PROTECTIVE INVESTMENT CO, PRE 14A, 1996-03-13

PROTECTIVE INVESTMENT CO
PRE 14A, 1996-03-13

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<PAGE>
PROTECTIVE INVESTMENT COMPANY
2801 HIGHWAY 280 SOUTH
BIRMINGHAM, ALABAMA 35223

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

NOTICE OF SPECIAL MEETINGS OF SHAREHOLDERS

APRIL 30, 1996

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

To owners of variable annuity contracts issued by Protective Life Insurance
Company ("PLICO") entitled to give voting instructions in connection with
separate accounts of PLICO.

Notice is hereby given that a special meeting of the shareholders of
Protective Investment Company (the "Company"), including Special Meetings of
shareholders (the "Meetings") of each of the Company's investment portfolios
(each, a "Fund" and collectively the "Funds"), will be held on April 30, 1996 at
the Protective Life Corporation Building, 2nd floor, Training Room A, 2801
Highway 280 South, Birmingham, Alabama 35223, at 10:00 a.m.

The Meetings will be held for the following purposes:

1. To approve or disapprove an investment management agreement between the
Company, on behalf of each Fund, and Investment Distributors Advisory
Services, Inc. ("IDASI"), pursuant to which IDASI will serve as
investment manager with respect to each Fund. SHAREHOLDERS OF EACH FUND
VOTING SEPARATELY.

2a. To approve or disapprove investment advisory agreements between IDASI
and Goldman Sachs Asset Management ("GSAM"), an operating division of
Goldman, Sachs & Co., pursuant to which GSAM will serve as investment
adviser to each of Protective Money Market Fund, Protective Select Equity
Fund, Protective Capital Growth Fund, Protective Small Cap Equity Fund,
and Protective Growth and Income Fund. SHAREHOLDERS OF EACH OF THE
FOREGOING FUNDS VOTING SEPARATELY.

2b. To approve or disapprove investment advisory agreements between IDASI
and Goldman Sachs Asset Management International ("GSAMI"), an affiliate
of Goldman, Sachs & Co., pursuant to which GSAMI will serve as investment
adviser to each of Protective International Equity Fund and Protective
Global Income Fund. SHAREHOLDERS OF EACH OF THE FOREGOING FUNDS VOTING
SEPARATELY.

3. To elect five directors to the Company's Board of Directors.
SHAREHOLDERS OF ALL OF THE FUNDS VOTING TOGETHER.

4. To ratify or reject the selection of Coopers & Lybrand L.L.P. as the
Company's independent public accountant. SHAREHOLDERS OF ALL OF THE FUNDS
VOTING TOGETHER.

5. To transact such other business as may properly come before the Meetings
or any adjournment(s) thereof.

PLICO and a separate account of PLICO are the only shareholders of the
Company. However, PLICO hereby solicits and agrees to vote the shares of the
Company at the Meetings in accordance with timely instructions received from
owners of the variable annuity contracts ("variable contracts") having contract
values allocated to such separate account invested in such shares.

As a variable contract owner of record at the close of business on March 21,
1996, you have the right to instruct PLICO as to the manner in which shares of a
Fund attributable to your variable contract should be voted. To assist you in
giving your instructions, a Voting Instruction Form is enclosed that reflects
the number of shares of each of the above Funds of the Company for which you are
entitled to give voting instructions. In addition, a Proxy Statement is attached
to this Notice and describes the matters to be voted upon at the Meetings or any
adjournment(s) thereof.
<PAGE>
YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETINGS, PLEASE
COMPLETE, DATE AND SIGN THE ENCLOSED VOTING INSTRUCTION FORM AND RETURN IT
PROMPTLY IN THE ENCLOSED POSTAGE PREPAID ENVELOPE.

By Order of the Board of Directors

Lizabeth Reynolds Nichols
SECRETARY

Birmingham, Alabama
March , 1996
<PAGE>
PROTECTIVE INVESTMENT COMPANY
2801 HIGHWAY 280 SOUTH
BIRMINGHAM, ALABAMA 35223
------------------------

PROXY STATEMENT
MARCH , 1996
------------------------

This Proxy Statement is being furnished on behalf of the Board of Directors
of Protective Investment Company (the "Company"), by Protective Life Insurance
Company ("PLICO") to owners of variable annuity contracts issued by PLICO and
having contract values on the record date allocated to a separate account of
PLICO invested in shares of the Company.

This Proxy Statement is being furnished in connection with the solicitation
of voting instructions from owners of such variable annuity contracts ("variable
contracts") for use at special meetings (the "Meetings") of shareholders of
Protective Money Market Fund, Protective Select Equity Fund, Protective Capital
Growth Fund, Protective Small Cap Equity Fund, Protective International Equity
Fund, Protective Growth and Income Fund, and Protective Global Income Fund
(each, a "Fund"). The Meetings are to be held on April 30, 1996, at 10:00 a.m.,
Birmingham, Alabama time, at the offices of Protective Life Corporation in the
2nd Floor, Training Room A, 2801 Highway 280 South, Birmingham, Alabama for the
purposes set forth below and in the accompanying Notice of the Meetings. The
approximate mailing date of this Proxy Statement and Voting Instruction Form is
March 27, 1996.

The costs of the Meetings including the solicitation of voting instructions
will be paid by PLICO. In addition to the use of the mails, voting instructions
may be solicited, in person or by telephone, by officers of the Company and
regular employees and representatives of PLICO or its affiliates, who will not
be separately compensated therefor.

At the Meetings, the shareholders of Protective Money Market Fund,
Protective Select Equity Fund, Protective Capital Growth Fund, Protective Small
Cap Equity Fund, and Protective Growth and Income Fund, EACH VOTING SEPARATELY,
will be asked:

1. To approve or disapprove an investment management agreement between the
Company and Investment Distributors Advisory Services, Inc. ("IDASI")
pursuant to which IDASI will serve as investment manager with respect to
their Fund; and

2. To approve or disapprove an investment advisory agreement between IDASI
and Goldman Sachs Asset Management ("GSAM"), an operating division of
Goldman, Sachs & Co., pursuant to which GSAM will serve as investment
adviser to their Fund.

At the Meetings, the shareholders of Protective International Equity Fund
and Protective Global Income Fund, EACH VOTING SEPARATELY, will be asked:

2. To approve or disapprove an investment advisory agreement between IDASI
and Goldman Sachs Asset Management International ("GSAMI"), an affiliate
of Goldman, Sachs & Co., pursuant to which GSAMI will serve as investment
adviser to their Fund.

At the Meetings, the shareholders of each of the Funds, VOTING TOGETHER,
will be asked:

3. To elect five directors to the Company's Board of Directors.
4. To ratify or reject the selection of Coopers & Lybrand L.L.P., as the
Company's independent public accountant.

5. To transact such other business as may properly come before the Meeting
or any adjournment(s) thereof.
<PAGE>
The following chart indicates which shareholders are entitled to vote on
each proposal.

