Lehman Brothers Institutional Funds Group Trust
Prime Money Market Fund
Prime Value Money Market Fund
Government Obligations Money Market Fund
100% Government Obligations Money Market Fund
Treasury Instruments Money Market Fund II
100% Treasury Instruments Money Market Fund
Municipal Money Market Fund
Tax-Free Money Market Fund
California Municipal Money Market Fund
Supplement to the Prospectuses Dated
May 31, 1994
The following information supplements the Prospectus of each of
the above-referenced portfolios (individually, a "Fund" and
collectively, the "Funds") of the Lehman Brothers Institutional Funds
Group Trust (the "Trust") to reflect the addition of Class E shares
to the three classes of shares currently offered by the Funds to
institutional investors and provides relevant disclosure with respect
to the Class E shares. The following discussion relates solely to
the Class E shares. Please see the Prospectuses of the Funds for
information relating to all other classes of shares.
BACKGROUND AND EXPENSE INFORMATION
The following modifies the Expense Summary in each Fund's
Prospectus to reflect the inclusion of Class E shares and lists the
costs and expenses that an investor in Class E shares can expect to
incur during such Fund's current fiscal year ending January 31, 1995.
Expense Summary
I*
II**
III***
IV
Annual Fund Operating
Expenses
(as a percentage of
average net assets)
Advisory Fees (net of
applicable fee waivers)
.10%
.09%
.08%
.00%
Rule 12b-1 fees
.15%
.15%
.15%
.15%
Other Expenses -
including Administration
Fees (net of applicable
fee waivers)
.06%
.07%
.08%
.16%
Total Fund Operating
Expenses (after expense
reimbursement)
.31%
.31%
.31%
.31%
____________________
* The expenses listed in Column I relate to the following Funds: Prime
Money Market Fund; Prime Value Money Market Fund; and Municipal Money Market
Fund.
** The expenses listed in Column II relate to the following Funds:
Government Obligations Money Market Fund; Treasury Instruments Money Market
Fund II; and 100% Treasury Instruments Money Market Fund.
*** The expenses listed in Column III relate to the Tax-Free Money Market
Fund.
The expenses listed in Column IV relate to the following Funds: 100%
Government Obligations Money Market Fund and California Municipal Money Market
Fund.
The Expense Summary above reflects current expected fees and each Fund's
Investment Adviser's and Administrator's voluntary fee waiver and expense
reimbursement arrangements in effect for each Fund's fiscal year ending
January 31, 1995.
In order to maintain a competitive expense ratio during 1994 and
thereafter, each Fund's Investment Adviser and Administrator have
agreed to waive fees and reimburse expenses if and to the extent that
total operating expenses (with certain exceptions) exceed the levels
as described in each Fund's Prospectus. Absent reimbursement of
expenses, the Total Fund Operating Expenses of Class E shares would
be 0.39% of the Fund's average daily net assets with respect to Prime
Money Market Fund; Prime Value Money Market Fund; and Municipal Money
Market Fund, 0.40% of the Fund's average daily net assets with
respect to Government Obligations Money Market Fund; Treasury
Instruments Money Market Fund II; and 100% Treasury Instruments Money
Market Fund, 0.41% of the Fund's average daily net assets with
respect to Tax-Free Money Market Fund, 0.51% of the Fund's average
daily net assets with respect to 100% Government Obligations Money
Market Fund, and 0.52% of the Fund's average daily net assets with
respect to California Municipal Money Market Fund..
_____
Example: An investor in each of the Funds would pay the following
expenses on a $1,000 investment, assuming (1) a 5% annual return and
(2) redemption at the end of each time period with respect to the
following shares:
1 Year
3
Years
5
Years
10
Years
Class E shares:
$3
$10
$17
$39
THE FOREGOING SHOULD NOT BE CONSIDERED A REPRESENTATION OF ACTUAL
EXPENSES AND RATES OF RETURN, WHICH MAY BE GREATER OR LESSER THAN
THOSE SHOWN.
DIVIDENDS AND YIELDS
Dividends are determined in the same manner and are paid in the
same amount for each share of each Fund irrespective of class, except
that the Class E shares bear the expense of fees paid by the Funds
(at the rate of .15%) to Service Organizations for certain services
they provide to the beneficial owners of such shares. As a result,
at any given time, the net yield on Class E shares will be
approximately .15% lower than the net yield on Class A shares,
approximately .10% higher than the net yield on Class B shares and
approximately .20% higher than the net yield on Class C shares. Any
fees charged by Service Organizations or other institutional
investors directly to their customers in connection with investments
in Fund shares are not reflected in the Fund's yields or expenses.
Investors may call 1-800-238-2560 to obtain current yield
information.
MANAGEMENT OF THE FUND
Service Organizations
Service Organizations and/or institutional customers of Service
Organizations may purchase Class E shares. These shares are
identical in all respects to the other classes of shares offered by
the Funds except that they bear fees described below and enjoy
certain exclusive voting rights on matters relating to these fees. A
Fund will enter into an agreement with each Service Organization
whose Customers are the beneficial owners of Class E shares that
requires the Service Organization to provide certain services to
Customers in consideration of the Fund's payment of service fees at
the annual rate of .15% of the average daily net asset value of such
shares beneficially owned by Customers. Such services, which are
described more fully in the Statement of Additional Information under
"Management of the Fund - Service Organizations," may include
aggregating and processing purchase and redemption requests from
Customers, placing net purchase and redemption orders with Lehman
Brothers, responding to Customer inquiries relating to the services
provided by the Service Organization and handling correspondence.
