SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
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Eaton Vance Growth Trust
(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i) (1) and 0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount Previously Paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement no.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
EV MARATHON WORLDWIDE DEVELOPING RESOURCES FUND
(FORMERLY EV MARATHON GOLD & NATURAL RESOURCES FUND)
24 FEDERAL STREET BOSTON, MASS. 02110
February 19, 1997
Dear Shareholders:
On March 27, 1997, a Special Meeting of Shareholders of EV Marathon
Worldwide Developing Resources Fund (formerly EV Marathon Gold & Natural
Resources Fund) (the "Fund"), a series of Eaton Vance Growth Trust (the
"Trust"), will be held to vote on several important proposals. ADOPTION OF THESE
PROPOSALS, WHICH THE TRUST'S TRUSTEES HAVE APPROVED AND BELIEVE WILL PROVIDE
SIGNIFICANT BENEFITS TO THE FUND AND ITS SHAREHOLDERS, REQUIRES APPROVAL OF THE
FUND'S SHAREHOLDERS. As a shareholder, you are entitled to cast one vote for
each share that you own.
VOTING ONLY TAKES A FEW MINUTES - PLEASE RESPOND PROMPTLY.
YOUR VOTE IS IMPORTANT, NO MATTER HOW MANY SHARES YOU OWN. If the
required votes are not received by March 27, 1997, it will be necessary to send
further mailings to secure it. This is a costly process and is paid for by the
Fund. Therefore, you, as a shareholder, ultimately pay for the expense of a
delayed vote. Please sign and return your proxy promptly to avoid this
unnecessary expense.
The primary purpose of the Meeting is to consider proposals to adopt
the master-feeder mutual fund structure for the Fund. This would involve the
transfer of the Fund's assets to a corresponding open-end management investment
company (the "Portfolio") to achieve the investment objective of the Fund. In
adopting this structure, other collective investment vehicles having different
distribution arrangements will be able to invest in the Portfolio. Since these
other collective investment vehicles will have investors who could not otherwise
invest in the existing Fund, additional assets should be attracted to the
Portfolio. THE FUND WILL THEN BE IN A POSITION TO REALIZE DIRECTLY OR INDIRECTLY
CERTAIN ECONOMIES OF SCALE, BASED ON THE PREMISE THAT CERTAIN OF THE EXPENSES OF
OPERATING AN INVESTMENT PORTFOLIO ARE RELATIVELY FIXED AND THAT A LARGER
INVESTMENT PORTFOLIO MAY EVENTUALLY ACHIEVE A LOWER RATIO OF OPERATING EXPENSES
TO NET ASSETS. AS A RESULT, SHAREHOLDERS OF THE EXISTING FUND MAY EVENTUALLY
ENJOY HIGHER RETURNS ON THEIR RESPECTIVE INVESTMENTS. The Trustees believe that
over time the aggregate per share expenses borne by the Fund's shareholders
should be less than the expenses that would be incurred if the Fund continued to
operate as a stand alone entity. There can, of course, be no assurance these
anticipated economies of scale and other benefits will be realized.
<PAGE>
At the Meeting, shareholders also will be asked to amend certain
fundamental investment restrictions to conform them to current regulatory
requirements.
THIS IS A VERY IMPORTANT MEETING. IF YOU DO NOT PLAN
TO ATTEND IN PERSON, PLEASE SIGN, DATE AND RETURN THE
ENCLOSED PROXY CARD TODAY.
THE MATTERS TO BE PRESENTED TO THE MEETING ARE DESCRIBED IN DETAIL IN
THE ENCLOSED PROXY STATEMENT. THE TRUSTEES BELIEVE THAT ALL OF THE PROPOSALS ARE
IN THE BEST INTERESTS OF THE FUND AND ITS SHAREHOLDERS. The Trustees believe
that converting the Fund to the master-feeder structure will not expose
shareholders to significant new risks and will enable them to participate in a
larger, more diversified and potentially more attractive investment portfolio
and to achieve cost savings over time.
For the Board of Trustees
/s/ James B. Hawkes
James B. Hawkes, PRESIDENT AND TRUSTEE
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YOUR TRUSTEES URGE YOU TO VOTE IN FAVOR OF ALL PROPOSALS, AND LOOK FORWARD TO
RECEIVING YOUR PROXY SO YOUR SHARES CAN BE VOTED AT THE MEETING. FOR YOUR
CONVENIENCE AND TO SPEED DELIVERY OF YOUR PROXY, PLEASE USE THE ENCLOSED
POSTAGE-PAID ENVELOPE. YOUR PROMPT RESPONSE IS APPRECIATED. THANK YOU.
================================================================================
<PAGE>
EV MARATHON WORLDWIDE DEVELOPING RESOURCES FUND
(FORMERLY EV MARATHON GOLD & NATURAL RESOURCES FUND)
24 FEDERAL STREET, BOSTON, MASS. 02110
Notice of Special Meeting of Shareholders
To Be Held March 27, 1997
A Special Meeting of the Shareholders of EV Marathon Worldwide
Developing Resources Fund (formerly EV Marathon Gold & Natural Resources Fund)
(the "Fund"), a series of Eaton Vance Growth Trust (the "Trust"), will be held
at the principal office of the Trust, 24 Federal Street, Boston, Massachusetts
on March 27, 1997, commencing at 10:00 A.M. (Boston time), for the following
purposes:
1. To consider and act upon a proposal to adopt a new investment
policy to authorize the Fund to invest its investable assets
in one or more other investment companies sponsored by Eaton
Vance Management with investment policies consistent with
those of the Fund.
2. To consider and act upon a proposal to authorize the Fund to
vote at a meeting of holders of interests in the Worldwide
Developing Resources Portfolio to (A) elect a board of
trustees of the Portfolio; (B) ratify the selection of
Deloitte & Touche as the independent certified public
accountants of the Portfolio; and (C) approve the Investment
Advisory Agreement (as set forth in Exhibit A to the
accompanying Proxy Statement) between the Portfolio and its
investment adviser, Boston Management and Research (a
subsidiary of Eaton Vance Management).
3. To consider and act upon a proposal to eliminate, reclassify
and amend certain of the Fund's fundamental investment
policies (as set forth in Exhibit B to the accompanying Proxy
Statement).
4. To consider and act upon any matters incidental to the
foregoing purposes or any of them, and any other matters which
may properly come before said meeting or any adjourned session
thereof.
1
<PAGE>
These proposals are discussed in greater detail in the following pages.
The meeting is called pursuant to the By-Laws of the Trust. The
Trustees of the Trust have fixed the close of business on February 14, 1997 as
the record date for the determination of the shareholders of the Fund entitled
to notice of and to vote at the meeting and any adjournments thereof.