VOTING GROUPS

<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PROPOSAL MONEY SELECT CAPITAL SMALL CAP GROWTH AND GLOBAL
- --------------------------------- MARKET EQUITY GROWTH EQUITY INCOME INTERNATIONAL INCOME
FUND FUND FUND FUND FUND EQUITY FUND FUND
1. Approval of investment
management agreement with X X X X X X X
IDASI
2a. Approval of investment
advisory agreement with GSAM X X X X X
2b. Approval of investment
advisory agreement with X X
GSAMI
3. Election of Directors X X X X X X X
4. Ratification of selection X X X X X X X
</TABLE>

GENERAL VOTING INFORMATION

PLICO itself and a separate account of PLICO are the only shareholders of
the Funds. PLICO will vote the shares of the Funds at the Meetings in accordance
with the timely instructions received from persons entitled to give voting
instructions under variable contracts funded through such separate account.

PLICO will vote shares attributable to variable contracts as to which no
voting instructions are received in proportion (for, against or abstain) to
those for which instructions are received. PLICO also will vote shares not
attributable to variable contracts (I.E., representing seed money investments in
the Funds made by PLICO) in proportion to those for which instructions are
received from variable contract owners. If a Voting Instruction Form is received
that does not specify a choice, PLICO will consider its timely receipt as an
instruction to vote in favor of the proposal(s) to which it relates. In certain
circumstances, PLICO has the right to disregard voting instructions from certain
variable contract owners. PLICO does not believe that these circumstances exist
with respect to matters currently before shareholders. Variable contract owners
may revoke voting instructions given to PLICO at any time prior to the Meetings
by notifying the Secretary of the Company in writing.

The Company, a Maryland corporation organized in 1993, is registered with
the U.S. Securities and Exchange Commission (the "Commission") as an open-end
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act").

Each share of the Company's outstanding common stock is entitled to one vote
for each dollar of net asset value represented by that share. Fractional votes
are counted.

2
<PAGE>
The Board of Directors of the Fund has fixed March 21, 1996 as the record
date for the determination of shareholders entitled to notice of and to vote at
the Meetings. As of March 21, 1996, there were outstanding the following numbers
of shares of each class of common stock of the Company, representing the
following number of votes to which each class is entitled:

<TABLE>
<CAPTION>
NET ASSET NUMBER OF
NUMBER OF VALUE PER VOTES ENTITLED
SHARES OUTSTANDING SHARE TO BE CAST
------------------ ------------- ---------------------
<S> <C> <C> <C>
Protective Money Market Fund...........................................
Protective Select Equity Fund..........................................
Protective Capital Growth Fund.........................................
Protective Small Cap Equity Fund.......................................
Protective International Equity Fund...................................
Protective Growth and Income Fund......................................
Protective Global Income Fund..........................................
</TABLE>

The following table sets forth, as of March 21, 1996, the beneficial
ownership of the Company's common stock by: (1) each person known by the Company
or PLICO to beneficially own shares of any class of such stock representing more
than 5% of the votes attributable to that class, (2) each director of the
Company, and (3) directors of the Company as a group. For this purpose, persons
who have the right to instruct PLICO as to shares of stock attributable to a
variable contract are considered beneficial owners of such shares of stock.

<TABLE>
<CAPTION>
NUMBER OF VOTES (AND PERCENT OF CLASS) ATTRIBUTABLE TO SHARES BENEFICIALLY OWNED
------------------------------------------------------------------------------------------------
MONEY MARKET SELECT CAPITAL SMALL CAP GLOBAL INTERNATIONAL GROWTH &
NAME OF BENEFICIAL OWNER FUND EQUITY FUND GROWTH FUND EQUITY FUND INCOME FUND EQUITY FUND INCOME FUND
- -------------------------------- ------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
PLICO........................... ( %) ( %) ( %) ( %) ( %) ( %) ( %)
D. Warren Bailey................ 0 0 0 0 0 0 0
R. Stephen Briggs............... (*) (*) (*) (*) (*) (*) (*)
Carolyn King.................... (*) (*) (*) (*) (*) (*) (*)
G. Ruffner Page, Jr............. (*) (*) (*) (*) (*) (*) (*)
Cleophus Thomas, Jr............. (*) (*) (*) (*) (*) (*) (*)
</TABLE>

- ------------------------------
*The percentage of votes attributable to shares beneficially owned does not
exceed one percent (1%).

All shares for which PLICO timely receives properly executed instructions,
which are not subsequently revoked prior to the Meetings, will be voted at the
Meetings in accordance with such instructions. Voting instructions to abstain on
the item to be voted upon will be applied on a pro rata basis to reduce the
votes eligible to be cast.

To the knowledge of the Company and PLICO, no person has the right to
instruct PLICO with respect to more than 5% of the votes attributable to shares
of any Fund.

Approval of the agreements in proposals 1 and 2 above requires, as to each
Fund, the affirmative vote of a majority of the votes entitled to be cast for
that Fund or 67% or more of the outstanding votes present (in person or by
proxy) at the Meeting for that Fund, if the holders of more than 50% of the
votes entitled to be cast for that Fund are present, whichever is less.

Election of each nominee as a director requires, as to the entire Company,
the affirmative vote of a plurality of the votes present (in person or by proxy)
at the Meetings, provided that at least one-third of the votes entitled to be
cast are present at the Meetings.

Ratification of the selection of Coopers & Lybrand L.L.P. requires, as to
the entire Company, the affirmative vote of a majority of the votes present (in
person or by proxy) at the Meetings, provided that at least one-third of the
votes entitled to be cast are present at the Meetings.

3
<PAGE>
ITEM 1: APPROVAL OR DISAPPROVAL OF INVESTMENT MANAGEMENT AGREEMENT BETWEEN
IDASI AND THE COMPANY

The shareholders of each Fund will be asked at the Meetings to approve an
investment management agreement (the "Management Agreement") between IDASI and
the Company with respect to their Fund. The Management Agreement was approved
for each Fund by the Board of Directors, including a majority of the Directors
who are not parties to the Management Agreement or interested persons of such
parties ("independent directors"), at a meeting held on March 20, 1996. The
Management Agreement is attached as Exhibit A.

IDASI, which is located at 2801 Highway 280 South, Birmingham, Alabama
35223, has been investment manager for the Funds since March 1994, when the
Management Agreement first became effective. IDASI is a wholly-owned subsidiary
of Protective Life Corporation ("PLC"), an insurance holding company whose
common stock is traded on the New York Stock Exchange. PLC's principal operating
subsidiary is Protective Life Insurance Company ("PLICO") a stock life insurance
company which maintains its administrative offices in Birmingham, Alabama. PLICO
was incorporated in Alabama in 1907 and changed its state of domicile from
Alabama to Tennessee in 1992. PLICO's principal business is the writing of
individual and group life and health insurance contracts, annuity contracts, and
guaranteed investment contracts.

See Appendix C to this Proxy Statement for a complete list of the directors
and principal executive officers of IDASI.

