<PAGE>
 
                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                            Washington, D.C.  20549

                                   FORM 10-K

               (x) Annual Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

                 For the fiscal year ended:  December 31, 1997
                                       or
                 (  ) Transition Report Pursuant to Section 13
                or 15(d) of the Securities Exchange Act of 1934

                        Commission file number:  0-23240

                       THE GROWTH AND GUARANTEE FUND L.P.
                       ----------------------------------
             (Exact name of registrant as specified in its charter)

            DELAWARE                                    13-3407269
-------------------------------                   -------------------
(State of other jurisdiction of                    (I.R.S. Employer
incorporation or organization)                    Identification No.)

                   C/O MERRILL LYNCH INVESTMENT PARTNERS INC.
                        MERRILL LYNCH WORLD HEADQUARTERS
                             WORLD FINANCIAL CENTER
                SOUTH TOWER, 6TH FLOOR, NEW YORK, NY  10080-6106
                ------------------------------------------------
                    (Address of principal executive offices)

      Registrant's telephone number, including area code:  (212) 236-5662
                                                           --------------

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:  None

<TABLE> 
<S>                                                          <C> 
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:  Limited Partnership Units
                                                             -------------------------
                                                                (Title of Class)
</TABLE> 
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
                                                            Yes   X          No
                                                                -----     -----

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

Aggregate market value of the voting and non-voting stock held by non-affiliates
of the registrant:  the registrant is a limited partnership; as of February 1,
1998, limited partnership interests with an aggregate value of $10,570,323 were
outstanding and held by non-affiliates.

                      DOCUMENTS INCORPORATED BY REFERENCE

The registrant's "1997 Annual Report and Independent Auditors' Report," the
annual report to security holders for the fiscal year ended December 31, 1997,
is incorporated by reference into Part II, Item 8, and Part IV hereof and filed
as an Exhibit herewith.
<PAGE>
 
                       THE GROWTH AND GUARANTEE FUND L.P.

                      ANNUAL REPORT FOR 1997 ON FORM 10-K


                               Table of Contents
                               -----------------

<TABLE> 
<CAPTION> 
                                    PART I 
                                    ------
                                                                                                  PAGE
                                                                                                  ----
<S>        <C>                                                                                  <C> 
Item 1.    Business..............................................................................   1
 
Item 2.    Properties............................................................................   4
 
Item 3.    Legal Proceedings.....................................................................   5
 
Item 4.    Submission of Matters to a Vote of Security Holders...................................   5
 
                                    PART II
                                    -------
 
Item 5.     Market for Registrant's Common Equity and Related Stockholder Matters................   5
 
Item 6.     Selected Financial Data..............................................................   6
 
Item 7.     Management's Discussion and Analysis of Financial Condition and Results of Operations   9
 
Item 7A.    Quantitative and Qualitative Disclosures About Market Risk...........................  10
 
Item 8.     Financial Statements and Supplementary Data..........................................  10
 
Item 9.     Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.  11
 
</TABLE>

<TABLE> 

                                   PART III
                                   --------

<S>        <C>                                                                                  <C> 
Item 10.    Directors and Executive Officers of the Registrant...................................  11
 
Item 11.    Executive Compensation...............................................................  13
 
Item 12.    Security Ownership of Certain Beneficial Owners and Management.......................  13
 
Item 13.    Certain Relationships and Related Transactions.......................................  14
 

                                    PART IV
                                    -------

Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K........................  15
</TABLE> 

                                      ii
<PAGE>
 
                                     PART I

ITEM 1:   BUSINESS
          --------

     (a) General Development of Business:
         ------------------------------- 

          The Growth and Guarantee Fund L.P. (the "Partnership" or the "Fund")
was organized under the Delaware Revised Uniform Limited Partnership Act on
January 21, 1987.  The Partnership began trading on June 12, 1987.

          The Partnership holds stock index futures and options positions as
directed by asset allocation strategies developed by Leland O'Brien Rubinstein
Associates Inc. ("LOR" or the "Trading Advisor"), the objective of which is to
limit losses in down S&P Stock Index markets while optimizing the extent to
which the Net Asset Value per Unit may participate, over time and on an
unleveraged basis, in significant upward movements in stock index levels.

          The Partnership does not trade directly but rather through a
subsidiary limited partnership (the "Trading Partnership").  This structure is
used so as to isolate the assets used to provide the Fund's "Principal
Protection" feature from the risk of trading losses.

          Merrill Lynch Investment Partners Inc. (the "General Partner" or
"MLIP") acts as the general partner of the Partnership.  Merrill Lynch Futures
Inc. (the "Commodity Broker" or "MLF") is the Partnership's commodity broker.
The General Partner is a wholly-owned subsidiary of Merrill Lynch Group Inc.,
which in turn is a wholly-owned subsidiary of Merrill Lynch & Co., Inc.  The
Commodity Broker is an indirect wholly-owned subsidiary of Merrill Lynch & Co.,
Inc. (ML&Co. and its affiliates are herein sometimes referred to as "Merrill
Lynch.")

          The Fund issued two series of units of limited partnership interest
("Units").  The Series A had an initial capitalization of $148,349,950, and the
Series B $84,283,207, respectively.  No Units of either Series were sold after
the initial closing.  The Series B Units ceased trading December 31, 1991.
Through December 31, 1997, Series A Units with an aggregate Net Asset Value of
$139,863,134 had been redeemed (including December 31, 1997 redemptions which
were not actually paid out until January 1998), and the capitalization of the
Fund was $10,762,615. The Net Asset Value per Series A Unit, originally $100 as
of August 5, 1987, had risen to $270.32.  As of December 31, 1997, the Fund had
451 Limited Partners.

          The highest month-end Net Asset Value per Series A Unit through
December 31, 1997 was $270.32 (December, 1997) and the lowest $87.31 (October,
1987).

     (b) Financial Information about Industry Segments:
         --------------------------------------------- 

          The Partnership's business constitutes only one segment for financial
reporting purposes, i.e., a speculative "commodity pool."

     (c) Narrative Description of Business:
         --------------------------------- 

          GENERAL

          The Partnership's trading strategy is to apply the asset allocation
techniques in an attempt to maximize the Partnership's upside participation in
upward movements in stock index levels while preserving its ability to liquidate
positions prior to incurring losses in excess of the Downside Protection
parameters.  The trading strategy is primarily reactive, i.e., it responds to
market movements without attempting to forecast trends or future prices (as
would, for example, a trend-following system).  This strategy is applied
directly to the futures markets, attempting to assure the Downside Protection
through liquidating long stock index futures positions.