/s/ Thomas Otis
THOMAS OTIS, SECRETARY
February 19, 1997
IMPORTANT - SHAREHOLDERS CAN HELP THE TRUSTEES AVOID THE NECESSITY AND
ADDITIONAL EXPENSE TO THE FUND OF FURTHER SOLICITATIONS TO INSURE A QUORUM BY
PROMPTLY RETURNING THE ENCLOSED PROXY. THE ENCLOSED ADDRESSED ENVELOPE REQUIRES
NO POSTAGE IF MAILED IN THE UNITED STATES AND IS INTENDED FOR YOUR CONVENIENCE.
2
<PAGE>
EV MARATHON WORLDWIDE DEVELOPING RESOURCES FUND
(FORMERLY EV MARATHON GOLD & NATURAL RESOURCES FUND)
24 Federal Street
Boston, Massachusetts 02110
February 19, 1997
PROXY STATEMENT
A proxy is enclosed with the foregoing Notice of a Special Meeting of
the Shareholders of EV Marathon Worldwide Developing Resources Fund (formerly EV
Marathon Gold & Natural Resources Fund) (the "Fund"), a series of Eaton Vance
Growth Trust (the "Trust") to be held March 27, 1997 for the benefit of
shareholders who do not expect to be present at the meeting. This proxy is
solicited on behalf of the Trustees of the Trust, and is revocable by the person
giving it prior to exercise by a signed writing filed with the Fund's transfer
agent, First Data Investor Services Group, P.O. Box 5123, Westborough, MA
01581-5123, or by executing and delivering a later dated proxy, or by attending
the meeting and voting your shares in person. Each proxy will be voted in
accordance with its instructions; if no instruction is given, an executed proxy
will authorize the persons named as attorneys, or any of them, to vote in favor
of each such matter. This proxy material is being initially mailed to
shareholders on or about February 19, 1997.
The Trustees have fixed the close of business February 14, 1997, as the
record date for the determination of the shareholders entitled to notice of and
to vote at the meeting and any adjournments thereof. Shareholders at the close
of business on the record date will be entitled to one vote for each share held.
As of February 14, 1997, there were 1,524,968.071 shares of beneficial interest
of the Fund outstanding. As of such date, Merrill Lynch, Pierce, Fenner & Smith,
Inc. of Jacksonville, FL, broker-dealers, held of record 16.1% of the
outstanding shares, which it held on behalf of its customers who are the
beneficial owners of such shares and as to which it has voting power under
certain limited circumstances. Such firm has informed the Fund that none of its
customers beneficially owned more than 5% of the outstanding shares. To the
knowledge of the Trust, no other person owns (of record or beneficially) 5% or
more of the Fund's outstanding shares.
The Trustees know of no business other than that mentioned in Items 1
through 3 of the Notice of the meeting which will be presented at the meeting.
If any other matter is properly presented at the meeting, it is the intention of
the persons named as attorneys in the enclosed proxy to vote the proxies in
accordance with their judgment in regard to such matter.
3
<PAGE>
PROPOSAL 1. TO APPROVE A NEW INVESTMENT POLICY
AND TO SUPPLEMENT INVESTMENT RESTRICTIONS TO
PERMIT A NEW INVESTMENT STRUCTURE
Summary
The Board of Trustees of the Trust has approved, and is submitting to
the shareholders of the Fund for approval, the adoption of a new investment
policy for the Fund and the addition of a fundamental investment policy to
permit the Fund to invest its "investable assets" (portfolio securities and
cash) in one or more open-end management investment companies, including the
Worldwide Developing Resources Portfolio (the "Portfolio"), having the same
investment adviser. The new investment policy and change in the investment
restrictions for the Fund are subject to approval by the Fund's shareholders. If
this Proposal is approved by the Fund's shareholders, the Trustees intend to
invest the Fund's investable assets in the Portfolio, thereby converting the
Fund to the Master-Feeder structure.
NEW INVESTMENT POLICY
The Board of Trustees recommends that the shareholders of the Fund
approve a new investment policy for the Fund, I.E., to invest its investable
assets in the Portfolio. The Portfolio is a trust which, like the Fund, is
registered as an open-end management company under the Investment Company Act of
1940 (the "Act"). The Portfolio has substantially the same investment objective,
policies and restrictions as the Fund if shareholders approve Proposal 3. Eaton
Vance Management ("EVM") is currently the investment adviser of the Fund and its
wholly-owned subsidiary, Boston Management and Research ("BMR"), will be the
investment adviser of the Portfolio if Proposal 2(C) is approved. Accordingly,
by investing in the Portfolio, the Fund would seek its investment objective
through its investment in the Portfolio, rather than through direct investments
in securities. The Portfolio in turn would invest in securities in accordance
with its objective, policies and restrictions.
The new investment policy would permit the Fund to invest in other
registered investment companies in the Eaton Vance group of funds in addition to
or in lieu of the Portfolio, if such other funds invest in securities that the
Fund can invest in and the Trustees of the Trust determine it is in the best
interests of the Fund to do so. THERE IS NO CURRENT INTENTION TO USE THIS
AUTHORITY.
The Portfolio is a no-load, open-end management investment company
registered under the Act. The Portfolio was organized as a trust under New York
law on February 14, 1997. The interests in the Portfolio are not available for
purchase by members of the general public.
4
<PAGE>
By investing the Fund's assets in the Portfolio, the Trustees expect
that the Eaton Vance organization will be in a position to engage in new
marketing strategies by sponsoring other collective investment vehicles with
different distribution arrangements that could invest in the Portfolio. Eaton
Vance Distributors, Inc. has employed personnel to develop such new vehicles.
Initially, an off-shore fund (which now has nominal assets) will be investing in
the Portfolio on or about the date this Proposal is implemented. To the extent
that these strategies are successful, the new Master-Feeder structure could
enable the Fund to participate in a larger, more diversified and potentially
more attractive investment portfolio. The Fund would be in a position to
benefit, directly or indirectly, from certain economies of scale, based on the
premise that certain of the expenses of operating an investment portfolio are
relatively fixed and that a larger investment portfolio may eventually achieve a
lower ratio of operating expenses to average net assets. The Trustees also
believe that investing in the Portfolio may produce other benefits resulting
from such increased asset size such as the ability to purchase securities in
larger amounts than the Fund currently is able to acquire. No such portfolio
benefits or economies of scale are anticipated until other investors invest
their assets in the Portfolio. See the pro forma expense tables and the
discussion provided below. There can be no assurance that these anticipated
benefits will be realized.