Prior to March, 1994, IDASI had no previous experience in providing
management services for investment companies; however, its officers, all of whom
are officers of PLC or PLICO, have extensive experience in the development and
distribution of investment products, particularly, guaranteed investment
contracts. In addition, IDASI has retained GSAM and GSAMI entities that have
extensive experience managing the assets of investment companies, pension plans
and other clients, to manage the investment and reinvestment of the Funds'
assets.

IDASI and the Company first entered into a Management Agreement on March 3,
1994. Since that date, the Management Agreement has covered all of the Funds
other than Protective Capital Growth Fund. The Management Agreement was extended
to cover the Capital Growth Fund on May 3, 1995. The Management Agreement was
first approved by the Company's Board of Directors (including a majority of the
independent directors) for the Funds other than Protective Capital Growth Fund,
at a meeting held on February 8, 1994. The Management Agreement was approved by
the Company's Board of Directors (including a majority of the independent
directors) for the Capital Growth Fund at a meeting held on May 3, 1995. PLICO,
as the holder of seed money shares, approved the Management Agreement on March
2, 1994 for the Funds other than Protective Capital Growth Fund and on June 20,
1995 for the Capital Growth Fund.

Under the Management Agreement, IDASI assumes overall responsibility,
subject to the supervision of the Company's Board of Directors, for
administering all operations of the Company and for monitoring and evaluating
the management of the assets of each of the Funds by GSAM and GSAMI on an
ongoing basis. Under the Management Agreement, IDASI provides or arranges for
the provision of the overall business management and administrative services
necessary for the Company's operations and furnishes or procures any other
services and information necessary for the proper conduct of the Company's
business. IDASI also acts as liaison among, and supervisor of, the various
service providers to the Company, including the custodian, transfer agent, and
accounting services agent and to its own administration agent that performs
services for the Company on its behalf. IDASI is also responsible for overseeing
the Company's compliance with the requirements of applicable law and with each
Fund's investment objective(s), policies and restrictions, including oversight
of GSAMI and GSAMI.

For its services to the Company, IDASI receives a monthly management fee.
The fee is deducted daily from the assets of each of the Funds and paid to IDASI
monthly. The fee for each Fund is based on the average daily net assets of the
Fund at the following annual rates: Money Market Fund .50%, Select Equity Fund
.80%, Capital Growth Fund .80%, Small Cap Equity Fund .80%, International Equity
Fund 1.10%, Growth and Income Fund .80%, and Global Income Fund 1.10%. For the
fiscal

4
<PAGE>
year ended December 31, 1995, IDASI received management fees in connection with
each of the Funds as follows: Money Market Fund $28,954, Select Equity Fund
$282,954, Small Cap Equity $268,136, International Equity Fund $448,460, Growth
and Income Fund $661,953, Capital Growth Fund $24,876 and Global Income Fund
$262,733.

The Management Agreement does not place limits on the operating expenses of
the Company or of any Fund. However, Protective Life Insurance Company ("PLICO")
has voluntarily undertaken to pay any such expenses (but not including brokerage
or other portfolio transaction expenses or expenses of litigation,
indemnification, taxes or other extraordinary expenses) to the extent that such
expenses, as accrued for each Fund, exceed the following percentages of that
Fund's estimated average daily net assets on an annualized basis: Money Market
Fund, .60%; Select Equity Fund, .80%; Capital Growth Fund, .80%; Small Cap
Equity Fund, .80%; International Equity Fund, 1.10%; Growth and Income Fund,
.80%; and Global Income Fund, 1.10%. PLICO may withdraw this undertaking to pay
expenses as to any or all of the Funds upon 120 days' notice to the Company.

The Management Agreement provides that IDASI may render similar services to
others so long as the services that it provides thereunder are not impaired
thereby. The Management Agreement also provides that IDASI shall not be liable
for any error of judgment or mistake of law or for any loss arising out of any
investment or for any act or omission in the management of the Company, except
for (i) willful misfeasance, bad faith or gross negligence in the performance of
its duties or by reason of reckless disregard of its duties or obligations under
the Management Agreement, and (ii) to the extent specified in Section 36(b) of
the Act concerning loss resulting from a breach of fiduciary duty with respect
to the receipt of compensation.

The Management Agreement as approved by the Board of Directors is now being
submitted for approval by the shareholders of each Fund. If approved by the
shareholders of a Fund, it will continue in effect for that Fund for a term
ending March , 1997, and will continue from year to year thereafter, subject
to approval annually by (a) the shareholders of the Fund or a majority of the
directors of the Company, and (b) the vote of a majority of the independent
directors, cast in person at a meeting called for the purpose of voting on such
approval. If the shareholders of a Fund fail to approve the Management Agreement
for that Fund, the Directors shall consider appropriate action with respect to
such non-approval of the Management Agreement.

DIRECTORS' RECOMMENDATION

In determining whether it was appropriate to approve the Management
Agreement for each Fund and to recommend its approval to that Fund's
shareholders, the Board of Directors, including the independent directors
considered various matters and materials provided by IDASI. Information
considered by the Directors included, among other things, the following: (1) the
compensation to be received by IDASI; (2) the nature and quality of the services
required to be performed by IDASI to the Funds; (3) the profitability of IDASI
in managing each Fund; (4) the qualifications of the personnel of IDASI; (5) the
past performance of IDASI with regard to each Fund; (6) the policies and
practices of IDASI in assigning personnel resources to provide the services; (7)
any significant regulatory compliance issues which might have affected IDASI;
and (8) the past investment performance of each Fund as compared with that of
similar funds and related indices.

THE BOARD OF DIRECTORS RECOMMENDS SHAREHOLDERS VOTE IN FAVOR OF THE APPROVAL
OF THE INVESTMENT MANAGEMENT AGREEMENT WITH IDASI.

ITEMS 2A AND 2B: APPROVAL OR DISAPPROVAL OF INVESTMENT ADVISORY AGREEMENTS
BETWEEN IDASI AND GSAM OR GSAMI

The shareholders of each Fund will be asked at the Meetings to approve a new
investment advisory agreement (a "New Investment Advisory Agreement") for their
Fund between IDASI, and GSAM or GSAMI. The New Investment Advisory Agreements
were approved by the Board of Directors, including a majority of the Directors
who are not parties to the Agreements or interested persons of such parties
("independent directors"), at a meeting held on March 20, 1996. The New
Investment Advisory Agreements are attached as Exhibit B.

5
<PAGE>
If approved by the shareholders of a Fund, the New Investment Advisory
Agreements will continue in effect for an initial term ending March , 1997,
and will continue from year to year thereafter, subject to approval annually by
(a) the shareholders of the Fund or a majority of the directors of the Company,
and (b) the vote of a majority of the independent directors, cast in person at a
meeting called for the purpose of voting on such approval. If the shareholders
of a Fund fail to approve the New Investment Advisory Agreement for that Fund,
the Directors shall consider appropriate action with respect to such
non-approval of the New Investment Advisory Agreements.