                                      -1-
<PAGE>
 
          Series A Units ended 1997 with a Protected Minimum Net Asset Value of
$229.90, as of the end of the current Time Horizon (November 30, 1998).  At such
time, the program will either be restarted or the Fund will dissolve.  In order
to assure this minimum value, the Fund purchases Treasury STRIPS maturing at the
end of the current Time Horizon in a face amount equal to the Protected Minimum
NAV.  These STRIPS are not subject to the risk of market losses.

          The Fund is structured to provide a "New Profits Lock-In" in the event
that the NAV per series A Unit increases by 10% or more.  The latest "New
Profits Lock-In" was established at an NAV per Series A Unit of $255.45 on June
13, 1997.

          USE OF PROCEEDS AND INTEREST INCOME

          General.  The Fund's assets are used as a means of providing the
          -------                                                         
Fund's "principal protection" feature and as security for and to pay the
Partnership's trading losses as well as any expenses and redemptions.  The
Partnership's assets are generally available to earn interest, as more fully
described below under "-- Available Assets."

          Market Sectors.  The Partnership trades in one market sector, the S&P
          --------------                                                       
stock index futures markets. As the Fund's objective is to replicate the
positive return on the S&P 500 Index while also providing Downside Protection,
it is a non-diversified investment focused exclusively on the S&P 500 futures
contract.

          Market Types.  The Fund trades exclusively on the Chicago Mercantile
          ------------                                                        
Exchange, on which the S&P 500 futures contract is traded.

          Custody of Assets.  All of the Fund's assets are currently held in
          -----------------                                                 
customer accounts at Merrill Lynch or in bank accounts opened in the name of the
Fund

          STRIPS.  In order to provide its "principal protection" feature of
          ------                                                            
assuring investors will not lose more than 10% of the value of their respective
investments over the course of any 18 month Time Horizon, the Fund invests
approximately 80% of its assets in Treasury STRIPS (effectively zero coupon
bonds) maturing at the end of the Time Horizon in a principal amount sufficient
to assure the Protected Minimum Net Asset Value per Series A Unit.

          Available Assets.  In addition to the STRIPS held by it to provide its
          ----------------                                                      
"principal protection" feature, the Fund earns interest, as described below, on
its "Available Assets,"  which can be generally described as the cash actually
held by the Fund or invested in short-term Treasury bills.  Available Assets are
held in U.S. dollars and are comprised of the following:  (a) the Fund's cash
balance in the offset accounts (as described below) -- which includes "open
trade equity" (unrealized gains and losses on open positions) on the Fund's S&P
500 Stock Index futures contracts, which is paid into or out of the Fund's
account on a daily basis; and (b) short-term Treasury bills purchased by the
Fund.

          Interest Earned on the Fund's Available Assets.  The Fund's Available
          ----------------------------------------------                       
Assets (which for purposes of this description do not include the STRIPS held by
the Fund so as to assure the Protected Minimum Net Asset Value per Series A Unit
as of the end of each Time Horizon) are held in cash in offset accounts and in
short-term Treasury bills purchased from dealers unaffiliated with Merrill
Lynch.  Offset accounts are non-interest bearing demand deposit accounts
maintained with banks unaffiliated with Merrill Lynch.  An integral feature of
the offset arrangements is that the participating banks specifically acknowledge
that the offset accounts are MLF customer accounts, not subject to any Merrill
Lynch liability.

          MLF credits the Partnership, as of the end of each month, with
interest at the effective daily 91-day Treasury bill rate on the average daily
Available Assets held in the offset accounts during such month.  The Fund
receives all the interest paid on the short-term Treasury bills in which it
invests.

          The use of the offset account arrangements for the Partnership's
Available Assets may be discontinued by Merrill Lynch whether or not Merrill
Lynch otherwise continues to maintain its offset arrangements.  The offset

                                      -2-
<PAGE>
 
arrangements are dependent on the banks' continued willingness to make overnight
credits available to Merrill Lynch, which, in turn, is dependent on the credit
standing of ML&Co.  If Merrill Lynch were to determine that the offset
arrangements had ceased to be practicable (either because ML&Co. credit lines at
participating banks were exhausted or for any other reason), Merrill Lynch would
thereafter attempt to invest all of the Fund's Available Assets to the maximum
practicable extent in short-term Treasury bills.  All interest earned on the
Available Assets so invested would be paid to the Fund, but MLIP would expect
the amount of such interest to be less than that available to the Fund under the
offset account arrangements.  The remaining Available Assets of the Fund would
be kept in cash to meet variation margin payments and pay expenses, but would
not earn interest for the Fund.

          The banks at which the offset accounts are maintained make available
to Merrill Lynch interest-free overnight credits, loans or overdrafts in the
amount of  the Fund's Available Assets held in the offset accounts, charging
Merrill Lynch a small fee for this service.  The economic benefits derived by
Merrill Lynch -- net of the interest credits paid to the Fund and the fee paid
to the offset banks -- from the offset accounts have not exceeded  3/4 of 1% per
annum of the Fund's average daily Available Assets held in the offset accounts.
These revenues to Merrill Lynch are in addition to the Brokerage Commissions
paid by the Fund to MLF.

                          ____________________________

          The General Partner has determined that there may have been a
miscalculation in the interest credited to the Fund for a period prior to
November 1996.  Accordingly, Merrill Lynch has credited the Fund's investors
(directly, not by crediting the Fund itself).  For current Merrill Lynch
clients, this credit, which includes compounded interest, appears on the
December 1997 account statements.  The total amount of the adjustment is
approximately $5,000.

          CHARGES

          The following table summarizes the charges incurred by the Fund during
1995, 1996 and 1997.