To the extent that the Fund invests its investable assets in the
Portfolio, the Fund would no longer require investment advisory services and
would have a reduced need for certain administrative services. For this reason,
if shareholders of the Fund approve the addition to the investment restrictions
described and adopt the new investment policy described in this Proposal, and
the Fund invests its investable assets in the Portfolio, no investment advisory
fees will be paid under the existing investment advisory agreement of the Fund
with EVM. Currently, under such agreement with EVM, the Fund pays a monthly fee
of .0625% (equivalent to .75 of 1% annually) of the average daily net assets of
the Fund up to $500 million; the fee is reduced at various asset levels over
$500 million.
The Portfolio has an Investment Advisory Agreement pursuant to which
BMR will be paid a monthly fee calculated in the same manner as the fee
currently being paid by the Fund, as set forth above, on the average daily net
assets of the Portfolio up to $500 million. On net assets of $500 million and
over the annual fee is reduced as follows:
Monthly Fee Rate
Average Daily Net Assets for the Month (For Each Level)
- -------------------------------------- ----------------
$500 million but less than $1 billion 11/192 of 1%
$1 billion but less than $1.5 billion 5/96 of 1%
$1.5 billion but less than $2 billion 3/64 of 1%
$2 billion but less than $3 billion 1/24 of 1%
$3 billion and over 7/192 of 1%
5
<PAGE>
If Proposal 2(C) is approved and the average daily net assets of the Portfolio
should grow to over $500 million, lower advisory fee rates would go into effect
in accordance with the above schedule. Thus, the total investment advisory fee
received by EVM and its subsidiary will not increase as a result of the
implementation of the Fund's proposed investment in the Portfolio.
Upon exchange of the investable assets of the Fund for an interest in
the Portfolio, the Fund will retain the services of EVM under an administrative
services agreement to act as administrator of the Fund. The Fund has not
retained the services of an investment adviser since the Fund seeks to achieve
the investment objective of the Fund by investing the Fund's assets in the
Portfolio. Under the administrative services agreement, EVM would provide the
Fund with general office facilities and supervise the overall administration of
the Fund. For these services EVM currently receives no compensation. The
Trustees of the Trust may determine, in the future, to compensate EVM for its
services under the administrative services agreement.
The Portfolio and the Fund, as the case may be, will each be
responsible for all respective costs and expenses not expressly stated to be
payable by BMR under the investment advisory agreement with the Portfolio, or by
EVM under the administrative services agreement with the Fund. Such costs and
expenses to be borne by the Portfolio and the Fund, as the case may be, include,
without limitation: custody and transfer agency fees and expenses, including
those incurred for determining net asset value and keeping accounting books and
records; expenses of pricing and valuation services; the cost of share
certificates; membership dues in investment company organizations; expenses of
acquiring, holding and disposing of securities and other investments; fees and
expenses of registering under the securities laws and governmental fees;
expenses of reporting to shareholders and investors; proxy statements and other
expenses of shareholders' or investors' meetings; insurance premiums; printing
and mailing expenses; interest, taxes and corporate fees; legal and accounting
expenses; compensation and expenses of Trustees not affiliated with BMR or EVM;
and investment advisory fees and, if any, administrative services fees. The
Portfolio and the Fund will also each bear expenses incurred in connection with
litigation in which the Portfolio or the Fund, as the case may be, is a party
and any legal obligation to indemnify its respective officers and Trustees with
respect thereto, to the extent not covered by insurance.
The following table shows the actual expenses of the Fund for the
twelve months ended January 31, 1997, and a pro forma adjustment thereof
assuming the Fund had invested its investable assets in the Portfolio for the
entire period then ended. The pro forma adjustment includes the estimated costs
of converting the Fund to the Master-Feeder structure and the estimated costs of
this proxy solicitation (approximately $5,000). The pro forma adjustment assumes
that: (i) there were no holders of interests in the Portfolio other than the
Fund; and (ii) the average daily net assets of the Fund and the Portfolio were
equal to the actual average daily net assets of the Fund during the period.
6
<PAGE>
FUND OPERATING EXPENSES FOR THE TWELVE MONTHS
ENDED JANUARY 31, 1997 (UNAUDITED)
(ANNUALIZED AS A PERCENT OF AVERAGE DAILY NET ASSETS)
PRO FORMA (ASSUMING THAT THE AVERAGE
DAILY NET ASSETS INVESTED BY THE FUND
IN THE PORTFOLIO WERE $19,679,581)
-----------------------------------
ACTUAL FUND PORTFOLIO TOTAL
Shareholder Transaction Costs 0.00% 0.00% 0.00% 0.00%
Annual Fund Operating Expenses
Investment advisory fees 0.75% 0.00% 0.75% 0.75%
Other expenses 1.58% 1.41% 0.17% 1.85%
----- ----- ----- -----
Total Fund Operating Expenses 2.33% 1.41% 0.92% 2.33%
===== ===== ===== =====
Assuming that the Fund was the only holder of an interest in the
Portfolio and that the Fund was fully invested therein, the net asset value per
share, distributions per share and net investment income per share of the Fund
would have been about the same on a pro forma basis as the actual net asset
value, distributions and net investment income per share of the Fund during the
period indicated.
In recommending that the shareholders authorize the conversion of the
Fund to the Master-Feeder structure, the Trustees have taken into account and
evaluated the possible effects which increased assets in the Portfolio may have
on the expense ratio of the Fund. There is, of course, no assurance that the net
assets of the Portfolio will grow. After carefully weighing the costs involved
against the anticipated benefits of converting the Fund to the Master-Feeder
structure, the Board of Trustees recommend that the shareholders of the Fund
vote to approve Proposal 1.
If Proposal 1 is approved by shareholders of the Fund, the Board of
Trustees expects to implement the investment for the Fund by causing the Fund to
exchange its investable assets (portfolio securities and cash) as well as
certain other assets (including receivables for securities sold from the
portfolio and receivables for interest on portfolio securities) for an interest
in the Portfolio. The proposed transaction will not alter the rights and
privileges of shareholders of the Fund. The value of a shareholder's investment
in the Fund will be the same immediately after the Fund's investment in the
Portfolio as immediately before that investment. Of course, the value of a
shareholder's investment in the Fund may fluctuate thereafter.
The Fund would be able to withdraw its investment in the Portfolio at
any time, if the Trustees determine that it is in the best interests of the Fund
to do so. Upon any such withdrawal, the Trustees would consider what action
might be taken, including the investment of the investable assets of the Fund in
another pooled investment entity having substantially the same investment
objective as the Fund or the retention of an investment adviser to manage the
Fund's assets in accordance with its investment policies as is presently the
case.
7
<PAGE>
DESCRIPTION OF THE PORTFOLIO
The investment objective of the Portfolio is the same as the objective
of the Fund. The Portfolio seeks to achieve its investment objective through
investments limited to the types of securities in which the Fund is authorized
to invest. The investment restrictions and policies of the Portfolio are such
that the Portfolio may not invest in any security or engage in any transaction
which would not be permitted by the investment restrictions and policies of the
Fund if the Fund were to invest directly in such a security or engage directly
in such a transaction.