INFORMATION ABOUT GSAM AND GSAMI

Goldman Sachs Asset Management, One New York Plaza, New York, New York
10004, a separate operating division of Goldman Sachs, acts as the investment
adviser of the Money Market Fund, Select Equity Fund, Capital Growth Fund, Small
Cap Equity Fund and Growth and Income Fund. Goldman Sachs Asset Management
International, 140 Fleet Street, London EC4A 2BJ England, an affiliate of
Goldman Sachs, acts as the investment adviser to the International Equity Fund
and the Global Income Fund. Both Goldman Sachs and GSAMI are registered with the
SEC as investment advisers. GSAM and GSAMI and their affiliates serve a wide
range of clients including private and public pension funds, endowments,
foundations, banks, thrifts, insurance companies, corporations and private
investors and family groups. As of January 31, 1996, the Advisers, together with
their affiliates, acted as investment adviser, administrator or distributor for
assets in excess of $51 billion.

Founded in 1869, Goldman Sachs is among the oldest and largest investment
banking firms in the United States. Goldman Sachs is a leader in developing
portfolio strategies and in many fields of investing and financing,
participating in financial markets worldwide and serving individuals,
institutions, corporations and governments. Goldman Sachs is among the principal
market sources for current and thorough information on companies, industrial
sectors, markets, economies and currencies, and trades and makes markets in a
wide range of equity and debt securities 24-hours a day. The firm is
headquartered in New York and has offices throughout the United States and in
Beijing, Frankfurt, George Town, London, Madrid, Milan, Montreal, Osaka, Paris,
Seoul, Shanghai, Singapore, Sydney, Taipei, Tokyo, Toronto, Vancouver and
Zurich. It has trading professionals through the United States, as well as in
London, Tokyo and Singapore.

GSAMI was organized in 1990. As a company with unlimited liability under the
laws of England, it is authorized to conduct investment advisory business in the
United Kingdom as a member of the Investment Management Regulatory Organisation
Limited, a U.K. self-regulatory organization.

In performing investment advisory services both GSAM and GSAMI while
remaining responsible for advising the Funds, may rely upon the asset management
division of its Singapore and Tokyo affiliates. Each is also able to draw upon
the research and expertise of its other affiliate offices for portfolio
decisions and management with respect to certain securities.

GSAM and GSAMI are able to draw on the substantial research and market
expertise of Goldman Sachs, whose investment research effort is one of the
largest in the industry. With an annual equity research budget approaching $120
million, Goldman Sachs' Investment Research Department covers approximately
1,700 companies, including approximately 1,000 U.S. corporations in 60
industries. The in-depth information and analyses generated by Goldman Sachs'
research analysts are available to GSAM and GSAMI. For more than a decade,
Goldman Sachs has been among the top-ranked firms in INSTITUTIONAL INVESTOR'S
annual "All-America Research Team" survey. In addition, many of Goldman Sachs'
economists, securities analysts, portfolio strategists and credit analysts have
consistently been highly ranked in respected industry surveys conducted in the
U.S. and abroad. Goldman Sachs is also among the leading investment firms using
quantitative analysis (now used by a growing number of investors) to structure
and evaluate portfolios.

In connection with the Funds' investments in foreign securities and related
transactions in foreign currencies, GSAMI has access to Goldman Sachs' economics
team, based in London, which is internationally recognized for its skill in
currency forecasting and international economics.

6
<PAGE>
The fixed-income research capabilities of Goldman Sachs available to GSAM
and GSAMI include the Goldman Sachs' Fixed-Income Research Department and the
Credit Department. The Fixed-Income Research Department monitors developments in
U.S. and foreign fixed-income markets, assesses the outlooks for various sectors
of the markets and provides relative value comparisons, as well as analyzes
trading opportunities within and across market sectors. The Fixed-Income
Research Department is at the forefront in developing and using computer-based
tools for analyzing fixed-income securities and markets, developing new
fixed-income products and structuring portfolio strategies for investment policy
and tactical asset allocation decisions. The Credit Department tracks specific
governments, regions and industries and from time to time may review the credit
quality of a Fund's investments.

In addition to fixed-income research and credit research, both GSAM and
GSAMI are supported by Goldman Sachs' economics research. The Economics Research
Department conducts economic, financial and currency markets research which
analyzes economic trends and interest and exchange rate movements worldwide. The
Economics Research Department tracks factors such as inflation and money supply
figures, balance of trade figures, economic growth, commodity prices, monetary
and fiscal policies, and political events that can influence interest rates and
currency trends.

The success of Goldman Sachs' international research team has brought wide
recognition to its members. The team has earned top rankings in the
INSTITUTIONAL INVESTOR annual "All British Research Team Survey" in the
following categories: Economics (U.K.) 1986-1993; Economics/International
1989-1993; and Currency Forecasting 1986-1993. In addition, the team has also
earned top rankings in the annual "Extel Financial Survey" of U.K. investment
managers in the following categories: U.K. Economy 1989-1995; International
Economies 1986, 1988-1995; International Government Bond Market 1993-1995; and
Currency Movements 1986-1993.

In allocating assets in a Fund's portfolio among currencies, GSAM and GSAMI
will have access to the Global Asset Allocation Model. The model is based on the
observation that the prices of all financial assets, including foreign
currencies, will adjust until investors globally are comfortable holding the
pool of outstanding assets. Using the model, GSAM and GSAMI will estimate the
total returns from each currency sector which are consistent with the average
investor holding a portfolio equal to the market capitalization of the financial
assets among those currency sectors. These estimated equilibrium returns are
then combined with Goldman Sachs' research professionals' expectations to
produce an optimal currency and asset allocation for the level of risk suitable
for a Fund's investment objective and criteria. In allocating a Fund's assets
among currencies GSAM and GSAMI will also have access to Goldman Sachs'
economics team, which is internationally recognized for its skill in currency
forecasting and international economics.

See Appendix D to this Proxy Statement for a complete list of the directors
and principal executive officers of GSAM and GSAMI and a table setting forth the
registered investment companies having similar objectives to the Funds for which
GSAM or GSAMI serves as a sub-adviser, including the fees payable to GSAM or
GSAMI.

CURRENT INVESTMENT ADVISORY AGREEMENTS

GSAM and GSAMI entered into investment advisory agreements, dated March 2,
1994 (May 3, 1995 for Capital Growth Fund), with IDASI in connection with each
Fund that each advises. Under the agreements, GSAM and GSAMI, subject to the
general supervision of the Company's Board of Directors, manages the investment
portfolio of each Fund. Under the investment advisory agreements, GSAM and GSAMI
are responsible for making investment decisions for the Funds and for placing
the purchase and sale orders for the portfolio transactions of each Fund. In
this capacity, GSAM and GSAMI obtain and evaluate appropriate economic,
statistical, timing, and financial information and formulate and implement
investment programs in furtherance of each Fund's investment objective(s).

7
<PAGE>
As compensation for its services to the Funds on behalf of IDASI, GSAM or
GSAMI receive a monthly fee from IDASI based on the average daily net assets of
each Fund at the annual rates shown in the table on page .