<TABLE>
<CAPTION>
                                  1995                    1996                    1997
                          -----------------------------------------------------------------------
 
                                   % OF AVERAGE             % OF AVERAGE             % OF AVERAGE
                          DOLLAR    MONTH-END      DOLLAR    MONTH-END      DOLLAR    MONTH-END
COST                      AMOUNT    NET ASSETS     AMOUNT    NET ASSETS     AMOUNT    NET ASSETS
----                     --------   ----------    --------   ----------    --------   ----------
<S>                      <C>       <C>            <C>       <C>            <C>       <C>            
Brokerage Commissions    $  4,225          0.05%  $  2,938          0.03%  $  4,894          0.05%
Administrative Fees       144,696          1.78    158,330          1.77    180,711          1.77
                         --------          ----   --------          ----   --------          ----
       Total             $148,921          1.83%  $161,268          1.80%  $185,605          1.82%
                         ========          ====   ========          ====   ========          ====
</TABLE>

                          ____________________________

          The foregoing table does not reflect the benefits which may be derived
by Merrill Lynch from the deposit of certain of the Fund's Available Assets
(other than the STRIPS which provides the Fund's "Principal Protection" feature)
in offset accounts.  See Item 1(c), "Narrative Description of Business -- Use of
Proceeds and Interest Income."

          The Fund's average month-end Net Assets during 1995, 1996 and 1997
equaled $8,107,763, $8,948,805 and $10,187,651 , respectively.

          During 1995, 1996 and 1997, the Fund earned $407,304, $453,093 and
$588,693 in interest income, or approximately 5.02%, 5.06% and 5.78% of the
Fund's average month-end Net Assets.

                                      -3-
<PAGE>
 
                         ------------------------------

                         DESCRIPTION OF CURRENT CHARGES
<TABLE>
<CAPTION>
 
 
RECIPIENT        NATURE OF PAYMENT        AMOUNT OF PAYMENT
---------        -----------------        -----------------                      
<S>              <C>                      <C>
 
MLF              Brokerage Commissions    A round turn rate of $25, which includes exchange,
                                          clearing and NFA fees

MLF              Use of Fund assets       Merrill Lynch may derive an economic benefit from
                                          the deposit of certain of the Fund's Available Assets in
                                          offset accounts; such benefit to date has not exceeded
                                          3/4 of 1% of such average daily Available Assets.

Third Parties    Administrative Expenses  As incurred.
 
MLF; Others      Extraordinary expenses   Actual costs incurred; none paid to date, and expected
                                          to be negligible.
 
</TABLE>                 

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

          REGULATION

          The General Partner, LOR and the Commodity Broker are each subject to
regulation by the Commodity Futures Trading Commission (the "CFTC") and the
National Futures Association.  Other than in respect of its periodic reporting
requirements under the Securities Exchange Act of 1934, the Partnership itself
is generally not subject to regulation by the Securities and Exchange
Commission.  However, MLIP itself is registered as an "investment adviser" under
the Investment Advisers Act of 1940.

          (i) through (xii) -- not applicable.

          (xiii)  The Partnership has no employees.

     (d) Financial Information about Foreign and Domestic Operations and Export
         ----------------------------------------------------------------------
Sales:
----- 

          The Partnership does not engage in material operations in foreign
countries, nor is a material portion of the Partnership's revenues derived from
customers in foreign countries.

ITEM 2:   PROPERTIES
          ----------

     The Partnership does not use any physical properties in the conduct of its
business.

     The Partnership's only place of business is the place of business of the
General Partner (see Item 10 herein). The General Partner performs all
administrative services for the Partnership from the General Partner's offices.

                                      -4-
<PAGE>
 
ITEM 3:   LEGAL PROCEEDINGS
          -----------------

     ML&Co. -- the sole stockholder of Merrill Lynch Group, Inc. (which is the
sole stockholder of MLIP) -- as well as certain of its subsidiaries and
affiliates have been named as defendants in civil actions, arbitration
proceedings and claims arising out of their respective business activities.
Although the ultimate outcome of these actions cannot be ascertained at this
time and the results of legal proceedings cannot be predicted with certainty, it
is the opinion of management that the result of these matters will not be
materially adverse to the business operations or the financial condition of MLIP
or the Fund.

     MLIP itself has never been the subject of any material litigation.

     On June 24, 1997, the CFTC accepted an Offer of Settlement from MLF and
others, in a matter captioned "In the Matter of Mitsubishi Corporation and
Merrill Lynch Futures Inc., et al.," CFTC Docket No. 97-10, pursuant to which
MLF, without admitting or denying the allegations against it, consented to a
finding by the Commission that MLF had violated Section 4c(a)(A) of the
Commodity Exchange Act, relating to wash sales (the CFTC alleged that the
customer entered nearly simultaneous orders without the intent to engage in a
bona fide trading transaction), and CFTC Regulation 1.37(a), relating to
recordkeeping requirements.  MLF agreed to cease and desist from violating
Section 4c(a)(A) of the Act and Regulation 1.37(a), and to pay a civil monetary
penalty of $175,000.

ITEM 4:   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
          ---------------------------------------------------

     The Partnership has never submitted any matters to a vote of its Limited
Partners.

                                    PART II

ITEM 5:   MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
          ---------------------------------------------------------------------

     (a)  Market Information:
          ------------------ 

          There is no public trading market for the Units, nor will one develop.
Rather, Limited Partners may redeem Units as of the end of each month at Net
Asset Value.  Units redeemed prior to the end of the current Time Horizon are
not assured of any minimum Net Asset Value per Unit by the Partnership's
"principal protection" feature.

     (b)  Holders:
          ------- 

          As of December 31, 1997, there were 452 holders of Units, including
the General Partner .

     (c)  Dividends:
          --------- 

          The Partnership has made no distributions since trading commenced, nor
does the General Partner presently intend to make any distributions in the
future.

                                      -5-
<PAGE>
 
ITEM 6:   SELECTED FINANCIAL DATA
          -----------------------

          The following selected financial data has been derived from the
audited financial statements of the Partnership.


