall, in the opinion of the Company's
counsel, be necessary in order to have the Registration Statement and the
Prospectus at all times contain all material facts required to be stated
therein or necessary to make the statements therein not misleading to a
purchaser of Fund shares. If the Company shall not file such amendment or
amendments within 15 days after receipt by the Company of a written request
from Distributor to do so, Distributor may, at its option, terminate this
agreement immediately. The Company shall not file any amendment to the
Registration Statement or the Prospectus without giving Distributor reasonable
notice thereof in advance, provided that nothing in this
3
<PAGE> 4
agreement shall in any way limit the Company's right to file at any time such
amendments to the Registration Statement or the Prospectus as the Company may
deem advisable. The Company represents and warrants to Distributor that any
amendment to the Registration Statement or the Prospectus filed hereafter by
the Company will, when it becomes effective under the 1933 Act, contain all
statements required to be stated therein in accordance with the 1933 Act, the
1940 Act and the Rules and Regulations, that all statements of fact contained
therein will, when the same shall become effective, be true and correct, and
that no such amendment, when it becomes effective, will include an untrue
statement of a material fact or will omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading to
a purchaser of Fund shares.
10. Subject to the provisions of paragraph 7, the Company shall
prepare and furnish to Distributor from time to time such number of copies of
the most recent form of the Prospectus filed with the SEC as Distributor may
reasonably request. The Company authorizes Distributor and Servicing Agents to
use the Prospectus, in the form furnished to Distributor from time to time, in
connection with the sale of Fund shares. The Company shall indemnify, defend
and hold harmless Distributor, its officers and partners and any person who
controls Distributor within the meaning of the 1933 Act, from and against any
and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which Distributor, its officers or
partners or any such controlling person, may incur under the 1933 Act, the 1940
Act, the common law or otherwise, arising out of or based upon any alleged
untrue statement of a material fact contained in the Registration Statement or
the Prospectus or arising out of or based upon any alleged omission to state a
material fact required to be stated in either thereof or necessary to make the
statements in either thereof not misleading. Notwithstanding the foregoing,
this indemnity agreement, to the extent that it might require indemnity of any
person who is an officer or partner of Distributor and who is also a director
of the Company, shall not inure to the benefit of such officer or partner
unless a court of competent jurisdiction shall determine, or it shall have been
determined by controlling precedent, that such result would not be against
public policy as expressed in the 1933 Act or the 1940 Act, and in no event
shall anything contained herein be so construed as to protect Distributor
against any liability to the Company or its stockholders to which Distributor
would otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of its reckless
disregard of its obligations and duties under this agreement. This indemnity
agreement is expressly conditioned upon the Company's being notified of any
action brought against Distributor, its officers or partners or any such
controlling person, which notification shall be given by letter or by telegram
addressed to the Company at its principal office in Little Rock, Arkansas, and
sent to the Company by the person against whom such action is brought within 10
days after the summons or other first legal process shall have been served.
The failure to notify the Company of any such action shall not relieve the
Company from any liability which it may have to the person against whom such
action is brought by reason of any such alleged untrue statement or omission
otherwise than on account of the indemnity agreement contained in this
paragraph. The Company shall be entitled to assume the defense of any suit
brought to enforce any such claim, demand or liability, but, in such case, the
defense shall be conducted by counsel chosen by the Company and approved by
Distributor. If the Company elects to assume the defense of any such suit and
retain counsel approved by
4
<PAGE> 5
Distributor, the defendant or defendants in such suit shall bear the fees and
expenses of any additional counsel retained by any of them, but in case the
Company does not elect to assume the defense of any such suit, or in case
Distributor does not approve of counsel chosen by the Company, the Company will
reimburse Distributor, its officers and partners or the controlling person or
persons named as defendant or defendants in such suit, for the fees and
expenses of any counsel retained by Distributor or them. In addition,
Distributor shall have the right to employ one separate counsel to represent
it, its officers and partners and any such controlling person who may be
subject to liability arising out of any claim in respect of which indemnity may
be sought by Distributor against the Company hereunder if in the reasonable
judgment of Distributor it is advisable because of actual or potential
differing interests between the Distributor, its officers and partners or such
controlling person and the Company in the conduct of the defense of such
action, for Distributor, its officers and partners or such controlling person
to be represented by separate counsel, in which event the fees and expenses of
such separate counsel shall be borne by the Company. This indemnity agreement
and the Company's representations and warranties in this agreement shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of Distributor, its officers and partners or any such controlling
person and shall survive the delivery of any shares as provided in this
agreement. This indemnity agreement shall inure exclusively to the benefit of
Distributor and its successors, Distributor's officers and partners and their
respective estates and any such controlling persons and their successors and
estates. The Company shall promptly notify Distributor of the commencement of
any litigation or proceedings against it in connection with the issue and sale
of any Fund shares.
11. Distributor agrees to indemnify, defend and hold harmless
the Company, its officers and directors and any person who controls the Company
within the meaning of the 1933 Act, from and against any and all claims,
demands, liabilities and expenses (including the cost of investigating or
defending such claims, demands or liabilities and any counsel fees incurred in
connection therewith) which the Company, its officers or directors or any such
controlling person, may incur under the 1933 Act, the 1940 Act, the common law
or otherwise, but only to the extent that such liability or expense incurred by
the Company, its officers or directors or such controlling person resulting
from such claims or demands shall arise out of or be based upon (a) any alleged
untrue statement of a material fact contained in information furnished in
writing by Distributor to the Company specifically for use in the Registration
Statement or the Prospectus or shall arise out of or be based upon any alleged
omission to state a material fact in connection with such information required
to be stated in the Registration Statement or the Prospectus or necessary to
make such information not misleading and (b) any alleged act or omission on
Distributor's part as the Company's agent that has not been expressly
authorized by the Company in writing. This indemnity agreement is expressly
conditioned upon Distributor's being notified of any action brought against the
Company, its officers and directors or any such controlling person, which
notification shall be given by letter or telegram, addressed to Distributor at
its principal office in Little Rock, Arkansas, and sent to Distributor by the
person against whom such action is brought, within 10 days after the summons or
other first legal process shall have been served. The failure to notify
Distributor of any such action shall not relieve Distributor from any liability
which it may have to the Company, its officers or directors or such controlling
person by reason of any such alleged misstatement or omission on Distributor's
part otherwise than on account of the indemnity agreement contained in this
paragraph. Distributor shall have a right to control the defense of
5
<PAGE> 6
such action with counsel of its own choosing and approved by the Company if
such action is based solely upon such alleged misstatement or omission on
Distributor's part, and in any other event the Company, its officers and
directors or such controlling person shall each have the right to participate
in the defense or preparation of the defense of any such action at their own
expense.
12. No Fund shares shall be sold through Distributor or by the
Company under this agreement and no orders for the purchase of Fund shares
shall be confirmed or accepted by the Company if and so long as the
effectiveness of the Registration Statement shall be suspended under any of the
provisions of the 1933 Act. Nothing contained in this paragraph 12 shall in
any way restrict, limit or have any application to or bearing upon the
Company's obligation to redeem Fund shares from any shareholder in accordance
with the provisions of its Articles of Incorporation. The Company will use its
best efforts at all times to have Fund shares effectively registered under the
1933 Act.
13. The Company agrees to advise Distributor immediately:
(a) of any request by the SEC for amendments to the
Registration Statement or the Prospectus or for additional information;
(b) in the event of the issuance by the SEC of any stop
order suspending the effectiveness of the Registration Statement or the
Prospectus under the 1933 Act or the initiation of any proceedings for that
purpose;
(c) of the happening of any material event that makes
untrue any statement made in the Registration Statement or the Prospectus or
that requires the making of a change in either thereof in order to make the
statements therein not misleading; and
(d) of any action of the SEC with respect to any
amendments to the Registration Statement or the Prospectus that may from time
to time be filed with the SEC under the 1933 Act or the 1940 Act.
14. Insofar as they concern the Company, the Company shall
comply with all applicable laws, rules and regulations, including, without
limiting the generality of the foregoing, all rules or regulations made or
adopted pursuant to the 1933 Act, the 1940 Act or by any securities association
registered under the 1934 Act.
15. Distributor may, if it desires and at its own cost and
expense, appoint or employ agents to assist it in carrying out its obligations
under this agreement, but no such appointment or employment shall relieve
Distributor of any of its responsibilities or obligations to the Company under
this agreement.
16. Subject to the provisions of paragraph 9, this agreement
shall continue in effect until such time as there shall remain no unsold
balance of Fund shares registered under the 1933 Act, provided that this
agreement shall continue in effect for a period of more than one year from the
date hereof only so long as such continuance is specifically approved at least
annually in
6
<PAGE> 7
accordance with the 1940 Act and the rules thereunder. This agreement shall
terminate automatically in the event of its assignment (as defined in the 1940
Act). This agreement may, in any event, be terminated at any time, without the
payment of any penalty, by the Company upon 60 days' written notice to
Distributor or by Distributor at any time after the second anniversary of the
effective date of this agreement on 60 days' written notice to the Company.
17. This agreement shall be governed by and construed in
accordance with the laws of the State of Arkansas.
7
<PAGE> 8
If the foregoing correctly sets forth the agreement between the
Company and Distributor, please so indicate by signing and returning to the
Company the enclosed copy hereof.
Very truly yours,
STAGECOACH INC.
By:
------------------------------
Name:
-------------------------
Title:
------------------------
ACCEPTED as of the date
set forth above:
STEPHENS INC.
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
8
<PAGE> 9
STEPHENS INC.
111 Center Street
Little Rock, Arkansas 72201
FORM OF
SELLING GROUP AGREEMENT
STAGECOACH INC.
Ladies and Gentlemen:
We are the exclusive distributor of the shares of capital stock of
the several portfolios (each a "Fund" and collectively the "Funds") of
Stagecoach Inc. (the "Company"), a Maryland corporation, pursuant to the terms
of a Distribution Agreement between us and the Company. We invite you to
participate in the distribution of the shares of capital stock of certain of
the Funds (as identified to you from time to time) ("Shares") on the following
terms:
1. You represent and warrant that you are either (a) a
registered broker or dealer pursuant to the Securities
Exchange Act of 1934 ("1934 Act"), and a member of the
National Association of Securities Dealers, Inc. (the
"NASD"), and that you will maintain such registration and
membership and abide by the Rules of Fair Practice, the
Constitution and By-Laws of the NASD and all other rules and
regulations that are now or may become applicable to you and
your activities hereunder; or (b) a bank exempt from
registration as a broker-dealer under the federal securities
laws, and that you will conduct your activities hereunder and
otherwise in a manner so as to remain exempt from such
registration and in compliance with the provisions of the
Glass-Steagall Act and all other rules and regulations that
are now or may become applicable to you and your activities
hereunder.
2. You represent and warrant that you are registered or
qualified to act as a broker or dealer (or are exempt from
being required to register or qualify as such) in the states
or other jurisdictions where you transact business. You
agree that you will maintain such registrations or
qualifications in full force and effect throughout the term
of this Agreement (and if an exemption becomes no longer
available, to immediately so qualify or register). You agree
to comply with all applicable federal, state and local laws,
including, without limiting the generality of the foregoing,
the Securities Act of 1933, the 1934 Act and the Investment
1
<PAGE> 10
Company Act of 1940 ("1940 Act"), and all applicable rules or
regulations thereunder. You agree to offer and sell Shares
only in the states and other jurisdictions in which we have
indicated that such offers and sales can be made and in which
you are qualified to so act. You further agree not to offer
or sell Shares outside the several states, territories and
possessions of the United States.
3. You agree to offer and sell Shares of the Funds to your
customers only at the applicable public offering price (which
is the net asset value per share plus the applicable sales
load, if any) then in effect as described in the respective
Fund's then currently effective prospectus, including any
supplements or amendments thereto ("Prospectus"). You may
establish and charge reasonable service fees to your clients
for processing exchange or redemption orders for Shares,
provided you disclose the fees to your clients.
4. Purchase orders for Shares ("Purchase Orders") received from
you and accepted by us will be executed at the applicable
public offering price next determined after our receipt and
acceptance of such Purchase Order, in accordance with the
Prospectuses. All Purchase Orders must meet the applicable
minimum initial and subsequent investment requirements as
described and set forth in the Prospectuses. You agree to
date and time stamp all orders received by you and to
promptly forward all Purchase Orders to us or the Company's
Transfer Agent in time for processing at the public offering
price next determined after receipt by you. You agree that
you will not withhold Purchase Orders or purchase shares in
anticipation of receiving Purchase Orders from customers.
The procedures applicable to the handling of Purchase Orders
shall be subject to such instructions as may be issued by us
from time to time.
5. All Purchase Orders are subject to acceptance by us and
confirmation by the Company or its Transfer Agent. We
reserve the right in our sole discretion to reject any
Purchase Order, including contingent or conditional Purchase
Orders, in whole or in part. We also reserve the right in
our discretion without notice to you to suspend sales or
withdraw the offering of Shares, in whole or in part, or to
cancel this Agreement.
6. You agree to purchase Shares only through us or from your
customers. Purchases through us shall be made only for the
purpose of covering Purchase Orders already received from
your customers or for your bona fide investment. Purchases
from your customers, if any, shall be at a price that is not
less than the applicable net asset value quoted by the
Company at the time of such purchase as determined in the
manner set forth in the Prospectuses. All transactions in
Shares shall be subject to the terms and provisions set forth
in the Prospectuses.
7. Shares purchased hereunder will not be issued in certificated
form except where permitted by the applicable Prospectus,
upon written request by you or your
2
<PAGE> 11
customer, and only when payment and proper registration or
transfer instructions have been received by the Company or
its Transfer Agent.
8. If a customer's account with a Fund is established without
the customer signing an Account Application, you represent
that the instructions relating to the registration and
shareholder options selected (whether on the Account
Application, in some other document or orally) are in
accordance with the customer's instructions, and you shall be
responsible to the Company, its Transfer Agent and us for any
losses, claims, damages or expenses resulting from acting
upon such instructions.
9. If payment for Shares purchased hereunder is not received or
made within the applicable time period specified in the
governing Prospectus, or if you cancel any order at any time
after our acceptance of the Purchase Order, we reserve the
right to cancel the sale (or, at our option, to redeem the
Shares), in which case you shall be responsible to the
Company, its Transfer Agent and us for any losses, claims,
damages or expenses resulting from your failure to make
payment or cancellation as aforesaid.
10. You have no authority whatsoever to act as agent for, partner
of or participant in a joint venture with the Company or us
or any other member of the Selling Group, and nothing in this
Agreement shall constitute either of us the agent of the
other or shall constitute you or the Company the agent of
each other. In all transactions in the Shares, you are
acting as principal or as agent for your customer and we are
acting as agent for the Company and not as principal. We are
not responsible for registering or qualifying the Shares for
sale in any jurisdiction. We also are not responsible for
the issuance, form, validity, enforceability or value of the
Company's Shares.
11. No person is authorized to act for us or to make any
representations concerning the Company or its Shares except
those contained in the Prospectuses and the Statements of
Additional Information, and in sales literature issued by us
supplemental to the Prospectuses and Statements of Additional
Information ("Sales Literature"). In purchasing Shares
through us, you shall rely solely upon the representations
contained in the Prospectuses, the Statements of Additional
Information and the Sales Literature. We will furnish you,
upon request, with a reasonable quantity of copies of the
Prospectuses, Statements of Additional Information, Sales
Literature and amendments and supplements thereto. You agree
that if and when we supply you with copies of any supplements
to any Prospectus, you will affix copies of such supplements
to all such Prospectuses in your possession, that thereafter
you will distribute such Prospectuses only with such
supplements affixed, and that you will present Purchase
Orders only from persons who have received Prospectuses with
such supplements affixed. You agree not to use Sales
Literature in connection with the solicitation of Purchase
Orders unless accompanied or preceded by the relevant
Prospectus.
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<PAGE> 12
12. As compensation, you shall be entitled to receive that
portion of any sales load assessed on the purchase of the
Shares equal to the dealer allowance, as set forth in the
Prospectuses. Sales loads and dealer allowances shall take
into account volume discounts, rights of accumulation,
letters of intent, certain reinvestments of redemption
proceeds, certain reductions for designated persons or groups
and exchanges and any other arrangements for the reduction or
elimination of sales loads and dealer allowances, all as
described in the Prospectuses. You are responsible for
obtaining from your customer such information as you deem
necessary to establish a reasonable basis for believing that
the customer is eligible for any claimed reductions in or
elimination of sales loads, and for obtaining from your
customer requisite tax identification numbers and
certifications. By transmitting Purchase Orders to us or to
the Company's Transfer Agent, you shall be deemed to have
represented and warranted to us, the Company, and its
Transfer Agent that you have a reasonable basis for
believing, and do believe, that the customer is eligible for
such reduction or elimination and that, unless you advise us
otherwise, you have obtained the requisite tax identification
numbers and certifications.
13. As further compensation for distribution-related services
performed by you in connection with the distribution of
Shares of any of the Funds which have distribution plans in
effect under Rule 12b-1 under the 1940 Act that provide for
compensation for distribution-related services, you also may
receive a periodic fee based upon a percentage of the average
daily net asset value of Shares of the respective Funds
attributable to you, in accordance with the applicable
Distribution Plans as disclosed in the governing Prospectus.
14. If any Shares are repurchased or tendered for redemption by
the Company within seven business days after acceptance by us
or the Company of the Purchase Order for such Shares, you
shall forfeit the right to and promptly refund to us the full
dealer allowance paid or reallowed to you in connection with
the original Purchase Order.
15. You agree to indemnify the Company, its Transfer Agent and us
for any losses, claims, damages or expenses arising out of or
in connection with any wrongful act or omission by you, your
representatives, agents or sub-agents not in accordance with
this Agreement, provided that such losses, claims, damages or
expenses were not caused by the indemnitees' willful
misfeasance, bad faith or gross negligence.
16. This Agreement shall become effective upon receipt by us of a
signed copy hereof, and shall cancel and supersede any and
all prior Selling Group Agreements or similar agreements or
contracts relating to the distribution of the Shares. Any
amendments to this Agreement shall be deemed accepted by you,
and will take effect with respect to, and on the date of, any
orders placed by you after the date
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<PAGE> 13
set forth in any notice of amendment sent by us to you. This
Agreement shall be governed by, and construed in accordance
with, the laws of the State of Arkansas.
17. This Agreement may be terminated upon written notice by
either party at any time, and shall automatically terminate
upon its attempted assignment by you, whether by operation of
law or otherwise, or by us otherwise than by operation of
law. We reserve the right to cancel this Agreement at any
time without notice if any Shares are offered for sale by you
at less than the applicable public offering price as set
forth in the Prospectuses.
18. This Agreement is in all respects subject to statements
regarding the sale and repurchase or redemption of Shares
made in the Prospectuses, and to the Rules of Fair Practice
of the NASD, which shall control and override any provision
to the contrary in this Agreement.
19. All communications to us shall be sent to us by mail or by
confirmed telefacsimile at 111 Center Street, Little Rock,
Arkansas 72201. Any notice to you shall be duly given if
sent by mail or by confirmed telefacsimile to you at your
address as set forth on the signature page hereof. Any party
that changes its address shall promptly notify the other
party in accordance with the terms of this paragraph.
Date: STEPHENS INC.
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
5
<PAGE> 14
The undersigned accepts this invitation to become a member of the
Selling Group and agrees to abide by the foregoing terms and conditions.
Date:
Address:
Telephone:
Telefacsimile:
By: By:
------------------------------ ------------------------------
(Authorized Signature) (Authorized Signature)
Name: Name:
------------------------- -------------------------
Title: Title:
------------------------ ------------------------
Please execute this Agreement in duplicate and return one copy to
Stephens Inc.
6
<PAGE> 1
EX-99.B 6(b)
FORM OF AMENDED AND RESTATED
DISTRIBUTION AGREEMENT
STAGECOACH INC.
111 Center Street
Little Rock, Arkansas 72201
October ___, 1995
Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
Dear Sirs:
This will confirm the agreement between the undersigned (the
"Company"), on behalf of each of its portfolios now or hereafter in effect
(each, a "Fund"), and you ("Distributor") as follows:
1. As the Company's agent, Distributor shall be the exclusive
distributor for the unsold portion of shares of each Fund that are registered
under the Securities Act of 1933 (the "1933 Act").
2. The Company shall sell through Distributor, as the Company's
agent, and deliver, upon the terms set forth herein, Fund shares that
Distributor orders from the Company and for which Distributor has received and
confirmed unconditional purchase orders. All orders from Distributor shall be
subject to acceptance and confirmation by the Company. The Company shall have
the right, at its election, to deliver either shares issued upon original issue
or treasury shares.
3. As the Company's agent, Distributor may sell and distribute
Fund shares in such manner not inconsistent with the provisions hereof as
Distributor may determine from time to time. In that connection Distributor
shall comply with all laws, rules and regulations applicable to it, including,
without limiting the generality of the foregoing, all applicable rules or
regulations under the Investment Company Act of 1940 (the "1940 Act") and of
any securities association registered under the Securities Exchange Act of 1934
(the "1934 Act").
4. The Company reserves the right to sell Fund shares to
purchasers to the extent that it or the transfer agent for Fund shares receives
purchase applications therefor. Distributor's right to accept purchase orders
for Fund shares or to make sales thereof shall not apply to Fund shares
1
<PAGE> 2
that may be offered by the Company to shareholders for the reinvestment of cash
distributed to shareholders by the Company or Fund shares that may otherwise be
offered by the Company to shareholders, unless Distributor is otherwise
notified by the Company.
5. All shares offered for sale and sold by Distributor shall be
offered for sale and sold by Distributor to or through securities dealers or
banks and other depository institutions having agreements with Distributor
("Servicing Agents") upon the terms and conditions set forth in paragraph 7(b)
hereof or to investors at the price per share (the "offering price", which is
the net asset value per share plus the applicable sales charge, if any)
specified and determined as provided in the Prospectus (the "Prospectus")
included in the Company's Registration Statement, as amended from time to time,
under the 1933 Act and the 1940 Act (the "Registration Statement"), relating to
the offering of its shares for sale. If the offering price is not an exact
multiple of one cent, it shall be adjusted to the nearest full cent. The
Company shall determine and furnish promptly to Distributor a statement of the
offering price at least once on each day on which the Prospectus states the
Company is required to determine the Company's net asset value for the purpose
of pricing purchase orders. Each offering price shall become effective at the
time and shall remain in effect during the period specified in the statement.
Each such statement shall show the basis of its computation. For purposes of
establishing the offering price, the Company shall consider a purchase order to
have been presented to it at the time it was originally entered by Distributor
for transmission to it, provided the original purchase order and Distributor's
fulfilling order to the Company are appropriately time stamped or evidenced to
show the time of original entry and that Distributor's fulfilling order to the
Company is received by the Company within a time deemed by it to be reasonable
after the purchase order was originally entered. Purchases of shares shall be
made for full and fractional shares, carried to the third decimal place.
6. Ownership of Fund shares sold hereunder shall be registered in
such names and denominations as are specified in writing to the Company or to
its agent designated for the purpose. No certificates for shares of a Fund
will be issued.
7. (a) Distributor shall from time to time employ or associate
with it such persons as it believes necessary to assist it in carrying out its
obligations under this agreement. The compensation of such persons shall be
paid by Distributor.
(b) Distributor shall have the right to enter into
servicing agreements with Servicing Agents of its choice for the sale or
marketing of Fund shares at the offering price and upon the terms and
conditions set forth in the Prospectus. Distributor may amend those
agreements, or modify the form of agreement, only upon approval of the Company.
(c) Distributor shall pay all expenses incurred in
connection with its qualification as a dealer or broker under Federal or state
laws.
(d) Distributor shall pay all expenses incurred in
connection with: (i) printing and distributing such number of copies of the
Prospectus as Distributor deems necessary for use in connection with offering
Fund shares to prospective investors, (ii) preparing, printing and distributing
any other literature and advertising deemed appropriate by Distributor for use
in
2
<PAGE> 3
connection with offering Fund shares for sale and (iii) all other expenses
incurred in connection with the sale of Fund shares as contemplated by this
agreement, except as otherwise specifically provided in this agreement. In
addition, it is understood and agreed that, so long as a plan of distribution
of a Fund adopted pursuant to Rule 12b-1 of the 1940 Act (a "Plan") continues
in effect, any expenses incurred by Distributor hereunder in connection with
such Fund may be paid from amounts received by it from such Fund under the
Plan. So long as a Plan continues in effect, Distributor shall be entitled to
receive reimbursement from the Company under the Plan for actual expenses
incurred in connection with the Fund to the extent such expenses are
reimbursable under the Plan and shall be entitled to receive compensation for
distribution-related services to the extent provided for under the Plan.
Distributor shall provide to the Board of Directors of the Company and the
Board of Directors shall review, at least quarterly, a written report of the
amounts so expended, the purposes for which such expenditures were made, the
amounts of reimbursements received and the amounts of compensation received.
(e) The Company shall execute all documents and furnish
any information which may be reasonably necessary in connection with the
qualification of Fund shares of the Company for sale in jurisdictions
designated by Distributor.
8. The Company shall furnish to Distributor from time to time,
for use in connection with the sale of Fund shares, such written information
with respect to the Company as Distributor may reasonably request. In each
case such written information shall be signed by an authorized officer of the
Company. The Company represents and warrants that such information, when
signed by one of its officers, shall be true and correct. The Company shall
also furnish to Distributor copies of its reports to its stockholders and such
additional information regarding the Company's financial condition as
Distributor may reasonably request from time to time.