The investment advisory agreements each provide that GSAM and GSAMI may
render similar services to others so long as the services that they provide
thereunder are not impaired thereby.

The investment advisory agreement for each Fund (other than Capital Growth
Fund) was approved by the directors of the Company, including a majority of the
independent directors, on February 8, 1994, and by the sole initial shareholder
of the Fund on March 2, 1994. The investment advisory agreement for Capital
Growth Fund was approved by the directors, including a majority of independent
directors, on May 3, 1995 and by the sole initial shareholder of the Fund on
June 20, 1995.

The investment advisory agreements will each terminate automatically if
assigned, and each is terminable at any time without penalty by the directors of
the Company or by vote of a majority of the votes attributable to outstanding
voting securities of the applicable Fund on 60 days' written notice to either
GSAM or GSAMI, as appropriate and by GSAM and GSAMI on 90 days' written notice
to IDASI and the Company.

NEW INVESTMENT ADVISORY AGREEMENTS

Except for the fees to be paid, the New Investment Advisory Agreements are
substantially identical to the current investment advisory agreements. The
monthly fee schedule in the New Investment Advisory Agreements differs from the
current monthly fee schedule in the current agreements in that the breakpoints
have been increased for all of the Funds. In addition, the percentage rate of
the monthly fee payable on the International Equity Fund and the Global Income
Fund has been increased from an effective annual rate of .20% to .25% of assets
in each of these Funds in excess of $200 million. The new Fee Schedule as
compared with the current Fee Schedule is as follows:

NEW INVESTMENT ADVISORY AGREEMENT FEE SCHEDULES

<TABLE>
<CAPTION>
$0-100 MILLION $100-200 MILLION $200 MILLION
----------------- ------------------- ---------------
<S> <C> <C> <C>
Money Market.............................................. .35% .25% .15%
International Equity...................................... .40% .30% .25%
Growth & Income........................................... .40% .30% .20%
Select Equity............................................. .40% .30% .20%
Small Cap................................................. .40% .30% .20%
Cap Growth................................................ .40% .30% .20%
</TABLE>

CURRENT INVESTMENT ADVISORY AGREEMENT FEE SCHEDULES

<TABLE>
<CAPTION>
$0-50 MILLION $50-150 MILLION $150-250 MILLION $250 MILLION
----------------- ------------------- ------------------- ---------------
<S> <C> <C> <C> <C>
Money Market............................. .35% .25% .20% .15%
International Equity..................... .40% .30% .25% .20%
Global Income............................ .40% .30% .25% .20%
</TABLE>

<TABLE>
<CAPTION>
$0-50 MILLION $50-200 MILLION $200 MILLION
----------------- ------------------- -------------------
<S> <C> <C> <C>
Growth & Income.......................... .40% .30% .20%
Select Equity............................ .40% .30% .20%
Small Cap................................ .40% .30% .20%
Cap Growth............................... .40% .30% .20%
</TABLE>

For the fiscal year ended December 31, 1995, IDASI paid the following fees
to GSAM and GSAMI in connection with each of the Funds: Money Market Fund
$16,877, Select Equity Fund $140,992, Capital Growth Fund $12,438, Small Cap
Equity Fund $134,073, International Equity Fund $162,253, Growth and Income Fund
$297,818, and Global Income Fund $95,539.

8
<PAGE>
Had these New Investment Advisory Agreements been in effect in 1995, the
fees payable by IDASI to GSAM and GSAMI would have been: Money Market Fund
$ , Select Equity Fund $ , Small Cap Equity Fund $ ,
International Equity Fund $ , Growth & Income Fund $ , Capital Growth
Fund $ and Global Income Fund $ .

AFFILIATE TRANSACTIONS

GSAM and GSAMI are responsible for decisions to buy and sell securities for
the Funds, the selection of brokers and dealers to effect the transactions and
the negotiation of brokerage commissions, if any. Purchases and sales of
securities on a securities exchange are effected through brokers who charge a
negotiated commission for their services. Orders may be directed to any broker
including, to the extent and in the manner permitted by applicable law, Goldman
Sachs.

In the over-the-counter market, securities are generally traded on a "net"
basis with dealers acting as principal for their own accounts without a stated
commission, although the price of a security usually includes a profit to the
dealer. In underwritten offerings, securities are purchased at a fixed price
which includes an amount of compensation to the underwriter, generally referred
to as the underwriter's concession or discount. On occasion, certain money
market instruments may be purchased directly from an issuer, in which case no
commissions or discounts are paid. Except to the extent that the Money Market
Fund purchases securities from Goldman Sachs consistent with the terms of an SEC
order permitting such sales, the Company will not deal with Goldman Sachs in any
transaction in which Goldman Sachs acts as principal.

In placing orders for portfolio securities of a Fund, GSAM and GSAMI are
required to give primary consideration to obtaining the most favorable price and
efficient execution. This means that GSAM and GSAMI will seek to execute each
transaction at a price and commission, if any, which provide the most favorable
total cost or proceeds reasonably attainable in the circumstances. While GSAM
and GSAMI generally seek reasonably competitive spreads or commissions, the
Funds will not necessarily be paying the lowest spread or commission available.
Within the framework of this policy, GSAM and GSAMI will consider research and
investment services provided by brokers or dealers who effect or are parties to
portfolio transactions of the Funds, GSAM and GSAMI and their affiliates, or
other clients of GSAM and GSAMI or their affiliates. Such research and
investment services are those which brokerage houses customarily provide to
institutional investors and include statistical and economic data and research
reports on particular companies and industries. Such services are used by GSAM
and GSAMI in connection with all of their investment activities, and some of
such services obtained in connection with the execution of transactions for the
Funds may be used in managing other investment accounts. Conversely, brokers
furnishing such services may be selected for the execution of transactions of
such other accounts, whose aggregate assets are far larger than those of the
Funds, and the services furnished by such brokers may be used by GSAM and GSAMI
in providing investment advisory services for the Funds.

On occasions when GSAM and GSAMI deem the purchase or sale of a security to
be in the best interest of a Fund as well as its other advisory clients
(including any other fund or other investment company or advisory account for
which GSAM and GSAMI or an affiliate acts as investment adviser), GSAM and
GSAMI, to the extent permitted by applicable laws and regulations, may aggregate
the securities to be sold or purchased for the Fund with those to be sold or
purchased for such other customers in order to obtain the best net price and
most favorable execution. In such event, allocation of the securities so
purchased or sold, as well as the expenses incurred in the transaction, will be
made by GSAM and GSAMI in the manner they consider to be most equitable and
consistent with its fiduciary obligations to the Fund and such other customers.
In some instances, this procedure may adversely affect the price and size of the
position obtainable for a Fund.

Commission rates are established pursuant to negotiations with the broker
based on the quality and quantity of execution services provided by the broker
in the light of generally prevailing rates. The allocation of orders among
brokers and the commission rates paid are reviewed periodically by the board of
directors of the Company.