<TABLE>
<CAPTION>
                                            YEAR ENDED     YEAR ENDED     YEAR ENDED     YEAR ENDED     YEAR ENDED
                                           DECEMBER 31,   DECEMBER 31,   DECEMBER 31,   DECEMBER 31,   DECEMBER 31,
INCOME STATEMENT DATA                          1997           1996           1995           1994           1993
---------------------                      -------------  -------------  -------------  -------------  -------------
<S>                                        <C>            <C>            <C>            <C>            <C>
Revenues:

Trading Profits (Loss)

  Realized Gain (Loss)                      $ 1,801,922     $1,226,117     $2,374,649     $ (324,228)    $  382,507

  Change in Unrealized (Loss) Gain               40,042        (64,696)      (367,336)       (73,403)       (87,474)
                                            -----------     ----------     ----------     ----------     ----------

         Total Trading Results                1,841,964      1,161,421      2,007,313       (397,631)       295,033

Interest Income                                 588,693        453,093        407,304        355,496        353,974
                                            -----------     ----------     ----------     ----------     ----------

         Total Revenues                       2,430,657      1,614,514      2,414,617        (42,135)       649,007
                                            -----------     ----------     ----------     ----------     ----------
 
Expenses:

   Brokerage Commissions                          4,894          2,938          4,225          8,247          9,891

   Administrative Fees                          180,711        158,330        144,696        142,881        164,052
                                            -----------     ----------     ----------     ----------     ----------

        Total Expenses                          185,605        161,268        148,921        151,128        173,943
                                            -----------     ----------     ----------     ----------     ----------

        Income before Minority Interest       2,245,052      1,453,246      2,265,696       (193,263)       475,064

        Minority Interest Income                (90,502)       (28,850)       (12,942)             -              -
                                            -----------     ----------     ----------     ----------     ----------

                      Net Income (Loss)     $ 2,154,550     $1,424,396     $2,252,754      ($193,263)    $  475,064
                                            ===========     ==========     ==========     ==========     ==========
</TABLE> 

<TABLE> 
<CAPTION> 
                                           DECEMBER 31,   DECEMBER 31,   DECEMBER 31,   DECEMBER 31,   DECEMBER 31,
                                                   1997           1996           1995           1994           1993
BALANCE SHEET DATA                          -----------     ----------     ----------     ----------     ----------
<S>                                         <C>             <C>            <C>            <C>            <C> 
Fund Net Asset Value                        $10,762,615     $9,421,523     $8,623,082     $7,566,511     $8,748,614

Net Asset Value per Series A Unit               $270.32        $218.46        $186.57        $141.33        $144.72
</TABLE>

                                      -6-
<PAGE>
 
<TABLE>
<CAPTION>
                                   MONTH-END NET ASSET VALUE PER SERIES A UNIT
------------------------------------------------------------------------------------------------------------------
         JAN.     FEB.     MAR.     APR.      MAY     JUNE     JULY     AUG.     SEPT.    OCT.     NOV.     DEC.
------------------------------------------------------------------------------------------------------------------
<S>     <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>      <C>
 1993   $138.74  $140.38  $141.95  $138.85  $141.07  $140.99  $140.50  $144.51  $142.22  $144.75  $143.30  $144.72
------------------------------------------------------------------------------------------------------------------
 1994   $148.74  $144.86  $140.67  $140.72  $142.00  $138.44  $142.06  $146.14  $142.90  $145.19  $140.21  $141.33
------------------------------------------------------------------------------------------------------------------
 1995   $144.95  $149.87  $152.99  $157.25  $163.05  $166.23  $171.58  $172.09  $178.01  $177.64  $184.56  $186.57
------------------------------------------------------------------------------------------------------------------
 1996   $192.60  $192.04  $193.82  $194.68  $198.40  $199.74  $191.34  $193.92  $203.75  $210.32  $223.74  $218.46
------------------------------------------------------------------------------------------------------------------
 1997   $230.41  $231.23  $221.77  $231.83  $244.06  $252.44  $269.18  $256.52  $265.99  $260.51  $267.04  $270.32
------------------------------------------------------------------------------------------------------------------
</TABLE>

        Pursuant to CFTC policy, monthly performance is presented from January
1, 1993, even though the Units were outstanding prior to such date.

                                      -7-
<PAGE>
 
                       THE GROWTH AND GUARANTEE FUND L.P.
                               DECEMBER 31, 1997

   Type of Pool:  Single-Advisor/Publicly-Offered/"Principal Protected"/(1)/
                     Inception of Trading:  August 5, 1987
                    Aggregate Subscriptions:    $148,349,450
                     Current Capitalization:   $10,762,615
                 Worst Monthly Drawdown/(2)/:  (4.70)%  (8/97)
           Worst Peak-to-Valley Drawdown/(3)/:  (6.93)%  (2/94-6/94)
                                 _____________

        Net Asset Value per Series A Unit, December 31, 1997:   $270.32

<TABLE>
<CAPTION>
---------------------------------------------------------
               MONTHLY RATES OF RETURN/(4)/
---------------------------------------------------------
      MONTH         1997    1996    1995    1994     1993
---------------------------------------------------------
<S>                <C>     <C>     <C>     <C>      <C>
January             5.47%   3.23%   2.56%    2.77%   0.85%
---------------------------------------------------------
February            0.36   (0.29)   3.40    (2.61)   1.19
---------------------------------------------------------
March              (4.09)   0.93    2.08    (2.89)   1.12
---------------------------------------------------------
April               4.54    0.45    2.78     0.03   (2.19)
---------------------------------------------------------
May                 5.28    1.91    3.69     0.91    1.60
---------------------------------------------------------
June                3.43    0.67    1.95    (2.51)  (0.06)
---------------------------------------------------------
July                6.63   (4.21)   3.22     2.61   (0.67)
---------------------------------------------------------
August             (4.70)   1.35    0.30     2.88    3.19
---------------------------------------------------------
September           3.69    5.07    3.44    (2.22)  (1.59)
---------------------------------------------------------
October            (2.06)   3.22   (0.20)    1.61    1.78
---------------------------------------------------------
November            2.51    6.38    3.89    (3.43)  (1.00)
---------------------------------------------------------
December            1.23   (2.36)   1.09     0.80    0.99
---------------------------------------------------------
Compound Annual    23.76%  17.09%  32.01%  (2.34)%   5.20%
Rate of Return
---------------------------------------------------------
</TABLE>


          (1)  Certain funds, including other funds sponsored by MLIP, are
structured so as to guarantee to investors that their investment will be worth
no less than a specified amount as of a date certain in the future.  The CFTC
refers to such funds as "principal protected."  The Partnership provides its
"principal protection" feature through the purchase of STRIPS which matures as
of the end of each Time Horizon in an amount equal to 90% of the Partnership's
capitalization as of the beginning of such Time Horizon.