9. The Registration Statement and the Prospectus have been or
will be, as the case may be, carefully prepared in conformity with the 1933
Act, the 1940 Act and the rules and regulations (the "Rules and Regulations")
of the Securities and Exchange Commission (the "SEC"). The Company represents
and warrants to Distributor that the Registration Statement and the Prospectus
contain or will contain all statements required to be stated therein in
accordance with the 1933 Act, the 1940 Act and the Rules and Regulations, that
all statements of fact contained or to be contained therein are or will be true
and correct at the time indicated or the effective date, as the case may be,
and that neither the Registration Statement nor the Prospectus, when it shall
become effective under the 1933 Act or be authorized for use, shall include an
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
to a purchaser of Fund shares. The Company shall from time to time file such
amendment or amendments to the Registration Statement and the Prospectus as, in
the light of future developments, shall, in the opinion of the Company's
counsel, be necessary in order to have the Registration Statement and the
Prospectus at all times contain all material facts required to be stated
therein or necessary to make the statements therein not misleading to a
purchaser of Fund shares. If the Company shall not file such amendment or
amendments within 15 days after receipt by the Company of a written request
from Distributor to do so, Distributor may, at its option, terminate this
agreement immediately. The Company shall not file any amendment to the
Registration Statement or the Prospectus
3
<PAGE> 4
without giving Distributor reasonable notice thereof in advance, provided that
nothing in this agreement shall in any way limit the Company's right to file at
any time such amendments to the Registration Statement or the Prospectus as the
Company may deem advisable. The Company represents and warrants to Distributor
that any amendment to the Registration Statement or the Prospectus filed
hereafter by the Company will, when it becomes effective under the 1933 Act,
contain all statements required to be stated therein in accordance with the
1933 Act, the 1940 Act and the Rules and Regulations, that all statements of
fact contained therein will, when the same shall become effective, be true and
correct, and that no such amendment, when it becomes effective, will include an
untrue statement of a material fact or will omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading to a purchaser of Fund shares.
10. Subject to the provisions of paragraph 7, the Company shall
prepare and furnish to Distributor from time to time such number of copies of
the most recent form of the Prospectus filed with the SEC as Distributor may
reasonably request. The Company authorizes Distributor and Servicing Agents to
use the Prospectus, in the form furnished to Distributor from time to time, in
connection with the sale of Fund shares. The Company shall indemnify, defend
and hold harmless Distributor, its officers and partners and any person who
controls Distributor within the meaning of the 1933 Act, from and against any
and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which Distributor, its officers or
partners or any such controlling person, may incur under the 1933 Act, the 1940
Act, the common law or otherwise, arising out of or based upon any alleged
untrue statement of a material fact contained in the Registration Statement or
the Prospectus or arising out of or based upon any alleged omission to state a
material fact required to be stated in either thereof or necessary to make the
statements in either thereof not misleading. Notwithstanding the foregoing,
this indemnity agreement, to the extent that it might require indemnity of any
person who is an officer or partner of Distributor and who is also a director
of the Company, shall not inure to the benefit of such officer or partner
unless a court of competent jurisdiction shall determine, or it shall have been
determined by controlling precedent, that such result would not be against
public policy as expressed in the 1933 Act or the 1940 Act, and in no event
shall anything contained herein be so construed as to protect Distributor
against any liability to the Company or its stockholders to which Distributor
would otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of its reckless
disregard of its obligations and duties under this agreement. This indemnity
agreement is expressly conditioned upon the Company's being notified of any
action brought against Distributor, its officers or partners or any such
controlling person, which notification shall be given by letter or by telegram
addressed to the Company at its principal office in Little Rock, Arkansas, and
sent to the Company by the person against whom such action is brought within 10
days after the summons or other first legal process shall have been served.
The failure to notify the Company of any such action shall not relieve the
Company from any liability which it may have to the person against whom such
action is brought by reason of any such alleged untrue statement or omission
otherwise than on account of the indemnity agreement contained in this
paragraph. The Company shall be entitled to assume the defense of any suit
brought to enforce any such claim, demand or liability, but, in such case, the
defense shall be conducted by counsel chosen by the Company and approved by
Distributor. If
4
<PAGE> 5
the Company elects to assume the defense of any such suit and retain counsel
approved by Distributor, the defendant or defendants in such suit shall bear
the fees and expenses of any additional counsel retained by any of them, but in
case the Company does not elect to assume the defense of any such suit, or in
case Distributor does not approve of counsel chosen by the Company, the Company
will reimburse Distributor, its officers and partners or the controlling person
or persons named as defendant or defendants in such suit, for the fees and
expenses of any counsel retained by Distributor or them. In addition,
Distributor shall have the right to employ one separate counsel to represent
it, its officers and partners and any such controlling person who may be
subject to liability arising out of any claim in respect of which indemnity may
be sought by Distributor against the Company hereunder if in the reasonable
judgment of Distributor it is advisable because of actual or potential
differing interests between the Distributor, its officers and partners or such
controlling person and the Company in the conduct of the defense of such
action, for Distributor, its officers and partners or such controlling person
to be represented by separate counsel, in which event the fees and expenses of
such separate counsel shall be borne by the Company. This indemnity agreement
and the Company's representations and warranties in this agreement shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of Distributor, its officers and partners or any such controlling
person and shall survive the delivery of any shares as provided in this
agreement. This indemnity agreement shall inure exclusively to the benefit of
Distributor and its successors, Distributor's officers and partners and their
respective estates and any such controlling persons and their successors and
estates. The Company shall promptly notify Distributor of the commencement of
any litigation or proceedings against it in connection with the issue and sale
of any Fund shares.
11. Distributor agrees to indemnify, defend and hold harmless
the Company, its officers and directors and any person who controls the Company
within the meaning of the 1933 Act, from and against any and all claims,
demands, liabilities and expenses (including the cost of investigating or
defending such claims, demands or liabilities and any counsel fees incurred in
connection therewith) which the Company, its officers or directors or any such
controlling person, may incur under the 1933 Act, the 1940 Act, the common law
or otherwise, but only to the extent that such liability or expense incurred by
the Company, its officers or directors or such controlling person resulting
from such claims or demands shall arise out of or be based upon (a) any alleged
untrue statement of a material fact contained in information furnished in
writing by Distributor to the Company specifically for use in the Registration
Statement or the Prospectus or shall arise out of or be based upon any alleged
omission to state a material fact in connection with such information required
to be stated in the Registration Statement or the Prospectus or necessary to
make such information not misleading and (b) any alleged act or omission on
Distributor's part as the Company's agent that has not been expressly
authorized by the Company in writing. This indemnity agreement is expressly
conditioned upon Distributor's being notified of any action brought against the
Company, its officers and directors or any such controlling person, which
notification shall be given by letter or telegram, addressed to Distributor at
its principal office in Little Rock, Arkansas, and sent to Distributor by the
person against whom such action is brought, within 10 days after the summons or
other first legal process shall have been served. The failure to notify
Distributor of any such action shall not relieve Distributor from any liability
which it may have to the Company, its officers or directors or such controlling
person by reason of any such alleged misstatement or omission on Distributor's
part otherwise than on account of the indemnity
5
<PAGE> 6
agreement contained in this paragraph. Distributor shall have a right to
control the defense of such action with counsel of its own choosing and
approved by the Company if such action is based solely upon such alleged
misstatement or omission on Distributor's part, and in any other event the
Company, its officers and directors or such controlling person shall each have
the right to participate in the defense or preparation of the defense of any
such action at their own expense.
12. No Fund shares shall be sold through Distributor or by the
Company under this agreement and no orders for the purchase of Fund shares
shall be confirmed or accepted by the Company if and so long as the
effectiveness of the Registration Statement shall be suspended under any of the
provisions of the 1933 Act. Nothing contained in this paragraph 12 shall in
any way restrict, limit or have any application to or bearing upon the
Company's obligation to redeem Fund shares from any shareholder in accordance
with the provisions of its Articles of Incorporation. The Company will use its
best efforts at all times to have Fund shares effectively registered under the
1933 Act.
13. The Company agrees to advise Distributor immediately:
(a) of any request by the SEC for amendments to the
Registration Statement or the Prospectus or for additional information;
(b) in the event of the issuance by the SEC of any stop
order suspending the effectiveness of the Registration Statement or the
Prospectus under the 1933 Act or the initiation of any proceedings for that
purpose;
(c) of the happening of any material event that makes
untrue any statement made in the Registration Statement or the Prospectus or
that requires the making of a change in either thereof in order to make the
statements therein not misleading; and
(d) of any action of the SEC with respect to any
amendments to the Registration Statement or the Prospectus that may from time
to time be filed with the SEC under the 1933 Act or the 1940 Act.
14. Insofar as they concern the Company, the Company shall
comply with all applicable laws, rules and regulations, including, without
limiting the generality of the foregoing, all rules or regulations made or
adopted pursuant to the 1933 Act, the 1940 Act or by any securities association
registered under the 1934 Act.
15. Distributor may, if it desires and at its own cost and
expense, appoint or employ agents to assist it in carrying out its obligations
under this agreement, but no such appointment or employment shall relieve
Distributor of any of its responsibilities or obligations to the Company under
this agreement.
16. Subject to the provisions of paragraph 9, this agreement
shall continue in effect until such time as there shall remain no unsold
balance of Fund shares registered under the 1933 Act, provided that this
agreement shall continue in effect for a period of more than one year from
6
<PAGE> 7
the date hereof only so long as such continuance is specifically approved at
least annually in accordance with the 1940 Act and the rules thereunder. This
agreement shall terminate automatically in the event of its assignment (as
defined in the 1940 Act). This agreement may, in any event, be terminated at
any time, without the payment of any penalty, by the Company upon 60 days'
written notice to Distributor or by Distributor at any time after the second
anniversary of the effective date of this agreement on 60 days' written notice
to the Company.
17. This agreement shall be governed by and construed in
accordance with the laws of the State of Arkansas.
7
<PAGE> 8
If the foregoing correctly sets forth the agreement between the
Company and Distributor, please so indicate by signing and returning to the
Company the enclosed copy hereof.
Very truly yours,
STAGECOACH INC.
By:
------------------------------
Name:
-------------------------
Title:
------------------------
ACCEPTED as of the date
set forth above:
STEPHENS INC.
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
8
<PAGE> 9
STEPHENS INC.
111 Center Street
Little Rock, Arkansas 72201
FORM OF
SELLING GROUP AGREEMENT
STAGECOACH INC.
Ladies and Gentlemen:
We are the exclusive distributor of the shares of capital stock of
the several portfolios (each a "Fund" and collectively the "Funds") of
Stagecoach Inc. (the "Company"), a Maryland corporation, pursuant to the terms
of a Distribution Agreement between us and the Company. We invite you to
participate in the distribution of the shares of capital stock of certain of
the Funds (as identified to you from time to time) ("Shares") on the following
terms:
1. You represent and warrant that you are either (a) a
registered broker or dealer pursuant to the Securities
Exchange Act of 1934 ("1934 Act"), and a member of the
National Association of Securities Dealers, Inc. (the
"NASD"), and that you will maintain such registration and
membership and abide by the Rules of Fair Practice, the
Constitution and By-Laws of the NASD and all other rules and
regulations that are now or may become applicable to you and
your activities hereunder; or (b) a bank exempt from
registration as a broker-dealer under the federal securities
laws, and that you will conduct your activities hereunder and
otherwise in a manner so as to remain exempt from such
registration and in compliance with the provisions of the
Glass-Steagall Act and all other rules and regulations that
are now or may become applicable to you and your activities
hereunder.
2. You represent and warrant that you are registered or
qualified to act as a broker or dealer (or are exempt from
being required to register or qualify as such) in the states
or other jurisdictions where you transact business. You
agree that you will maintain such registrations or
qualifications in full force and effect throughout the term
of this Agreement (and if an exemption becomes no longer
available, to immediately so qualify or register). You agree
to comply with all applicable federal, state and local laws,
including, without limiting the generality of the foregoing,
the Securities Act of 1933, the 1934 Act and the Investment
Company Act of 1940 ("1940 Act"), and all applicable rules or
regulations thereunder. You agree to offer and sell Shares
only in the states and other jurisdictions in which we have
indicated that such offers and sales can be made and in which
you are qualified to so act. You further agree not to offer
or sell Shares outside the several states, territories and
possessions of the United States.
1
<PAGE> 10
3. You agree to offer and sell Shares of the Funds to your
customers only at the applicable public offering price (which
is the net asset value per share plus the applicable sales
load, if any) then in effect as described in the respective
Fund's then currently effective prospectus, including any
supplements or amendments thereto ("Prospectus"). You may
establish and charge reasonable service fees to your clients
for processing exchange or redemption orders for Shares,
provided you disclose the fees to your clients.
4. Purchase orders for Shares ("Purchase Orders") received from
you and accepted by us will be executed at the applicable
public offering price next determined after our receipt and
acceptance of such Purchase Order, in accordance with the
Prospectuses. All Purchase Orders must meet the applicable
minimum initial and subsequent investment requirements as
described and set forth in the Prospectuses. You agree to
date and time stamp all orders received by you and to
promptly forward all Purchase Orders to us or the Company's
Transfer Agent in time for processing at the public offering
price next determined after receipt by you. You agree that
you will not withhold Purchase Orders or purchase shares in
anticipation of receiving Purchase Orders from customers.
The procedures applicable to the handling of Purchase Orders
shall be subject to such instructions as may be issued by us
from time to time.
5. All Purchase Orders are subject to acceptance by us and
confirmation by the Company or its Transfer Agent. We
reserve the right in our sole discretion to reject any
Purchase Order, including contingent or conditional Purchase
Orders, in whole or in part. We also reserve the right in
our discretion without notice to you to suspend sales or
withdraw the offering of Shares, in whole or in part, or to
cancel this Agreement.
6. You agree to purchase Shares only through us or from your
customers. Purchases through us shall be made only for the
purpose of covering Purchase Orders already received from
your customers or for your bona fide investment. Purchases
from your customers, if any, shall be at a price that is not
less than the applicable net asset value quoted by the
Company at the time of such purchase as determined in the
manner set forth in the Prospectuses. All transactions in
Shares shall be subject to the terms and provisions set forth
in the Prospectuses.
7. Shares purchased hereunder will not be issued in certificated
form except where permitted by the applicable Prospectus,
upon written request by you or your customer, and only when
payment and proper registration or transfer instructions
have been received by the Company or its Transfer Agent.
8. If a customer's account with a Fund is established without
the customer signing an Account Application, you represent
that the instructions relating to the registration and
shareholder options selected (whether on the Account
Application, in some other document or orally) are in
accordance with the customer's instructions, and you shall
2
<PAGE> 11
be responsible to the Company, its Transfer Agent and us for
any losses, claims, damages or expenses resulting from acting
upon such instructions.
9. If payment for Shares purchased hereunder is not received or
made within the applicable time period specified in the
governing Prospectus, or if you cancel any order at any time
after our acceptance of the Purchase Order, we reserve the
right to cancel the sale (or, at our option, to redeem the
Shares), in which case you shall be responsible to the
Company, its Transfer Agent and us for any losses, claims,
damages or expenses resulting from your failure to make
payment or cancellation as aforesaid.
10. You have no authority whatsoever to act as agent for, partner
of or participant in a joint venture with the Company or us
or any other member of the Selling Group, and nothing in this
Agreement shall constitute either of us the agent of the
other or shall constitute you or the Company the agent of
each other. In all transactions in the Shares, you are
acting as principal or as agent for your customer and we are
acting as agent for the Company and not as principal. We are
not responsible for registering or qualifying the Shares for
sale in any jurisdiction. We also are not responsible for
the issuance, form, validity, enforceability or value of the
Company's Shares.
11. No person is authorized to act for us or to make any
representations concerning the Company or its Shares except
those contained in the Prospectuses and the Statements of
Additional Information, and in sales literature issued by us
supplemental to the Prospectuses and Statements of Additional
Information ("Sales Literature"). In purchasing Shares
through us, you shall rely solely upon the representations
contained in the Prospectuses, the Statements of Additional
Information and the Sales Literature. We will furnish you,
upon request, with a reasonable quantity of copies of the
Prospectuses, Statements of Additional Information, Sales
Literature and amendments and supplements thereto. You agree
that if and when we supply you with copies of any supplements
to any Prospectus, you will affix copies of such supplements
to all such Prospectuses in your possession, that thereafter
you will distribute such Prospectuses only with such
supplements affixed, and that you will present Purchase
Orders only from persons who have received Prospectuses with
such supplements affixed. You agree not to use Sales
Literature in connection with the solicitation of Purchase
Orders unless accompanied or preceded by the relevant
Prospectus.
12. As compensation, you shall be entitled to receive that
portion of any sales load assessed on the purchase of the
Shares equal to the dealer allowance, as set forth in the
Prospectuses. Sales loads and dealer allowances shall take
into account volume discounts, rights of accumulation,
letters of intent, certain reinvestments of redemption
proceeds, certain reductions for designated persons or groups
and exchanges and any other arrangements for the reduction or
elimination of sales loads and dealer allowances, all as
described in the Prospectuses. You are responsible for
obtaining from your customer such information as you deem
necessary to establish a
3
<PAGE> 12
reasonable basis for believing that the customer is eligible
for any claimed reductions in or elimination of sales loads,
and for obtaining from your customer requisite tax
identification numbers and certifications. By transmitting
Purchase Orders to us or to the Company's Transfer Agent,
you shall be deemed to have represented and warranted to us,
the Company, and its Transfer Agent that you have a
reasonable basis for believing, and do believe, that the
customer is eligible for such reduction or elimination and
that, unless you advise us otherwise, you have obtained the
requisite tax identification numbers and certifications.
13. As further compensation for distribution-related services
performed by you in connection with the distribution of
Shares of any of the Funds which have distribution plans in
effect under Rule 12b-1 under the 1940 Act that provide for
compensation for distribution-related services, you also may
receive a periodic fee based upon a percentage of the average
daily net asset value of Shares of the respective Funds
attributable to you, in accordance with the applicable
Distribution Plans as disclosed in the governing Prospectus.
14. If any Shares are repurchased or tendered for redemption by
the Company within seven business days after acceptance by us
or the Company of the Purchase Order for such Shares, you
shall forfeit the right to and promptly refund to us the full
dealer allowance paid or reallowed to you in connection with
the original Purchase Order.
15. You agree to indemnify the Company, its Transfer Agent and us
for any losses, claims, damages or expenses arising out of or
in connection with any wrongful act or omission by you, your
representatives, agents or sub-agents not in accordance with
this Agreement, provided that such losses, claims, damages or
expenses were not caused by the indemnitees' willful
misfeasance, bad faith or gross negligence.
16. This Agreement shall become effective upon receipt by us of a
signed copy hereof, and shall cancel and supersede any and
all prior Selling Group Agreements or similar agreements or
contracts relating to the distribution of the Shares. Any
amendments to this Agreement shall be deemed accepted by you,
and will take effect with respect to, and on the date of, any
orders placed by you after the date set forth in any notice
of amendment sent by us to you. This Agreement shall be
governed by, and construed in accordance with, the laws of
the State of Arkansas.
17. This Agreement may be terminated upon written notice by
either party at any time, and shall automatically terminate
upon its attempted assignment by you, whether by operation of
law or otherwise, or by us otherwise than by operation of
law. We reserve the right to cancel this Agreement at any
time without notice if any Shares are offered for sale by you
at less than the applicable public offering price as set
forth in the Prospectuses.
18. This Agreement is in all respects subject to statements
regarding the sale and repurchase or redemption of Shares
made in the Prospectuses, and to the Rules of
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<PAGE> 13
Fair Practice of the NASD, which shall control and override
any provision to the contrary in this Agreement.
19. All communications to us shall be sent to us by mail or by
confirmed telefacsimile at 111 Center Street, Little Rock,
Arkansas 72201. Any notice to you shall be duly given if
sent by mail or by confirmed telefacsimile to you at your
address as set forth on the signature page hereof. Any party
that changes its address shall promptly notify the other
party in accordance with the terms of this paragraph.
Date: STEPHENS INC.
By:
------------------------------
Name:
------------------------
Title:
------------------------
The undersigned accepts this invitation to become a member of the
Selling Group and agrees to abide by the foregoing terms and conditions.
Date:
Address:
Telephone:
Telefacsimile:
By: By:
----------------------------- -----------------------------
(Authorized Signature) (Authorized Signature)
Name: Name:
----------------------- -----------------------
Title: Title:
----------------------- -----------------------
Please execute this Agreement in duplicate and return one copy to
Stephens Inc.
5
<PAGE> 14
The undersigned accepts this invitation to become a member of the
Selling Group and agrees to abide by the foregoing terms and conditions.
Date:
Address:
Telephone:
Telefacsimile:
By: By:
------------------------------ ------------------------------
(Authorized Signature) (Authorized Signature)
Name: Name:
------------------------- -------------------------
Title: Title:
------------------------ ------------------------
Please execute this Agreement in duplicate and return one copy to
Stephens Inc.
6
<PAGE> 1
EX-99.B 8(a)
CUSTODY AGREEMENT
This Agreement is made as of February 2, 1995 (the "Custody
Agreement"), by and between STAGECOACH INC. (the "Company"), on behalf of the
Funds listed on the attached Appendix A (each a "Fund"), and WELLS FARGO BANK,
N.A. (the "Custodian").
W I T N E S S E T H :
that for and in consideration of the mutual promises hereinafter set forth the
Company and the Custodian agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Custody Agreement, the following words and
phrases, unless the context otherwise requires, shall have the following
meaning:
1. "Authorized Person" shall be deemed to include the treasurer,
the controller or any other person, whether or not any such person is an
Officer or employee of the Company, duly authorized by the Board of Directors
to give Oral Instructions and Written Instructions on behalf of the Fund and
listed in one of the Certificates attached hereto as Appendices B-1 through B-4
or such other Certificate as may be received from time to time by the
Custodian.
2. "Book-Entry System" shall mean the Federal Reserve/Treasury
book-entry system for United States and Federal agency securities, its
successor(s) and its nominee(s).
3. "Certificate" shall mean any notice, instruction, or other
instrument in writing, authorized or required by this Custody Agreement to be
given to the Custodian, which is actually received by the Custodian and signed
on behalf of the Fund by any two Officers of the Company.
4. "Clearing Member" shall mean a registered broker-dealer which
is a member of a national securities exchange qualified to act as a custodian
for an investment company, or any broker-dealer reasonably believed by the
Custodian to be such a clearing member.
5. "Depository" shall mean The Depository Trust Company ("DTC"),
Participants Trust Company ("PTC"), and any other clearing agency registered
with the Securities and Exchange Commission under Section 17A of the Securities
Exchange Act of 1934, its successor(s) and its nominee(s), provided the
Custodian has received a certified copy of a resolution of the Board of
Directors specifically approving deposits in DTC, PTC or such other clearing
agency. The term "Depository" shall further mean and include any person
authorized to act as a depository pursuant to Section 17, Rule 17f-4 or Rule
17f-5 thereunder, under the Investment Company Act of 1940, its successor(s)
and its nominee(s), specifically identified in a
1
<PAGE> 2
certified copy of a resolution of the Board of Directors specifically approving
deposits therein by the Custodian.
6. "Margin Account" shall mean a segregated account in the name
of a broker, dealer, or Clearing Member, or in the name of the Company or a
Fund for the benefit of a broker, dealer, or Clearing Member, or otherwise, in
accordance with an agreement between the Company on behalf of a Fund, the
Custodian and a broker, dealer, or Clearing Member (a "Margin Account
Agreement"), separate and distinct from the custody account, in which certain
Securities and/or money of a Fund shall be deposited and withdrawn from time to
time in connection with such transactions as the Fund may from time to time
determine. Securities held in the Book-Entry System or the Depository shall be
deemed to have deposited in, or withdrawn from, a Margin Account upon the
Custodian's effecting an appropriate entry on its books and records.
7. "Money Market Securities" shall be deemed to include, without
limitation, debt obligations issued or guaranteed as to principal and interest
by the government of the United States or agencies or instrumentalities
thereof, commercial paper, certificates of deposit and bankers' acceptances,
repurchase and reverse repurchase agreements with respect to the same and bank
time deposits, where the purchase and sale of such securities normally requires
settlement in federal funds on the same date as such purchase or sale.
8. "Officers" shall be deemed to include the President, and Vice
President, the Secretary, the Treasurer, the Controller, any Assistant
Secretary, any Assistant Treasurer or any other person or persons duly
authorized by the Board of Directors to execute any Certificate, instruction,
notice or other instrument on behalf of the Fund and listed in the Certificates
attached hereto as Appendices C-1 through C-4 or such other Certificates as may
be received by the Custodian from time to time.
9. "Oral Instructions" shall mean verbal instructions actually
received by the Custodian from an Authorized Person or from a person reasonably
believed by the Custodian to be an Authorized Person.
10. "Reverse Repurchase Agreement" shall mean an agreement
pursuant to which a Fund sells Securities and agrees to repurchase such
Securities at a described or specified date and price.
11. "Security" or "Securities" shall be deemed to include,
without limitation, Money Market Securities, Reverse Repurchase Agreements,
common stock and other instruments or rights having characteristics similar to
common stocks, preferred stocks, debt obligations issued by state or municipal
governments and by public authorities (including, without limitation, general
obligations bonds), bonds, debentures, notes, mortgages or other obligations,
and any certificates, receipts, warrants or other instruments representing
rights to receive, purchase, sell or subscribe for the same, or evidencing or
representing any other rights or interest therein, or any property or assets.
2
<PAGE> 3
12. "Segregated Security Account" shall mean an account
maintained under the terms of this Agreement as a segregated account, by
recordation or otherwise, within the custody account in which certain
Securities and/or other assets of a Fund shall be deposited and withdrawn from
time to time in accordance with Certificates received by the Custodian in
connection with such transactions as the Fund may from time to time determine.
13. "Shares" shall mean the shares of common stock of a Fund,
each of which, in the case of a Fund having Series, is allocated to a
particular Series.