9
<PAGE>
GSAM and GSAMI may use Goldman Sachs as a broker for the Funds. In order for
Goldman Sachs to effect any portfolio transactions for a Fund, the commissions,
fees or other remuneration received by Goldman Sachs must be reasonable and fair
compared to the commissions, fees or other remuneration paid to other brokers in
connection with comparable transactions involving similar securities being
purchased or sold on a securities exchange during a comparable period of time.
This standard permits Goldman Sachs to receive no more than the remuneration
which would be expected to be received by an unaffiliated broker in a
commensurate arm's-length transaction. Furthermore, the Board of Directors of
the Company, including a majority of the independent directors, have adopted
procedures which are reasonably designed to provide that any commissions, fees
or other remuneration paid to Goldman Sachs are consistent with the foregoing
standard. Brokerage transactions with Goldman Sachs are also subject to such
fiduciary standards as may be imposed upon Goldman Sachs by applicable law.

In addition, although Section 11(a) of the Securities Exchange Act of 1934
provides that member firms of a national securities exchange may not effect
transactions on such exchange for the account of an investment company of which
the member firm or its affiliate is the investment adviser, except pursuant to
the requirements of that Section. The Company's Board of Directors has adopted
procedures designed to insure compliance with the requirements of Section 11(a).
In this regard, Goldman Sachs will provide the Company at least annually with a
statement setting forth the total amount of all compensation retained by Goldman
Sachs in connection with effecting transactions for the accounts of each Fund.
The board of directors of the Company will review and approve all of each Fund's
portfolio transactions with Goldman Sachs and the compensation received by
Goldman Sachs in connection therewith.

For the fiscal period ending December 31, 1995, the Funds paid the following
amounts in brokerage commissions: Money Market Fund $0, Select Equity Fund
$61,560, Small Cap Equity Fund $99,151, International Equity Fund $180,874,
Growth and Income Fund $232,571, Global Income Fund $0 and Capital Growth Fund
$12,219.

For the fiscal period ending December 31, 1995, the Funds paid the following
amounts in brokerage commissions to Goldman Sachs: Money Market Fund $0, Select
Equity Fund $0, Small Cap Equity Fund $12,010, International Equity Fund $3,957,
Growth and Income Fund $26,236, Global Income Fund $0 and Capital Growth Fund
$1,833.

THE BOARD OF DIRECTORS RECOMMENDS SHAREHOLDERS VOTE IN FAVOR OF THE APPROVAL
OF THE INVESTMENT ADVISORY AGREEMENTS WITH GSAM AND GSAMI.

DIRECTORS' RECOMMENDATION

In determining whether it was appropriate to approve the New Investment
Advisory Agreements and to recommend approval to shareholders the Board of
Directors, including the independent directors considered among other things,
the following: (1) the compensation to be received by GSAM and GSAMI; (2) the
nature and quality of the services required to be performed by GSAM and GSAMI;
(3) the results achieved by GSAM and GSAMI; (4) the personnel and research
capabilities of GSAM and GSAMI and (5) GSAM's and GSAMI's methodology in
managing portfolios comparable to the Fund.

ITEM 3. ELECTION OF DIRECTORS

The Company's current Board of Directors consists of five directors. The
nominees for election as directors are listed below along with their current
addresses and principal occupation for the past five years. All of the nominees
are currently serving as directors and have consented to being named as a
nominee in this Proxy Statement. Should any nominee become unable or unwilling
to serve, the persons appointed as proxies shall vote for the selection of such
other person or persons as the Board of Directors shall recommend. If elected,
all nominees will serve until their successors are elected and qualify.

10
<PAGE>
During the fiscal year ended December 31, 1995, the Company's Board of
Directors held four meetings. The Board of Directors has an audit committee
consisting of Messrs. Bailey, Page and Thomas, which held two meetings during
the 1995 fiscal year. The audit committee reviews audits, audit procedures,
financial statements and other financial and operational matters of the Company.
The Board of Directors has an interim valuation committee consisting of Ms. King
and Messrs. Briggs and Page that did not meet during the 1995 fiscal year. Each
director attended at least 75% of the meetings of the Board of Directors and the
meetings held by the committee(s) of the Board on which such director served
during the 1995 fiscal year.

The directors and officers of the Company are listed below together with
their respective positions with the Company and a brief statement of their
principal occupations during the past five years.

OFFICERS AND DIRECTORS

<TABLE>
<CAPTION>
NAME AND ADDRESS POSITION WITH THE COMPANY, PRINCIPAL OCCUPATIONS AND OTHER AFFILIATIONS
- -------------------------------------- --------------------------------------------------------------------------
<S> <C>
D. Warren Bailey Director since February 1994.
Parisian
750 Lakeshore Parkway
Birmingham, Alabama 35211

R. Stephen Briggs* Director since February 1994. Executive Vice President, Protective Life
Corporation (since October, 1993).**

Carolyn King* Director and President since May 1995. Senior Vice President, Protective
Life Corporation (since May, 1995). Senior Vice President, Provident Life
and Accident Insurance Company (August 1994 - March 1995.) Various other
positions with Provident Life and Accident Insurance Company (1980 -
August 1994).

G. Ruffner Page, Jr. Director since February 1994.
McWane Cast Iron Pipe
23 Inverness Center Parkway
Birmingham, Alabama 35243

Cleophus Thomas, Jr. Director since February 1994.
Reid & Thomas
1000 Quintard Avenue
501 South Trust Bank Building
P. O. Box 2303
Anniston, Alabama 36202
</TABLE>

11
<PAGE>
<TABLE>
<CAPTION>
NAME AND ADDRESS POSITION WITH THE COMPANY, PRINCIPAL OCCUPATIONS AND OTHER AFFILIATIONS
- -------------------------------------- --------------------------------------------------------------------------
<S> <C>
Richard J. Bielen* Vice President and Compliance Officer since February 1994. Vice President,
Protective Life Corporation (since July 1991).**

John O'Sullivan* Treasurer. Vice President, Protective Life Insurance Company (since
, 1995)

Lizabeth R. Nichols* Vice President, Secretary and Chief Compliance Officer since February
1994. Vice President and Senior Associate Counsel, Protective Life
Corporation, (since October, 1994)**

Jerry W. DeFoor* Vice President, and Chief Accounting Officer. Vice President and Chief
Accounting Officer, Protective Life Corporation
</TABLE>

- ------------------------
*"Interested Person" of the Company for purposes of the Investment Company Act
of 1940, as amended. The address of Interested Persons of the Company is 2801
Highway 280 South, Birmingham, Alabama 35223.

**These are the most current titles and positions for these persons at PLC and
PLICO. Each has held various positions with PLC and PLICO over the past five
years.

DIRECTORS' COMPENSATION

<TABLE>
<CAPTION>
AGGREGATE
COMPENSATION
FROM THE
NAME OF DIRECTOR COMPANY
- ------------------------------------------------------------------------------- -------------
<S> <C>
D. Warren Bailey............................................................... $ 8,000
R. Stephen Briggs.............................................................. 0
Carolyn King................................................................... 0
G. Ruffner Page, Jr............................................................ 8,000
Cleophus Thomas, Jr............................................................ 8,000
</TABLE>

Directors and officers of the Company do not receive any benefits from the
Company upon retirement nor does the Company accrue any expense for pension or
retirement benefits. The directors and officers of the Company do not currently
serve as directors or officers of any investment company that is an affiliated
person of the Company or that is managed by IDASI.