If the proposed investment in the Portfolio is implemented, the Fund's
assets would no longer be directly invested in a portfolio of securities but
would rather be invested in the securities of a single issuer, I.E., the
Portfolio, which is a New York trust, and is registered as an open-end
management investment company under the Act. The Portfolio's securities will not
be publicly offered. Nevertheless, inasmuch as the assets of the Portfolio would
be directly invested in a portfolio of securities, the Trustees of the Trust
believe there are no material risks of the Fund investing in the Portfolio that
are different from those to which shareholders of the Fund are currently
subject.
The approval of the Portfolio's investors (I.E., holders of interests
in the Portfolio, such as the Fund) would be required to change any of its
investment restrictions; however, any change in nonfundamental investment
policies would not require such approval. For a discussion of when Fund
shareholders would be requested to vote on Portfolio matters, see below.
Like the Fund, the Portfolio determines its net asset value once on
each day the New York Stock Exchange (the "Exchange") is open for trading, as of
the close of regular trading on the Exchange. The Portfolio's net asset value is
computed by determining the value of the Portfolio's total assets (the
securities it holds plus any cash or other assets, including interest accrued
but not yet received), and subtracting all of the Portfolio's liabilities
(including accrued expenses).
Marketable securities listed on securities exchanges or in the NASDAQ
National Market System are valued at closing sale prices or if there were no
sales at the mean between the closing bid and asked prices therefor on such
exchanges or System. Unlisted or listed securities for which closing sale prices
are not available are valued at the mean between the latest bid and asked
prices. Direct placement securities and securities of venture capital companies
are taken at fair value as determined in good faith by or pursuant to procedures
established by the Trustees; however, direct placement securities and securities
of former venture capital companies which are readily marketable are considered
marketable securities. Short-term debt securities are valued at amortized cost,
which approximates market. Other fixed income and debt securities, including
listed securities for which price quotations are available, will normally be
valued on the basis of valuations furnished by a pricing service. Physical
commodities, including bullion, will generally be valued at fair value based on
prevailing market prices.
8
<PAGE>
The Fund's net asset value is determined at the same time and on the
same days that the net asset value of the Portfolio is calculated. Net asset
value per share is computed by determining the value of the Fund's assets (its
investment in the Portfolio and other assets), subtracting all of the Fund's
liabilities (including accrued expenses), and dividing the result by the total
number of shares outstanding at such time.
As a partnership under the Internal Revenue Code of 1986, as amended
(the "Code"), the Portfolio does not pay federal income or excise taxes.
Provided the Fund qualifies as a regulated investment company for federal income
tax purposes (by distributing to shareholders its net investment income and net
realized capital gains in accordance with the timing requirements imposed by the
Code) and the Portfolio is treated as a partnership for federal and
Massachusetts tax purposes, neither is liable for income, corporate excise tax
or franchise tax in Massachusetts.
Interests in the Portfolio have no pre-emptive or conversion rights,
and are fully paid and non-assessable, except as set forth below. The Portfolio
normally will not hold meetings of holders of such interests except as required
under the Act. The Portfolio would be required to hold a meeting of holders in
the event that at any time less than a majority of the trustees holding office
had been elected by holders. The trustees of the Portfolio continue to hold
office until their successors are elected and have qualified. Holders holding a
specified percentage interest in the Portfolio may call a meeting of holders in
the Portfolio for the purpose of removing any trustee. A trustee of the
Portfolio may be removed upon a majority vote of holders in the Portfolio
qualified to vote in the election. The By-Laws require the Portfolio to assist
its holders in calling such a meeting. Upon liquidation of the Portfolio,
holders in the Portfolio would be entitled to share pro rata in the net assets
of the Portfolio available for distribution to holders.
Each holder in the Portfolio is entitled to a vote in proportion to its
share of the interests in the Portfolio. Except as described below, whenever the
Fund is requested to vote on matters pertaining to the Portfolio, the Fund will
hold a meeting of its shareholders and will cast its votes proportionately as
instructed by Fund shareholders.
Subject to applicable statutory and regulatory requirements, the Fund
would not request a vote of its shareholders with respect to (a) any proposal
relating to the Portfolio, which proposal, if made with respect to the Fund,
would not require the vote of the shareholders of the Fund, or (b) any proposal,
with respect to the Portfolio that is identical, in all material respects, to a
proposal that has previously been approved by shareholders of the Fund. Any
proposal submitted to holders in the Portfolio, and that is not required to be
voted on by shareholders of the Fund, would nonetheless be voted on by the
Trustees of the Trust.
Investments in the Portfolio may not be transferred, but a holder may
withdraw all or any portion of its investment at any time at net asset value.
Each holder in the Portfolio, including the Fund, will be liable for all
obligations of the Portfolio. However, the risk of a holder in the Portfolio
incurring financial loss on account of such liability is limited to
circumstances in which both inadequate insurance exists, and the Portfolio
itself is unable to meet its obligations. Thus, shareholders of the Fund should
not experience losses from the new investment structure itself.
9
<PAGE>
The Portfolio has its own board of trustees, including a majority of
trustees who are not "interested" persons of the Portfolio as defined in the
Act. The present trustees of the Portfolio are identical to the present Trustees
of the Trust and are listed in Proposal 2(A) of this Proxy Statement.
TAX CONSIDERATIONS
The Internal Revenue Service has issued private letter rulings to
numerous investment companies, including other EVM advised funds, to the effect
that this type of transaction will not result in recognition of capital gains.
Such rulings are not binding on the Service with respect to the Fund.
Nevertheless, the Fund has received an opinion of tax counsel, Brown & Wood LLP,
to the effect that, although there is no judicial authority directly on point,
the contribution of its assets to the Portfolio in exchange for an interest in
the Portfolio will not result in the recognition of gain or loss to the Fund for
federal income tax purposes pursuant to Internal Revenue Code Section 721 and
related authorities. The Fund has not applied for a ruling from the Internal
Revenue Service to the same effect and legal opinions are not binding on the
Service. If it were determined that the transaction was taxable, the Fund would
realize and recognize gain in an amount equal to the appreciation (undiminished
by losses) in the transferred assets as of the date of the transfer (the "deemed
gain"). If the Fund did not make a distribution to its shareholders equal to all
or a portion of the deemed gain, the Fund could be subject to tax (plus interest
and penalties) on all or a portion of the deemed gain. Alternatively, if the
Fund were to make a distribution to its shareholders in an amount equal to all
or a portion of the deemed gain, then its shareholders at the time of such
distribution would be taxed on the amount distributed and the Fund could be
required to pay penalties and/or interest. Depending on the amount and nature of
the deemed gain and the Fund's previous distributions of gains with respect to
the same taxable year, the Fund might be required to make the distribution
described in the preceding sentence in order to preserve its qualification under
the Code as a regulated investment company.