14. "Written Instructions" shall mean written communications
actually received by the Custodian from an Authorized Person or from a person
reasonably believed by the Custodian to be an Authorized Person by telex or any
other such system whereby the receiver of such communications is able to verify
by codes or otherwise with a reasonable degree of certainty the authenticity of
the sender of such communication.
ARTICLE II
APPOINTMENT OF A CUSTODIAN
15. The Company on behalf of each Fund hereby constitutes and
appoints the Custodian as custodian of all the Securities and moneys at any
time owned by a Fund during the term of this Custody Agreement.
16. The Custodian hereby accepts appointment as such custodian
and agrees to perform all the duties thereof as set forth in this Agreement.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
17. Except as otherwise provided in Article V, each Fund will
deliver or cause to be delivered to the Custodian all Securities and all moneys
owned by it, including cash received for the issuance of its Shares, at any
time during the term of this Agreement. The Custodian will not be responsible
for such Securities and such moneys until actually received by it. The
Custodian will be entitled to reverse any credits made on a Fund's behalf where
such credits have been previously made and moneys are not finally collected.
The Fund shall deliver to the Custodian a certified resolution of the Board of
Directors authorizing and instructing the Custodian on a continuous and ongoing
basis to deposit in the Book-Entry System all Securities eligible for deposit
therein and to utilize the Book-Entry System to the extent possible in
connection with its performance hereunder, including, without limitation, in
connection with settlements of purchases and sales of Securities, loans of
Securities, and deliveries and returns of Securities collateral. Prior to a
deposit of Securities of a Fund in the Depository, the Fund shall deliver to
the Custodian a certified resolution of the Board of Directors of the Fund
approving, authorizing and instructing the Custodian on a continuous and
ongoing basis until instructed to the contrary by a Certificate actually
received by the Custodian to deposit in the Depository all Securities eligible
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<PAGE> 4
for deposit therein and to utilize the Depository to the extent possible in
connection with its performance hereunder, including, without limitation, in
connection with settlements of purchases and sales of Securities, loans of
Securities, and deliveries and returns of Securities collateral. Securities
and moneys of a Fund deposited in either the Book-Entry System or the
Depository will be represented in accounts which include only assets held by
the Custodian for customers, including, but not limited to, accounts in which
the Custodian acts in a fiduciary or representative capacity.
18. The Custodian shall credit to a separate account in the name
of a Fund all moneys received by it for the account of the Fund, and shall
disburse the same only:
(a) In payment for Securities purchased, as provided in Article
IV hereof;
(b) In payment of dividends or distributions, as provided in
Article VIII hereof;
(c) In payment of original issue or other taxes, as provided in
Article IX hereof;
(d) In payment for Shares redeemed by it, as provided in Article
IX hereof;
(e) Pursuant to Certificates setting forth the name and addresses
of the person to whom the payment is to be made, and the purpose for which
payment is to be made; or
(f) In payment of the fees and in reimbursement of the expenses
and liabilities of the Custodian, as provided in Article XII hereof.
19. Promptly after the close of business on each day, the
Custodian shall furnish each Fund with confirmations and a summary of all
transfers to or from the account of the Fund during said day. Where Securities
are transferred to the account of a Fund, the Custodian shall also by
book-entry or otherwise identify as belonging to the Fund a quantity of
Securities in a fungible bulk of Securities registered in the name of the
Custodian (or its nominee) or shown on the Custodian's account on the books of
the Book-Entry System or the Depository. The Custodian shall furnish each Fund
at least monthly with a detailed statement of the Securities and moneys held
for the Fund under this Agreement.
20. Except as otherwise provided in Article V, all Securities
held for a Fund, which are issued or issuable only in bearer form, except such
Securities as are held in the Book-Entry System, shall be held by the Custodian
in that form; all other Securities held for a Fund may be registered in the
name of the Fund, in the name of any duly appointed registered nominee of the
Custodian as the Custodian may from time to time determine, or in the name of
the Book-Entry System or the Depository or their successor(s) or their
nominee(s). The Company agrees to furnish to the Custodian appropriate
instruments to enable the Custodian to hold or deliver in proper form for
transfer, or to register in the name of its registered nominee or in the name
of the Book-Entry System or the Depository, any Securities which it may hold
for the account of a Fund and which may from time to time be registered in the
name of the Fund. The Custodian shall hold all such Securities which are not
held in the Book-Entry System or in the Depository in a separate
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<PAGE> 5
account in the name of the Fund physically segregated at all times from those
of any other person or persons.
5. Except as otherwise provided in this Custody Agreement and
unless otherwise instructed to the contrary by a Certificate, the Custodian by
itself, or through the use of the Book-Entry System or the Depository with
respect to the Securities therein deposited, shall with respect to all
Securities held for a Fund in accordance with this Agreement:
(a) Collect all income due or payable;
(b) Present for payment and collect the amount payable upon such
Securities which are called, but only if either (i) the Custodian receives a
written notice of such call, or (ii) notice of such call appears in one or more
of the publications listed in Appendix D annexed hereto, which may be amended
at any time by the Custodian upon five business days' prior notifications to
the Fund;
(c) Present for payment and collect the amount payable upon all
Securities which mature;
(d) Surrender Securities in temporary form for definitive
Securities;
(e) Execute, as Custodian, any necessary declarations or
certificates of ownership under the federal income tax laws or the laws or
regulations of any other taxing authority now or hereafter in effect; and
(f) Hold directly, or through the Book-Entry System or the
Depository with respect to Securities therein deposited, for the account of a
Fund all rights and similar securities issued with respect to any Securities
held by the Custodian hereunder.
6. Upon receipt of a Certificate and not otherwise, the
Custodian, directly or through the use of the Book-Entry System or the
Depository, shall:
(a) Execute and deliver to such persons as may be designated in
such Certificate proxies, consents, authorizations, and any other instruments
whereby the authority of a Fund as owner of any Securities may be exercised;
(b) Deliver any Securities held for a Fund in exchange for other
Securities or cash issued or paid in connection with the liquidation,
reorganization, refinancing, merger, consolidation or recapitalization of any
corporation, or the exercise of any conversion privilege;
(c) Deliver any Securities held for a Fund to any protective
committee, reorganization committee or other person in connection with the
reorganization, refinancing, merger, consolidation, recapitalization or sale of
assets of any corporation, and receive and hold under the terms of this Custody
Agreement such certificates of deposit, interim receipts or other instruments
or documents as may be issued to it to evidence such delivery;
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<PAGE> 6
(d) Make such transfer or exchanges of the assets of a Fund and
take such other steps as shall be stated in said order to be for the purpose of
effectuating any duly authorized plan of liquidation, reorganization, merger,
consolidation or recapitalization of the Fund; and
(e) Present for payment and collect the amount payable upon
Securities not described in preceding paragraph 5(b) of this Article which may
be called as specified in the Certificate.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUNDS
21. Promptly after each purchase or sale (as applicable) of
Securities by a Fund, other than a purchase or sale of any Reverse Repurchase
Agreement, the Fund shall deliver to the Custodian (i) with respect to each
purchase or sale of Securities which are not Money Market Securities, a
Certificate; and (ii) with respect to each purchase or sale of Money Market
Securities, a Certificate, Oral Instructions or Written Instructions,
specifying with respect to each such purchase or sale: (a) the name of the
issuer and the title of the Securities; (b) the number of shares or the
principal amount purchased or sold and accrued interest, if any; (c) the date
of purchase or sale and settlement date; (d) the purchase or sale price per
unit; (e) the total amount payable upon such purchase or sale; (f) the name of
the person from whom or the broker through whom the purchase or sale was made,
and the name of the clearing broker, if any; (g) in the case of a purchase, the
name of the broker to which payment is to be made; and (h) in the case of a
sale, the name of the broker to whom the Securities are to be delivered. In
the case of a purchase, the Custodian shall, upon receipt of Securities
purchased by or for a Fund, pay out of the moneys held for the account of the
Fund the total amount payable to the person from whom, or the broker through
whom, the purchase was made, provided that the same conforms to the total
amount payable as set forth in such Certificate, Oral Instructions or Written
Instructions. In the case of a sale, the Custodian shall deliver the
Securities upon receipt of the total amount payable to a Fund upon such sale,
provided that the same conforms to the total amount payable as set forth in
such Certificate, Oral Instructions or Written Instructions. Subject to the
foregoing, the Custodian may accept payment in such form as shall be
satisfactory to it, and may deliver Securities and arrange for payment in
accordance with the customs prevailing among dealers in securities.
ARTICLE V
SHORT SALES
22. Promptly after any short sale, a Fund shall deliver to the
Custodian a Certificate specifying: (a) the name of the issuer and the title
of the Security; (b) the number of shares or principal amount sold, and accrued
interest or dividends, if any; (c) the dates of the sale and settlement; (d)
the sale price per unit; (e) the total amount credited to the Fund upon such
sales, if any (f) the amount of cash and/or the amount and kind of Securities,
if any, which are to be deposited in a Margin Account and the name in which
such Margin Account has been or is to be established; (g) the amount of cash
and/or the amount and kind of Securities, if any, to be
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<PAGE> 7
deposited in a Segregated Security Account; and (h) the name of the broker
through which such short sale was made. The Custodian shall upon its receipt
of a statement from such broker confirming such sale and that the total amount
credited to the Fund upon such sale, if any, as specified in the Certificate is
held by such broker for the account of the Custodian (or any nominee of the
Custodian) as custodian of the Fund, issue a receipt or make the deposits into
the Margin Account and the Segregated Security Account specified in the
Certificate.
23. In connection with the closing-out of any short sale, a Fund
shall promptly deliver to the Custodian a Certificate specifying with respect
to each such closing-out: (a) the name of the issuer and the title of the
Security; (b) the number of shares or the principal amount, and accrued
interest or dividends, if any, required to effect such closing-out to be
delivered to the broker; (c) the dates of the closing-out and settlement; (d)
the purchase price per unit; (e) the net total amount payable to the Fund upon
such closing-out; (f) the net total amount payable to the broker upon such
closing-out; (g) the amount of cash and the amount and kind of Securities, if
any, to be withdrawn, from the Margin Account; (h) the amount of cash and/or
the amount and kind of Securities, if any, to be withdrawn from the Segregated
Security Account; and (i) the name of the broker through which the Fund is
effecting such closing-out. The Custodian shall, upon receipt of the net total
amount payable to the Fund upon such closing-out and the return and/or
cancellation of the receipts, if any, issued by the Custodian with respect to
the short sale being closed-out, pay out the moneys held for the account of the
Fund to the broker the net total amount payable to the broker, and make the
withdrawals from the Margin Account and the Segregated Security Account, as the
same are specified in the Certificate.
ARTICLE VI
REVERSE REPURCHASE AGREEMENTS
24. Promptly after a Fund enters into a Reverse Repurchase
Agreement with respect to Securities and money held by the Custodian hereunder,
the Fund shall deliver to the Custodian a Certificate, or in the event such
Reverse Repurchase Agreement is a Money Market Security, a Certificate, Oral
Instructions or Written Instructions specifying: (a) the total amount payable
to the Fund in connection with such Reverse Repurchase Agreement; (b) the
broker or dealer through or with which the Reverse Repurchase Agreement is
entered; (c) the amount and kind of Securities to be delivered by the Fund to
such broker or dealer; (d) the date of such Reverse Repurchase Agreement; and
(e) the amount of cash and/or the amount and kind of Securities, if any, to be
deposited in a Segregated Security Account in connection with such Reverse
Repurchase Agreement. The Custodian shall, upon receipt of the total amount
payable to the Fund specified in the Certificate, Oral Instructions or Written
Instructions make the delivery to the broker or dealer, and the deposits, if
any, to the Segregated Security Account, specified in such Certificate, Oral
Instructions or Written Instructions.
25. Upon the termination of a Reverse Repurchase Agreement
described in paragraph 1 of this Article VI, a Fund shall promptly deliver a
Certificate or, in the event such Reverse Repurchase Agreement is a Money
Market Security, a Certificate, Oral Instructions or Written Instructions to
the Custodian specifying: (a) the Reverse Repurchase Agreement being
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<PAGE> 8
terminated; (b) the total amount payable by the Fund in connection with such
termination; (c) the amount and kind of Securities to be received by the Fund
in connection with such termination; (d) the date of termination; (e) the name
of the broker or dealer with or through which the Reverse Repurchase Agreement
is to be terminated; and (f) the amount of cash and/or the amount and kind of
Securities to be withdrawn from the Segregated Security Account. The Custodian
shall, upon receipt of the amount and kind of Securities to be received by the
Fund specified in the Certificate, Oral Instructions or Written Instructions,
make the payment to the broker or dealer, and the withdrawals, if any, from the
Segregated Security Account, specified in such Certificate, Oral Instructions
or Written Instructions.
ARTICLE VII
MARGIN ACCOUNTS, SEGREGATED SECURITY
ACCOUNTS AND COLLATERAL ACCOUNTS
26. The Custodian shall, from time to time, make such deposits
to, or withdrawals from, a Segregated Security Account as specified in a
Certificate received by the Custodian. Such Certificate shall specify the
amount of cash and/or the amount and kind of Securities to be deposited in, or
withdrawn from, the Segregated Security Account. In the event that a Fund
fails to specify in a Certificate the name of the issuer, the title and the
number of shares or the principal amount of any particular Securities to be
deposited by the Custodian into, or withdrawn from, a Segregated Securities
Account, the Custodian shall be under no obligation to make any such deposit or
withdrawal and shall so notify the Fund.
27. The Custodian shall make deliveries or payments from a Margin
Account to the broker, dealer or Clearing Member in whose name, or for whose
benefit, the account was established as specified in the Margin Account
Agreement.
28. Amounts received by the Custodian as payments or
distributions with respect to Securities deposited in any Margin Account shall
be dealt with in accordance with the terms and conditions of the Margin Account
Agreement.
29. The Custodian shall have a continuing lien and security
interest in and to any property at any time held by the Custodian in any
Collateral Account described herein.
30. On each business day, the Custodian shall furnish each Fund
with a statement with respect to each Margin Account in which money or
Securities are held specifying as of the close of business on the previous
business day: (a) the name of the Margin Account; (b) the amount and kind of
Securities held therein; and (c) the amount of money held therein. The
Custodian shall make available upon request to any broker or dealer specified
in the name of a Margin Account a copy of the statement furnished the Fund with
respect to such Margin Account.
31. Promptly after the close of business on each business day in
which cash and/or Securities are maintained in a Collateral Account, the
Custodian shall furnish each Fund with a statement with respect to such
Collateral Account specifying the amount of cash and/or the
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<PAGE> 9
amount and kind of Securities held therein. No later than the close of
business next succeeding the delivery to the Fund of such statement, the Fund
shall furnish to the Custodian a Certificate or Written Instructions specifying
the then market value of the Securities described in such statement.
ARTICLE VIII
PAYMENT OF DIVIDENDS OR DISTRIBUTIONS
32. Each Fund shall furnish to the Custodian a copy of the
resolution of the Board of Directors, certified by the Secretary or any
Assistant Secretary, either (i) setting forth the date of the declaration of a
dividend or distribution, the date of payment thereof, the record date as of
which shareholders entitled to payment shall be determined, the amount payable
per share to the shareholders of record as of that date and the total amount
payable to the Dividend Agent of the Fund on the payment date, or (ii)
authorizing the declaration of dividends and distributions on a daily basis or
some other periodic basis and authorizing the Custodian to rely on Oral
Instructions, Written Instructions or a Certificate setting forth the date of
the declaration of such dividend or distribution, the date of payment thereof,
the record date as of which shareholders entitled to payment shall be
determined, the amount payable per share to the shareholders of record as of
that date and the total amount payable to the Dividend Agent on the payment
date.
33. Upon the payment date specified in such resolution, Oral
Instructions, Written Instructions or Certificate, the Custodian shall pay out
the moneys held for the account of the Fund the total amount payable to the
Dividend Agent of the Fund.
ARTICLE IX
SALE AND REDEMPTION OF SHARES
34. Whenever a Fund shall sell any of its Shares, it shall
deliver to the Custodian a Certificate duly specifying the number of Shares
sold, trade date, price and the amount of money to be received by the Custodian
for the sale of such Shares.
35. Upon receipt of such money from the Transfer Agent or
Co-Transfer Agent, the Custodian shall credit such money to the account of a
Fund.
36. Upon issuance of any of a Fund's Shares in accordance with
the foregoing provisions of this Article IX, the Custodian shall pay, out of
the money held for the account of the Fund, all original issue or other taxes
required to be paid by the Fund in connection with such issuance upon the
receipt of a Certificate specifying the amount to be paid.
37. Except as provided hereinafter, whenever a Fund shall redeem
any of its Shares, it shall furnish to the Custodian a Certificate specifying
the number of Shares redeemed and the amount to be paid for the Shares
redeemed.
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38. Upon receipt from the Transfer Agent or Co-Transfer Agent of
an advice setting forth the number of Shares received by the Transfer Agent or
Co-Transfer Agent, for redemption and that such Shares are valid and in good
form for redemption, the Custodian shall make payment to the Transfer Agent as
the case may be, out of the moneys held for the account of a Fund of the total
amount specified in the Certificate issued pursuant to paragraph 4 of this
Article IX.
39. Notwithstanding the above provisions regarding the
redemption of any of a Fund's Shares, whenever its Shares are redeemed pursuant
to any check redemption privilege which may from time to time be offered by the
Fund, the Custodian, unless otherwise instructed by a Certificate, shall, upon
receipt of an advice from the Fund or its agent setting forth that the
redemption is in good form for redemption in accordance with the check
redemption procedure, honor the check presented as part of such check
redemption privilege out of the money held in the account of the Fund for such
purposes.
ARTICLE X
OVERDRAFTS OR INDEBTEDNESS
40. If the Custodian should in its sole discretion advance funds
on behalf of a Fund which results in an overdraft because the moneys held by
the Custodian for the account of the Fund shall be insufficient to pay the
total amount payable upon a purchase of Securities as set forth in a
Certificate or Oral Instructions issued pursuant to Article IV, or which
results in an overdraft for some other reason, or if the Fund is, for any other
reason, indebted to the Custodian (except a borrowing for investment or for
temporary or emergency purposes using Securities as collateral pursuant to a
separate agreement and subject to the provisions of paragraph 2 of this Article
X), such overdraft or indebtedness shall be deemed to be a loan made by the
Custodian to the Fund payable on demand and shall bear interest from the date
incurred at a rate per annum (based on a 360-day year for the actual number of
days involved) equal to 1/2% over the Custodian's prime commercial lending rate
in effect from time to time, such rate to be adjusted on the effective date of
any change in such prime commercial lending rate but in no event to be less
than 6% per annum. Any such overdraft or indebtedness shall be reduced by an
amount equal to the total of all amounts due the Fund which have not been
collected by the Custodian on behalf of the Fund when due because of the
failure of the Custodian to make timely demand or presentment for payment. In
addition, each Fund hereby agrees that the Custodian shall have a continuing
lien and security interest in and to any property at any time held by it for
the benefit of the Fund or in which the Fund may have an interest which is then
in the Custodian's possession or control or in possession or control of any
third party acting in the Custodian's behalf. The Company authorizes the
Custodian, in its sole discretion, at any time to charge any such overdraft or
indebtedness together with interest due thereon against any balance of account
standing to the Fund's credit on the Custodian's books.
41. Each Fund will cause to be delivered to the Custodian by any
bank (including, if the borrowing is pursuant to a separate agreement, the
Custodian) from which it borrows money for investment or for temporary or
emergency purposes using Securities as collateral for such
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borrowings, a notice or undertaking in the form currently employed by any such
bank setting forth the amount which such bank will loan to the Fund against
delivery of a stated amount of collateral. The Fund shall promptly deliver to
the Custodian a Certificate specifying with respect to each such borrowing:
(a) the name of the bank; (b) the amount and terms of the borrowing, which may
be set forth by incorporating by reference an attached promissory note, duly
endorsed by the Fund, or other loan agreement; (c) the time and date, if known,
on which the loan is to be entered into; (d) the date on which the loan becomes
due an payable; (e) the total amount payable to the Fund on the borrowing date;
(f) the market value of Securities to be delivered as collateral for such loan,
including the name of the issuer, the title and the number of shares or the
principal of any particular Securities; and (g) a statement specifying whether
such loan is for investment purposes or for temporary or emergency purposes and
that such loan is in conformance with the Investment Company Act of 1940 and
the Fund's prospectus. The Custodian shall deliver on the borrowing date
specified in a Certificate the specified collateral and the executed promissory
note, if any, against delivery by the lending bank of the total amount of the
loan payable, provided that the same conforms to the total amounts payable as
set forth in the Certificate. The Custodian may, at the option of the lending
bank, keep such collateral in its possession, but such collateral shall be
subject to all rights therein given the lending bank by virtue of any
promissory note or loan agreement. The Custodian shall deliver such Securities
as additional collateral as may be specified in a Certificate to collateralize
further any transaction described in this paragraph. The Fund shall cause all
Securities released from collateral status to be returned directly to the
Custodian, and the Custodian shall receive from time to time such return of
collateral as may be tendered to it. In the event that the Fund fails to
specify in a Certificate the name of the issuer, the title and number of shares
or the principal amount of any particular Securities to be delivered as
collateral by the Custodian, the Custodian shall not be under any obligation to
deliver any Securities.
ARTICLE XI
LOAN OF PORTFOLIO SECURITIES OF THE FUND
42. If a Fund is permitted by the terms of its Articles of
Incorporation and as disclosed in its most recent and currently effective
prospectus to lend its portfolio securities, within twenty-four (24) hours
after each loan of portfolio Securities the Fund shall deliver or cause to be
delivered to the Custodian a Certificate specifying with respect to each such
loan; (a) the name of the issuer and the title of the Securities; (b) the
number of shares or the principal amount loaned; (c) the date of loan and
delivery; (d) the total amount to be delivered to the Custodian against the
loan of the Securities, including the amount of cash collateral and the
premium, if any, separately identified; and (e) the name of the broker, dealer
or financial institution to which the loan was made. The Custodian shall
deliver the Securities thus designated to the broker, dealer or financial
institution to which the loan was made upon receipt of the total amount
designated as to be delivered against the loan of Securities The Custodian
may accept payment in connection with a delivery otherwise than through the
Book-Entry System or Depository only in the form of a certified or bank
cashier's check payable to the order of the Fund or the Custodian drawn on New
York Clearing House funds and may deliver Securities in accordance with the
customs prevailing among dealers in securities.
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<PAGE> 12
43. Promptly after each termination of the loan of Securities by
a Fund, the Fund shall deliver or cause to be delivered to the Custodian a
Certificate specifying with respect to each such loan termination and return of
Securities: (a) the name of the issuer and the title of the Securities to be
returned; (b) the number of shares or the principal amount to be returned; (c)
the date of termination; (d) the total amount to be delivered by the Custodian
(including the cash collateral for such Securities minus any offsetting credits
as described in said Certificate); and (e) the name of the broker, dealer or
financial institution from which the Securities will be returned. The
Custodian shall receive all Securities returned from the broker, dealer, or
financial institution to which such Securities were loaned and upon receipt
thereof shall pay, out of the moneys held for the account of the Fund, the
total amount payable upon such return of Securities as set forth in the
Certificate.
ARTICLE XII
THE CUSTODIAN
44. Except as hereinafter provided, neither the Custodian nor its
nominee shall be liable for any loss or damage, including attorney's fees,
resulting from its action or omission to act or otherwise, either hereunder or
under any Margin Account Agreement, except for any such loss or damage arising
out of its own negligence or willful misconduct. The Custodian may, with
respect to questions of law arising hereunder or under any Margin Account
Agreement, apply for and obtain the advice and opinion of counsel to the Fund
or of its own counsel, at the expense of the Fund, and shall be fully protected
with respect to anything done or omitted by it in good faith in conformity with
such advice or opinion. The Custodian shall be liable to the Fund for any loss
or damage resulting from the use of the Book-Entry System or any Depository
arising by reason of any negligence, misfeasance or willful misconduct on the
part of the Custodian or any of its employees or agents.
45. Without limiting the generality of the foregoing, the
Custodian shall be under no obligation to inquire into, and shall not be liable
for:
(a) The validity of the issue of any Securities purchased, sold
or written by or for a Fund, the legality of the purchase, sale or writing
thereof, or the propriety of the amount paid or received thereof;
(b) The legality of the issue or sale of any of a Fund's Shares,
or the sufficiency of the amount to be received therefor;
(c) The legality of the redemption of any of a Fund's Shares, or
the propriety of the amount to be paid therefor;
(d) The legality of the declaration or payment of any dividend by
a Fund;
(e) The legality of any borrowing by a Fund using Securities as
collateral;
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(f) The legality of any loan of portfolio Securities pursuant to
Article XI of this Agreement, nor shall the Custodian be under any duty or
obligation to see to it that any cash collateral delivered to it by a broker,
dealer or financial institutions or held by it at any time as a result of such
loan of portfolio Securities of a Fund is adequate collateral for the Fund
against any loss it might sustain as a result of such loan. The Custodian
specifically, but not by way of limitation, shall not be under any duty or
obligation periodically to check or notify the Fund that the amount of such
cash collateral held by it for the Fund is sufficient collateral for the Fund,
but such duty or obligation shall be the sole responsibility of the Fund. In
addition, the Custodian shall be under no duty or obligation to see that any
broker, dealer or financial institution to which portfolio Securities of the
Fund are lent pursuant to Article XI of this Agreement makes payment to it of
any dividends or interest which are payable to or for the account of the Fund
during the period of such loan or at the termination of such loan, provided,
however, that the Custodian shall promptly notify the Fund in the event that
such dividends or interest are not paid and received when due; or
(g) The sufficiency or value of any amounts of money and/or
Securities held in any Margin Account, Segregated Security Account or
Collateral Account in connection with transactions by a Fund. In addition, the
Custodian shall be under no duty or obligation to see that any broker, dealer,
or Clearing Member makes payment to the Fund of any variation margin payment or
similar payment which the Fund may be entitled to receive from such broker,
dealer, or Clearing Member, to see that any payment received by the Custodian
from any broker, dealer, or Clearing Member is the amount the Fund is entitled
to receive, or to notify the Fund of the Custodian's receipt or non-receipt of
any such payment; provided however that the Custodian, upon the Fund's written
request, shall as Custodian, demand from any broker, dealer, or Clearing Member
identified by the Fund the payment of any variation margin payment or similar
payment that the Fund asserts it is entitled to receive pursuant to the terms
of a Margin Account Agreement or otherwise from such broker, dealer, or
Clearing Member.