ITEM 4. RATIFICATION OR REJECTION OF THE SELECTION OF COOPERS & LYBRAND L.L.P.
AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANT

The firm of Coopers & Lybrand L.L.P. has been selected as the independent
public accountant for the Company for the 1996 fiscal year. Coopers & Lybrand
L.L.P. has served as the Company's independent public accountant since its
inception in 1993. Neither Coopers & Lybrand L.L.P. nor any of its members has a
direct or indirect financial interest in the Company. Coopers & Lybrand L.L.P.
also serves as independent accountants to PLICO and its parent, PLC.

A representative of Coopers & Lybrand L.L.P. is expected to be present at
the Meetings to answer questions from investors. This representative will have
an opportunity to make a statement if he or she desires and to respond to
appropriate questions.

THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE TO RATIFY THE SELECTION
OF COOPERS & LYBRAND L.L.P. AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANT FOR
THE 1996 FISCAL YEAR.

REPORTS AVAILABLE

Copies of the Company's 1995 Annual Report will be furnished without charge
upon request by writing to the Company at 2801 Highway 280 South, Birmingham,
Alabama 35223 or by calling 1-(800) 627-0220.

12
<PAGE>
SHAREHOLDER PROPOSALS

As a general matter, the Company does not hold annual meetings of
shareholders. Shareholders wishing to submit proposals for inclusion in a proxy
statement for a subsequent shareholder's meeting should sent their written
proposals to the Secretary of the Company, 2801 Highway 280 South, Birmingham,
Alabama 35223.

OTHER INFORMATION

Pursuant to a distribution agreement, Investment Distributors, Inc. ("IDI"),
acts without remuneration as the Company's distributor in the distribution of
the shares of each Fund. Like PLICO and IDASI, IDI is a wholly-owned subsidiary
of PLC and is located at 2801 Highway 280 South, Birmingham, Alabama 35223. IDI
has no obligation to sell any stated number of shares.

Pursuant to a custody agreement with the Company, State Street Bank and
Trust Company ("State Street") 1776 Heritage Drive, North Quincy, Massachusetts
02171, Mail Stop: A5N serves as custodian of the Funds' assets. Pursuant to the
custody agreement, State Street also performs certain accounting services for
the Company. These services include maintaining and keeping current the
Company's books, accounts, records, journals and other records of original entry
related to the Company's business, performing certain daily functions related
thereto, including calculating each Fund's daily net asset value. Pursuant to a
transfer agency and service agreement with the Company, State Street also acts
as transfer, redemption and dividend disbursement agent for the Company.

OTHER BUSINESS

Management knows of no business to be presented to the Meetings other than
the matters set forth in this Proxy Statement, but should any other matter
requiring the vote of shareholders arise, the proxies will vote thereon
according to their best judgment in the interest of the Company.

13
<PAGE>

APPENDIX A - To be Filed with Definitive Proxy Statement

APPENDIX B - To be Filed with Definitive Proxy Statement

<PAGE>
APPENDIX C

The directors and principal executive officers of IDASI and their principal
occupations are as shown below. The business address of each such person is 2801
Highway 280 South, Birmingham, Alabama 35223.

<TABLE>
<CAPTION>
NAME AND ADDRESS POSITION WITH IDASI AND PRINCIPAL OCCUPATION
- -------------------------- --------------------------------------------------------------------------------------
<S> <C>
John K. Wright Secretary, Director. Secretary, Director ProEquities, Inc., 2801 Highway 280 South,
Birmingham, Alabama 35223. Vice President and Senior Associate Counsel, Protective
Life Corporation, 2802 Highway 280 South, Birmingham, Alabama 35223

Lizabeth R. Hichols Vice President, Chief Compliance Officer, Director. Assistant Secretary, Chief
Compliance Officer, Director, ProEquities, Inc., 2801 Highway 280 South, Birmingham,
Alabama 35223. Vice President and Senior Associate Counsel, Protective Life
Corporation, 2802 Highway 280 South, Birmingham, Alabama 35223

R. Stephen Briggs President, Director. Director ProEquities, Inc., 2801 Highway 280 South, Birmingham,
Alabama 35223. Executive Vice President, Protective Life Corporation, 2802 Highway 280
South, Birmingham, Alabama 35223

Richard Bielen Director. Vice President, Investments. Protective Life Corporation, 2802 Highway 280
South, Birmingham, Alabama 35223
</TABLE>

14
<PAGE>
APPENDIX D

The directors and principal executive officers of GSAM and/or GSAMI and
their principal occupations are as shown below.

GSAM is a separate operating division of Goldman, Sachs & Co., a New York
limited partnership. The following general partners of Goldman Sachs & Co. are
responsible for GSAM:

<TABLE>
<CAPTION>
NAME AND ADDRESS POSITION WITH GSAM AND PRINCIPAL OCCUPATION
- -------------------------- --------------------------------------------------------------------------------------
<S> <C>
David B. Ford Goldman Sachs & Co. (Asset Management Division), One New York Plaza, New York, NY
10004; Co-Head November 1995 to Present, Chairman and Chief Executive Officer November
1994 to November 1995, Co-Chairman and Co-Chief Executive Officer February 1994 to
November 1994, Goldman, Sachs & Co., 85 Broad Street, New York, NY 10004 - General
Partner 1986 to Present

John P. McNulty Goldman, Sachs & Co. (Asset Management Division), One New York Plaza, New York, NY
10004, Co-Head November 1995 to Present, The Goldman Sachs Group, L.P., 85 Broad
Street, New York NY 10004 - Limited Partner 1994 to November 1995, Goldman Sachs &
Co., 85 Broad Street, New York, NY 10004 - General Partner November 1995 to Present -
General Partner 1990 to 1994

Sharmin Mossavar-Rahmani Goldman, Sachs & Co. (Asset Management Division), One New York Plaza, New York, NY
10004 - General Partner 1993 to Present - Chief Investment Officer - Fixed Income 1993
to Present - Vice President March 1993 to November 1993, Fidelity Management Trust
Company 82 Devonshire Street, Boston, MA 02109 - Chief Investment Officer - Fixed
Income 1987 to 1993
</TABLE>

GSAMI is an affiliate of Goldman, Sachs & Co. The following general partners
are responsible for GSAMI:

<TABLE>
<CAPTION>
NAME AND ADDRESS POSITION WITH GSAMI AND PRINCIPAL OCCUPATION
- -------------------------- --------------------------------------------------------------------------------------
<S> <C>
David B. Ford Goldman Sachs Asset Management International, 140 Fleet Street, London, EC4A 2BJ,
England - Managing Director & Chief Executive Officer November 1995 to Present -
Director December 1994 to Present, Goldman Sachs & Co. (Asset Management Division),
One New York Plaza, New York NY 10004 - Co-Head November 1995 to Present - Chairman
and Chief Executive Officer November 1994 to November 1995 - Co-Chairman and Co-Chief
Executive Officer February 1994 to November 1994, Goldman Sachs & Co., 85 Broad
Street, New York, NY 10004 - General Partner 1986 to Present - Vice President, Fixed
Income Division 1975