          (2)  Worst Monthly Drawdown represents the largest negative Monthly
Rate of Return experienced since January 1, 1993 by the Fund; a drawdown is
measured on the basis of month-end Net Asset Value only, and does not reflect
intra-month figures.

          (3)  Worst Peak-to-Valley Drawdown represents the greatest percentage
decline since January 1, 1993 from a month-end cumulative Monthly Rate of Return
without such cumulative Monthly Rate of Return being equaled or exceeded as of a
subsequent month-end.  For example, if the Monthly Rate of Return was (1)% in
each of January and February, 1% in March and (2)% in April, the Peak-to-Valley
Drawdown would still be continuing at the end of April in the amount of
approximately (3)%, whereas if the Monthly Rate of Return had been approximately
3% in March, the Peak-to-Valley Drawdown would have ended as of the end of
February at approximately the (2)% level.

          (4)  Monthly Rate of Return is the net performance of the Fund during
the month of determination (including interest income and after all expenses
have been accrued or paid) divided by the total equity of the Fund as of the
beginning of such month.

                                      -8-
<PAGE>
 
ITEM 7:   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          ---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------

     RESULTS OF OPERATIONS

          General.  The Fund is materially different from most other futures
          -------                                                           
funds in that it does not attempt to achieve speculative profits from taking
long or short positions in a variety of markets.  Rather, the Fund's objective
is to capture a substantial portion of significant upside movements in the S&P
500 Stock Index (dividends not reinvested) while providing the protection of a
maximum loss which can be incurred during any 18 month Time Horizon.  The Fund's
ability to capture upside S&P 500 Stock Index movements is based on a call
options strategy, and is path dependent -- i.e., the extent to which the Fund is
able to capture upside movements in the S&P 500 depends on the patterns in which
such movements occur.  For example, if the S&P 500 increased during a Time
Horizon by a total of 25% but did so after incurring a 15% drop, it is likely
the Fund would recognize little or none of the upward movement, because it would
have lost all that it had available to lose during the Time Horizon in question
during the course of the 15% drop.

          During the past 36 months of trading ending December 31, 1997, the S&P
500 Stock Index (dividends not reinvested) increased a total of 110.84%, whereas
the Net Asset Value per Series A Unit increased 91.27%.

     PERFORMANCE SUMMARY

          The Fund's performance is dependent upon upwards movements in the S&P
Stock Index, which the Fund attempts to capture through taking long positions in
the S&P 500 Stock Index Futures Contract.

     1995
          During 1995, the Fund's average month-end Net Assets equaled
$8,107,763, and the Fund recognized gross trading gains of $2,007,313 or 24.76%
of such average month-end Net Assets.  Brokerage commissions of $4,225 or 0.05%
and Administrative expenses of $144,696 or 1.78% of average month-end Net Assets
were paid.  Interest income of $407,304 or 5.02% of average month-end Net Assets
resulted in net income of $2,252,754 (after deduction of MLIP's Minority
Interest in the Trading Partnership) or 27.79% of average month-end Net Assets
which resulted in a 32.01% increase in the overall Net Asset Value of the Fund.

     1996
          During 1996, the Fund's average month-end Net Assets equaled
$8,948,805, and the Fund recognized gross trading gains of $1,161,421 or 12.98%
of such average month-end Net Assets.  Brokerage commissions of $2,938 or 0.03%
and Administrative expenses of $158,330 or 1.77% of average month-end Net Assets
were paid.  Interest income of $453,093 or 5.06% of average month-end Net Assets
resulted in net income of $1,424,396 (after deduction of MLIP's Minority
Interest in the Trading Partnership) or 15.92% of average month-end Net Assets,
which resulted in a 17.09% increase in the Net Asset Value per Unit.

     1997
          During 1997, the Fund's average month-end Net Assets equaled
$10,187,651, and the Fund recognized gross trading gains of $1,841,964 or 18.08%
of such average month-end Net Assets.  Brokerage commissions of $4,894 or 0.05%
and Administrative expenses of $180,711 or 1.77% of average month-end Net Assets
were paid.  Interest income of $588,693 or 5.78% of average month-end Net Assets
resulted in net income of $2,154,550 (after deduction of MLIP's Minority
Interest in the Trading Partnership) or 21.15% of average month-end Net Assets,
which resulted in a 23.74% increase in the Net Asset Value per Unit.

     IMPORTANCE OF MARKET FACTORS

          The performance of the Fund is dependent on the performance of the S&P
500 Stock Index Futures Contract.  The Fund's trading strategy involves taking
"long only" positions in this Contract, attempting to capture substantially all
of any upward movement in the S&P 500 Stock Index, while providing the "downside
protection" of assuring investors that they cannot lose more than 10% of the
capital during any 18-month Time Horizon.  The Fund's ability to achieve this
objective is, however, "path dependent."  Given different patterns of  S&P 500


                                      -9-
<PAGE>
 
Stock Index movements during a Time Horizon, the Fund could capture all, most,
or very little of the cumulative gain in the Index over a Time Horizon. Volatile
S&P 500 markets are likely to minimize or reduce the percentage of any
cumulative gain reflected in the performance of the Fund, as the Fund would be
continually acquiring and liquidating S&P positions in response to fluctuating
S&P 500 Index levels. On the other hand, in the case of a strongly upward
trending S&P Index, the Fund would be likely to capture substantantly all of the
cumulative gain in the Index over a Time Horizon. Comparisons between the Fund's
performance in any given fiscal year to that in the prior fiscal year are no
more, or less, meaningful than a comparison between S&P 500 Stock Index
movements which took into account both the overall increase or decrease in the
Index over the period and the pattern of price movements which resulted in such
increase or decrease.

     LIQUIDITY

          A significant portion of the Partnership's assets were held in U.S.
Treasury STRIPS which, in turn, generate the protected minimum Net Asset Value.
The U.S. STRIPS are highly liquid but are acquired by the Fund on a buy-and-hold
basis for the course of a Time Horizon, except to the extent liquidated to fund
a portion of redemptions.  A portion of the Partnership's assets are also held
as cash which, in turn, is used to margin its stock index futures positions and
is withdrawn, as necessary, to pay a portion of redemptions and fees.