46. The Custodian shall not be liable for, or considered to be
the Custodian of, any money, whether or not represented by any check, draft or
other instrument for the payment of money, received by it on behalf of a Fund
until the Custodian actually receives and collects such money directly or by
the final crediting of the account representing the Fund's interest at the the
Book-Entry System or the Depository.
47. The Custodian shall have no responsibility and shall not be
liable for ascertaining or acting upon any calls, conversions, exchange,
offers, tenders, interest rate changes or similar matters relating to
Securities held in the Depository unless the Custodian shall have actually
received timely notice from the Depository. In no event shall the Custodian
have any responsibility or liability for the failure of the Depository to
collect, or for the late collection or late crediting by the Depository of any
amount payable upon Securities deposited in the Depository which may mature or
be redeemed, retired, called or otherwise become payable. However, upon
receipt of a Certificate from the Fund of an overdue amount on Securities held
in the Depository, the Custodian shall make a claim against the Depository on
behalf of the Fund, except that the Custodian shall not be under any obligation
to appear in, prosecute or defend any
13
<PAGE> 14
action suit or proceeding in respect to any Securities held by the Depository
which in its opinion may involve it in expense or liability, unless indemnity
satisfactory to it against all expense and liability be furnished as often as
may be required.
48. The Custodian shall not be under any duty or obligation to
take action to effect collection of any amount due to a Fund from the Transfer
Agent of the Fund nor to take any action to effect payment or distribution by
the Transfer Agent of the Fund of any amount paid by the Custodian to the
Transfer Agent of the Fund in accordance with this Agreement.
49. The Custodian shall not be under any duty or obligation to
take action to effect collection of any amount, if the Securities upon which
such amount is payable are in default, or if payment is refused after due
demand or presentation, unless and until (i) it shall be directed to take such
action by a Certificate and (ii) it shall be assured to its satisfaction of
reimbursement of its costs and expenses in connection with any such action.
50. The Custodian may appoint one or more banking institutions as
Depository or Depositories or as sub-custodian or sub-custodians, including,
but not limited to, banking institutions located in foreign countries, of
Securities and moneys at any time owned by the Fund, upon terms and conditions
approved in a Certificate, which shall, if requested by the Custodian, be
accompanied by an approving resolution of the Board of Directors adopted in
accordance with Rule 17f-5 under the Investment Company Act of 1940, as
amended.
51. The Custodian shall not be under any duty or obligation to
ascertain whether any Securities at any time delivered to or held by it for the
account of a Fund are such as properly may be held by the Fund under the
provisions of its Articles of Incorporation.
52. The Custodian shall not be entitled to compensation for
providing custody services to a Fund so long as the Custodian receives fees for
providing investment advisory services to the Fund or investment advisory or
custodial services to the series of another registered management investment
company in which the Fund invests all of its assets. If it no longer receives
compensation for providing such services, the Custodian shall be entitled to
such reasonable fees as it may from time to time negotiate with the Fund.
53. The Custodian shall be entitled to rely upon any Certificate,
notice or other instrument in writing received by the Custodian and reasonably
believed by the Custodian to be a Certificate. The Custodian shall be entitled
to rely upon any Oral Instructions and any Written Instructions actually
received by the Custodian pursuant to Article IV or VII hereof. The Fund
agrees to forward to the Custodian a Certificate or facsimile thereof,
confirming such Oral Instructions or Written Instructions in such manner so
that such Certificate or facsimile thereof is received by the Custodian,
whether by hand delivery, telex or otherwise, by the close of business of the
same day that such Oral Instructions or Written Instructions are given to the
Custodian. Each Fund agrees that the fact that such confirming instructions
are not received by the Custodian shall in no way affect the validity of the
transactions hereby authorized by the Fund. Each Fund agrees that the
Custodian shall incur no liability to the Fund in acting upon Oral Instructions
given
14
<PAGE> 15
to the Custodian hereunder concerning such transactions, provided such
instructions reasonably appear to have been received from an Authorized Person.
54. The Custodian shall be entitled to rely upon any instrument,
instruction or notice received by the Custodian and reasonably believed by the
Custodian to be given in accordance with the terms and conditions of any Margin
Account Agreement. Without limiting the generality of the foregoing, the
Custodian shall be under no duty to inquire into, and shall not be liable for,
the accuracy of any statements or representations contained if any such
instrument or other notice including, without limitation, any specification of
any amount to be paid to a broker, dealer, or Clearing Member.
55. The books and records pertaining to the Fund which are in the
possession of the Custodian shall be the property of the Fund. Such books and
records shall be prepared and maintained as required by the Investment Company
Act of 1940, as amended, and other applicable securities laws, rules and
regulations. Each Fund, or the Fund's authorized representatives, shall have
access to such books and records during the Custodian's normal business hours.
Upon the reasonable request of the Fund, copies of any such books and records
shall be provided by the Custodian to the Fund or the Fund's authorized
representative at the Fund's expense.
56. The Custodian shall provide the Company with any report
obtained by the Custodian on the system of internal accounting control of the
Book-Entry System or the Depository and with such reports on its own systems of
internal accounting control as the Fund may reasonably request from time to
time.
57. Each Fund agrees to indemnify the Custodian against and save
the Custodian harmless from all liability, claims, losses and demands
whatsoever, including attorney's fees, howsoever arising or incurred because of
or in connection with the Custodian's payment or non-payment of checks pursuant
to paragraph 6 of Article IX as part of any check redemption privilege program
of the Fund, except for any such liability, claim, loss and demand arising out
of the Custodian's own negligence or willful misconduct.
58. Subject to the foregoing provisions of this Agreement, the
Custodian may deliver and receive Securities, and receipts with respect to such
Securities, and arrange for payments to be made and received by the Custodian
in accordance with the customs prevailing from time to time among brokers or
dealers in such Securities.
59. The Custodian shall have no duties or responsibilities
whatsoever except such duties and responsibilities as are specifically set
forth in this Agreement or Appendix E attached hereto, and no covenant or
obligation shall be implied in this Agreement against the Custodian.
ARTICLE XIII
TERMINATION
15
<PAGE> 16
60. This Agreement shall continue until February 2, 1997, and
thereafter shall continue automatically for successive annual periods, provided
such continuance is specifically approved at least annually by (i) the Board of
Directors or (ii) vote of a majority (as defined in the Investment Company Act
of 1940) of the Fund's outstanding voting securities, provided that in either
event its continuance also is approved by a majority of the Directors who are
not "interested persons" (as defined in said Act) of any party to this
Agreement, by vote cast in person at a meeting called for the purpose of voting
on such approval. This Agreement is terminable without penalty, on sixty (60)
days' notice, by the Board of Directors or by vote of holders of a majority of
the Fund's shares or, upon not less than ninety (90) days' notice, by the
Custodian. In the event such notice is given by a Fund, it shall be
accompanied by a copy of a resolution of the Board of Directors, certified by
the Secretary or any Assistant Secretary, electing to terminate this Agreement
and designating a successor custodian or custodians, each of which shall be a
bank or trust company having not less that $2,000,000 aggregate capital,
surplus and undivided profits. In the event such notice is given by the
Custodian, the Fund shall, on or before the termination date, deliver to the
Custodian a copy of a resolution of its Directors, certified by the Secretary
or any Assistant Secretary, designating a successor custodian or custodians.
In the absence of such designation by the Fund, the Custodian may designate a
successor custodian which shall be a bank or trust company having not less than
$2,000,000 aggregate capital, surplus and undivided profits. Upon the date set
forth in such notice, this Agreement shall terminate and the Custodian shall,
upon receipt of a notice of acceptance by the successor custodian, on that date
deliver directly to the successor custodian all Securities and moneys then
owned by a Fund and held by it as Custodian, after deducting all fees,
expenses, and other amounts for the payment of reimbursement of which shall
then be entitled.
61. If a successor custodian is not designated by a Fund or the
Custodian in accordance with the preceding paragraph, the Fund shall, upon the
date specified in the notice of termination of this Agreement and upon the
delivery by the Custodian of all Securities (other than Securities held in the
Book-Entry System which cannot be delivered to the Fund) and moneys then owned
by the Fund, be deemed to be its own custodian, and the Custodian shall thereby
be relieved of all duties and responsibilities pursuant to this Agreement,
other than the duty with respect to Securities held in the Book-Entry System,
in any Depository or by a Clearing Member which cannot be delivered to the
Fund, to hold such Securities hereunder in accordance with this Custody
Agreement.
ARTICLE XIV
MISCELLANEOUS
62. Annexed hereto as Appendices B1-4 is a Certificate signed by
an Officer of the Company under its seal, setting forth the names and the
signatures of the present Authorized Persons. The Company agrees to furnish to
the Custodian a new Certificate in similar form in the event that any such
present Authorized Person ceases to be an Authorized Person or in the event
that other or additional Authorized Persons are elected or appointed. Until
such new Certificate shall be received, the Custodian shall be fully protected
in acting under the provisions of this
16
<PAGE> 17
Agreement upon Oral Instructions or signatures of the present Authorized
Persons as set forth in the last delivered Certificate.
63. Annexed hereto as Appendices C1-4 is a Certificate signed by
two of the present Officers of the Company under its seal, setting forth the
names and the signatures of the present Officers of the Company. The Fund
agrees to furnish to the Custodian a new Certificate in similar form in the
event any such present Officer ceases to be an Officer of the Company, or in
the event that other or additional Officers are elected or appointed. Until
such new Certificate shall be received, the Custodian shall be fully be
protected in acting under the provisions of this Custody Agreement upon the
signatures of the Officers as set forth in the last delivered Certificate.
64. Any notice or other instrument in writing, authorized or
required by this Agreement to be given to the Custodian, shall be deemed
sufficiently given if addressed to the Custodian and mailed or delivered to it
at its offices at 420 Montgomery Street, San Francisco, California, 94104, or
at such other place as the Custodian may from time to time designate in
writing.
65. Any notice or other instrument in writing, authorized or
required by this Agreement to be given the Company, shall be deemed
sufficiently given if addressed to the Company and mailed or delivered to it at
its office at 111 Center Street, Little Rock, Arkansas, 72201, or at such other
place as the Company may from time to time designate in writing.
66. This Agreement may not be amended or modified in any manner
except by a written agreement executed by both parties to this Custody
Agreement and approved by a resolution of the Board of Directors.
67. This Custody Agreement shall extend to and shall be binding
upon the parties hereto, and their respective successor(s) and assign(s);
provided, however, that this Agreement shall not be assignable by the Company
without the written consent of the Custodian, or by the Custodian without the
written consent of the Company, authorized or approved by a resolution of its
Board of Directors.
68. This Custody Agreement shall be construed in accordance with
the laws of the State of California.
69. This Custody Agreement may be executed in any number of
counterparts, each which shall be deemed to be an original, but such
counterparts shall, together, constitute only one instrument.
70. This Custody Agreement has been executed on behalf of the
Company by the undersigned officer of the Company in his capacity as an officer
of the Company. The obligations of this Agreement shall only be binding upon
the assets and property of the relevant Fund, as provided for in the Company's
Articles of Incorporation, and shall not be binding upon any director, officer
of shareholder of the Company or Fund individually.
17
<PAGE> 18
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their respective Officers, thereunto duly authorized, as of
the day and year first above written.
STAGECOACH INC. WELLS FARGO BANK, N.A.
By: By:
------------------------------ ------------------------------
Name: Name:
---------------------------- ----------------------------
Title: Title:
--------------------------- ---------------------------
By: By:
------------------------------ ------------------------------
Name: Name:
---------------------------- ----------------------------
Title: Title:
--------------------------- ---------------------------
18
<PAGE> 19
APPENDIX A
ASSET ALLOCATION FUND
BOND INDEX FUND
S&P 500 STOCK FUND
U.S. TREASURY ALLOCATION FUND
A-1
<PAGE> 20
APPENDIX B-1
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the Asset Allocation Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-1
<PAGE> 21
APPENDIX B-2
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the Bond Index Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-2
<PAGE> 22
APPENDIX B-3
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the S&P 500 Stock Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-3
<PAGE> 23
APPENDIX B-4
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the U.S. Treasury Allocation Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-4
<PAGE> 24
APPENDIX C-1
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the Asset
Allocation Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-1
<PAGE> 25
APPENDIX C-2
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the Bond
Index Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-2
<PAGE> 26
APPENDIX C-3
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the S&P 500
Stock Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-3
<PAGE> 27
APPENDIX C-4
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the U.S.
Treasury Allocation Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-4
<PAGE> 28
APPENDIX D
DESIGNATED PUBLICATIONS LIST FOR CALLED INSTRUMENTS
The following publications are designated publications for the
purposes of Article III, Para. 5(b):
A. The Bond Buyer
B. The Depository Trust Company Notices
C. Financial Daily Card Services
D. The New York Times
E. Standard & Poor's Called Bond Record
F. The Wall Street Journal
D-1
<PAGE> 29
APPENDIX E
CUSTODY FEES
Net Asset Charge 0.0167% (1.67 bps) annually
Transaction Charges:
Depository Eligible $10.00 ea.
Physical Delivery $20.00 ea.
Principal & Interest Paydown $10.00 ea.
Sweeps $-0-
PORTFOLIO ACCOUNTING
Monthly Base Fee $2,000.00
Net Asset Charge
F First $50,000,000 Net Assets 0.070% (7 bps) annually
Next $50,000,000 Net Assets 0.045% (4.5 bps) annually
Net Assets Over $100,000,000 0.020% (2.0 bps) annually
E-1
<PAGE> 30
APPENDIX F
COMPANY AND FUND ACCOUNTING SERVICES:
SCHEDULE OF SERVICES
A. Maintain Fund general ledger and journal.
B. Prepare and record disbursements for direct Fund expenses.
C. Prepare daily money transfers.
D. Reconcile all Fund bank and custodian accounts.
E. Assist Fund independent auditors as appropriate.
F. Prepare daily projection of available cash balances.
G. Record trading activity for purposes of determining net asset values and
daily dividend.
H. Prepare daily portfolio evaluation report to value portfolio securities
and determine daily accrued income.
I. Determine the daily net asset value per share.
J. Determine the daily dividend per share.
K. Prepare monthly, quarterly, semi-annual and annual financial statements.
L. Provide financial information for reports to the Securities and Exchange
Commission in compliance with the provisions of the Investment Company
Act of 1940 and the Securities Act of 1933, the Internal Revenue Service
and any other regulatory or governmental agencies as required.
M. Provide financial, yield, net asset value, etc., information to National
Association of Securities Dealers, Inc., and other survey and statistical
agencies as instructed from time to time by the Fund.
F-1
<PAGE> 1
EX-99.B 8(b)
CUSTODY AGREEMENT
STAGECOACH INC.
111 CENTER STREET
LITTLE ROCK, ARKANSAS 72201
This Agreement is made as of the 1st day of February, 1994 (the
"Agreement"), by and between STAGECOACH INC. (the "Company"), on behalf of the
Funds listed on the attached Appendix A (each a "Fund" and collectively, the
"Funds"), and WELLS FARGO BANK, N.A. (the "Custodian").
W I T N E S S E T H :
that for and in consideration of the mutual promises hereinafter set forth, the
Company and the Custodian agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meaning:
1. "Authorized Person" shall be deemed to include the treasurer,
the controller or any other person, whether or not any such person is an
Officer or employee of the Company, duly authorized by the Board of Directors
("Directors") to give Oral Instructions and Written Instructions on behalf of a
Fund and listed in the Certificates attached hereto as Appendices B-1 through
B-2 or such other Certificates as may be received from time to time by the
Custodian.
2. "Book-Entry System" shall mean the federal Reserve/Treasury
book-entry system for United States and federal agency securities, its
successor(s) and its nominee(s).
3. "Certificate" shall mean any notice, instruction, or other
instrument in writing, authorized or required by this Agreement to be given to
the Custodian, which is actually received by the Custodian and signed on behalf
of a Fund by any two Officers of the Company.
4. "Clearing Member" shall mean a registered broker-dealer that
is a member of a national securities exchange qualified to act as a custodian
for an investment company, or any broker-dealer reasonably believed by the
Custodian to be such a clearing member.
5. "Depository" shall mean The Depository Trust Company ("DTC"),
a clearing agency registered with the Securities and Exchange Commission, its
successor or successors and its nominee or nominees, provided the Custodian has
received a certified copy of a resolution of the Company's Directors
specifically approving deposits in DTC. The term "Depository" shall further
mean and include any person authorized to act as a depository under the
Investment Company Act of 1940, its successor(s) and its nominee(s),
specifically identified in a certified copy of a resolution of the Company's
Directors specifically approving deposits therein by the Custodian.
6. "Margin Account" shall mean a segregated account in the name
of a broker, dealer, or Clearing Member, or in the name of the Company or a
Fund for the benefit of a broker, dealer, or Clearing Member, or otherwise, in
accordance with an agreement between the Company on behalf of a Fund, the
Custodian and a broker, dealer, or Clearing Member (a "Margin Account
Agreement"), separate and distinct from the custody account, in which certain
Securities and/or moneys of the Fund shall be deposited and withdrawn from time
to time in connection with such transactions as the Fund may from time to time
determine. Securities held in the Book-
<PAGE> 2
Entry System or the Depository shall be deemed to have deposited in, or
withdrawn from, a Margin Account upon the Custodian's effecting an appropriate
entry on its books and records.
7. "Money Market Securities" shall be deemed to include, without
limitation, debt obligations issued or guaranteed as to principal and interest
by the government of the United States or agencies or instrumentalities
thereof, commercial paper, certificates of deposit and bankers' acceptances,
repurchase and reverse repurchase agreements with respect to the same and bank
time deposits, where the purchase and sale of such securities normally requires
settlement in federal funds on the same date as such purchase or sale.
8. "Officers" shall be deemed to include the President, and Vice
President, the Secretary, the Treasurer, the Controller, any Assistant
Secretary, any Assistant Treasurer or any other person or persons duly
authorized by the Directors of the Company to execute any Certificate,
instruction, notice or other instrument on behalf of a Fund and listed in the
Certificates attached hereto as Appendices C-1 through C-8 or such other
Certificates as may be received by the Custodian from time to time.
9. "Oral Instructions" shall mean verbal instructions actually
received by the Custodian from an Authorized Person or from a person reasonably
believed by the Custodian to be an Authorized Person.
10. "Reverse Repurchase Agreement" shall mean an agreement
pursuant to which a Fund sells Securities and agrees to repurchase such
Securities at a described or specified date and price.
11. "Security" or "Securities" shall be deemed to include,
without limitation, Money Market Securities, Reverse Repurchase Agreements,
common stock and other instruments or rights having characteristics similar to
common stocks, preferred stocks, debt obligations issued by state or municipal
governments and by public authorities (including, without limitation, general
obligations bonds), bonds, debentures, notes, mortgages or other obligations,
and any certificates, receipts, warrants or other instruments representing
rights to receive, purchase, sell or subscribe for the same, or evidencing or
representing any other rights or interest therein, or any property or assets.
12. "Segregated Security Account" shall mean an account
maintained under the terms of this Agreement as a segregated account, by
recordation or otherwise, within the custody account in which certain
Securities and/or other assets of a Fund shall be deposited and withdrawn from
time to time in accordance with Certificates received by the Custodian in
connection with such transactions as the Fund may from time to time determine.
13. "Shares" shall mean the shares of common stock of a Fund,
each of which, in the case of a Fund having Series, is allocated to a
particular Series.
14. "Written Instructions" shall mean written communications
actually received by the Custodian from an Authorized Person or from a person
reasonably believed by the Custodian to be an Authorized Person by telex or any
other such system whereby the receiver of such communications is able to verify
by codes or otherwise with a reasonable degree of certainty the authenticity of
the sender of such communication.
ARTICLE II
APPOINTMENT OF A CUSTODIAN
15. The Company on behalf of each Fund hereby constitutes and
appoints the Custodian as custodian of all the Securities and moneys at any
time owned by the Fund during the term of this Agreement.
16. The Custodian hereby accepts appointment as such custodian
and agrees to perform all the duties thereof as set forth in this Agreement.
2
<PAGE> 3
ARTICLE III
CUSTODY OF CASH AND SECURITIES
17. Except as otherwise provided in Article V, each Fund will
deliver or cause to be delivered to the Custodian all Securities and all moneys
owned by it, including cash received for the issuance of its Shares, at any
time during the term of this Agreement. The Custodian will not be responsible
for such Securities and such moneys until actually received by it. The
Custodian will be entitled to reverse any credits made on a Fund's behalf where
such credits have been previously made and moneys are not finally collected.
Each Fund shall deliver to the Custodian a certified resolution of the
Directors of the Company authorizing and instructing the Custodian on a
continuous and ongoing basis to deposit in the Book-Entry System all Securities
eligible for deposit therein and to utilize the Book- Entry System to the
extent possible in connection with its performance hereunder, including,
without limitation, in connection with settlements of purchases and sales of
Securities, loans of Securities, and deliveries and returns of Securities
collateral. Prior to a deposit of Securities of a Fund in the Depository, the
Fund shall deliver to the Custodian a certified resolution of the Directors of
the Company approving, authorizing and instructing the Custodian on a
continuous and ongoing basis until instructed to the contrary by a Certificate
actually received by the Custodian to deposit in the Depository all Securities
eligible for deposit therein and to utilize the Depository to the extent
possible in connection with its performance hereunder, including, without
limitation, in connection with settlements of purchases and sales of
Securities, loans of Securities, and deliveries and returns of Securities
collateral. Securities and moneys of a Fund deposited in either the Book-Entry
System or the Depository will be represented in accounts which include only
assets held by the Custodian for customers, including, but not limited to,
accounts in which the Custodian acts in a fiduciary or representative capacity.
18. The Custodian shall credit to a separate account in the name
of each Fund all moneys received by it for the account of the Fund, and shall
disburse the same only:
(a) In payment for Securities purchased, as provided in Article
IV hereof;
(b) In payment of dividends or distributions, as provided in
Article VIII hereof;
(c) In payment of original issue or other taxes, as provided in
Article IX hereof;
(d) In payment for Shares redeemed by it, as provided in Article
IX hereof;
(e) Pursuant to Certificates setting forth the name and addresses
of the person to whom the payment is tobe made, and the purpose for which
payment is to be made; or
(f) In payment of the fees and in reimbursement of the expenses
and liabilities of the Custodian, as provided in Article XII hereof.
19. Promptly after the close of business on each day, the
Custodian shall furnish each Fund with confirmations and a summary of all
transfers to or from the account of the Fund during said day. Where Securities
are transferred to the account of a Fund, the Custodian shall also by
book-entry or otherwise identify as belonging to the Fund a quantity of
Securities in a fungible bulk of Securities registered in the name of the
Custodian (or its nominee) or shown on the Custodian's account on the books of
the Book-Entry System or the Depository. The Custodian shall provide to each
Fund, at least monthly, a detailed statement of the Securities and moneys held
for the Fund under this Agreement.
20. Except as otherwise provided in Article V, all Securities
held for a Fund, which are issued or issuable only in bearer form, except such
Securities as are held in the Book-Entry System, shall be held by the Custodian
in that form; all other Securities held for a Fund may be registered in the
name of the Fund, in the name of any duly appointed registered nominee of the
Custodian as the Custodian may from time to time determine, or in the name of
the Book-Entry System or the Depository or their successor(s) or their
nominee(s). The Company agrees to furnish to the Custodian appropriate
instruments to enable the Custodian to hold or deliver in proper form for
transfer, or to register in the name of its registered nominee or in the name
of the Book-Entry System or
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the Depository, any Securities which it may hold for the account of a Fund and
which may from time to time be registered in the name of each Fund. The
Custodian shall hold all such Securities which are not held in the Book-Entry
System or in the Depository in a separate account in the name of each Fund
physically segregated at all times from those of any other person or persons.
5. Except as otherwise provided in this Agreement and unless
otherwise instructed to the contrary by a Certificate, the Custodian by itself,
or through the use of the Book-Entry System or the Depository with respect to
the Securities therein deposited, shall with respect to all Securities held for
a Fund in accordance with this Agreement:
(a) Collect all income due or payable;
(b) Present for payment and collect the amount payable upon such
Securities which are called, but only if either (i) the Custodian receives a
written notice of such call, or (ii) notice of such call appears in one or more
of the publications listed in Appendix D annexed hereto, which may be amended
at any time by the Custodian upon five business days' prior notification to a
Fund;
(c) Present for payment and collect the amount payable upon all
Securities which mature;
(d) Surrender Securities in temporary form for definitive
Securities;
(e) Execute, as Custodian, any necessary declarations or
certificates of ownership under the federal income tax laws or the laws or
regulations of any other taxing authority now or hereafter in effect; and
(f) Hold directly, or through the Book-Entry System or the
Depository with respect to Securities therein deposited, for the account of
each Fund all rights and similar securities issued with respect to any
Securities held by the Custodian hereunder.