John P. McNulty Goldman Sachs Asset Management International, 140 Fleet Street, London, EC4A 2BJ,
England - Director January 1996 to Present, Goldman, Sachs & Co., (Asset Management
Division), One New York Plaza, New York, NY 10004 - Co-Head November 1995 to Present,
The Goldman Sachs Group, L.P., 85 Broad Street, New York, NY 10004 - Limited Partner
1994 to November 1995, Goldman, Sachs & Co., 85 Broad Street, New York, NY 10004 -
General Partner November 1995 to Present - General Partner 1990 to 1994
</TABLE>

15
<PAGE>
<TABLE>
<CAPTION>
NAME AND ADDRESS POSITION WITH GSAMI AND PRINCIPAL OCCUPATION
- -------------------------- --------------------------------------------------------------------------------------
<S> <C>
David W. Blood Goldman Sachs Asset Management International, 140 Fleet Street, London, EC4A 2BJ,
England - Director November 1995 to Present, Goldman Sachs International Peterborough
Court, 133 Fleet Street, London, EC4A 2BB, England - Managing Director (2/95) 1993 to
Present, Goldman, Sachs & Co., 85 Broad Street, New York, NY 10004 - General Partner
(11/94) 1985 to Present

Gregory K. Palm Goldman Sachs Asset Management International, 140 Fleet Street, London, EC4A 2BJ,
England - Director 1994 to Present, Goldman Sachs International, Peterborough Court,
133 Fleet Street, London, EC4A 2BB, England - Co-General Counsel 1992 to Present,
Goldman Sachs & Co., 85 Broad Street, New York, NY 10004 - General Partner 1992 to
Present, Sullivan & Cromwell, 165 Broad Street, New York, NY 10004 - Partner 1976 to
1992
</TABLE>

GSAM and/or GSAMI receive fees for investment sub-advisory services provided
to the following portfolios of other registered investment companies having a
similar investment objective to each of the Funds.

<TABLE>
<CAPTION>
PORTFOLIO OF APPROXIMATE NET WAIVER OR
OTHER REGISTERED ASSETS AS OF RATE OF ANNUAL REDUCTION OF
FUND INVESTMENT COMPANY 12/31/95 COMPENSATION COMPENSATION
- ----------------------------------------- ------------------- ---------------- -------------- ---------------
<S> <C> <C> <C> <C>
Money Market.............................
Select Equity............................
Capital Growth...........................
Small Cap Equity.........................
Growth and Income........................
International Equity.....................
Global Income............................
</TABLE>

16
<PAGE>
VOTING INSTRUCTION FORM
PROTECTIVE INVESTMENT COMPANY
VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE
PROTECTIVE INVESTMENT COMPANY FOR A SPECIAL MEETING OF SHAREHOLDERS OF THE
PROTECTIVE INVESTMENT COMPANY

I hereby instruct Protective Life Insurance Company ("Protective Life") to
vote the shares of the Money Market Fund (the "Fund") of the Protective
Investment Company (the "Company") as to which I am entitled to give
instructions as shown, at a Special Meeting of the Shareholders of the Fund
("the Meeting") to be held at 10:00 a.m. on April 30, 1996, in Training Room A,
the second floor of the Protective Life Corporation Building, 2801 Highway 280
South, Birmingham, Alabama 35223 and any adjournments thereof as follows:

(1) To approve the Investment Management Agreement between Investment
Distributors Advisory Services, Inc. ("IDASI"), and the Fund:
/ / For / / Against / / Abstain

(2) To approve the investment advisory agreements between IDASI and Goldman
Sachs Asset Management ("GSAM");
/ / For / / Against / / Abstain
(3) To elect the nominees for directors to the Company's Board of
Directors.

/ / For all nominees listed below (except as marked to the contrary)

/ / Withhold authority to vote for all nominees listed below:

(Instructions: To withhold authority to vote for any individual nominee(s),
strike a line through the names of such nominee(s) in the list below.)

Carolyn King, R. Stephen Briggs, D. Warren Bailey,
G. Ruffner Page, Jr., Cleophus Thomas, Jr.
______________________________________________________________

(4) To ratify the selection of Coopers Lybrand L.L.P. the Company's
independent public accountant.
/ / For / / Against / / Abstain

(5) In the discretion of Protective Life, to transact such other business
as may properly come before the Meeting or any adjournment thereof.

THE BOARD OF DIRECTORS OF THE COMPANY
RECOMMENDS A VOTE FOR ALL PROPOSALS.
<PAGE>
PLEASE SIGN AND DATE THIS FORM AND RETURN PROMPTLY.

I hereby revoke any and all voting instructions with respect to such shares
previously given by me. I acknowledge receipt of the Proxy Statement dated March
, 1996. THIS INSTRUCTION WILL BE VOTED AS SPECIFIED. IF NO SPECIFICATION IS
MADE, THIS INSTRUCTION WILL BE VOTED "FOR" EACH PROPOSAL.

This instruction may be revoked at any time prior to the Meeting by
notifying the Secretary of Protective Life in writing at 2801 Highway 280 South,
Birmingham, Alabama 35223.

- ------------------------------------- -------------------------------------
Variable Contract Owner Signature Date

PLEASE SIGN, DATE AND RETURN THIS FORM PROMPTLY. Your signature should be
exactly as name or names appear on this Voting Instruction Form. If the
individual signing the form is a fiduciary (E.G., attorney, executor, trustee,
guardian, etc.) the individual's signature must be followed by his/her full
title.
<PAGE>
VOTING INSTRUCTION FORM
PROTECTIVE INVESTMENT COMPANY
VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE
PROTECTIVE INVESTMENT COMPANY FOR A SPECIAL MEETING OF SHAREHOLDERS OF THE
PROTECTIVE INVESTMENT COMPANY

I hereby instruct Protective Life Insurance Company ("Protective Life") to
vote the shares of the Select Equity Fund (the "Fund") of the Protective
Investment Company (the "Company") as to which I am entitled to give
instructions as shown, at a Special Meeting of the Shareholders of the Fund
("the Meeting") to be held at 10:00 a.m. on April 30, 1996, in Training Room A,
the second floor of the Protective Life Corporation Building, 2801 Highway 280
South, Birmingham, Alabama 35223 and any adjournments thereof as follows:

(1) To approve the Investment Management Agreement between Investment
Distributors Advisory Services, Inc. ("IDASI"), and the Fund:
/ / For / / Against / / Abstain

(2) To approve the investment advisory agreements between IDASI and Goldman
Sachs Asset Management ("GSAM");
/ / For / / Against / / Abstain

(3) To elect the nominees for directors to the Company's Board of
Directors.