As of January 31, 1997, the gross unrealized appreciation in the assets
of the Fund on a federal income tax basis was $6,648,300 (unaudited). The amount
of gross unrealized appreciation in the assets of the Fund at the time of
transfer of the Fund's assets to the Portfolio may be more or less than the
amount indicated in the preceding sentence, and no assurance can be given as to
the magnitude of such amount at the time of such transfer.
PROPOSED SUPPLEMENT TO INVESTMENT RESTRICTIONS
Certain of the Fund's investment restrictions must be amended,
eliminated or reclassified in order for the Fund to invest its investable assets
in the Portfolio. (See investment restrictions (5), (6), (7), (8), (10), (14)
and (A) in Exhibit B.) The Board of Trustees of the Trust has approved, subject
to a shareholder vote, a supplemental provision to be added to the investment
restrictions of the Fund to permit it to invest its investable assets in the
Portfolio.
10
<PAGE>
The Board of Trustees proposes that these restrictions and all other
investment restrictions be supplemented with an additional fundamental
investment provision as follows: "(15) NOTWITHSTANDING THE INVESTMENT POLICIES
AND RESTRICTIONS OF THE FUND, THE FUND MAY INVEST ITS ASSETS IN AN OPEN-END
MANAGEMENT INVESTMENT COMPANY (A PORTFOLIO) WITH SUBSTANTIALLY THE SAME
INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS AS THE FUND; MOREOVER, SUBJECT
TO TRUSTEE APPROVAL THE FUND MAY INVEST ITS INVESTABLE ASSETS IN OTHER OPEN-END
MANAGEMENT INVESTMENT COMPANIES IN THE SAME GROUP OF INVESTMENT COMPANIES WITH
THE SAME INVESTMENT ADVISER AS THE PORTFOLIO (OR AN AFFILIATE) IF, WITH RESPECT
TO SUCH ASSETS, THE OTHER COMPANIES' PERMITTED INVESTMENTS ARE SUBSTANTIALLY THE
SAME AS THOSE OF THE FUND."
This additional investment provision would also apply to any
conflicting nonfundamental investment policies. (The current investment
restrictions would also be revised if Proposal 3 is approved.)
EVALUATION BY THE TRUST'S TRUSTEES
The Board of Trustees of the Trust has carefully considered Proposal 1,
which will in effect authorize the conversion of the Fund to the Master-Feeder
structure. The Board has carefully evaluated the potential benefits that would
be associated with this Proposal. In this regard, the Board believes that the
Portfolio will attract other collective investment vehicles having different
distribution arrangements which will have investors who would not otherwise be
investors in the Fund. As a result, additional assets should be attracted to the
Portfolio and thus this Proposal should be a benefit to the Fund's existing and
future shareholders. By this pooling of assets the Portfolio is likely, over
time, to achieve a variety of operating economies. The larger asset size of the
Portfolio, in the Board's view, can be expected to permit the purchase of
investments in larger amounts than the Fund currently is able to purchase, which
may reduce certain operating expenses indirectly borne by the Fund's
shareholders. In general, to the extent that certain operating costs are
relatively fixed and currently are borne by the Fund alone, these expenses would
instead be borne in whole or in part by the Portfolio and shared by the Fund's
shareholders with other investors in the Portfolio. These portfolio benefits and
economies of scale would be likely only if assets of the Portfolio were to grow
through investments in the Portfolio by entities in addition to the Fund. There
can be no assurance that such benefits will be realized. The Board also
recognized that the investment adviser could benefit from the proposed structure
because such structure could enable the investment adviser to increase its
assets under management through the development of new vehicles to attract
investor assets to the investment adviser.
The Trustees of the Trust believe that over time the aggregate per
share expenses of the Fund and the Portfolio should be less than the expenses
that would be incurred by the Fund if it continued to retain the services of an
investment adviser and to invest directly in securities although there can be no
assurance that such expense savings will be realized. The Board also considered
risks associated with an investment in the Portfolio. The Trustees believe that
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the Portfolio's investment policies and restrictions involve substantially
the same risks as are associated with the Fund's direct investment in
securities. Moreover, investment in other investment companies by the Fund would
only be implemented after Trustee assessment of the cost and risk of doing so.
Based on their consideration, analysis and evaluation of the above
factors and other information deemed by them to be relevant to this Proposal,
the Fund's Trustees (including the Independent Trustees) have concluded that it
would be in the best interests of the Fund and its shareholders to approve a new
investment policy and supplement to the fundamental investment restrictions to
enable the Fund to invest its investable assets in other investment companies
and in particular the Portfolio.
VOTE REQUIRED TO APPROVE PROPOSAL 1
Approval by the shareholders of the Fund of the new investment policy
and supplement to its fundamental investment restrictions requires the
affirmative vote of a majority of the outstanding voting securities of the Fund,
which term as used in this Proxy Statement means the vote of the lesser of (a)
more than 50% of the outstanding shares of the Fund, or (b) 67% of the shares of
the Fund present at the meeting if the holders of more than 50% of the
outstanding shares of the Fund are present or represented by proxy at the
meeting.
THE TRUSTEES OF THE TRUST RECOMMEND THAT THE SHAREHOLDERS OF THE FUND
VOTE TO APPROVE THIS PROPOSAL. In the event the shareholders of the Fund fail to
approve this Proposal, the Trustees would continue to retain EVM as the
investment adviser for the Fund to manage the Fund's assets through direct
investments in securities, and the Fund's existing Investment Advisory Agreement
between EVM and the Fund would continue in effect in its current form.
PROPOSAL 2. AUTHORIZATION TO VOTE AT MEETING OF
PORTFOLIO INVESTORS
Shareholders of the Fund are being asked to vote on certain matters
with respect to the Portfolio because the Portfolio is expected to call a
meeting of its holders (including the Fund) to vote on such matters.
Specifically, it is expected that the Portfolio will ask its holders to vote at
such meeting to:
(A) Elect a board of trustees of the Portfolio;
(B) Ratify the selection of Deloitte & Touche as the
independent certified public accountants of the Portfolio; and
(C) Approve the Investment Advisory Agreement as set forth in
Exhibit A to this Proxy Statement between the Portfolio and its investment
adviser, Boston Management and Research (a subsidiary of Eaton Vance
Management).
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The Fund will cast its votes at the meeting of holders of interests in
the Portfolio on each matter in the same proportions as the votes cast by the
Fund's shareholders. Based on the Fund's current net assets, it is anticipated
that the Fund will hold over 99% of the interests in the Portfolio when the
conversion occurs.