6. Upon receipt of a Certificate and not otherwise, the
Custodian, directly or through the use of the Book-Entry System or the
Depository, shall:
(a) Execute and deliver to such persons as may be designated in
such Certificate proxies, consents, authorizations, and any other instruments
whereby the authority of a Fund as owner of any Securities may be exercised;
(b) Deliver any Securities held for a Fund in exchange for other
Securities or cash issued or paid in connection with the liquidation,
reorganization, refinancing, merger, consolidation or recapitalization of any
corporation, or the exercise of any conversion privilege;
(c) Deliver any Securities held for a Fund to any protective
committee, reorganization committee or other person in connection with the
reorganization, refinancing, merger, consolidation, recapitalization or sale of
assets of any corporation, and receive and hold under the terms of this
Agreement such certificates of deposit, interim receipts or other instruments
or documents as may be issued to it to evidence such delivery;
(d) Make such transfer or exchanges of the assets of a Fund and
take such other steps as shall be stated in said order to be for the purpose of
effectuating any duly authorized plan of liquidation, reorganization, merger,
consolidation or recapitalization of the Fund; and
(e) Present for payment and collect the amount payable upon
Securities not described in preceding paragraph 5(b) of this Article which may
be called as specified in the Certificate.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF A FUND
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21. Promptly after each purchase or sale (as applicable) of
Securities by a Fund, other than a purchase or sale of any Reverse Repurchase
Agreement, the Fund shall deliver to the Custodian (i) with respect to each
purchase or sale of Securities which are not Money Market Securities, a
Certificate; and (ii) with respect to each purchase or sale of Money Market
Securities, a Certificate, Oral Instructions or Written Instructions,
specifying with respect to each such purchase or sale: (a) the name of the
issuer and the title of the Securities; (b) the number of shares or the
principal amount purchased or sold and accrued interest, if any; (c) the date
of purchase or sale and settlement date; (d) the purchase or sale price per
unit; (e) the total amount payable upon such purchase or sale; (f) the name of
the person from whom or the broker through whom the purchase or sale was made,
and the name of the clearing broker, if any; (g) in the case of a purchase, the
name of the broker to which payment is to be made; and (h) in the case of a
sale, the name of the broker to whom the Securities are to be delivered. In
the case of a purchase, the Custodian shall, upon receipt of Securities
purchased by or for a Fund, pay out of the moneys held for the account of the
Fund the total amount payable to the person from whom, or the broker through
whom, the purchase was made, provided that the same conforms to the total
amount payable as set forth in such Certificate, Oral Instructions or Written
Instructions. In the case of a sale, the Custodian shall deliver the
Securities upon receipt of the total amount payable to a Fund upon such sale,
provided that the same conforms to the total amount payable as set forth in
such Certificate, Oral Instructions or Written Instructions. Subject to the
foregoing, the Custodian may accept payment in such form as shall be
satisfactory to it, and may deliver Securities and arrange for payment in
accordance with the customs prevailing among dealers in securities.
ARTICLE V
SHORT SALES
22. Promptly after any short sale, a Fund shall deliver to the
Custodian a Certificate specifying: (a) the name of the issuer and the title
of the Security; (b) the number of shares or principal amount sold, and accrued
interest or dividends, if any; (c) the dates of the sale and settlement; (d)
the sale price per unit; (e) the total amount credited to the Fund upon such
sale, if any (f) the amount of cash and/or the amount and kind of Securities,
if any, which are to be deposited in a Margin Account and the name in which
such Margin Account has been or is to be established; (g) the amount of cash
and/or the amount and kind of Securities, if any, to be deposited in a
Segregated Security Account; and (h) the name of the broker through which such
short sale was made. The Custodian shall upon its receipt of a statement from
such broker confirming such sale and that the total amount credited to the Fund
upon such sale, if any, as specified in the Certificate is held by such broker
for the account of the Custodian (or any nominee of the Custodian) as custodian
of the Fund, issue a receipt or make the deposits into the Margin Account and
the Segregated Security Account specified in the Certificate.
23. In connection with the closing-out of any short sale, a Fund
shall promptly deliver to the Custodian a Certificate specifying with respect
to each such closing-out: (a) the name of the issuer and the title of the
Security; (b) the number of shares or the principal amount, and accrued
interest or dividends, if any, required to effect such closing-out to be
delivered to the broker; (c) the dates of the closing-out and settlement; (d)
the purchase price per unit; (e) the net total amount payable to the Fund upon
such closing-out; (f) the net total amount payable to the broker upon such
closing-out; (g) the amount of cash and the amount and kind of Securities, if
any, to be withdrawn, from the Margin Account; (h) the amount of cash and/or
the amount and kind of Securities, if any, to be withdrawn from the Segregated
Security Account; and (i) the name of the broker through which the Fund is
effecting such closing-out. The Custodian shall, upon receipt of the net total
amount payable to the Fund upon such closing-out and the return and/or
cancellation of the receipts, if any, issued by the Custodian with respect to
the short sale being closed-out, pay out the moneys held for the account of the
Fund to the broker the net total amount payable to the broker, and make the
withdrawals from the Margin Account and the Segregated Security Account, as the
same are specified in the Certificate.
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ARTICLE VI
REVERSE REPURCHASE AGREEMENTS
24. Promptly after a Fund enters into a Reverse Repurchase
Agreement with respect to Securities and money held by the Custodian hereunder,
the Fund shall deliver to the Custodian a Certificate, or in the event such
Reverse Repurchase Agreement is a Money Market Security, a Certificate, Oral
Instructions or Written Instructions specifying: (a) the total amount payable
to the Fund in connection with such Reverse Repurchase Agreement; (b) the
broker or dealer through or with which the Reverse Repurchase Agreement is
entered; (c) the amount and kind of Securities to be delivered by the Fund to
such broker or dealer; (d) the date of such Reverse Repurchase Agreement; and
(e) the amount of cash and/or the amount and kind of Securities, if any, to be
deposited in a Segregated Security Account in connection with such Reverse
Repurchase Agreement. The Custodian shall, upon receipt of the total amount
payable to the Fund specified in the Certificate, Oral Instructions or Written
Instructions make the delivery to the broker or dealer, and the deposits, if
any, to the Segregated Security Account, specified in such Certificate, Oral
Instructions or Written Instructions.
25. Upon the termination of a Reverse Repurchase Agreement
described in paragraph 1 of this Article VI, a Fund shall promptly deliver a
Certificate or, in the event such Reverse Repurchase Agreement is a Money
Market Security, a Certificate, Oral Instructions or Written Instructions to
the Custodian specifying: (a) the Reverse Repurchase Agreement being
terminated; (b) the total amount payable by the Fund in connection with such
termination; (c) the amount and kind of Securities to be received by the Fund
in connection with such termination; (d) the date of termination; (e) the name
of the broker or dealer with or through which the Reverse Repurchase Agreement
is to be terminated; and (f) the amount of cash and/or the amount and kind of
Securities to be withdrawn from the Segregated Security Account. The Custodian
shall, upon receipt of the amount and kind of Securities to be received by the
Fund specified in the Certificate, Oral Instructions or Written Instructions,
make the payment to the broker or dealer, and the withdrawals, if any, from the
Segregated Security Account, specified in such Certificate, Oral Instructions
or Written Instructions.
ARTICLE VII
MARGIN ACCOUNTS, SEGREGATED SECURITY
ACCOUNTS AND COLLATERAL ACCOUNTS
26. The Custodian shall, from time to time, make such deposits
to, or withdrawals from, a Segregated Security Account as specified in a
Certificate received by the Custodian. Such Certificate shall specify the
amount of cash and/or the amount and kind of Securities to be deposited in, or
withdrawn from, the Segregated Security Account. In the event that a Fund
fails to specify in a Certificate the name of the issuer, the title and the
number of shares or the principal amount of any particular Securities to be
deposited by the Custodian into, or withdrawn from, a Segregated Securities
Account, the Custodian shall be under no obligation to make any such deposit or
withdrawal and shall so notify the Fund.
27. The Custodian shall make deliveries or payments from a Margin
Account to the broker, dealer or Clearing Member in whose name, or for whose
benefit, the account was established as specified in the Margin Account
Agreement.
28. Amounts received by the Custodian as payments or
distributions with respect to Securities deposited in any Margin Account shall
be dealt with in accordance with the terms and conditions of the Margin Account
Agreement.
29. The Custodian shall have a continuing lien and security
interest in and to any property at any time held by the Custodian in any
Collateral Account described herein.
30. On each business day, the Custodian shall furnish the Fund
with a statement with respect to its Margin Account in which money or
Securities are held specifying as of the close of business on the previous
business day: (a) the name of the Margin Account; (b) the amount and kind of
Securities held therein; and (c) the
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amount of money held therein. The Custodian shall make available upon request
to any broker or dealer specified in the name of a Margin Account a copy of the
statement furnished a Fund with respect to such Margin Account.
31. Promptly after the close of business on each business day in
which cash and/or Securities are maintained in a Collateral Account, the
Custodian shall furnish each Fund with a statement with respect to the Fund's
Collateral Account specifying the amount of cash and/or the amount and kind of
Securities held therein. No later than the close of business next succeeding
the delivery to the Fund of such statement, the Fund shall furnish the
Custodian with a Certificate or Written Instructions specifying the then market
value of the Securities described in such statement.
ARTICLE VIII
PAYMENT OF DIVIDENDS OR DISTRIBUTIONS
32. Each Fund shall furnish the Custodian with a copy of the
resolution of the Directors, certified by the Secretary or any Assistant
Secretary, either (i) setting forth the date of the declaration of a dividend
or distribution, the date of payment thereof, the record date as of which
shareholders entitled to payment shall be determined, the amount payable per
share to the shareholders of record as of that date and the total amount
payable to the Dividend Agent of the Fund on the payment date, or (ii)
authorizing the declaration of dividends and distributions on a daily basis or
some other periodic basis and authorizing the Custodian to rely on Oral
Instructions, Written Instructions or a Certificate setting forth the date of
the declaration of such dividend or distribution, the date of payment thereof,
the record date as of which shareholders entitled to payment shall be
determined, the amount payable per share to the shareholders of record as of
that date and the total amount payable to the Dividend Agent on the payment
date.
33. Upon the payment date specified in such resolution, Oral
Instructions, Written Instructions or Certificate, the Custodian shall pay out
the moneys held for the account of each Fund the total amount payable to the
Dividend Agent of the Fund.
ARTICLE IX
SALE AND REDEMPTION OF SHARES
34. Whenever a Fund shall sell any of its Shares, it shall
deliver to the Custodian a Certificate duly specifying the number of Shares
sold, trade date, price and the amount of money to be received by the Custodian
for the sale of such Shares.
35. Upon receipt of such money from the Transfer Agent or a
co-transfer agent, the Custodian shall credit such money to the account of the
Fund.
36. Upon issuance of any of a Fund's Shares in accordance with
the foregoing provisions of this Article IX, the Custodian shall pay, out of
the money held for the account of the Fund, all original issue or other taxes
required to be paid by the Fund in connection with such issuance upon the
receipt of a Certificate specifying the amount to be paid.
37. Except as provided hereinafter, whenever a Fund shall redeem
any of its Shares, it shall furnish the Custodian with a Certificate specifying
the number of Shares redeemed and the amount to be paid for the Shares
redeemed.
38. Upon receipt from the Transfer Agent or co-transfer agent of
an advice setting forth the number of Shares received by the Transfer Agent or
co-transfer agent for redemption, and that such Shares are valid and in good
form for redemption, the Custodian shall make payment to the Transfer Agent or
co-transfer agent, as the case may be, out of the moneys held for the account
of a Fund of the total amount specified in the Certificate issued pursuant to
paragraph 4 of this Article IX.
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39. Notwithstanding the above provisions regarding the
redemption of any of a Fund's Shares, whenever its Shares are redeemed pursuant
to any check redemption privilege which may from time to time be offered by the
Fund, the Custodian, unless otherwise instructed by a Certificate, shall, upon
receipt of an advice from the Fund or its agent setting forth that the
redemption is in good form for redemption in accordance with the check
redemption procedure, honor the check presented as part of such check
redemption privilege out of the money held in the account of the Fund for such
purposes.
ARTICLE X
OVERDRAFTS OR INDEBTEDNESS
40. If the Custodian should in its sole discretion advance funds
on behalf of a Fund which results in an overdraft because the moneys held by
the Custodian for the account of the Fund shall be insufficient to pay the
total amount payable upon a purchase of Securities as set forth in a
Certificate or Oral Instructions issued pursuant to Article IV, or which
results in an overdraft for some other reason, or if the Fund is, for any other
reason, indebted to the Custodian (except a borrowing for investment or for
temporary or emergency purposes using Securities as collateral pursuant to a
separate agreement and subject to the provisions of paragraph 2 of this Article
X), such overdraft or indebtedness shall be deemed to be a loan made by the
Custodian to the Fund payable on demand and shall bear interest from the date
incurred at a rate to be agreed upon from time to time by the Custodian and the
Fund. Any such overdraft or indebtedness shall be reduced by an amount equal
to the total of all amounts due the Fund which have not been collected by the
Custodian on behalf of the Fund when due because of the failure of the
Custodian to make timely demand or presentment for payment. In addition, the
Company on behalf of each Fund hereby agrees that the Custodian shall have a
continuing lien and security interest in and to any property at any time held
by it for the benefit of a Fund or in which the Fund may have an interest which
is then in the Custodian's possession or control or in possession or control of
any third party acting on the Custodian's behalf. Each Fund authorizes the
Custodian, in its sole discretion, at any time to charge any such overdraft or
indebtedness together with interest due thereon against any balance of account
standing to the Fund's credit on the Custodian's books.
41. Each Fund will cause to be delivered to the Custodian by any
bank (including, if the borrowing is pursuant to a separate agreement, the
Custodian) from which it borrows money for investment or for temporary or
emergency purposes using Securities as collateral for such borrowings, a notice
or undertaking in the form currently employed by any such bank setting forth
the amount which such bank will loan to the Fund against delivery of a stated
amount of collateral. A Fund shall promptly deliver to the Custodian a
Certificate specifying with respect to each such borrowing: (a) the name of
the bank; (b) the amount and terms of the borrowing, which may be set forth by
incorporating by reference an attached promissory note, duly endorsed by the
Fund, or other loan agreement; (c) the time and date, if known, on which the
loan is to be entered into; (d) the date on which the loan becomes due and
payable; (e) the total amount payable to the Fund on the borrowing date; (f)
the market value of Securities to be delivered as collateral for such loan,
including the name of the issuer, the title and the number of shares or the
principal of any particular Securities; and (g) a statement specifying whether
such loan is for investment purposes or for temporary or emergency purposes and
that such loan is in conformance with the Investment Company Act of 1940 and
the Fund's prospectus. The Custodian shall deliver on the borrowing date
specified in a Certificate the specified collateral and the executed promissory
note, if any, against delivery by the lending bank of the total amount of the
loan payable, provided that the same conforms to the total amounts payable as
set forth in the Certificate. The Custodian may, at the option of the lending
bank, keep such collateral in its possession, but such collateral shall be
subject to all rights therein given the lending bank by virtue of any
promissory note or loan agreement. The Custodian shall deliver such Securities
as additional collateral as may be specified in a Certificate to collateralize
further any transaction described in this paragraph. Each Fund shall cause all
Securities released from collateral status to be returned directly to the
Custodian, and the Custodian shall receive from time to time such return of
collateral as may be tendered to it. In the event that a Fund fails to specify
in a Certificate the name of the issuer, the title and number of shares or the
principal amount of any particular Securities to be delivered as collateral by
the Custodian, the Custodian shall not be under any obligation to deliver any
Securities.
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ARTICLE XI
LOANS OF PORTFOLIO SECURITIES OF A FUND
42. If a Fund is permitted by the terms of the Company's Articles
of Incorporation and as disclosed in the Fund's most recent and currently
effective prospectus to lend its portfolio securities, within twenty-four (24)
hours after each loan of portfolio Securities the Fund shall deliver or cause
to be delivered to the Custodian a Certificate specifying with respect to each
such loan; (a) the name of the issuer and the title of the Securities; (b) the
number of shares or the principal amount loaned; (c) the date of loan and
delivery; (d) the total amount to be delivered to the Custodian against the
loan of the Securities, including the amount of cash collateral and the
premium, if any, separately identified; and (e) the name of the broker, dealer
or financial institution to which the loan was made. The Custodian shall
deliver the Securities thus designated to the broker, dealer or financial
institution to which the loan was made upon receipt of the total amount
designated as to be delivered against the loan of Securities. The Custodian
may accept payment in connection with a delivery otherwise than through the
Book-Entry System or Depository only in the form of a certified or bank
cashier's check payable to the order of the fund or the Custodian drawn on New
York Clearing House funds and may deliver Securities in accordance with the
customs prevailing among dealers in securities.
43. Promptly after each termination of the loan of Securities by
a Fund, the Fund shall deliver or cause to be delivered to the Custodian a
Certificate specifying with respect to each such loan termination and return of
Securities: (a) the name of the issuer and the title of the Securities to be
returned; (b) the number of shares or the principal amount to be returned; (c)
the date of termination; (d) the total amount to be delivered by the Custodian
(including the cash collateral for such Securities minus any offsetting credits
as described in said Certificate); and (e) the name of the broker, dealer or
financial institution from which the Securities will be returned. The
Custodian shall receive all Securities returned from the broker, dealer, or
financial institution to which such Securities were loaned and upon receipt
thereof shall pay, out of the moneys held for the account of the Fund, the
total amount payable upon such return of Securities as set forth in the
Certificate.
ARTICLE XII
THE CUSTODIAN
44. Except as hereinafter provided, neither the Custodian nor its
nominee shall be liable for any loss or damage, including attorney's fees,
resulting from its action or omission to act or otherwise, either hereunder or
under any Margin Account Agreement, except for any such loss or damage arising
out of its own negligence or willful misconduct. The Custodian may, with
respect to questions of law arising hereunder or under any Margin Account
Agreement, apply for and obtain the advice and opinion of counsel to a Fund or
of its own counsel, at the expense of such Fund, and shall be fully protected
with respect to anything done or omitted by it in good faith in conformity with
such advice or opinion. The Custodian shall be liable to the Fund for any loss
or damage resulting from the use of the Book-Entry System or any Depository
arising by reason of any negligence, misfeasance or willful misconduct on the
part of the Custodian or any of its employees or agents.
45. Without limiting the generality of the foregoing, the
Custodian shall be under no obligation to inquire into, and shall not be liable
for:
(a) The validity of the issue of any Securities purchased, sold
or written by or for a Fund, the legality of the purchase, sale or writing
thereof, or the propriety of the amount paid or received thereof;
(b) The legality of the issue or sale of any of a Fund's Shares,
or the sufficiency of the amount to be received therefor;
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(c) The legality of the redemption of any of a Fund's Shares, or
the propriety of the amount to be paid therefor;
(d) The legality of the declaration or payment of any dividend by
a Fund;
(e) The legality of any borrowing by a Fund using Securities as
collateral;
(f) The legality of any loan of portfolio Securities pursuant to
Article XI of this Agreement, nor shall the Custodian be under any duty or
obligation to see to it that any cash collateral delivered to it by a broker,
dealer or financial institution or held by it at any time as a result of such
loan of portfolio Securities of a Fund is adequate collateral for such Fund
against any loss it might sustain as a result of such loan. The Custodian
specifically, but not by way of limitation, shall not be under any duty or
obligation periodically to check or notify a Fund that the amount of such cash
collateral held by it for the Fund is sufficient collateral for the Fund, but
such duty or obligation shall be the sole responsibility of the Fund. In
addition, the Custodian shall be under no duty or obligation to see that any
broker, dealer or financial institution to which portfolio Securities of a Fund
are lent pursuant to Article XI of this Agreement makes payment to it of any
dividends or interest which are payable to or for the account of the Fund
during the period of such loan or at the termination of such loan, provided,
however, that the Custodian shall promptly notify the Fund in the event that
such dividends or interest are not paid and received when due; or
(g) The sufficiency or value of any amounts of money and/or
Securities held in any Margin Account, Segregated Security Account or
Collateral Account in connection with transactions by a Fund. In addition, the
Custodian shall be under no duty or obligation to see that any broker, dealer,
or Clearing Member makes payment to a Fund of any variation margin payment or
similar payment which the Fund may be entitled to receive from such broker,
dealer, or Clearing Member, to see that any payment received by the Custodian
from any broker, dealer, or Clearing Member is the amount the Fund is entitled
to receive, or to notify the Fund of the Custodian's receipt or non-receipt of
any such payment; provided however that the Custodian, upon a Fund's written
request, shall as Custodian, demand from any broker, dealer, or Clearing Member
identified by the Fund the payment of any variation margin payment or similar
payment that the Fund asserts it is entitled to receive pursuant to the terms
of a Margin Account Agreement or otherwise from such broker, dealer, or
Clearing Member.
46. The Custodian shall not be liable for, or considered to be
the Custodian of, any money, whether or not represented by any check, draft or
other instrument for the payment of money, received by it on behalf of a Fund
until the Custodian actually receives and collects such money directly or by
the final crediting of the account representing the Fund's interest at the
Book-Entry System or the Depository.
47. The Custodian shall have no responsibility and shall not be
liable for ascertaining or acting upon any calls, conversions, exchanges,
offers, tenders, interest rate changes or similar matters relating to
Securities held in the Depository unless the Custodian shall have actually
received timely notice from the Depository. In no event shall the Custodian
have any responsibility or liability for the failure of the Depository to
collect, or for the late collection or late crediting by the Depository of any
amount payable upon Securities deposited in the Depository which may mature or
be redeemed, retired, called or otherwise become payable. However, upon
receipt of a Certificate from a Fund of an overdue amount on Securities held in
the Depository, the Custodian shall make a claim against the Depository on
behalf of the Fund, except that the Custodian shall not be under any obligation
to appear in, prosecute or defend any action, suit or proceeding in respect to
any Securities held by the Depository which in its opinion may involve it in
expense or liability, unless indemnity satisfactory to it against all expense
and liability be furnished as often as may be required.
48. The Custodian shall not be under any duty or obligation to
take action to effect collection of any amount due to a Fund from the Transfer
Agent of the Fund nor to take any action to effect payment or distribution by
the Transfer Agent of the Fund of any amount paid by the Custodian to the
Transfer Agent of the Fund in accordance with this Agreement.
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49. The Custodian shall not be under any duty or obligation to
take action to effect collection of any amount, if the Securities upon which
such amount is payable are in default, or if payment is refused after due
demand or presentation, unless and until (i) it shall be directed to take such
action by a Certificate and (ii) it shall be assured to its satisfaction of
reimbursement of its costs and expenses in connection with any such action.
50. The Custodian may appoint one or more banking institutions as
Depository or Depositories or as sub- custodian(s), including, but not limited
to, banking institutions located in foreign countries, of Securities and moneys
at any time owned by a Fund, upon terms and conditions approved in a
Certificate, which shall, if requested by the Custodian, be accompanied by an
approving resolution of the Company's Board of Directors adopted in accordance
with Rule 17f-5 under the Investment Company Act of 1940, as amended.
51. The Custodian shall not be under any duty or obligation to
ascertain whether any Securities at any time delivered to or held by it for the
account of a Fund are such as properly may be held by the Fund under the
provisions of the Company's Articles of Incorporation.
52. The Custodian shall not be entitled to compensation for
providing custody services to a Fund so long as the Custodian receives fees for
providing investment advisory services to the Fund or investment advisory or
custodial services to the series of another registered management investment
company in which the Fund invests all of its assets. If it no longer receives
compensation for providing such services, the Custodian shall be entitled to
such reasonable fees as it may from time to time negotiate with the Fund.
53. The Custodian shall be entitled to rely upon any Certificate,
notice or other instrument in writing received by the Custodian and reasonably
believed by the Custodian to be a Certificate. The Custodian shall be entitled
to rely upon any Oral Instructions and any Written Instructions actually
received by the Custodian pursuant to Article IV or VII hereof. Each Fund
agrees to forward to the Custodian a Certificate or facsimile thereof,
confirming such Oral Instructions or Written Instructions in such manner so
that such Certificate or facsimile thereof is received by the Custodian,
whether by hand delivery, telex or otherwise, by the close of business of the
same day that such Oral Instructions or Written Instructions are given to the
Custodian. Each Fund agrees that the fact that such confirming instructions
are not received by the Custodian shall in no way affect the validity of the
transactions hereby authorized by the Fund. Each Fund agrees that the
Custodian shall incur no liability to the Fund in acting upon Oral Instructions
given to the Custodian hereunder concerning such transactions, provided such
instructions reasonably appear to have been received from an Authorized Person.
54. The Custodian shall be entitled to rely upon any instrument,
instruction or notice received by the Custodian and reasonably believed by the
Custodian to be given in accordance with the terms and conditions of any Margin
Account Agreement. Without limiting the generality of the foregoing, the
Custodian shall be under no duty to inquire into, and shall not be liable for,
the accuracy of any statements or representations contained in any such
instrument or other notice including, without limitation, any specification of
any amount to be paid to a broker, dealer, or Clearing Member.
55. The books and records pertaining to each Fund which are in
the possession of the Custodian shall be the property of the Fund. Such books
and records shall be prepared and maintained as required by the Investment
Company Act of 1940, as amended, and other applicable securities laws, rules
and regulations. Each Fund, or the Fund's authorized representative(s), shall
have access to such books and records during the Custodian's normal business
hours. Upon the reasonable request of a Fund, copies of any such books and
records shall be provided by the Custodian to the Fund or the Fund's authorized
representative(s) at the Fund's expense.
56. The Custodian shall provide the Company with any report
obtained by the Custodian on the system of internal accounting control of the
Book-Entry System or the Depository control as the Company may reasonably
request from time to time.
