<PAGE>
Filed Pursuant to Rule 424(b)(3)
Registration Nos. 333-07593
333-07593-01
ML PRINCIPAL PROTECTION L.P.
SUPPLEMENT DATED FEBRUARY 3, 2000 TO THE PROSPECTUS
DATED MAY 7, 1999
In accordance with the rules of the Commodity Futures Trading
Commission (the "CFTC"), this Supplement updates certain information
contained in the Prospectus dated May 7, 1999 (the "Prospectus") of ML
Principal Protection L.P. (the "Fund"). All capitalized terms used herein
have the same meaning as in the Prospectus.
Prospective investors in the Fund should review carefully the
contents of both this Supplement and the Prospectus.
This Supplement contains an updated version of the performance
record of the Fund set forth on page 15 of the Prospectus and must be read in
conjunction with the notes thereto on page 16 of the Prospectus. As January
1, 2000 has passed, the risk factor regarding Year 2000 Issues set forth on
page 12 of the Prospectus and the related discussion set forth on page 23
have been updated as follows: "Although the advent of the Year 2000 proved to
be uneventful for most computer functions, it is unclear that all the related
systemic issues have been resolved. Furthermore, there appear to be other
computer critical dates or events which could result in material disruptions
to the computer programs employed by the Fund as well as by its service
providers."
* * * * * * * * * *
All information in the Prospectus is hereby restated, except as
updated hereby.
--------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
--------------------------
THE COMMODITY FUTURES TRADING COMMISSION HAS NOT PASSED UPON THE MERITS
OF PARTICIPATING IN THIS POOL NOR HAS THE COMMISSION PASSED UPON THE ADEQUACY OR
ACCURACY OF THIS DISCLOSURE DOCUMENT.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SELLING AGENT
MERRILL LYNCH INVESTMENT PARTNERS INC.
GENERAL PARTNER
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PERFORMANCE OF THE FUND
The following are the monthly rates of return from the inception of the
Fund through December 31, 1999. THERE CAN BE NO ASSURANCE THAT THE FUND WILL
CONTINUE TO PERFORM IN THE FUTURE THE WAY IT HAS IN THE PAST.
TYPE OF POOL: MULTI-ADVISOR; PUBLICLY-OFFERED/"PRINCIPAL PROTECTED"
INCEPTION OF TRADING: OCTOBER 12, 1994
AGGREGATE SUBSCRIPTIONS: $164,976,175
CURRENT CAPITALIZATION: $41,682,768
WORST MONTHLY DRAWDOWN: (3.70)% (2/96)
WORST PEAK-TO-VALLEY DRAWDOWN: (3.80)% (7/99-10/99)
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NET ASSET VALUE PER SERIES A UNIT, DECEMBER 31, 1999: $134.14 (adding back
$22.50 in distributions)
<TABLE>
<CAPTION>
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MONTHLY RATES OF RETURN
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MONTH 1999 1998 1997 1996 1995 1994
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<S> <C> <C> <C> <C> <C> <C>
January (1.09)% 0.07% 2.06% 2.45% (0.55)% --
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February 0.84 (0.56) 1.44 (3.70) 2.24 --
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March (0.52) 0.10 0.05 1.06 4.17 --
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April 1.17 (1.96) (0.70) 3.10 0.91 --
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May (1.30) 0.95 (1.43) (1.98) 1.20 --
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June 1.19 (0.86) 0.70 1.36 (0.21) --
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July 0.20 (0.67) 3.14 (1.68) (1.30) --
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August (0.02) 4.83 (2.71) 0.49 0.95 --
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September (0.91) 3.55 0.86 1.62 (0.32) --
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October (2.90) 0.06 (0.43) 4.25 0.29 1.04%
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November 1.60 (1.00) 0.80 2.50 0.69 0.32
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December 1.00 0.20 2.22 (0.20) 2.12 0.40
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Compound
Rate of (0.84)% 4.60% 6.01% 9.36% 10.55% 1.76%
Return (2 2/3 months)
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</TABLE>
UNITS ISSUED UNDER THIS PROSPECTUS AND PROSPECTUS SUPPLEMENT WILL
INITIALLY ALLOCATE 100% OF THEIR ASSETS TO TRADING (SUBJECT TO POSSIBLE
FUTURE DELEVERAGING). ALL UNITS ISSUED ON OR PRIOR TO MAY 1, 1997 COMMENCED
TRADING WITH 60%, AND UNITS ISSUED AFTER MAY 1, 1997 WITH 75%, OF THEIR
ASSETS ALLOCATED TO TRADING. BEGINNING MAY 1, 1998, UNITS ISSUED AFTER MAY 1,
1997 ALLOCATED 85% TO 95% OF THEIR ASSETS TO TRADING AND, AS OF JUNE 1, 1999,
ALLOCATE 100% OF THEIR ASSETS TO TRADING (ALSO SUBJECT TO POSSIBLE FUTURE
DELEVERAGING). CONSEQUENTLY, THE COMPOSITE PAST PERFORMANCE OF THE FUND MAY
NOT BE REPRESENTATIVE OF HOW THE UNITS WOULD HAVE PERFORMED OVER THE SAME
PERIOD. THE GREATER THE PERCENTAGE OF A SERIES' ASSETS ALLOCATED TO TRADING,
THE GREATER THE RISK OF LOSS AS WELL AS THE PROFIT POTENTIAL.
-------------------------
CUMULATIVE STATISTICS
CORRELATION COEFFICIENT VS. S&P 500: 0.03
BETA VS. S&P 500: 0.01
SHARPE RATIO: 0.10
PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
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<PAGE>
ACKNOWLEDGMENT OF RECEIPT OF THE
ML PRINCIPAL PROTECTION L.P. SUPPLEMENT
DATED FEBRUARY 3, 2000
TO THE PROSPECTUS DATED MAY 7, 1999
The undersigned hereby acknowledges that the undersigned has received a
copy of the ML Principal Protection L.P. Supplement dated February 3, 2000 to
the Prospectus dated May 7, 1999. A SIGNED COPY OF THIS ACKNOWLEDGMENT OF
RECEIPT OF THE FEBRUARY 3, 2000 SUPPLEMENT AND THE SUBSCRIPTION AGREEMENT AND
POWER OF ATTORNEY SIGNATURE PAGE FROM THE MAY 7, 1999 PROSPECTUS MUST BE
RETURNED TO YOUR MERRILL LYNCH FINANCIAL CONSULTANT.
INDIVIDUAL SUBSCRIBERS: ENTITY SUBSCRIBERS:
-------------------------- ----------------------------
(Name of Entity)
-------------------------- By:
Signature of Subscriber(s) -------------------------
Title:
----------------------
(Trustee, partner or
authorized officer)
Dated: _____________, 2000
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