PROPOSAL 2(A). AUTHORIZE THE FUND TO ELECT TRUSTEES
OF THE PORTFOLIO
It is the present intention that the enclosed proxy will, unless
authority to vote for election of one or more nominees is specifically withheld
by executing the proxy in the manner stated thereon, be used for the purpose of
authorizing the Fund to vote in favor of the election of the following six
nominees indicated below as trustees of the Portfolio, to hold office until
their successors are elected and qualified. PLEASE NOTE THAT EACH OF THE
FOLLOWING NOMINEES CURRENTLY SERVES AS A TRUSTEE OF THE TRUST. The nominee whose
name is preceded by an asterisk(*) is an "interested person" (as defined in the
Act) by reason of his affiliations with the Portfolio; Boston Management and
Research ("BMR"), the Portfolio's investment adviser and a wholly-owned
subsidiary of Eaton Vance Management ("EVM"); Eaton Vance Distributors, Inc.
("EVD"), the Portfolio's placement agent and a wholly-owned subsidiary of EVM;
or Eaton Vance Corp. ("EVC"), a holding company which owns all of the
outstanding stock of EVM; or of EVM's and BMR's trustee, Eaton Vance, Inc.
("EV"), which is a wholly-owned subsidiary of EVC. (EVM, EVD, EVC, BMR and their
affiliates are sometimes referred to collectively as the "EVC organization".)
NAME AND PRINCIPAL OCCUPATIONS OVER
OTHER INFORMATION PAST FIVE YEARS
- ----------------- ---------------
*JAMES B. HAWKES President of the Fund and a Trustee since inception.
Age: 55; has been a President and Chief inception. Executive Officer
trustee and President of EVC, EVM, BMR and EV (since November 1, 1996,
of the Portfolio since prior to which he was Executive Vice President) and
February 14, 1997. a Director of EVC and EV. He also serves as a
Director or Trustee and/or Officer of seventy-two
investment companies advised or administered by EVM
or BMR.
DONALD R. DWIGHT Mr. Dwight is President of Dwight Partners, Inc. (a
Age: 65; has been a corporate relations and communications company)
trustee of the Portfolio founded in 1988; Chairman of the Board of Newspapers
since February 14, 1997. of New England, Inc., since 1982. He also serves as
a Director, Director General Partner, or Trustee of
seventy-six investment companies advised or
administered by EVM or BMR.
SAMUEL L. HAYES, III Dr. Hayes is the Jacob H. Schiff Professor of
Age: 61; hs been a Investment Banking at Harvard Graduate School of
trustee of the Portfolio Business Administration. He also serves as a
since February 14, 1997. Director, Director General Partner, or Trustee of
seventy-six investment companies advised or
administered by EVM or BMR.
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NORTON H. REAMER President and a Director of United Asset Management
Age: 61, has been a Corporation, Director, Chairman and President of
trustee of the Portfolio UAM Funds (mutual funds). He also serves as a
since February 14, 1997. Director, Director General Partner, or Trustee of
seventy-six investment companies advised or
administered by EVM or BMR.
JOHN L. THORNDIKE Director of Fiduciary Company Incorporated in
Age: 70; has been a Boston, Massachusetts; a Trustee of the Boston
trustee of the Portfolio Symphony Orchestra. He also serves as a Director,
since February 14, 1997. Director General Partner, or Trustee of seventy-
three investment companies advised or administered
by EVM or BMR.
JACK L. TREYNOR An investment adviser and consultant. Associate
Age: 66; has been a Professor of Finance, Loyola-Marymount University,
trustee of the Portfolio Los Angeles, California (until May 1989). Mr.
since February 14, 1997. Treynor member of the Advisory Board of the
Institute for Quantitive Research in Finance. He
also serves as a Director, Director General
Partner, or Trustee of seventy-one investment
companies advised or administered by EVM or BMR.
As of February 14, 1997, no current or former trustee or officer of the
Portfolio, individually or as a group, directly and indirectly beneficially
owned more than 1% of the Fund's shares then outstanding.
It is not expected that any of the nominees referred to above will
decline or become unavailable for election, but in case this should happen, the
Portfolio may vote for a substitute nominee or nominees (unless authority to
vote for election of all nominees is specifically withheld by executing the
proxy in the manner stated thereon).
Messrs. Hayes (Chairman), Reamer and Thorndike are members of the
Special Committee of the board of trustees of the Portfolio. The purpose of the
Special Committee is to consider, evaluate and make recommendations to the full
board concerning (i) all contractual arrangements with service providers to the
Portfolio, including administrative services, transfer agency, custodial and
fund accounting and distribution services, and (ii) all other matters in which
Eaton Vance or its affiliates has any actual or potential conflict of interest
with the Portfolio or its interestholders.
The Nominating Committee is comprised of four trustees who are not
"interested persons" as that term is defined under the Act. The Committee has
four-year staggered terms, with one member rotating off the Committee to be
replaced by another noninterested trustee of the Portfolio. Messrs. Hayes
(Chairman), Reamer, Thorndike and Treynor are currently serving on the
committee. The purpose of the Committee is to recommend to the board nominees
for the position of noninterested trustee and to assure that at least a majority
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of the board of trustees is independent of Eaton Vance and its affiliates.
The board will, when a vacancy exists or is anticipated, consider any nominee
for trustee recommended by a shareholder if such recommendation is submitted to
the board in writing and contains sufficient background information concerning
the individual to enable a proper judgment to be made as to such individual's
qualifications.
Messrs. Treynor (Chairman) and Dwight are members of the Audit Committee of
the board of trustees of the Portfolio. The Audit Committee's functions include
making recommendations to the board regarding the selection of the independent
certified public accountants, and reviewing matters relative to trading and
brokerage policies and practices, accounting and auditing practices and
procedures, accounting records, internal accounting controls, and the functions
performed by the custodian, transfer agent and dividend disbursing agent of the
Portfolio.
The fees and expenses of those trustees of the Portfolio who are not
members of the Eaton Vance organization will be paid by the Portfolio. For the
calendar year ended December 31, 1996, the proposed trustees of the Portfolio
earned the following compensation in their capacities as trustees of the
Fund and other funds in the Eaton Vance fund complex:
Retirement
Benefit Accrued Total
Fund from Fund Compensation
Fund Compensation Complex Fund Complex(1)
---- ------------ ------- ---------------
Donald R. Dwight $ 35 $45,000 $145,000
Samuel L. Hayes, III 32 40,305 157,500
Norton H. Reamer 31 -0- 145,000
John L. Thorndike 32 28,125 150,000
Jack L. Treynor 34 -0- 150,000
(1) The Eaton Vance fund complex consists of 212 registered investment companies
or series thereof.
If this Proposal is approved it is estimated that each independent
trustee will receive approximately $160 in compensation from the Fund and $160
from the Portfolio in the next fiscal year of operations. Aggregate compensation
from the Eaton Vance complex would not increase.