57. Each Fund agrees to indemnify the Custodian against and save
the Custodian harmless from all liability, claims, losses and demands
whatsoever, including attorney's fees, howsoever arising or incurred because of
or in connection with the Custodian's payment or non-payment of checks pursuant
to paragraph 6 of Article IX
11
<PAGE> 12
as part of any check redemption privilege program of the Fund, except for any
such liability, claim, loss and demand arising out of the Custodian's own
negligence or willful misconduct.
58. Subject to the foregoing provisions of this Agreement, the
Custodian may deliver and receive Securities, and receipts with respect to such
Securities, and arrange for payments to be made and received by the Custodian
in accordance with the customs prevailing from time to time among brokers or
dealers in such Securities.
59. The Custodian shall have no duties or responsibilities
whatsoever except such duties and responsibilities as are specifically set
forth in this Agreement or Appendix E attached hereto, and no covenant or
obligation shall be implied in this Agreement against the Custodian.
ARTICLE XIII
TERMINATION
60. This Agreement shall continue until March 1, 1995, and
thereafter shall continue automatically for successive annual periods ending on
the last day of March of each year, provided such continuance is specifically
approved at least annually by (i) the Company's Directors or (ii) with respect
to a Fund, by vote of a majority (as defined in the Investment Company Act of
1940) of the Fund's outstanding voting securities, provided that in either
event its continuance also is approved by a majority of the Company's Directors
who are not "interested persons" (as defined in said Act) of any party to this
Agreement, by vote cast in person at a meeting called for the purpose of voting
on such approval. This Agreement is terminable with respect to a Fund without
penalty, on sixty (60) days' notice, by the Company's Directors or, by vote of
holders of a majority of the Fund's Shares or, upon not less than ninety (90)
days' notice, by the Custodian. In the event such notice is given by a Fund,
it shall be accompanied by a copy of a resolution of the Directors of the
Company on behalf of the Fund, certified by the Secretary or any Assistant
Secretary, electing to terminate this Agreement and designating a successor
custodian or custodians, each of which shall be a bank or trust company having
not less than $2,000,000 aggregate capital, surplus and undivided profits. In
the event such notice is given by the Custodian, the Fund shall, on or before
the termination date, deliver to the Custodian a copy of a resolution of the
Directors, certified by the Secretary or any Assistant Secretary, designating a
successor custodian or custodians. In the absence of such designation by a
Fund, the Custodian may designate a successor custodian which shall be a bank
or trust company having not less than $2,000,000 aggregate capital, surplus and
undivided profits. Upon the date set forth in such notice, this Agreement
shall terminate and the Custodian shall, upon receipt of a notice of acceptance
by the successor custodian, on that date deliver directly to the successor
custodian all Securities and moneys then owned by a Fund and held by it as
Custodian, after deducting all fees, expenses, and other amounts for the
payment of reimbursement of which shall then be entitled.
61. If a successor custodian is not designated by the Company on
behalf of a Fund or the Custodian in accordance with the preceding paragraph,
the Fund shall, upon the date specified in the notice of termination of this
Agreement and upon the delivery by the Custodian of all Securities (other than
Securities held in the Book-Entry System which cannot be delivered to the Fund)
and moneys then owned by the Fund, be deemed to be its own custodian, and the
Custodian shall thereby be relieved of all duties and responsibilities pursuant
to this Agreement, other than the duty with respect to Securities held in the
Book-Entry System, in any Depository or by a Clearing Member which cannot be
delivered to the Fund, to hold such Securities hereunder in accordance with
this Agreement.
ARTICLE XIV
MISCELLANEOUS
62. Annexed hereto as Appendices B-1 through B-8 are Certificates
signed by an Officer of the Company under its seal, setting forth the names and
the signatures of the present Authorized Persons. The Company agrees to
furnish to the Custodian a new Certificate(s) in similar form in the event that
any such present
12
<PAGE> 13
Authorized Person ceases to be an Authorized Person or in the event that other
or additional Authorized Persons are elected or appointed. Until such new
Certificate(s) shall be received, the Custodian shall be fully protected in
acting under the provisions of this Agreement upon Oral Instructions or
signatures of the present Authorized Persons as set forth in the last delivered
Certificate(s).
63. Annexed hereto as Appendices C-1 through C-8 are Certificates
signed by two of the present Officers of the Company under its seal, setting
forth the names and the signatures of the present Officers of the Company.
Each Fund agrees to furnish to the Custodian a new Certificate(s) in similar
form in the event any such present Officer ceases to be an Officer of the
Company, or in the event that other or additional Officers are elected or
appointed. Until such new Certificate(s) shall be received, the Custodian
shall be fully be protected in acting under the provisions of this Agreement
upon the signatures of the Officers as set forth in the last delivered
Certificate(s).
64. Any notice or other instrument in writing, authorized or
required by this Agreement to be given to the Custodian, shall be deemed
sufficiently given if addressed to the Custodian and mailed or delivered to it
at its offices at 420 Montgomery Street, San Francisco, California, 94104, or
at such other place as the Custodian may from time to time designate in
writing.
65. Any notice or other instrument in writing, authorized or
required by this Agreement to be given a Fund, shall be deemed sufficiently
given if addressed to such Fund and mailed or delivered to it at its office at
111 Center Street, Little Rock, Arkansas, 72201, or at such other place as the
Fund may from time to time designate in writing.
66. This Agreement may not be amended or modified in any manner
except by a written agreement executed by both parties to this Agreement and
approved by a resolution of the Directors of the Company.
67. This Agreement shall extend to and shall be binding upon the
parties hereto, and their respective successor(s) and assign(s); provided,
however, that this Agreement shall not be assignable by the Company without the
written consent of the Custodian, or by the Custodian without the written
consent of the Company, authorized or approved by a resolution of its
Directors.
68. This Agreement shall be construed in accordance with the laws
of the State of California.
69. This Agreement may be executed in any number of counterparts,
each which shall be deemed to be an original, but such counterparts shall,
together, constitute only one instrument.
13
<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their respective Officers, thereunto duly authorized, as of
the day and year first above written.
STAGECOACH INC. WELLS FARGO BANK, N.A.
By: By:
------------------------------ ------------------------------
Name: Name:
---------------------------- ----------------------------
Title: Title:
--------------------------- ---------------------------
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
14
<PAGE> 15
APPENDIX A
California Tax-Free Intermediate Income Fund
California Tax-Free Money Market Fund
California Tax-Free Short-Term Income Fund
Growth and Income Fund
Growth Stock Fund
National Tax-Free Intermediate Income Fund
National Tax-Free Money Market Fund
Short-Intermediate Term Fund
A-1
<PAGE> 16
APPENDIX B-1
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the California Tax-Free Intermediate Income Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-1
<PAGE> 17
APPENDIX B-2
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the California Tax-Free Money Market Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-2
<PAGE> 18
APPENDIX B-3
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the California Tax-Free Short-Term Income Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-3
<PAGE> 19
APPENDIX B-4
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the Growth and Income Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-4
<PAGE> 20
APPENDIX B-5
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the Growth Stock Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-5
<PAGE> 21
APPENDIX B-6
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the National Tax-Free Intermediate Income Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-6
<PAGE> 22
APPENDIX B-7
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the National Tax-Free Money Market Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-7
<PAGE> 23
APPENDIX B-8
AUTHORIZED PERSONS
Pursuant to Article I, Para. 1 and Article XIV, Para. 1 of
the Custody Agreement, the following persons have been authorized by the Board
of Directors to give Oral Instructions and Written Instructions on behalf of
the Short-Intermediate Term Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-8
<PAGE> 24
APPENDIX C-1
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the
California Tax-Free Intermediate Income Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-1
<PAGE> 25
APPENDIX C-2
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the
California Tax- Free Money Market Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-2
<PAGE> 26
APPENDIX C-3
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the
California Tax- Free Short-Term Income Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-3
<PAGE> 27
APPENDIX C-4
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the Growth
and Income Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-4
<PAGE> 28
APPENDIX C-5
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the Growth
Stock Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-5
<PAGE> 29
APPENDIX C-6
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the National
Tax- Free Intermediate Income Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-6
<PAGE> 30
APPENDIX C-7
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the National
Tax- Free Money Market Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-7
<PAGE> 31
APPENDIX C-8
OFFICERS
Pursuant to Article I, Para. 8, and Article XIV, Para.
2, of the Custody Agreement, the term "Officers" does not include any persons
other than the President, Vice President, Secretary, Treasurer, Controller,
Assistant Secretary and Assistant Treasurer; and the following persons are
Officers of the Company authorized by the Board of Directors to execute any
Certificate, instruction, notice or other instrument on behalf of the Short-
Intermediate Term Fund.
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
Signature:
------------------------------
Name:
-----------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
C-8
<PAGE> 32
APPENDIX D
DESIGNATED PUBLICATIONS LIST FOR CALLED INSTRUMENTS
The following publications are designated publications for the
purposes of Article III, Para. 5(b):
A. The Bond Buyer
B. The Depository Trust Company Notices
C. Financial Daily Card Services
D. The New York Times
E. Standard & Poor's Called Bond Record
F. The Wall Street Journal
D-1
<PAGE> 33
APPENDIX E
COMPANY AND FUND ACCOUNTING SERVICES:
SCHEDULE OF SERVICES
A. Maintain Fund general ledger and journal.
B. Prepare and record disbursements for direct Fund expenses.
C. Prepare daily money transfers.
D. Reconcile all Fund bank and custodian accounts.
E. Assist Fund independent auditors as appropriate.
F. Prepare daily projection of available cash balances.
G. Record trading activity for purposes of determining net asset values and
daily dividend.
H. Prepare daily portfolio evaluation report to value portfolio securities
and determine daily accrued income.
I. Determine the daily net asset value per share.
J. Determine the daily dividend per share.
K. Prepare monthly, quarterly, semi-annual and annual financial statements.
L. Provide financial information for reports to the Securities and Exchange
Commission in compliance with the provisions of the Investment Company
Act of 1940 and the Securities Act of 1933, the Internal Revenue Service
and any other regulatory or governmental agencies as required.
M. Provide financial, yield, net asset value, etc., information to National
Association of Securities Dealers, Inc., and other survey and statistical
agencies as instructed from time to time by a Fund.
E-1
<PAGE> 1
EX-99.B 8(c)
FORM OF
CUSTODY AGREEMENT
This Agreement is made as of the ___ day of December, 1995 (the "Agreement"),
by and between STAGECOACH INC. (the "Company"), on behalf of the [name of fund]
(hereinafter called the "Fund"), and [name of entity], a special purpose trust
company (hereinafter called the "Custodian").
WITNESSETH:
that for and in consideration of the mutual promises hereinafter set forth the
Company and the Custodian agree as follows:
1. Definitions
The word "securities" as used herein include stocks, shares, bonds,
debentures, notes, mortgages, or other obligations and any certificates,
receipts, warrants, options or other instruments representing rights to
receive, purchase, or subscribe for the same or evidencing or
representing any other rights or interests therein, or in any property or
assets.
The words "officers' certificate" shall mean a certification in writing
signed in the name of the Company by those persons who are officers of
the Company who are duly authorized to sign by the Board of Directors of
the Company (the "Board of Directors").
The word "depository" shall mean The Depository Trust Company ("DTC"),
Participants Trust Company ("PTC"), and any other clearing agency
registered with the Securities and Exchange Commission under Section 17A
of the Securities Exchange Act of 1934, its successor(s) and its
nominee(s), provided the Custodian has received a certified copy of a
resolution of the Board of Directors specifically approving deposits in
DTC, PTC or such other clearing agency. The Term "Depository" shall
further mean and include any person authorized to act as a depository
pursuant to Section 17, Rule 17f-4 or Rule 17f-5 thereunder, under the
Investment Company Act of 1940, its successor(s) and its nominee(s),
specifically identified in a certified copy of a resolution of the Board
of Directors specifically approving deposits therein by the Custodian.
2. Names, Titles and Signatures of Fund's Officers
An officer of the Company will certify to Custodian the names and
signatures of those persons authorized to sign the officers' certificates
described in Section 1 hereof, and the names of the members of the Board
of Directors, together with any charges which may occur from time to
time.
1
<PAGE> 2
3. Appointment and Authority of Custodian: Accounts, Receipt and
Disbursement of Money
A. The Company hereby appoints Custodian as custodian of all
securities and moneys at any time owned by the Fund during
the term of this Agreement. Custodian hereby accepts
appointment as such custodian and agrees to perform the
duties thereof as hereinafter set forth.
B. Custodian shall open and maintain a separate account or
accounts in the name of the Fund. Custodian shall hold in
such account or accounts, subject to the provisions hereof,
all cash received by it from or for the account of the
Fund. Custodian shall make payments of cash to, or for the
account of, the Fund from such cash only (a) for the
purchase of securities for the portfolio of the Fund upon
the delivery of such securities to Custodian, registered in
the name of the Fund or in the name of the nominee of
Custodian referred to in Section 7 hereof or in the proper
form for transfer, (b) for the purchase or redemption of
shares of beneficial ownership of the Fund, (c) for the
payment of interest, dividends, taxes, Director's fees or
operating expenses (including, without limitation, fees for
legal, accounting and auditing services and expense for
printing and postage), (d) for payments in connection with
the conversion, exchange or surrender of securities owned
or subscribed to by the Fund held by or to be delivered to
Custodian, or (e) for other purposes certified by
resolution of the Company's Board of Directors. Before
making any such payment Custodian shall receive
instructions from the Fund requesting such payment.
C. Custodian is hereby authorized to endorse and collect all
checks, drafts or other orders for the payment of money
received by Custodian for the account of the Fund.
D. Subject to the requirements of the Investment Company Act
of 1940 and subject to the approval of the Company's Board
of Directors, the Custodian shall have the authority to
keep and maintain the Fund's securities with certain
sub-custodians, including, but not limited to, Bankers
Trust Company, the Federal Reserve Book-Entry System DTC,
PTC and other depositories as defined above.
4. Receipt of Securities
Custodian shall hold in a separate account, pursuant to the
provisions hereof, all securities received by it from or for the account of the
Fund. All such securities are to be held or disposed of by Custodian for, and
subject at all times to the instructions of, the Company pursuant to the terms
of this Agreement. Custodian shall have no power or authority to assign,
hypothecate, pledge or otherwise dispose of any such securities and
investments, except pursuant to the direction of the Company and only for the
account of such Fund as set forth in Section 5 of this Agreement.
2
<PAGE> 3
5. Transfer, Exchange, Redelivery, etc. of Securities
Custodian shall have power to release or deliver any securities of
the Fund held by it pursuant to this Agreement on the direction of the Company.
Custodian agrees to transfer, exchange or deliver securities held by it
hereunder only (a) for sales of such securities for the account of such Fund
upon receipt by Custodian of payment therefor, (b) when such securities are
called, redeemed or retired or otherwise become payable, (c) for examination by
a broker selling any such securities in accordance with "street delivery"
custom, (d) in exchange for, or upon conversion into, other securities alone or
other securities and cash, whether pursuant to any plan or merger,
consolidation, reorganization, recapitalization or readjustment, or otherwise,
(e) upon conversion of such securities pursuant to their terms into other
securities, (f) upon exercise of subscription, purchase or other similar rights
represented by such securities, (g) for the purpose of exchanging interim
receipts or temporary securities for definitive securities, (h) for other
proper purposes. As to any deliveries made by Custodian pursuant to items (a),
(b), (d), (e), (f), or (g), securities or cash receivable in exchange therefor
shall be deliverable to Custodian. Before making any such transfer, exchange
or delivery, Custodian shall receive (and may rely upon) an officers'
certificate requesting such transfer, exchange or delivery, and stating that it
is for a purpose permitted under the terms of items (a) through (g) inclusive
of this Section 5 and also, in respect of item (h), upon receipt of an
officers' certificate specifying the securities to be delivered, setting forth
the purpose for which such delivery is to be made, declaring such purpose to be
a proper purpose, and naming the person or persons to whom delivery of such
securities shall be made; provided, however, that an officers' certificate need
not precede any such transfer, exchange or delivery of a money market
instrument if an authorized officer of the Company issues appropriate oral
instructions to Custodian and an appropriate officers' certificate is received
by Custodian within two business days thereafter.
6. Custodian's Acts Without Instructions
Unless and until Custodian receives an officers' certificate or
other written instructions to the contrary, Custodian shall: (a) present for
payment all coupons and other income items held by it for the account of the
Fund which call for payment upon presentation and hold the cash received by it
upon such payment for the account of the Fund; (b) collect interest and cash
dividends received, with notice to the Fund, for the account of the Fund; (c)
hold for the account of the Fund hereunder all stock dividends, rights and
similar securities issued with respect to any securities held by it hereunder;
and (d) execute as agent on behalf of the Fund all necessary ownership
certificates required by the Internal Revenue Code or the Income Tax
Regulations of the United States Treasury Department or under the laws of any
state now or hereafter in effect, inserting the Fund's name on such
certificates as the owner of the securities covered thereby, to the extent it
may lawfully do so.
7. Registration of Securities
Except as otherwise directed by an officers' certificate Custodian
shall register all securities, except such as are in bearer form, in nominee
form, and shall execute and deliver all
3
<PAGE> 4
such certificates in connection therewith as may be required by such laws or
regulations or under the laws of any state. Custodian shall use its best
efforts to insure that the specific securities held by it hereunder shall be at
all times identifiable in its records.
The Fund shall from time to time furnish to Custodian appropriate
instruments to enable Custodian to hold or deliver in proper form for transfer,
or to register in the name of a nominee, any securities which it may hold for
the account of the Fund and which from time to time may be registered in the
name of the Fund.
8. Voting and Other Action
Neither Custodian nor any nominee of Custodian shall vote any of
the securities held hereunder by or for the account of the Fund, except in
accordance with the guidelines approved by the Company.
9. Transfer Tax and Other Disbursements
The Fund shall pay or reimburse Custodian from time to time for
any transfer taxes payable upon transfers of securities made hereunder, and for
all other necessary, reasonable and proper disbursements and expenses made or
incurred by Custodian in the performance of this Agreement.
Custodian shall execute and deliver such certificates in
connection with securities delivered to it or by it under this Agreement as may
be required, under the provisions of the Internal Revenue Code and any
Regulations of the Treasury Department issued thereunder, or under the laws of
any state, to exempt from taxation any exemptable transfers and/or deliveries
of any such securities.
10. Concerning Custodian
The Custodian shall not be entitled to compensation for providing
custody services to the Fund pursuant to this Agreement so long as Custodian or
Wells Fargo Nikko Investment Advisors [OR ITS SUCCESSOR] receives fees for
providing investment advisory (or sub-advisory) services to the Fund. If it or
Wells Fargo Nikko Investment Advisors [OR ITS SUCCESSOR] no longer receives
compensation for providing such services, Custodian shall be entitled to such
compensation as it may from time negotiate with the Company.
Custodian shall not be liable for any action taken in good faith
upon any certificate herein described or certified copy of any resolution of
the Board of Directors, and may rely on the genuineness of any such document
which it may in good faith believe to have been validly executed.
The Fund agrees to reimburse and make Custodian and its nominee
whole from all taxes, charges, expenses, assessments, claims, and liabilities
(including reasonable attorney's fees) incurred or assessed against it or by
its nominee in connection with the performance of this
4
<PAGE> 5
Agreement, except such as may arise from Custodian's or its nominee's own
negligent action, negligent failure to act or willful misconduct. In the event
of any advance of cash for any purpose made by Custodian resulting from orders
or instructions of the Company, or in the event that Custodian or its nominee
shall incur or be assessed any taxes, charges, expenses, assessments, claims or
liabilities in connection with the performance of this Agreement (except such
as may arise from Custodian or its nominee's own negligent action, negligent
failure to act or willful misconduct, and excluding any compensation payable by
the Company to Custodian hereunder), any property at any time held for the
account of the Fund shall be security therefor.
Custodian shall reimburse, indemnify and make the Fund whole for
any actual loss or damages, including reasonable fees and expenses of counsel,
arising from Custodian's negligent action, negligent failure to act or its
willful misconduct.
11. Reports by Custodian
Custodian shall furnish the Fund from time to time with a
statement summarizing all transactions and entries for the account of the Fund.
Custodian shall furnish the Fund at the end of every month with a list of the
portfolio securities held for the Fund showing the aggregate cost of each
issue. Custodian shall furnish the Fund, at the close of each quarter of the
Fund's fiscal year, with a list showing the cost of the securities held by it
for the Fund hereunder, adjusted for all commitments confirmed by the Fund as
of such close, certified by a duly authorized officer of Custodian. The books
and records of Custodian pertaining to its actions under this Agreement shall
be open to inspection and audit at reasonable times by officers of, and
auditors employed by, the Company.
12. Termination of Agreement
This Agreement may be terminated by the Company on ninety (90)
days notice, given in writing and sent by registered mail, to Custodian at 45
Fremont Street, San Francisco, California 94105, or to the Company at 525
Market Street, Suite 1200, San Francisco, California 94163. Upon termination
of this Agreement, pending appointment of a successor to Custodian, Custodian
shall deliver cash, securities or other property of the Fund only to a bank (as
defined in the Investment Company Act of 1940, as amended; the "1940 Act")
located in San Francisco, California of its own selection, having an aggregate
capital, surplus and undivided profits, as shown by its last published report
of condition of not less than Two Million Dollars ($2,000,000) as custodian for
the Fund to be held under terms similar to those of this Agreement provided,
however, that Custodian shall not be required to make any such delivery or
payment until full payment shall have been made by the Fund of all liabilities
constituting a charge on or against Custodian, and until full payment shall
have been made to Custodian of all its fees, compensation, costs and expenses,
subject to the provisions of Section 10 of this Agreement. This Agreement may
not be assigned by Custodian without the consent of the Company, authorized or
approved by a resolution of its Board of Directors.
5
<PAGE> 6
13. Deposits of Securities in Securities Depositories
No provision of the Agreement shall be deemed to prevent the use
by Custodian of a central securities clearing agency or securities depository;
provided, however, that Custodian and the central securities clearing agency or
securities depository meet all applicable federal and state laws and
regulations (including all applicable requirements of the 1940 Act and the
rules and regulations promulgated thereunder) and the Board of Directors
approves by resolution the use of such central securities clearing agency or
securities depository.
14. Records
To the extent that Custodian in any capacity prepares or maintains
any records required to be maintained and preserved by the Company pursuant to
the provisions of the 1940 Act or the rules and regulations promulgated
thereunder, Custodian agrees to make any such records available to the Company
upon request and to preserve such records for the periods prescribed in Rule
31a-2 under the 1940 Act.
6
<PAGE> 7
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed as of the date above- written by their respective
representatives thereunto duly authorized.
STAGECOACH INC.
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
[NAME OF ENTITY]
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
7
<PAGE> 1
EX-99.B 9(a)
AMENDED AGENCY AGREEMENT
This agreement is made and entered into as of this 1st day of February,
1994 (the "Agreement"), by and between STAGECOACH INC., a registered
diversified management investment company incorporated in the State of Maryland
(the "Fund"), and Wells Fargo Bank, N.A., national association ("Agent"), for
transfer agency and dividend disbursing services as follows:
I. SERVICES.
A. Appointment of Agent. The Fund hereby appoints Agent as
its transfer and dividend disbursing agent for each of its investment
portfolios and Agent accepts such appointment.
B. Description of Services. As consideration for the
compensation hereinafter described in Section I(C), Agent agrees to provide the
Fund with the facilities and services described and set forth on Schedule A
attached hereto and incorporated herein by reference.
C. Compensation. As consideration for the services described
in Section I(B), above, the Fund shall pay to Agent an annual fee of (i) 0.10%
of the average net assets of the Asset Allocation Fund and the U.S. Treasury
Allocation Fund, (ii) 0.05% of the average net assets of the Money Market Fund,
and (iii) 0.03% of the average net assets of the National Tax-Free Intermediate
Income Fund, the National Tax-Free Money Market Fund, the California Tax- Free
Intermediate Income Fund, the California Tax-Free Short-Term Income Fund, the
California Tax-Free Money Market Fund, the S&P 500 Stock Fund, the Growth Stock
Fund, the Bond Index Fund, the Short-Intermediate Term Fund and the Growth and
Income Fund.
II. EXPENSES. The Fund shall promptly reimburse Agent for all
reasonable out-of-pocket expenses incurred by Agent in connection with the
performance of services under this Agreement, including, without limitation,
the following:
A. Postage, including first class mail insurance in connection
with mailing share certificates, express delivery, etc.;
B. Envelopes, check forms, continuous forms, forms for reports
and statements, stationery and other similar supplies;
C. Fees and costs of outside legal counsel employed by Agent;
D. Banking services, fees, and costs for wire transfers,
deposit accounts, etc.;
E. Expenses of fidelity and liability insurance and bonding;
<PAGE> 2
F. Fees and costs relating to the use, licensing, development
or implementation of data processing software used by or for the Fund;
G. Data transmission expenses;
H. Costs and microfilm/microfiche; and
I. Costs for telephone lines and equipment.
III. TERM. This Agreement shall become effective as of the date first
above written and shall continue until terminated pursuant to its provisions.
IV. INSURANCE. Agent agrees to procure and maintain such fidelity
bond coverage as may be required by the Investment Company Act of 1940 (the
"1940 Act"), in the amounts and with such deductibles as are required by or
permitted under the 1940 Act, as it may be amended from time to time.
V. REGISTRATION AND COMPLIANCE.
A. Agent represents that it is registered as a transfer agent
with the Securities and Exchange Commission ("SEC") pursuant to Section 17A of
the Securities Exchange Act of 1934 (the "Exchange Act") and the rules and
regulations promulgated thereunder, and Agent agrees to maintain said
registration current and comply with all of the requirements of the Exchange
Act, rules and regulations during the term of this Agreement.