          The S&P 500 stock index futures contracts in which the Partnership
trades may become illiquid under certain market conditions.  Stock index futures
contracts in the U.S. are subject to "circuit breakers" which require the
suspension of trading after certain market movements.  However, these "circuit
breakers" have rarely been "triggered," and because the Fund buys rather than
sells options, it is generally not exposed to risk of not being able to close
out positions against which the market is moving as a result of illiquidity.

          The Partnership does not have, nor does it expect to have, any capital
assets and has no material commitments for capital expenditures.  The
Partnership uses its assets to (i) assure the investors the protected minimum
Net Asset Values as of the end of the Time Horizons and (ii) supply the
necessary margin or premiums for, and to pay any losses incurred in connection
with, its trading activity and to pay redemptions and fees.  Inflation is not a
significant factor in the Fund's profitability although inflationary cycles can
give rise to the stock index futures markets in which the Fund trades
exclusively.  The Fund cannot be profitable during a Time Horizon unless the S&P
500 Stock Index market rises.

     THE YEAR 2000 COMPUTER ISSUE

     Merrill Lynch's modifications for Year 2000 systems compliance are
proceeding according to plan and are expected to be completed in early 1999.
Based on information currently available, the remaining expenditures are
estimated at $200 million and will cover hardware and software upgrades, systems
consulting, and computer maintenance.  These expenditures are not expected to
have a material adverse impact on Merrill Lynch's financial position, results of
operations, or cash flows in future periods.  However, the failure of Merrill
Lynch's securities exchanges, clearing organizations, vendors, clients, or
regulators to resolve their own processing issues in a timely manner could
result in a material financial risk.  Merrill Lynch is devoting necessary
resources to address all Year 2000 issues in a timely manner.

ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
         ----------------------------------------------------------

     Not applicable.

ITEM 8:   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
          -------------------------------------------

     The financial statements required by this Item are included in Exhibit
13.01.

     The supplementary financial information ("selected quarterly financial
data" and "information about oil and gas producing activities") specified by
Item 302 of Regulation S-K is not applicable.

                                      -10-
<PAGE>
 
ITEM 9:   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          ---------------------------------------------------------------
          FINANCIAL DISCLOSURE
          --------------------

     There were no changes in or disagreements with accountants on accounting or
financial disclosure.


                                    PART III

ITEM 10:  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
          --------------------------------------------------

     (a,b)  Identification of Directors and Executive Officers:
            -------------------------------------------------- 

          As a limited partnership, the Partnership itself has no officers or
directors and is managed by the General Partner.  Trading decisions are made by
the Trading Advisors on behalf of the Partnership.

          The directors and executive officers of MLIP as of February 1, 1998
and their business backgrounds are as follows.

 
 
John R. Frawley, Jr.                    Chairman, Chief Executive Officer,
                                        President and Director

Jeffrey F. Chandor                      Senior Vice President, Director of
                                        Sales, Marketing and Research and
                                        Director
 
Joseph H. Moglia                        Director
 
Allen N. Jones                          Director
 
Stephen G. Bodurtha                     Director
 
Michael A. Karmelin                     Chief Financial Officer, Vice
                                        President and Treasurer
 
Steven B. Olgin                         Vice President, Secretary and Director
                                        of Administration
 
 

          John R. Frawley, Jr. was born in 1943.  Mr. Frawley is Chairman, Chief
Executive Officer,  President and a Director of MLIP and Co-Chairman of MLF.  He
joined Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S") in 1966 and
has served in various positions, including Retail and Institutional Sales,
Manager of New York Institutional Sales, Director of Institutional Marketing,
Senior Vice President of Merrill Lynch Capital Markets and Director of
International Institutional Sales.  Mr. Frawley holds a Bachelor of Science
degree from Canisius College.  Mr. Frawley served on the CFTC's Regulatory
Coordination Advisory Committee from its formation in 1990 through its
dissolution in 1994.  Mr. Frawley is currently serving his fourth consecutive
one-year term as Chairman of the Managed Funds Association (formerly, the
Managed Futures Association), a national trade association that represents the
managed futures, hedge funds and fund of funds industry.  Mr. Frawley is also a
Director of that organization.  Mr. Frawley currently serves on a  panel created
by the Chicago Mercantile Exchange and The Board of Trade of the City of Chicago
to study cooperative efforts related to electronic trading, common clearing and
the issues regarding a potential merger.

                                      -11-
<PAGE>
 
          Jeffrey F. Chandor was born in 1942.  Mr. Chandor is Senior Vice
President, the Director of Sales, Marketing and Research and a Director of MLIP.
He joined MLPF&S in 1971 and has served as the Product Manager of International
Institutional Equities, Equity Derivatives and Mortgage-Backed Securities as
well as Managing Director of International Sales in the United States, and
Managing Director of Sales in Europe.  Mr. Chandor holds a Bachelor of Arts
degree from Trinity College, Hartford, Connecticut.

          Joseph H. Moglia was born in 1949.  He is a director of MLIP.  In
1971, he graduated from Fordham University with a Bachelor of Arts degree in
Economics.  He later received his Master of Science degree from the University
of Delaware.  He taught at the high school and college level for sixteen years.
Mr. Moglia joined MLPF&S in 1984, and has served in a number of senior roles,
including Director of New York Fixed Income Institutional Sales, Director of
Global Fixed Institutional Sales, and Director of the Municipal Division.  He is
currently Senior Vice President and Director of the Investment Strategy and
Product Group in Merrill Lynch Private Client, and Director of Middle Markets.

          Allen N. Jones was born in 1942.  Mr. Jones is a Director of MLIP and,
from July 1995 until January 1998, Mr. Jones was Chairman of the Board of
Directors of MLIP.  Mr. Jones graduated from the University of Arkansas with a
Bachelor of Science, Business Administration degree in 1964.  Since June 1992,
Mr. Jones has held the position of Senior Vice President of MLPF&S.  From June
1992 through February 1994, Mr. Jones was the President and Chief Executive
Officer of Merrill Lynch Insurance Group, Inc. ("MLIG") and remains on the Board
of Directors of MLIG and its subsidiary companies. From February 1994 to April
1997, Mr. Jones was the Director of Individual Financial Services of the Merrill
Lynch Private Client Group.  In April 1997, Mr. Jones became the Director of
Private Client marketing.