Trustees of the Portfolio who are not affiliated with the Adviser may
elect to defer receipt of all or a percentage of their annual fees in accordance
with the terms of a Trustees Deferred Compensation Plan (the "Trustees' Plan").
Under the Trustees' Plan, an eligible Trustee may elect to have his deferred
fees invested by the Portfolio in the shares of one or more funds in the Eaton
Vance Family of Funds, and the amount paid to the trustees under the Trustees'
Plan will be determined based upon the performance of such investments. Deferral
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<PAGE>
of trustees' fees in accordance with the Trustees' Plan will have a
negligible effect on the Portfolio's assets, liabilities, and net income per
share, and will not obligate the Portfolio to retain the services of any trustee
or obligate the Portfolio to pay any particular level of compensation to the
trustee. Neither the Portfolio nor the Trust has a retirement plan for its
Trustees.
THE TRUSTEES OF THE TRUST RECOMMEND THAT THE SHAREHOLDERS OF THE FUND
VOTE TO AUTHORIZE THE FUND TO ELECT EACH NOMINEE AS A TRUSTEE OF THE PORTFOLIO
AT THE MEETING OF THE HOLDERS OF INTERESTS IN THE PORTFOLIO.
PROPOSAL 2(B). RATIFICATION OF SELECTION OF ACCOUNTANTS
OF THE PORTFOLIO
A majority of the trustees of the Portfolio who are not interested
persons of the Portfolio or BMR have selected Deloitte & Touche, One Capital
Place, George Town, Grand Cayman, Cayman Islands, British West Indies ("Deloitte
& Touche Cayman"), as independent certified public accountants to sign or
certify any financial statements which may be filed by the Portfolio with the
Securities and Exchange Commission in respect of all or any part of the fiscal
year ending August 31, 1997, the employment of such accountants being
expressly conditioned upon the right of the Portfolio, by vote of a majority of
the outstanding "voting securities" in the Portfolio at any meeting called for
the purpose, to terminate such employment forthwith without any penalty. Such
selection was made pursuant to provisions of Section 32(a) of the Act, and is
subject to ratification or rejection by the holders of interests in the
Portfolio at the meeting of such holders. Deloitte & Touche LLP currently serves
as the independent certified public accountants of the Fund. Deloitte & Touche
Cayman is an affiliate of Deloitte & Touche LLP. A Cayman Island audit is needed
because of the offshore feeder fund that will invest in the Portfolio. U.S.
accounting standards will be used. The Fund is informed that no member of
Deloitte & Touche Cayman or Deloitte & Touche LLP has any direct or material
indirect interest in the Fund or the Portfolio.
The Portfolio's independent certified public accountants provide
customary professional services in connection with the audit function for a
management investment company such as the Portfolio, and their fees for such
services include fees for work leading to the expression of opinions on the
financial statements included in annual reports to the holders of interests in
the Portfolio, opinions on financial statements and other data included in the
Portfolio's annual report to the Securities and Exchange Commission, opinions on
financial statements included in amendments to the Portfolio's registration
statement, and preparation of the Portfolio's federal and state income tax
returns. The nature and scope of the professional services of the accountants
have been approved by the Portfolio's trustees, which have considered the
possible effect thereof on the independence of the accountants.
Representatives of Deloitte & Touche Cayman or Deloitte & Touche LLP
are not expected to be present at the meeting but have been given the
opportunity to make a statement if they do so desire and will be available
should any matter arise requiring their presence.
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<PAGE>
It is intended that proxies not limited to the contrary will be voted
in favor of authorizing the Fund to ratify the selection of Deloitte & Touche
Cayman as the independent certified public accountants to be employed by the
Portfolio to sign or certify financial statements required to be signed or
certified by independent public accountants and filed with the Securities and
Exchange Commission in respect of all or part of the fiscal year ending August
31, 1997.
THE TRUSTEES OF THE TRUST RECOMMEND THAT THE SHAREHOLDERS OF THE FUND
VOTE TO AUTHORIZE THE FUND TO RATIFY THE SELECTION OF DELOITTE & TOUCHE CAYMAN
AS THE INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS OF THE PORTFOLIO AT THE MEETING
OF THE HOLDERS OF INTERESTS IN THE PORTFOLIO.
PROPOSAL 2(C). AUTHORIZE THE FUND TO APPROVE THE
INVESTMENT ADVISORY AGREEMENT WITH
BOSTON MANAGEMENT AND RESEARCH
Boston Management and Research ("BMR") will act as investment adviser
to the Portfolio pursuant to an Investment Advisory Agreement between BMR and
the Portfolio, to be dated the date of the conversion to the Master-Feeder
structure (the "Agreement"). BMR, a Massachusetts business trust, is a
wholly-owned subsidiary of Eaton Vance Management ("EVM"). BMR or EVM act as
investment adviser to investment companies and various individual and
institutional clients with combined assets under management of over $17 billion.
EVM a Massachusetts business trust, is a wholly-owned subsidiary of Eaton Vance
Corp. ("EVC"), a publicly-held holding company which through its subsidiaries
and affiliates engages primarily in investment management, administration and
marketing activities. EVC also owns all of the outstanding stock of BMR's and
EVM's trustee, Eaton Vance, Inc. ("EV"). BMR and EVM employ the same investment
personnel to provide advisory services to their respective clients.
The Trustees of the Trust have reviewed the Agreement and recommend
that the shareholders of the Fund vote to authorize the Fund to approve the
Agreement entered into by the Portfolio at the meeting of holders of interests
in the Portfolio. A copy of the Agreement is attached hereto as Exhibit A and
the discussion of the Agreement herein is qualified in its entirety by such
Agreement.
The Agreement will remain in full force and effect through February 28,
1998, and will continue in full force and effect indefinitely thereafter, but
only so long as such continuance is specifically approved at least annually (i)
by the board of trustees of the Portfolio or by vote of a majority of the
outstanding voting securities (as defined in the Act) of the Portfolio, and (ii)
by the vote of a majority of those trustees of the Portfolio who are not
interested persons (as defined in the Act) of BMR or the Portfolio cast in
person at a meeting called for the purpose of voting on such approval. In
connection with the organization of the Portfolio, the Agreement was approved by
the trustees of the Portfolio, including a majority of those trustees who are
17
<PAGE>
not interested persons of BMR or the Portfolio, on February 14, 1997, and
by vote of EVM and BMR, which were then the holders of all the outstanding
voting securities of the Portfolio, on February 14, 1997. At the time of such
action by the trustees of the Portfolio, Mr. Hawkes, a director and officer of
EVC and EV and an officer of BMR and EVM, and a Voting Trustee and stockholder
of EVC, was a trustee of the Portfolio.