B. The Fund represents that it is a diversified management
investment company registered with the SEC in accordance with the 1940 Act and
the rules and regulations promulgated thereunder. The Fund is authorized to
offer and sell its shares pursuant to the 1940 Act, the Securities Act of 1933
("1933 Act") and the rules and regulations promulgated thereunder. The Fund
will furnish Agent with a list of those jurisdictions in the United States and
elsewhere in which it is authorized to offer and sell its shares to the general
public and will maintain the currency of such list by amendment. The Fund
agrees promptly to advise Agent of any change in or limitation upon its
authority to carry on business as an investment company pursuant to the 1940
Act, the Exchange Act and the 1933 Act and the statutes, rules and regulations
of each and every jurisdiction to which it is subject.
VI. DOCUMENTATION. The Fund and Agent shall each supply to the other
upon request such documentation as is required by them to carry out their
respective obligations under this Agreement including, but not limited to,
articles or incorporation, bylaws, codes of ethics, registration statements,
permits, financial reports, third party audits, certificates of authority,
computer tapes and related items.
VII. PROPRIETARY INFORMATION. It is agreed that all records and
documents, excepting computer data processing programs and any related
documentation used or prepared by, or on behalf of Agent for the performance of
its services hereunder, are the property of the
2
<PAGE> 3
Fund and shall be open to audit or inspection by the Fund or its agents during
the normal business hours of Agent, shall be maintained in a manner designed to
preserve the confidentiality thereof and to comply with applicable federal and
state laws and regulations, and shall, in whole or any specified part, be
surrendered to the Fund or its duly authorized agents upon receipt by Agent of
reasonable notice of and request therefor.
VIII. INDEMNITY. The Fund shall indemnify and hold Agent harmless
against any losses, claims, damages, liabilities or expenses (including
reasonable attorney's fees and expenses) resulting from any claim, demand,
action or suit brought by any person other than the Fund (including a
shareholder naming the Fund as a party) and not resulting from Agent's bad
faith, willful misfeasance, reckless disregard of its obligations and duties,
gross negligence or breach of this Agreement, and arising out of, or in
connection with:
A. Agent's performance hereunder;
B. Any error or omission in any record (including but not
limited to magnetic tapes, computer printouts, hard copies and microfilm or
microfiche copies) delivered, or caused to be delivered, by the Fund to Agent
in connection with this Agreement;
C. Bad faith, willful misfeasance, reckless disregard of its
obligations and duties or negligence of the Fund, or Agent's acting upon any
instructions reasonably believed by it to have been properly executed or
communicated by any person duly authorized by the Fund;
D. Agent's acting in reliance upon advice given by counsel for
Agent or upon advice reasonably believed by it to have been given by counsel
for the Fund; or
E. Agent's acting in reliance upon any instrument reasonably
believed by it to have been genuine and signed, countersigned or executed by
the proper person(s) in accordance with the currently effective certificate(s)
of authority delivered to Agent by the Fund.
In the event that Agent requests the Fund to indemnify or
hold it harmless hereunder, agent shall use its best efforts to inform the Fund
of the relevant facts concerning the matter in question. Agent shall use
reasonable care to identify and promptly notify the Fund concerning any matter
which presents, or appears likely to present, a claim for indemnification
against the Fund.
The Fund shall have the election of defending Agent against
any claim which may be the subject of indemnification hereunder. In the event
the Fund so elects, it will so notify Agent and thereupon the Fund shall take
over defense of the claim, and (if so requested by the Fund) Agent shall incur
no further legal limit or other expenses related thereto for which it would be
entitled to indemnify hereunder; provided, however, that nothing herein
contained shall prevent Agent from retaining, at its own expense, counsel to
defend any claim. Except with the Fund's prior consent, Agent shall in no
event confess any claim or make any compromise in any matter in which the Fund
will be asked to indemnify or hold harmless hereunder.
3
<PAGE> 4
IX. LIABILITY
A. Damages. Agent shall not be liable to the Fund, or any
third party, for punitive, exemplary, indirect, special or consequential
damages (even if Agent has been advised of the possibility of such damages)
arising from its obligations and the services provided under this Agreement,
including but not limited to loss of profits, loss of use of the shareholder
accounting system, cost of capital and expenses of substitute facilities,
programs or services.
B. Force Majeure. Anything in this Agreement to the contrary
notwithstanding, Agent shall not be liable for delays or errors occurring by
reason of circumstances beyond its control, including but not limited to acts
or civil or military authority, national emergencies, work stoppage, fire,
flood, catastrophe, earthquake, acts of God, insurrection, war, riot, data
processing and communications downtime (where such downtime occurs for reasons
other than Agent's gross negligence or willful misconduct) or interruption of
power supply.
X. AMENDMENT. This Agreement and the Schedules attached hereto and
made a part hereof may be amended at any time, with or without shareholder
approval (except as otherwise required by law), in writing signed by each of
the parties hereto. Any change in the Fund's registration statements or other
documents of compliance or in the forms relating to any plan, program or
service offered by its current prospectuses which would require a change in
Agent's obligations hereunder shall be subject to Agent's approval, which
approval shall not be unreasonably withheld.
XI. TERMINATION. This Agreement may be terminated by either party
without cause upon one hundred twenty (120) days prior written notice to the
other, and at any time for cause in the event that such cause remains
unremedied for more than thirty (30) days after receipt by the other party of
written specification of such cause.
In the event the Fund designates a successor to any of Agent's
obligations hereunder, Agent shall, at the expense and pursuant to the
direction of the Fund, transfer promptly to such successor all relevant books,
records and other data of the Fund in the possession or under the control of
Agent.
XII. SEVERABILITY. If any clause or provision of this Agreement is
determined to be illegal, invalid or unenforceable under present or future laws
effective during the term hereof, then such clause or provision shall be
considered severed herefrom and the remainder of this Agreement shall continue
in full force and effect.
XIII. APPLICABLE LAW. This Agreement shall be subject to and construed
in accordance with the laws of the State of California.
XIV. ENTIRE AGREEMENT. Except as otherwise provided herein, this
Agreement constitutes the entire and complete agreement of the parties hereto
relating to the subject matter hereof and supersedes and merges all prior
contracts and discussions between the parties.
4
<PAGE> 5
XV. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same Agreement and
each of which shall be deemed an original.
STAGECOACH INC. WELLS FARGO BANK, N.A.
By: /s/ Richard H. Blank, Jr. By: /s/ Robert Chlebowski
------------------------------ ------------------------------
Name: Richard H. Blank Name: Robert Chlebowski
--------------------------- ----------------------------
Title: Chief Operating Officer Title: Senior Vice President
-------------------------- ---------------------------
By: /s/ Henry J. Cavigli
------------------------------
Name: Henry J. Cavigli
----------------------------
Title: Vice President
---------------------------
5
<PAGE> 6
SCHEDULE A
SCHEDULE OF SERVICES
1. Share Transfer and Dividend Disbursing Services
2. Maintenance of shareholder accounts, including processing of new
accounts.
3. Posting address changes and other file maintenance for shareholder
accounts.
4. Posting all transactions to the shareholder file, including:
- Direct purchase
- Wire order purchases
- Direct redemptions
- Telephone redemption
- Wire order redemption
- Direct exchanges
- Dividend payments
- Dividend reinvestments
- Transfers
5. Prepare daily reconciliations of shareholder processing to money
movement instructions.
6. Issuing all checks and stopping and replacing checks.
7. Performing certain of the Fund's other mailings, including:
- Dividend and capital gain distributions
- 1099/year-end shareholder reporting
- Daily confirmations
- Furnish certified list of shareholders (hard copy of
microfilm)
8. Maintaining and retrieving all required past history for
shareholders and provide research capabilities as follows:
- Daily monitoring of all processing activity to verify
back-up documentation
- Provide exception reports
- Microfilming
- Storage, retrieval and archive of records in accordance
with Rules 31a-1, 31a-2, and 31a-3 under the 1940 Act.
9. Reporting and remitting as necessary for state escheat
requirements.
A-1
<PAGE> 1
EX-99.B 9(b)
FORM OF
AMENDMENT TO THE AMENDED AGENCY AGREEMENT
STAGECOACH INC.
This Amendment, dated as of December ___, 1995 (the "Amendment") is
entered into between STAGECOACH INC., an open-end investment company (the
"Company"), on behalf of its portfolios (collectively, the "Funds"), and WELLS
FARGO BANK, N.A. ("WELLS FARGO").
WHEREAS, the Company, on behalf of the Funds, and Wells Fargo have
entered into an Amended Agency Agreement dated February 1, 1994 (the "Agency
Agreement") under which the Company appointed Wells Fargo to act as transfer
and dividend disbursing agent for each of its Funds.
NOW THEREFORE, the parties hereto, in consideration of the mutual
promises in the Agency Agreement and contained herein and intending to be
legally bound, hereby agree as follows:
1. The following paragraph replaces Article I., Paragraph C. of the
Agency Agreement:
C. Compensation. As consideration for the services described in
Section I(B), above, the Fund shall pay to Agent an annual fee of (i)
0.10% of the average net assets of the Asset Allocation Fund, the U.S.
Treasury Allocation Fund, the LifePath 2000 Series, the LifePath 2010
Series, the LifePath 2020 Series, the LifePath 2030 Series and the
LifePath 2040 Series, (ii) 0.05% of the average net assets of the
Money Market Fund, and (iii) 0.03% of the average net assets of the
National Tax-Free Intermediate Income Fund, the National Tax-Free
Money Market Mutual Fund, the California Tax-Free Intermediate Income
Fund, the California Tax-Free Short-Term Income Fund, the California
Tax-Free Money Market Fund, the S&P 500 Stock Fund, the Growth Stock
Fund, the Bond Index Fund, the Short-Intermediate Term Fund and the
Growth and Income Fund.
Except to the extent amended by this Amendment, the Agency Agreement
shall remain unchanged and in full force and effect, and is hereby ratified and
confirmed in all respects as supplemented hereby.
1
<PAGE> 2
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
the Agency Agreement to be executed as of the date first above-written by their
respective representatives thereunto duly authorized.
Executed in several counterparts, each of which is an original.
STAGECOACH INC.
By:
------------------------------
Name:
-------------------------
Title:
------------------------
WELLS FARGO BANK, N.A..
By:
------------------------------
Name:
-------------------------
Title:
------------------------
2
<PAGE> 3
SCHEDULE I
Asset Allocation Fund
U.S. Treasury Allocation Fund
LifePath 2000 Series
LifePath 2010 Series
LifePath 2020 Series
LifePath 2030 Series
LifePath 2040 Series
3
<PAGE> 1
EX-99.B 9(d)
STAGECOACH INC.
SHAREHOLDER SERVICING PLAN
Introduction: It has been proposed that the above-captioned
investment company (the "Company") reapprove a Shareholder Servicing Plan (the
"Plan") with respect to its series named on Schedule 1 hereto, as such Schedule
may be revised from time to time (each, a "Fund"), under which the Company
would pay certain financial institutions, securities dealers and other industry
professionals (collectively, "Shareholder Servicing Agents") for providing
services to Fund shareholders. The Plan is not to be adopted pursuant to Rule
12b-1 under the Investment Company Act of 1940, as amended (the "Act"), and the
fee under the Plan is intended to be a "service fee" as defined in Article III,
Section 26, of the NASD Rules of Fair Practice.
The Company's Board, in considering whether the Company should
implement a written plan, has requested and evaluated such information as it
deemed necessary to an informed determination as to whether a written plan
should be implemented and has considered such pertinent factors as it deemed
necessary to form the basis for a decision to use Company assets for such
purposes.
In voting to approve the implementation of such a plan, the Board
has concluded, in the exercise of its reasonable business judgment and in light
of applicable fiduciary duties, that there is a reasonable likelihood that the
plan set forth below will benefit the Company and its shareholders.
The Plan: The material aspects of this Plan are as follows:
1. The Company is permitted to pay to one or more Shareholder
Servicing Agents a maximum fee at the annual rate set forth opposite each
Fund's name on Schedule 1 hereto, based upon the value of such Fund's average
daily net assets, in respect of the provision of personal services to
shareholders of such Fund and/or the maintenance of shareholder accounts. The
Board shall determine the amounts to be paid to Shareholder Servicing Agents
and the basis on which such payments will be made. Payments to a Shareholder
Servicing Agent are subject to compliance by the Shareholder Servicing Agent
with the terms of any related Plan agreement with the Company.
2. For the purpose of determining the fees payable under this
Plan, the value of the net assets of each Fund shall be computed in the manner
specified in the Company's Restated Articles of Incorporation for the
computation of the value of the Fund's net assets.
3. The Board shall be provided, at least quarterly, with a
written report of all amounts expended pursuant to this Plan. The report shall
state the purpose for which the amounts were expended.
-1-
<PAGE> 2
4. This Plan will become effective immediately upon approval
by a majority of the Board members, including a majority of the Board members
who are not "interested persons" (as defined in the Act) of the Company and
have no direct or indirect financial interest in the operation of this Plan or
in any agreements entered into in connection with this Plan, pursuant to a vote
cast in person at a meeting called for the purpose of voting on the approval of
this Plan.
5. This Plan shall continue for a period of one year from its
effective date, unless earlier terminated in accordance with its terms, and
thereafter shall continue automatically for successive annual periods, provided
such continuance is approved at least annually in the manner provided in
paragraph 4 hereof.
6. This Plan may be amended at any time by the Board, provided
that any material amendments of the terms of this Plan shall become effective
only upon approval as provided in paragraph 4 hereof.
7. This Plan is terminable without penalty at any time by vote
of a majority of the Board members who are not "interested persons" (as defined
in the Act) of the Company and have no direct or indirect financial interest in
the operation of this Plan or in any agreements entered into in connection with
this Plan.
8. The obligations hereunder and under any related Plan
agreement shall only be binding upon the assets and property of the relevant
Fund, as provided for in the Company's Articles of Incorporation and shall not
be binding upon any Director, officer or shareholder of the Company or Fund
individually.
Dated: December ___, 1995
-2-
<PAGE> 3
SCHEDULE 1
<TABLE>
<CAPTION>
Monthly Fee at
Annual Rate of
Name of Average Daily
Fund Values of Shares
- -------- ----------------
<S> <C>
LifePath 2000 Fund .20 of 1%
LifePath 2010 Fund .20 of 1%
LifePath 2020 Fund .20 of 1%
LifePath 2030 Fund .20 of 1%
LifePath 2040 Fund .20 of 1%
</TABLE>
-3-
<PAGE> 4
FORM OF SHAREHOLDER SERVICING AGREEMENT
Stagecoach Inc.
111 Center Street
Little Rock, Arkansas 72201
Gentlemen:
We wish to enter into this Shareholder Servicing Agreement with
you concerning the provision of certain services to shareholders of each series
named on Schedule 1 hereto, as such Schedule may be revised from time to time
(each, a "Fund"), of Stagecoach Inc. (the "Company"). The terms and conditions
of this Agreement are as follows:
1. We agree to provide certain services to the shareholders of each Fund
which services may include providing personal services relating to shareholder
accounts, such as answering shareholder inquiries regarding the Fund and
providing reports and other information, and providing services related to the
maintenance of shareholder accounts.
2. We will act solely as agent for, upon the order of, and for the account
of, the shareholders for whom we are providing the services described herein.
3. We will provide such office space and equipment, telephone facilities and
personnel (which may be any part of the space, equipment and facilities
currently used in our business, or any personnel employed by us) as may be
reasonably necessary or beneficial in order to provide such services
contemplated hereunder.
4. We will not nor will any of our officers, employees or agents make any
representations concerning the Company or the Funds except those contained in
the Funds' then-current prospectus and statement of additional information,
copies of which will be supplied to us by the Company, or in such supplemental
literature or advertising as may be authorized by the Company in writing.
5. For all purposes of this Agreement, we will be deemed to be an
independent contractor, and will have no authority to act as agent for the
Company in any manner or in any respect. We agree and do release, indemnify
and hold the Company harmless from and against any and all direct or indirect
liabilities or losses resulting from requests, directions, actions or inactions
of or by us or our officers, employees or agents regarding our responsibilities
hereunder for the purchase, redemption, transfer, or registration of Fund
shares by or on behalf of the holders of such shares. We and our employees,
upon request, will be available during normal business hours to consult with
the Company or its designees concerning the performance of our responsibilities
under this Agreement.
<PAGE> 5
6. In consideration of the services and facilities provided by us hereunder,
the Company agrees to pay us and we will accept as full payment therefor, a fee
at the annual rate set forth opposite each Fund's name on Schedule 1 hereto,
based on the average daily net asset value of the outstanding Fund shares as to
which we provide the services described herein, which fee will be computed
daily and payable monthly. For purposes of determining the fees payable under
this Section 6, the average daily net asset value of such outstanding shares
will be computed in the manner specified in the Company's registration
statement (as the same is in effect from time to time) in connection with the
computation of the net asset value of the relevant Funds for purposes of
purchases and redemptions. The Company, in its discretion and without notice,
may suspend or withdraw the sale of Fund shares.
7. Any person authorized to direct the disposition of monies paid or payable
by the Company pursuant to this Agreement will provide to the Company's Board,
at least quarterly, a written report of the amounts so expended and the
purposes for which such expenditures were made. In addition, we will furnish
the Company or its designees with such information as a Fund or its designees
may reasonably request (including, without limitation, periodic certifications
confirming the provision of the services described herein), and will otherwise
cooperate with the Company or its designees (including, without limitation, any
auditors designated by the Company), in connection with the preparation of
reports to the Company's Board concerning this Agreement and the monies paid or
payable pursuant hereto, as well as any other reports or filings that may be
required by law. We will promptly report to the Company any potential or
existing conflicts with respect to the investments of our customers in the
Funds.
8. The Company may enter into some similar Shareholder Servicing Agreements
with any other person or persons without our consent.
9. We represent, warrant and agree that: (i) in no event will any of the
services provided by us hereunder be primarily intended to result in the sale
of any shares issued by the Company; (ii) the compensation payable to us
hereunder, together with any other compensation payable to us by our clients in
connection with the investment of their assets in Fund shares, will be
disclosed by us to our clients, will be authorized by our clients and will not
result in an excessive or unreasonable fee to us; and (iii) we will not engage
in activities pursuant to this Agreement which constitute acting as a broker or
dealer under state law.
10. This Agreement will become effective on the date a fully executed copy of
this Agreement is received by the Company or its designee and accepted and
agreed to. Unless sooner terminated, this Agreement will continue until the
first anniversary of its effective date and thereafter will continue
automatically for successive annual periods ending on the anniversary of its
effective date, provided such continuance is specifically approved at least
annually by the Company in the manner described in Section 13.
<PAGE> 6
11. All notices and other communications will be duly given if mailed,
telegraphed, telexed or transmitted by similar telecommunications device to the
appropriate address shown above, or to such other address as either party shall
so provide the other.
12. This Agreement shall be construed in accordance with the internal laws of
the State of California without giving effect to principles of conflict of
interest.
13. This Agreement is subject to annual approval by vote of a majority of (i)
the Company's Board and (ii) the Directors who are not "interested persons" (as
defined in the Investment Company Act of 1940, as amended) of the Company or
us, by vote cast in person at a meeting called for the purpose of voting such
approval. This Agreement is terminable without penalty, on 10 days' notice, by
the Company's Board, or, on not less than 90 days' notice, by us. This
Agreement will terminate automatically in the event of its assignment (as
defined in the Act).
14. This contract has been executed on behalf of the Company by the
undersigned officer of the Company in his capacity as an officer of the
Company. The obligations of this contract shall only be binding upon the
assets and property of the relevant Fund, as provided for in the Company's
Articles of Incorporation, and shall not be binding upon any Director, officer
or shareholder of the Company or Fund individually.
<PAGE> 7
If you agree to be legally bound by the provisions of this
Agreement, please sign a copy of this letter where indicated below and promptly
return it to us.
Very truly yours,
WELLS FARGO BANK, N.A.
By: _________________________________
Name: _______________________________
Title: ______________________________
By: _________________________________
Name: _______________________________
Title: ______________________________
Accepted and agreed to:
STAGECOACH INC.
By: _________________________________
Name: _______________________________
Title: ______________________________
Dated: __________________, 199_
<PAGE> 8
SCHEDULE 1
<TABLE>
<CAPTION>
Annual Fee as a
Percentage of Average
Name of Fund Daily Net Assets
- -------------------- ---------------------
<S> <C> <C>
LifePath 2000 Fund .20 of 1%
LifePath 2010 Fund .20 of 1%
LifePath 2020 Fund .20 of 1%
LifePath 2030 Fund .20 of 1%
LifePath 2040 Fund .20 of 1%
</TABLE>
<PAGE> 1
EX-99.B 9(e)
CROSS INDEMNIFICATION AGREEMENT
THIS AGREEMENT is made as of the 30 day of December, 1994, by and
between Stagecoach Inc. (formerly WellsFunds Inc.), a Maryland corporation, and
Stagecoach Funds, Inc. ("Stagecoach Funds"), also a Maryland corporation.
WHEREAS, Stagecoach Inc. is an open-end management investment company
registered as such under the Investment Company Act of 1940 (the "1940 Act"),
currently consisting of thirteen operating investment portfolios, but which may
from time to time consist of a greater or lesser number of investment
portfolios; and
WHEREAS, Stagecoach Funds is an open-end management investment company
registered as such under the 1940 Act, currently consisting of twelve operating
investment portfolios, but which may form time to time consist of a greater or
lesser number of investment portfolios; and
WHEREAS, Stagecoach Inc. and Stagecoach Funds plan to offer on a
continuous basis, shares of common stock in their investment portfolios
("Securities") in one or more combined prospectuses (each a "Prospectus",
collectively "Prospectuses") and/or preliminary prospectuses (each a
"Preliminary Prospectus", collectively, "Preliminary Prospectuses") (any such
offering of Securities to be herinafter referred to as a "Joint Offering") and
plan on filing, from time to time, such combined prospectuses and other
materials with the Securities and Exchange Commission ("SEC") (any such filing
with the SEC to be referred to herein as a "Registration Statement");
NOW THEREFORE, Stagecoach Inc. and Stagecoach Funds hereby agree as
follows:
1. (a) Stagecoach Inc. will indemnify and hold harmless Stagecoach Funds
against any losses, claims, damages or liabilities to which Stagecoach
Funds may become subject, under the Securities Act of 1933 (the "1933
Act"), the 1940 Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Prospectus, any Preliminary Prospectus, any Registration
Statement, any other prospectuses relating to the Securities, or any
amendments or supplements to the foregoing (hereinafter referred to
collectively as the "Offering Documents"), or arise out of or are based
upon the omission or alleged omission to state in the Offering Documents a
material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in the Offering Documents in reliance
upon and in conformity with written information furnished to Stagecoach
Funds by Stagecoach Inc. expressly for use therein; and will reimburse
Stagecoach Funds for any legal or other expenses reasonably incurred by
Stagecoach funds in connection with investigating or defending any such
action or claim; provided, however, that Stagecoach Inc. shall not be
liable in any such case to the extent that any
1
<PAGE> 2
such loss, claim, damage, or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged
omission made in the Offering Documents in reliance upon and in conformity
with written information furnished to Stagecoach Inc. by Stagecoach Funds
expressly for use in the Offering Documents.
(b) Stagecoach Funds will indemnify and hold harmless Stagecoach Inc.
against any losses, claims, damages or liabilities to which Stagecoach Inc.
may become subject under the 1933 Act, 1940 Act, or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect hereof)
arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in the Offering Documents or arise
out of or are based upon the omission or alleged omission to state in the
Offering Documents therein a material fact required to be stated or
necessary to make the statements therein not misleading, in each case to
the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in the Offering
Documents in reliance upon and in conformity with written information
furnished to Stagecoach Inc. by Stagecoach Funds expressly for use therein;
and will reimburse Stagecoach Inc. for any legal or other expenses
reasonably incurred by Stagecoach Inc. in connection with investigating or
defending any such action or claim, provided, however, that Stagecoach
Funds shall not be liable in any such case to the extent that any such
loss, claim, damage, or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made
in the Offering Documents in reliance upon and in conformity with written
information furnished to Stagecoach Funds by Stagecoach Inc. expressly for
use in the Offering Documents.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission to so notify the
indemnifying party shall not relieve the indemnifying party from any
liability which it may have to any indemnified party otherwise than under
subsection (a) or (b) above. In any action brought against any indemnified
party the indemnifying party shall be entitled to participate therein and,
to the extent that it shall wish, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party, and, after
notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not
be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof
other than reasonable costs of investigation.
2. This agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
2
<PAGE> 3
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed by their authorized officers designated below as of the day and
year first written above.
STAGECOACH INC.
By: /s/ R. Greg Feltus
------------------------
R. Greg Feltus
Chairman and President of
the Board of Directors
STAGECOACH FUNDS, INC.
By: /s/ Richard H. Blank, Jr.
-------------------------
Richard H. Blank, Jr.
Chief Operating Officer,
Secretary and Treasurer
3
<PAGE> 1
EX-99.B 10
[MORRISON & FOERSTER LETTERHEAD]
DIRECT DIAL NUMBER
December 1, 1995
(202) 887-1500
Stagecoach Inc.
111 Center Street
Little Rock, Arkansas 72201
Re: Shares of Common Stock of Stagecoach Inc.
Ladies/Gentlemen:
We refer to Post-Effective Amendment No. 11 and Amendment No. 15 to the
Registration Statement on Form N-1A (SEC File Nos. 33-54126 and 811-7332) (the
"Registration Statement") of Stegecoach Inc. (the "Company")
relating to the registration of an indefinite number of shares of common stock
of the company (collectively, the "Shares").
We have been requested by the Company to furnish this opinion as
Exhibit 10 to the Registration Statement.