          Stephen G. Bodurtha was born in 1958.  Mr. Bodurtha is a Director of
MLIP.  In 1980, Mr. Bodurtha graduated from Wesleyan University, Middletown,
Connecticut with a Bachelor of Arts degree in Government, magna cum laude.  From
1980 to 1983, Mr. Bodurtha worked in the Investment Banking Division of Merrill
Lynch.  In 1985, he was awarded his Master of Business Administration degree
from Harvard University, where he also served as Associates Fellow (1985-1986).
From 1986 to 1989, Mr. Bodurtha held the positions of Associate and Vice
President with Kidder, Peabody & Co., Incorporated where he worked in their
Financial Futures & Options Group.  Mr. Bodurtha joined MLPF&S in 1989 and has
held the position of First Vice President since 1995.  He has been the Director
in charge of MLPF&S's Structured Investments Group since 1995.

          Michael A. Karmelin was born in 1947.  Mr. Karmelin is Chief Financial
Officer, Vice President and Treasurer of MLIP.  Prior to joining MLIP in April
1997, Mr. Karmelin was Chief Financial Officer of Merrill Lynch, Hubbard Inc.
("ML Hubbard"), a sponsor of real estate limited partnerships.  Mr. Karmelin
joined ML Hubbard in January 1994 and was a Vice President of ML Hubbard.  From
May 1994 to April 1997, he was the Chief Financial Officer of ML Hubbard,
responsible for its accounting, treasury and tax functions.  Prior to joining ML
Hubbard, Mr. Karmelin held several senior financial positions with ML&Co and
MLPF&S from December 1985 to December 1993, including Vice President/Senior
Financial Officer Corporate Real Estate and Purchasing, Manager Commitment
Control/Capital Budgeting, and Senior Project Manager/Project Analysis.  Prior
to joining ML&Co., Mr. Karmelin was employed at Avco Corporation for 17 years,
where he held a variety of financial positions.  Mr. Karmelin holds a B.B.A.
degree in Accounting from Baruch College, C.U.N.Y. and a Master of Business
Administration degree in Corporate Strategy and Finance from New York
University.  Mr. Karmelin passed the Certified Public Accounting examination in
1974 and is a member of the Treasury Management Association, the Institute of
Management Accountants and The Strategic Leadership Forum.

          Steven B. Olgin was born in 1960.  Mr. Olgin is Vice President,
Secretary and the Director of Administration of MLIP.  He joined MLIP in July
1994 and became a Vice President in July 1995.  From 1986 until July 1994, Mr.
Olgin was an associate of the law firm of Sidley & Austin.  In 1982, Mr. Olgin
graduated from The American University with a Bachelor of Science degree in
Business Administration and a Bachelor of Arts degree in Economics.  In 1986, he
received his Juris Doctor degree from The John Marshall Law School.  Mr. Olgin
is a member of the Managed Funds Association's Government Relations Committee
and has served as an arbitrator for the NFA. Mr. Olgin is also a member of the
Committee on Futures Regulation of the Association of the Bar of the City of New
York.

                                      -12-
<PAGE>
 
          Messrs. Moglia and Bodurtha became Directors in January 1998.

          As of December 31, 1997, the principals of MLIP had no investment in
the Fund, and MLIP's general partner interest in the Fund was valued at
$183,819.

          MLIP acts as general partner to twelve public futures funds whose
units of limited partnership interest are registered under the Securities
Exchange Act of 1934:  The Futures Expansion Fund Limited Partnership, ML
Futures Investments L.P., ML Futures Investments II L. P., John W. Henry &
Co./Millburn L.P., The S.E.C.T.O.R. Strategy Fund(SM) L.P., The SECTOR Strategy
Fund(SM) II L.P., The SECTOR Strategy Fund(SM) V L.P., The SECTOR Strategy 
Fund(SM) VI L.P., ML Global Horizons L.P., ML Principal Protection L.P.
(formerly, ML Principal Protection Plus L.P.), ML JWH Strategic Allocation Fund
L.P. and the Fund. Because MLIP serves as the sole general partner of each of
these funds, the officers and directors of MLIP effectively manage them as
officers and directors of such funds.

     (c) Identification of Certain Significant Employees:
         ----------------------------------------------- 

          None.

     (d)  Family Relationships:
          -------------------- 

          None.

     (e)  Business Experience:
          ------------------- 

          See Item 10(a)(b) above.

     (f) Involvement in Certain Legal Proceedings:
         ---------------------------------------- 

          None.

     (g)  Promoters and Control Persons:
          ----------------------------- 

          Not applicable.

ITEM 11:  EXECUTIVE COMPENSATION
          ----------------------

     The directors and officers of the General Partner are remunerated by the
General Partner in their respective positions.  The Partnership does not itself
have any officers, directors or employees.  The Partnership pays Brokerage
Commissions to an affiliate of the General Partner.  The General Partner or its
affiliates may also receive certain economic benefits from holding certain of
the Fund's dollar Available Assets in offset accounts, as described in Item 1(c)
above.  The directors and officers receive no "other compensation" from the
Partnership, and the directors receive no compensation for serving as directors
of the General Partner.  There are no compensation plans or arrangements
relating to a change in control of either the Partnership or the General
Partner.

ITEM 12:  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
          --------------------------------------------------------------

     (a) Security Ownership of Certain Beneficial Owners:
         ----------------------------------------------- 

          As of December 31, 1997, no person or "group" is known to be or have
been the beneficial owner of more than five percent of the Units.

     (b) Security Ownership of Management:
         -------------------------------- 

          As of December 31, 1997, the General Partner owned 680 Units (unit-
equivalent general partnership interests), which was less than 2% of the total
Units outstanding.

                                      -13-
<PAGE>
 
     (c)  Changes in Control:
          ------------------ 

          None.

ITEM 13:  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
          ----------------------------------------------

     (a) Transactions with Management and Others:
         --------------------------------------- 

          The General Partner acts as administrative and trading manager of the
Fund.  The General Partner provides all  normal ongoing administrative functions
of the Partnership, such as accounting, legal and printing services.  The
General Partner, which receives the Administrative Fees, pays all expenses
relating to such services.

     (b) Certain Business Relationships:
         ------------------------------ 

          MLF, an affiliate of the General Partner, acts as the principal
commodity broker for the Partnership.