The Service Organization, at its option, may also process dividend
payments from the Funds on behalf of Customers; provide information
periodically to Customers showing their positions in shares; arrange
for bank wires; act as shareholder of record and nominee; and provide
reasonable assistance in connection with the distribution of shares
to Customers. Services provided with respect to Class E shares will
generally be more limited than those provided with respect to Class B
and Class C shares. Under the terms of the agreements, Service
Organizations are required to provide to their Customers a schedule
of any fees that they may charge Customers in connection with their
investments in Class E shares.
DESCRIPTION OF SHARES AND MISCELLANEOUS
The Trust's Declaration of Trust authorizes the Board of
Trustees to issue an unlimited number of full and fractional shares
of beneficial interest in the Trust and to classify or reclassify any
unissued shares into one or more additional classes of shares. The
Trust is an open-end management investment company, which offers
thirteen portfolios, and each portfolio of the Trust currently offers
Class E shares, except for the New York Money Market fund which is
currently not offering shares to the public, the Floating Rate U.S.
Government Fund and the Short Duration U.S. Government Fund.
Holders of each Fund's shares will vote in the aggregate and not
by class on all matters, except where otherwise required by law and
except that Class E shares will be entitled to vote on matters
submitted to a vote of shareholders pertaining to the Fund's
arrangements with Service Organizations with respect to Class E.
Dated: June 24, 1994
Lehman Brothers Institutional Funds Group Trust
Prime Money Market Fund
Prime Value Money Market Fund
Government Obligations Money Market Fund
100% Government Obligations Money Market Fund
Treasury Instruments Money Market Fund II
100% Treasury Instruments Money Market Fund
Municipal Money Market Fund
Tax-Free Money Market Fund
California Municipal Money Market Fund
Supplement to the Statements of Additional Information
Dated May 31, 1994
The following information supplements the Statement of Additional
Information of each of the above-referenced portfolios (individually, a "Fund"
and collectively, the "Funds") of the Lehman Brothers Institutional Funds
Group Trust (the "Trust") to reflect the addition of Class E shares to the
three classes of shares currently offered by the Funds to institutional
investors and provides relevant disclosure with respect to Class E shares.
The following discussion relates solely to the Class E shares. Please see the
Statements of Additional Information of the Funds for information relating to
all other classes of shares.
MANAGEMENT OF THE FUND
Service Organizations
As stated in the Funds' Prospectuses, the Funds will enter into an
agreement with each Service Organization whose Customers are the beneficial
owners of Class E shares that requires the Service Organization to provide
certain services to Customers in consideration of the Funds' payment of .15%
of the average daily net asset value of Class E shares held by the Service
Organization for the benefit of Customers. Support services include: (i)
aggregating and processing purchase and redemption requests for Shares from
Clients and placing net purchase and redemption orders with the distributor of
the Shares; and (ii) responding to Client inquiries relating to the services
performed by the Service Organization and handling correspondence. The
Service Organization, at its option, may also (iii) act as shareholder of
record and as nominee; (iv) provide Clients with a service that invests the
assets of their accounts in Shares pursuant to specific or pre-authorized
instructions; (v) provide sub-accounting with respect to Shares beneficially
owned by Clients or the information necessary for sub-accounting; (vi) provide
checkwriting services; (vii) process dividend payments from the Fund on behalf
of Clients; (viii) provide information periodically to Clients showing their
positions in Shares; (ix) arrange for bank wires; (x) forward shareholder
communications from the Fund (such as proxies, shareholder reports, annual and
semi-annual financial statements and dividend, distribution and tax notices)
to Clients; (xi) provide reasonable assistance in connection with the
distribution of Shares to Clients as requested from time to time by us, which
assistance may include forwarding sales literature and advertising provided by
us for Clients; and (xii) provide such other similar services as the Fund may
reasonably request to the extent the Service Organization is permitted to do
so under applicable statutes, rules or regulations.
DIVIDENDS AND ADDITIONAL YIELD INFORMATION
Dividends are determined in the same manner and are paid in the same
amount for each share of each Fund irrespective of class, except that the
Class B, Class C and Class E shares bear all the expense of fees paid by the
Funds (at the rate of .25%, .35% and .15%, respectively) to Service
Organizations for certain services they provide to the beneficial owners of
such shares. As a result, at any given time, the net yield on Class E shares
will be approximately .15% lower than the net yield on Class A shares,
approximately .10% higher than the net yield on Class B shares and
approximately .20% higher than the net yield on Class C shares. The Class E
shares of the Funds did not have activity as of January 31, 1994 and,
accordingly, yield information is not available with respect to such shares.
ADDITIONAL DESCRIPTION CONCERNING FUND SHARES
As stated in the Prospectuses for the Funds, holders of each Fund's
shares will vote in the aggregate and not by class on all matters, except
where otherwise required by law and except that for each Fund only that Fund's
Class B, Class C and Class E shares will be entitled to vote on matters
submitted to a vote of shareholders pertaining to the Fund's arrangements with
Service Organizations with respect to the relevant Class of shares.
Dated: June 24, 1994
shared/institut/ifg/secfilin/esupp2.doc