We have examined such records, documents, instruments, certificates of
public officials and of the Company, made such inquiries of the Company, and
examined such questions of law as we have deemed necessary for the purpose of
rendering the opinion set forth herein. We have assumed the genuineness of all
signatures and the authenticity of all items submitted to us as originals and
the conformity with originals of all items submitted to us as copies.
Based upon and subject to the forgoing, we are of the opinion that:
The issuance and sale of the Shares by the Company have been duly and
validly authorized by all appropriate action, and upon delivery thereof and
payment therefor in accordance with the Registration Statement, the Shares will
be validly issued, fully paid and nonassessable by the Company.
We consent to the inclusion of this opinion as an exhibit to the
Registration Statement.
In addition, we hereby consent to the use of our name and to the
reference to our firm under the caption "Legal Counsel" in the Prospectus and
the description of advice rendered by our firm under the heading "Counsel" in
the Statement of Additional Information, both of which are included as part of
the Registration Statement.
Very truly yours,
/s/ MORRISON & FOERSTER
-----------------------
Morrison & Foerster
<PAGE> 1
EX-99.B 11(a)
INDEPENDENT AUDITORS' CONSENT
The Board of Directors and Shareholders
Stagecoach Inc.:
We consent to the inclusion in the Stagecoach Inc. Post-Effective Amendment No.
11 to the Registration Statement Number 33-54126 on Form N-1A under the
Securities Act of 1933 and Amendment No. 15 to the Registration Statement
Number 811-7332 on Form N-1A under the Investment Company Act of 1940 of our
report dated April 20, 1995, on the financial statements and financial
highlights of Stagecoach Trust (comprising, respectively, LifePath 2000 Fund,
LifePath 2010 Fund, LifePath 2020 Fund, LifePath 2030 Fund and LifePath 2040
Fund) for the year ended February 28, 1995, which report has been included in
the Statement of Additional Information.
We also consent to the incorporation by reference of our report dated April 20,
1995, on the financial statements and financial highlights of Stagecoach Inc.
(comprising, respectively, Asset Allocation Fund, Bond Index Fund, Growth Stock
Fund, Money Market Fund, S&P 500 Stock Fund, Short-Intermediate Term Fund and
U.S. Treasury Allocation Fund) for the year ended February 28, 1995, which
report has been incorporated by reference in the Statement of Additional
Information.
We also consent to the incorporation by reference of our report dated
April 14, 1995, on the financial statements and financial highlights of
Managed Series Investment Trust (comprising, respectively, Growth Stock Master
Portfolio and Short-Intermediate Term Master Portfolio) for the year ended
February 28, 1995, which report has been incorporated by reference in the
Statement of Additional Information.
We also consent to the reference to our firm under the heading "Financial
Highlights" in the prospectus, and "Independent Auditors" and "Financial
Information" in the Statement of Additional Information incorporated by
reference into the prospectus.
/s/ KPMG PEAT MARWICK LLP
San Francisco, California
November 30, 1995
<PAGE> 1
EX-99.B 11(b)
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the inclusion in Post-Effective Amendment No. 11 to the
Registration Statement on Form N-1A (file No. 33-54126) of Stagecoach Inc. for
its LifePath 2000 Fund, LifePath 2010, Fund, LifePath 2020 Fund, LifePath 2030
Fund, and LifePath 2040 Fund of our report dated April 20, 1995 on our audit of
the financial statements and financial highlights for LifePath 2000 Master
Portfolio, LifePath 2010 Master Portfolio, LifePath 2020 Master Portfolio,
LifePath 2030 Master Portfolio, and LifePath 2040 Master Portfolio (each, a
series of Master Investment Portfolio) for the periods indicated thereon.
/s/ COOPERS & LYBRAND L.L.P.
San Francisco, California
November 30, 1995
<PAGE> 1
EX-99.B 15(b)
DISTRIBUTION AND SERVICES PLAN
NATIONAL TAX-FREE INTERMEDIATE INCOME FUND
A SERIES OF
STAGECOACH INC.
WHEREAS, Stagecoach Inc. (the "Company") is an open-end management
investment company and is registered as such under the Investment Company Act
of 1940, as amended (the "Act"); and
WHEREAS, the Company desires to adopt a Distribution and Services
Plan (the "Plan") pursuant to Rule 12b-1 under the Act on behalf of the
National Tax-Free Intermediate Income Fund (the "Fund"), and the Board of
Directors has determined that there is a reasonable likelihood that the Plan
will benefit the Fund and its shareholders;
NOW, THEREFORE, the Company hereby adopts the Plan in accordance
with Rule 12b-1 under the Act on the following terms and conditions:
Section 1. Pursuant to the Plan, the Fund may defray all or part
of the actual cost of preparing and printing prospectuses and other promotional
materials and of providing such prospectuses and other promotional materials to
prospective shareholders of the Fund and may compensate personnel of the
distributor or reimburse the distributor for compensation paid to selling
agents for distribution-related or sales support services and may pay for any
other activities primarily intended to result in the sale of shares of the
Fund. Payments also may be used to compensate or reimburse servicing agents
for shareholder liaison services provided by entities that are dealers of
record or which have a servicing relationship with the beneficial owners of
shares of the Fund under a servicing agreement in substantially the form
approved by the Board of Directors. Total payments under the Plan may not
exceed 0.10% of the average daily net assets of the Fund on an annual basis.
Section 2. The Plan shall be effective on the date upon which it
is approved by "vote of a majority of the outstanding voting securities" (as
defined below) of the shares of the Fund and a majority of the Directors of the
Company, including a majority of the Qualified Directors (as defined below),
pursuant to a vote cast in person at a meeting (or meetings) called for the
purpose of voting on the approval of the Plan.
Section 3. The Plan (and each related agreement) will, unless
earlier terminated in accordance with its terms, remain in effect from year to
year after the first anniversary of its effectiveness if such continuance is
specifically approved at least annually by vote of a majority of both (a) the
Directors of the Company and (b) the Qualified Directors, cast in person at a
meeting (or meetings) called for the purpose of voting on such approval.
Section 4. The Company shall provide to the Company's Board of
Directors and the Directors shall review, at least quarterly, a written report
of the amounts expended by the
1
<PAGE> 2
Company under the Plan and each related agreement and the purposes for which
such expenditures were made.
Section 5. The Plan may be terminated at any time by vote of a
majority of the Qualified Directors or by vote of a majority of the outstanding
voting securities of the Fund.
Section 6. All agreements related to the Plan shall be in writing
and shall be approved by vote of a majority of both (a) the Directors of the
Company and (b) the Qualified Directors, cast in person at a meeting called for
the purpose of voting on such approval. Any agreement related to the Plan
shall provide:
A. That such Agreement may be terminated at any time, without payment
of any penalty, by vote of a majority of the Qualified Directors or by vote of
a majority of the outstanding voting securities of the Fund, on not more than
60 days' written notice to any other party to the agreement; and
B. That such agreement shall terminate automatically in the event of
its "assignment" (as defined below).
Section 7. The Plan may not be amended to increase materially the
amount that may be expended by the Fund pursuant to the Plan without the
approval by a vote of a majority of the outstanding voting securities of the
Fund, and no material amendment to the Plan shall be made unless approved by
vote of a majority of both (a) the Directors of the Company and (b) the
Qualified Directors, cast in person at a meeting (or meetings) called for the
purpose of voting on such approval.
Section 8. While the Plan is in effect, the selection and
nomination of each Director who is not an "interested person" (as defined
below) of the Company shall be committed to the discretion of the Directors who
are not interested persons.
Section 9. The Company shall preserve copies of the Plan, each
related agreement and each report made pursuant to Section 4 hereof, for a
period of not less than six years from the date of the Plan, such agreement or
such report, as the case may be, the first two years in an easily accessible
place.
Section 10. As used in the Plan, (a) the terms "assignment,"
"interested person" and "vote of a majority of the outstanding voting
securities" shall have the respective meanings specified in the Act and the
rules and regulations thereunder, subject to such exemption as may be granted
by the Securities and Exchange Commission and (b) the term "Qualified
Directors" shall mean the Directors of the Company who are not interested
persons of the Company and have no direct or indirect financial interest in the
operation of the Plan or in any agreements related to the Plan.
Dated: October 26, 1993
2
<PAGE> 1
EX-99.B 15(c)
DISTRIBUTION AND SERVICES PLAN
NATIONAL TAX-FREE MONEY MARKET FUND
A SERIES OF
STAGECOACH INC.
WHEREAS, Stagecoach Inc. (the "Company") is an open-end management
investment company and is registered as such under the Investment Company Act
of 1940, as amended (the "Act"); and
WHEREAS, the Company desires to adopt a Distribution and Services
Plan (the "Plan") pursuant to Rule 12b-1 under the Act on behalf of the
National Tax-Free Money Market Fund (the "Fund"), and the Board of Directors
has determined that there is a reasonable likelihood that the Plan will benefit
the Fund and its shareholders;
NOW, THEREFORE, the Company hereby adopts the Plan in accordance
with Rule 12b-1 under the Act on the following terms and conditions:
Section 1. Pursuant to the Plan, the Fund may defray all or part
of the actual cost of preparing and printing prospectuses and other promotional
materials and of providing such prospectuses and other promotional materials to
prospective shareholders of the Fund and may compensate personnel of the
distributor or reimburse the distributor for compensation paid to selling
agents for distribution-related or sales support services and may pay for any
other activities primarily intended to result in the sale of shares of the
Fund. Payments also may be used to compensate or reimburse servicing agents
for shareholder liaison services provided by entities that are dealers of
record or which have a servicing relationship with the beneficial owners of
shares of the Fund under a servicing agreement in substantially the form
approved by the Board of Directors. Total payments under the Plan may not
exceed 0.10% of the average daily net assets of the Fund on an annual basis.
Section 2. The Plan shall be effective on the date upon which it
is approved by "vote of a majority of the outstanding voting securities" (as
defined below) of the shares of the Fund and a majority of the Directors of the
Company, including a majority of the Qualified Directors (as defined below),
pursuant to a vote cast in person at a meeting (or meetings) called for the
purpose of voting on the approval of the Plan.
Section 3. The Plan (and each related agreement) will, unless
earlier terminated in accordance with its terms, remain in effect from year to
year after the first anniversary of its effectiveness if such continuance is
specifically approved at least annually by vote of a majority of both (a) the
Directors of the Company and (b) the Qualified Directors, cast in person at a
meeting (or meetings) called for the purpose of voting on such approval.
Section 4. The Company shall provide to the Company's Board of
Directors and the Directors shall review, at least quarterly, a written report
of the amounts expended by the
1
<PAGE> 2
Company under the Plan and each related agreement and the purposes for which
such expenditures were made.
Section 5. The Plan may be terminated at any time by vote of a
majority of the Qualified Directors or by vote of a majority of the outstanding
voting securities of the Fund.
Section 6. All agreements related to the Plan shall be in writing
and shall be approved by vote of a majority of both (a) the Directors of the
Company and (b) the Qualified Directors, cast in person at a meeting called for
the purpose of voting on such approval. Any agreement related to the Plan
shall provide:
A. That such Agreement may be terminated at any time,
without payment of any penalty, by vote of a majority of the Qualified
Directors or by vote of a majority of the outstanding voting securities
of the Fund, on not more than 60 days' written notice to any other party
to the agreement; and
B. That such agreement shall terminate automatically in the
event of its "assignment" (as defined below).
Section 7. The Plan may not be amended to increase materially the
amount that may be expended by the Fund pursuant to the Plan without the
approval by a vote of a majority of the outstanding voting securities of the
Fund, and no material amendment to the Plan shall be made unless approved by
vote of a majority of both (a) the Directors of the Company and (b) the
Qualified Directors, cast in person at a meeting (or meetings) called for the
purpose of voting on such approval.
Section 8. While the Plan is in effect, the selection and
nomination of each Director who is not an "interested person" (as defined
below) of the Company shall be committed to the discretion of the Directors who
are not interested persons.
Section 9. The Company shall preserve copies of the Plan, each
related agreement and each report made pursuant to Section 4 hereof, for a
period of not less than six years from the date of the Plan, such agreement or
such report, as the case may be, the first two years in an easily accessible
place.
Section 10. As used in the Plan, (a) the terms "assignment,"
"interested person" and "vote of a majority of the outstanding voting
securities" shall have the respective meanings specified in the Act and the
rules and regulations thereunder, subject to such exemption as may be granted
by the Securities and Exchange Commission and (b) the term "Qualified
Directors" shall mean the Directors of the Company who are not interested
persons of the Company and have no direct or indirect financial interest in the
operation of the Plan or in any agreements related to the Plan.
Dated: October 26, 1993
2
<PAGE> 1
EX-99.B 15(d)
DISTRIBUTION AND SERVICES PLAN
CALIFORNIA TAX-FREE INTERMEDIATE INCOME FUND
A SERIES OF
STAGECOACH INC.
WHEREAS, Stagecoach Inc. (the "Company") is an open-end management
investment company and is registered as such under the Investment Company Act
of 1940, as amended (the "Act"); and
WHEREAS, the Company desires to adopt a Distribution and Services
Plan (the "Plan") pursuant to Rule 12b-1 under the Act on behalf of the
California Tax-Free Intermediate Bond Fund (the "Fund"), and the Board of
Directors has determined that there is a reasonable likelihood that the Plan
will benefit the Fund and its shareholders;
NOW, THEREFORE, the Company hereby adopts the Plan in accordance
with Rule 12b-1 under the Act on the following terms and conditions:
Section 1. Pursuant to the Plan, the Fund may defray all or part
of the actual cost of preparing and printing prospectuses and other promotional
materials and of providing such prospectuses and other promotional materials to
prospective shareholders of the Fund and may compensate personnel of the
distributor or reimburse the distributor for compensation paid to selling
agents for distribution-related or sales support services and may pay for any
other activities primarily intended to result in the sale of shares of the
Fund. Payments also may be used to compensate or reimburse servicing agents
for shareholder liaison services provided by entities that are dealers of
record or which have a servicing relationship with the beneficial owners of
shares of the Fund under a servicing agreement in substantially the form
approved by the Board of Directors. Total payments under the Plan may not
exceed 0.10% of the average daily net assets of the Fund on an annual basis.
Section 2. The Plan shall be effective on the date upon which it
is approved by "vote of a majority of the outstanding voting securities" (as
defined below) of the shares of the Fund and a majority of the Directors of the
Company, including a majority of the Qualified Directors (as defined below),
pursuant to a vote cast in person at a meeting (or meetings) called for the
purpose of voting on the approval of the Plan.
Section 3. The Plan (and each related agreement) will, unless
earlier terminated in accordance with its terms, remain in effect from year to
year after the first anniversary of its effectiveness if such continuance is
specifically approved at least annually by vote of a majority of both (a) the
Directors of the Company and (b) the Qualified Directors, cast in person at a
meeting (or meetings) called for the purpose of voting on such approval.
Section 4. The Company shall provide to the Company's Board of
Directors and the Directors shall review, at least quarterly, a written report
of the amounts expended by the
1
<PAGE> 2
Company under the Plan and each related agreement and the purposes for which
such expenditures were made.
Section 5. The Plan may be terminated at any time by vote of a
majority of the Qualified Directors or by vote of a majority of the outstanding
voting securities of the Fund.
Section 6. All agreements related to the Plan shall be in writing
and shall be approved by vote of a majority of both (a) the Directors of the
Company and (b) the Qualified Directors, cast in person at a meeting called for
the purpose of voting on such approval. Any agreement related to the Plan
shall provide:
A. That such Agreement may be terminated at any time,
without payment of any penalty, by vote of a majority of the Qualified
Directors or by vote of a majority of the outstanding voting securities
of the Fund, on not more than 60 days' written notice to any other party
to the agreement; and
B. That such agreement shall terminate automatically in the
event of its "assignment" (as defined below).
Section 7. The Plan may not be amended to increase materially the
amount that may be expended by the Fund pursuant to the Plan without the
approval by a vote of a majority of the outstanding voting securities of the
Fund, and no material amendment to the Plan shall be made unless approved by
vote of a majority of both (a) the Directors of the Company and (b) the
Qualified Directors, cast in person at a meeting (or meetings) called for the
purpose of voting on such approval.
Section 8. While the Plan is in effect, the selection and
nomination of each Director who is not an "interested person" (as defined
below) of the Company shall be committed to the discretion of the Directors who
are not interested persons.
Section 9. The Company shall preserve copies of the Plan, each
related agreement and each report made pursuant to Section 4 hereof, for a
period of not less than six years from the date of the Plan, such agreement or
such report, as the case may be, the first two years in an easily accessible
place.
Section 10. As used in the Plan, (a) the terms "assignment,"
"interested person" and "vote of a majority of the outstanding voting
securities" shall have the respective meanings specified in the Act and the
rules and regulations thereunder, subject to such exemption as may be granted
by the Securities and Exchange Commission and (b) the term "Qualified
Directors" shall mean the Directors of the Company who are not interested
persons of the Company and have no direct or indirect financial interest in the
operation of the Plan or in any agreements related to the Plan.
Dated: October 26, 1993
2
<PAGE> 1
EX-99.B 15(e)
DISTRIBUTION AND SERVICES PLAN
CALIFORNIA TAX-FREE SHORT-TERM INCOME FUND
A SERIES OF
STAGECOACH INC. INC.
WHEREAS, Stagecoach Inc. (the "Company") is an open-end management
investment company and is registered as such under the Investment Company Act
of 1940, as amended (the "Act"); and
WHEREAS, the Company desires to adopt a Distribution and Services
Plan (the "Plan") pursuant to Rule 12b-1 under the Act on behalf of the
California Tax-Free Short Term Income Fund (the "Fund"), and the Board of
Directors has determined that there is a reasonable likelihood that the Plan
will benefit the Fund and its shareholders;
NOW, THEREFORE, the Company hereby adopts the Plan in accordance
with Rule 12b-1 under the Act on the following terms and conditions:
Section 1. Pursuant to the Plan, the Fund may defray all or part
of the actual cost of preparing and printing prospectuses and other promotional
materials and of providing such prospectuses and other promotional materials to
prospective shareholders of the Fund and may compensate personnel of the
distributor or reimburse the distributor for compensation paid to selling
agents for distribution-related or sales support services and may pay for any
other activities primarily intended to result in the sale of shares of the
Fund. Payments also may be used to compensate or reimburse servicing agents
for shareholder liaison services provided by entities that are dealers of
record or which have a servicing relationship with the beneficial owners of
shares of the Fund under a servicing agreement in substantially the form
approved by the Board of Directors. Total payments under the Plan may not
exceed 0.10% of the average daily net assets of the Fund on an annual basis.
Section 2. The Plan shall be effective on the date upon which it
is approved by "vote of a majority of the outstanding voting securities" (as
defined below) of the shares of the Fund and a majority of the Directors of the
Company, including a majority of the Qualified Directors (as defined below),
pursuant to a vote cast in person at a meeting (or meetings) called for the
purpose of voting on the approval of the Plan.
Section 3. The Plan (and each related agreement) will, unless
earlier terminated in accordance with its terms, remain in effect from year to
year after the first anniversary of its effectiveness if such continuance is
specifically approved at least annually by vote of a majority of both (a) the
Directors of the Company and (b) the Qualified Directors, cast in person at a
meeting (or meetings) called for the purpose of voting on such approval.
Section 4. The Company shall provide to the Company's Board of
Directors and the Directors shall review, at least quarterly, a written report
of the amounts expended by the
1
<PAGE> 2
Company under the Plan and each related agreement and the purposes for which
such expenditures were made.
Section 5. The Plan may be terminated at any time by vote of a
majority of the Qualified Directors or by vote of a majority of the outstanding
voting securities of the Fund.
Section 6. All agreements related to the Plan shall be in writing
and shall be approved by vote of a majority of both (a) the Directors of the
Company and (b) the Qualified Directors, cast in person at a meeting called for
the purpose of voting on such approval. Any agreement related to the Plan
shall provide:
A. That such Agreement may be terminated at any time, without
payment of any penalty, by vote of a majority of the Qualified Directors
or by vote of a majority of the outstanding voting securities of the
Fund, on not more than 60 days' written notice to any other party to the
agreement; and
B. That such agreement shall terminate automatically in the
event of its "assignment" (as defined below).
Section 7. The Plan may not be amended to increase materially the
amount that may be expended by the Fund pursuant to the Plan without the
approval by a vote of a majority of the outstanding voting securities of the
Fund, and no material amendment to the Plan shall be made unless approved by
vote of a majority of both (a) the Directors of the Company and (b) the
Qualified Directors, cast in person at a meeting (or meetings) called for the
purpose of voting on such approval.
Section 8. While the Plan is in effect, the selection and
nomination of each Director who is not an "interested person" (as defined
below) of the Company shall be committed to the discretion of the Directors who
are not interested persons.
Section 9. The Company shall preserve copies of the Plan, each
related agreement and each report made pursuant to Section 4 hereof, for a
period of not less than six years from the date of the Plan, such agreement or
such report, as the case may be, the first two years in an easily accessible
place.
Section 10. As used in the Plan, (a) the terms "assignment,"
"interested person" and "vote of a majority of the outstanding voting
securities" shall have the respective meanings specified in the Act and the
rules and regulations thereunder, subject to such exemption as may be granted
by the Securities and Exchange Commission and (b) the term "Qualified
Directors" shall mean the Directors of the Company who are not interested
persons of the Company and have no direct or indirect financial interest in the
operation of the Plan or in any agreements related to the Plan.
Dated: October 26, 1993
2
<PAGE> 1
EX-99.B 15(f)
DISTRIBUTION AND SERVICES PLAN
CALIFORNIA TAX-FREE MONEY MARKET FUND
A SERIES OF
STAGECOACH INC.
WHEREAS, Stagecoach Inc. (the "Company") is an open-end management
investment company and is registered as such under the Investment Company Act
of 1940, as amended (the "Act"); and
WHEREAS, the Company desires to adopt a Distribution and Services
Plan (the "Plan") pursuant to Rule 12b-1 under the Act on behalf of the
California Tax-Free Money Market Fund (the "Fund"), and the Board of Directors
has determined that there is a reasonable likelihood that the Plan will benefit
the Fund and its shareholders;
NOW, THEREFORE, the Company hereby adopts the Plan in accordance
with Rule 12b-1 under the Act on the following terms and conditions:
Section 1. Pursuant to the Plan, the Fund may defray all or part
of the actual cost of preparing and printing prospectuses and other promotional
materials and of providing such prospectuses and other promotional materials to
prospective shareholders of the Fund and may compensate personnel of the
distributor or reimburse the distributor for compensation paid to selling
agents for distribution-related or sales support services and may pay for any
other activities primarily intended to result in the sale of shares of the
Fund. Payments also may be used to compensate or reimburse servicing agents
for shareholder liaison services provided by entities that are dealers of
record or which have a servicing relationship with the beneficial owners of
shares of the Fund under a servicing agreement in substantially the form
approved by the Board of Directors. Total payments under the Plan may not
exceed 0.10% of the average daily net assets of the Fund on an annual basis.
Section 2. The Plan shall be effective on the date upon which it
is approved by "vote of a majority of the outstanding voting securities" (as
defined below) of the shares of the Fund and a majority of the Directors of the
Company, including a majority of the Qualified Directors (as defined below),
pursuant to a vote cast in person at a meeting (or meetings) called for the
purpose of voting on the approval of the Plan.
Section 3. The Plan (and each related agreement) will, unless
earlier terminated in accordance with its terms, remain in effect from year to
year after the first anniversary of its effectiveness if such continuance is
specifically approved at least annually by vote of a majority of both (a) the
Directors of the Company and (b) the Qualified Directors, cast in person at a
meeting (or meetings) called for the purpose of voting on such approval.
Section 4. The Company shall provide to the Company's Board of
Directors and the Directors shall review, at least quarterly, a written report
of the amounts expended by the
1
<PAGE> 2
Company under the Plan and each related agreement and the purposes for which
such expenditures were made.
Section 5. The Plan may be terminated at any time by vote of a
majority of the Qualified Directors or by vote of a majority of the outstanding
voting securities of the Fund.
Section 6. All agreements related to the Plan shall be in writing
and shall be approved by vote of a majority of both (a) the Directors of the
Company and (b) the Qualified Directors, cast in person at a meeting called for
the purpose of voting on such approval. Any agreement related to the Plan
shall provide:
A. That such Agreement may be terminated at any time, without
payment of any penalty, by vote of a majority of the Qualified Directors
or by vote of a majority of the outstanding voting securities of the
Fund, on not more than 60 days' written notice to any other party to the
agreement; and
B. That such agreement shall terminate automatically in the
event of its "assignment" (as defined below).
Section 7. The Plan may not be amended to increase materially the
amount that may be expended by the Fund pursuant to the Plan without the
approval by a vote of a majority of the outstanding voting securities of the
Fund, and no material amendment to the Plan shall be made unless approved by
vote of a majority of both (a) the Directors of the Company and (b) the
Qualified Directors, cast in person at a meeting (or meetings) called for the
purpose of voting on such approval.
Section 8. While the Plan is in effect, the selection and
nomination of each Director who is not an "interested person" (as defined
below) of the Company shall be committed to the discretion of the Directors who
are not interested persons.
Section 9. The Company shall preserve copies of the Plan, each
related agreement and each report made pursuant to Section 4 hereof, for a
period of not less than six years from the date of the Plan, such agreement or
such report, as the case may be, the first two years in an easily accessible
place.
Section 10. As used in the Plan, (a) the terms "assignment,"
"interested person" and "vote of a majority of the outstanding voting
securities" shall have the respective meanings specified in the Act and the
rules and regulations thereunder, subject to such exemption as may be granted
by the Securities and Exchange Commission and (b) the term "Qualified
Directors" shall mean the Directors of the Company who are not interested
persons of the Company and have no direct or indirect financial interest in the
operation of the Plan or in any agreements related to the Plan.
Dated: October 26, 1993
2