          In 1997 the Partnership paid:  (i) Brokerage Commissions of $4,894 to
the Commodity Broker, and (ii) Administrative Fees of $180,711 to the General
Partner, which included $32,975 in consulting and advisory fees paid by the
Commodity Broker to the Trading Advisors.  In addition, MLIP and its affiliates
may have derived certain economic benefits from maintaining a portion of the
Fund's assets in "offset accounts," as described under Item 1(c), "Narrative
Description of Business -- Use of Proceeds and Interest Income -- Interest
Earned on the Fund's U.S. Dollar Available Assets" and "Executive Compensation"
herein.

          See Item 1(c), "Narrative Description of Business -- Charges" and "--
Description of Current Charges" for a discussion of other business dealings
between MLIP affiliates and the Partnership.

     (c)  Indebtedness of Management:
          -------------------------- 

          The Partnership is prohibited from making any loans, to management or
          otherwise.

     (d)  Transactions with Promoters:
          --------------------------- 

          Not applicable.

                                      -14-
<PAGE>
 
                                    PART IV

ITEM 14:  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
          ---------------------------------------------------------------
 
        (a)1.  Financial Statements (found in Exhibit 13.01):  Page
               ----------------------------------------------  ----
 
       Independent Auditors' Report                             1
 
       Consolidated Statements of Financial Condition
       as of December 31, 1997 and 1996                         2
 
       For the years ended December 31, 1997,
       1996 and 1995:
               Consolidated Statements of Income                3
               Consolidated Statements of Changes in 
               Partners' Capital                                4
 
       Notes to Consolidated Financial Statements            5-10

          (a)2. Financial Statement Schedules:
                ----------------------------- 

          Financial statement schedules not included in this Form 10-K have been
omitted for the reason that they are not required or are not applicable or that
equivalent information has been included in the financial statements or notes
thereto.

          (a)3.  Exhibits:
                 -------- 

          The following exhibits are incorporated by reference or are filed
          herewith to this Annual Report on Form 10-K:

Designation    Description
-----------    -----------

3.02           Amended and Restated Limited Partnership Agreement of the
               Partnership.

Exhibit 3.02:  Is incorporated herein by reference from Exhibit 3.01 contained
               in Amendment No. 2 (as Exhibit A) to the Registration Statement
               (File No. 33-13175) filed on June 10, 1987, on Form S-1 under the
               Securities Act of 1933 (the "Registrant's Registration
               Statement").

3.04           Amended and Restated Certificate of Limited Partnership of the
               Partnership, dated July 27, 1995.

Exhibit 3.04:  Is incorporated by reference from Exhibit 3.04 contained in the
               Registrant's report on Form 10-Q for the Quarter Ended June 30,
               1995.

3.05           Certificate of Limited Partnership of the Trading Partnership
               dated June 24, 1994.

Exhibit 3.05:  Is incorporated herein by reference from Exhibit 3.05 contained
               in the Registrant's report on Form 10-K for the year ended
               December 31, 1996.

10.01(c)       Form of Advisory Agreement between the Partnership, Merrill Lynch
               Investment Partners Inc., Merrill Lynch Futures Inc. and each
               Trading Advisor.

Exhibit 10.01(c): Is incorporated by reference from Exhibit 10.01(c) contained
                  in the Registrant's report on Form 10-Q for the Quarter Ended
                  June 30, 1995.

                                      -15-
<PAGE>
 
10.02          Form of Consulting Agreement between each the Partnership and
               Merrill Lynch Futures Inc.

Exhibit 10.02: Is incorporated herein by reference from Exhibit 10.02
               contained in the Registrant's Registration Statement.

10.04          Form of Customer Agreement between the Partnership and Merrill
               Lynch Futures Inc.

Exhibit 10.04: Is incorporated herein by reference from Exhibit 10.04
               contained in the Registrant's Registration Statement.

13.01          1997 Annual Report and Independent Auditors' Report.

Exhibit 13.01: Is filed herewith.
 

28.01          Prospectus of the Partnership dated June 12, 1987.

Exhibit 28.01: Is incorporated by reference as filed with the Securities and
               Exchange Commission pursuant to Rule 424 under the Securities Act
               of 1933, on June 12, 1987.


     (b)  Report on Form 8-K:
          ------------------ 

          No reports on Form 8-K were filed during the fourth quarter of 1997.

                                      -16-
<PAGE>
 
                                   SIGNATURES


     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                              THE GROWTH AND GUARANTEE FUND L.P.

                              By:  MERRILL LYNCH INVESTMENT PARTNERS INC.
                              General Partner

                              By: /s/ John R. Frawley, Jr.
                                  ------------------------
                              John R. Frawley, Jr.
                              Chairman, Chief Executive Officer, President
                                and Director (Principal Executive Officer)


     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this report has been signed on March 25, 1998 by the
following persons on behalf of the Registrant and in the capacities indicated.
<TABLE>
<CAPTION>
 
Signature                                            Title                                Date
---------                                            -----                                ----     
<S>                         <C>                                                      <C>
 
/s/ John R. Frawley, Jr.    Chairman, Chief Executive Officer, President             March 25, 1998
--------------------------  and Director (Principal Executive Officer)
John R. Frawley, Jr.
 
/s/ Michael A. Karmelin     Vice President, Chief Financial Officer, and             March 25, 1998
--------------------------  Treasurer (Principal Financial and Accounting Officer) 
Michael A. Karmelin         
 
/s/ Jeffrey F. Chandor      Senior Vice President, Director of Sales,                March 25, 1998
--------------------------  Marketing and Research, and Director
Jeffrey F. Chandor          
 
/s/ Allen N. Jones          Director                                                 March 25, 1998
--------------------------
Allen N. Jones

(Being the principal executive officer, the principal financial and accounting
officer and a majority of the directors of Merrill Lynch Investment Partners
Inc.)

MERRILL LYNCH INVESTMENT    General Partner of Registrant                            March 25, 1998
  PARTNERS INC.

By: /s/ John R. Frawley, Jr.
    ----------------------------
     John R. Frawley, Jr.
</TABLE> 

                                      -17-
<PAGE>
 
                       THE GROWTH AND GUARANTEE FUND L.P.

                                 1997 FORM 10-K

                               INDEX TO EXHIBITS
                               -----------------


                  Exhibit
                  -------

Exhibit 13.01     1997 Annual Report and Independent Auditors' Report

                                      -18-