Under the terms of the Agreement, the Portfolio will employ BMR to act
as investment adviser for and to manage the investment and reinvestment of the
assets of the Portfolio and to administer its affairs, subject to the
supervision of its trustees. BMR furnishes to the Portfolio investment advice
and assistance, administrative services, office space, equipment and clerical
personnel, and investment advisory, statistical and research facilities, and has
arranged for certain members of the BMR organization to serve without salary as
officers or trustees of the Portfolio.
In approving the Agreement for the Portfolio, the trustees of the
Portfolio have taken into account such factors and information as were deemed by
them to be relevant to BMR's investment advisory relationship with the
Portfolio. In their deliberations the trustees have considered: the requirements
and needs of the Portfolio for management and administrative services and
facilities, the desirability of providing for the management of the Portfolio
through the EVC organization (of which BMR is a part), the nature, extent and
quality of the management and administrative services and facilities heretofore
provided by the EVC organization to the Fund, the ability of BMR's personnel,
the fiduciary duties and risks to be assumed by the BMR organization and its
commitment to provide management and administrative services and facilities to
the Portfolio on a continuing basis, the aggregate of the compensation and
benefits which will be received by the BMR organization pursuant to the
Agreement, the necessity that the BMR organization maintain its ability to
retain and attract capable personnel to service the Portfolio, the continuance
of appropriate incentives to assure that the BMR organization will provide high
quality management and administrative services to the Portfolio, the revenues,
expenses, financial condition, stability and capabilities of the EVC
organization, the advantages to the Portfolio of being one of many investment
companies advised and administered by the EVC organization, the investment
performance of the Fund since its inception, the various investment strategies
and techniques to be employed by BMR to enhance the Portfolio's investment
performance, current developments and trends in the mutual fund and financial
services industries including the entry of large and highly capitalized
companies which are spending and appear to be prepared to continue to spend
substantial amounts to engage personnel and to provide services for competing
mutual funds, the existence of soft dollar arrangements from which BMR may
benefit for trades made for the Portfolio, and other information and factors
which the trustees believed relevant to the matter.
Pursuant to the Agreement, BMR will provide the Portfolio with
investment research, advice and supervision, will furnish an investment program
and will determine what securities will be acquired, disposed of or exchanged by
the Portfolio and what portion, if any, of the Portfolio's assets will be held
uninvested. The Agreement requires BMR to pay the salaries and fees of all
officers and trustees of the Portfolio who are members of the BMR organization
18
<PAGE>
and all personnel of BMR performing services relating to research and
investment activities. The Agreement provides that the Portfolio will pay all
its expenses other than those expressly stated to be payable by BMR, which
expenses payable by the Portfolio will include, without implied limitation, (i)
expenses of maintaining the Portfolio and continuing its existence, (ii)
registration of the Portfolio under the Act, (iii) commissions, fees and other
expenses connected with the acquisition, holding and disposition of securities
and other investments, (iv) auditing, accounting and legal expenses, (v) taxes
and interest, (vi) governmental fees, (vii) expenses of issue, sale and
redemption of interests in the Portfolio, (viii) expenses of registering and
qualifying the Portfolio and interests in the Portfolio under federal and state
securities laws and of preparing and printing registration statements or other
offering statements or memoranda for such purposes and for distributing the same
to holders and investors, and fees and expenses of registering and maintaining
registrations of the Portfolio and of the Portfolio's placement agent as
broker-dealer or agent under state securities laws, (ix) expenses of reports and
notices to holders and of meetings of holders and proxy solicitations therefor,
(x) expenses of reports to governmental officers and commissions, (xi) insurance
expenses, (xii) association membership dues, (xiii) fees, expenses and
disbursements of custodians and subcustodians for all services to the Portfolio
(including without limitation safekeeping of funds, securities and other
investments, keeping of books, accounts and records, and determination of net
asset values, book capital account balances and tax capital account balances),
(xiv) fees, expenses and disbursements of transfer agents, dividend disbursing
agents, holder servicing agents and registrars for all services to the
Portfolio, (xv) expenses for servicing the accounts of holders, (xvi) any direct
charges to holders approved by the trustees of the Portfolio, (xvii)
compensation and expenses of trustees of the Portfolio who are not members of
the Adviser's organization, and (xviii) such non-recurring items as may arise,
including expenses incurred in connection with litigation, proceedings and
claims and the obligation of the Portfolio to indemnify its trustees, officers
and holders with respect thereto.
In consideration of the services, payments and facilities to be
furnished by BMR under the Agreement, the Portfolio will pay BMR a monthly
advisory fee equal to and calculated in the same manner as the advisory fee
currently being paid by the Fund as set forth under Proposal 1 above. Therefore,
there will be no increase in the schedule of advisory fee rates as a result of
the conversion of the Fund to the Master-Feeder structure. Because the Portfolio
has not commenced operations as of the date of this Proxy Statement, BMR has not
received any investment advisory fees from the Portfolio.
William D. Burt and Barclay Tittmann, Vice Presidents of EVM and BMR,
have been the co-portfolio managers of the Fund since February 1, 1995, and will
serve as co-portfolio managers of the Portfolio.
The Agreement provides that it may be terminated at any time without
penalty on sixty days' notice by BMR or by the trustees of the Portfolio or by
vote of a majority of the outstanding voting securities of the Portfolio, and
that it shall automatically terminate in the event of its assignment. The
Agreement provides that BMR may render services to others and engage in other
business activities. The Agreement also provides that BMR shall be liable for
any loss incurred in connection with the performance of its duties, or action
19
<PAGE>
taken or omitted under the Agreement in the absence of willful misfeasance, bad
faith or gross negligence in the performance of its duties or by reason of its
reckless disregard of its obligations and duties thereunder, or for any losses
which may be sustained in the acquisition, holding or disposition of any
security or other investment.
VOTE REQUIRED TO AUTHORIZE THE FUND TO
APPROVE THE INVESTMENT ADVISORY AGREEMENT
Authorization of the Fund to approve the Portfolio's Investment
Advisory Agreement with BMR at the meeting of the holders of interests in the
Portfolio requires the affirmative vote of a majority of the outstanding voting
securities of the Fund (as defined under "Vote Required to Approve Proposal 1").
THE TRUSTEES OF THE TRUST RECOMMEND THAT THE SHAREHOLDERS OF THE FUND
VOTE TO APPROVE THIS PROPOSAL. In the event that the shareholders of the Fund
fail to approve this Proposal, the Trustees of the Trust will consider what
further action should be taken.
PROPOSAL 3. TO APPROVE THE ELIMINATION,
RECLASSIFICATION AND AMENDMENT OF CERTAIN
FUNDAMENTAL INVESTMENT POLICIES
The Act requires a registered investment company like the Fund to have
certain specific investment policies which can be changed only by a shareholder
vote. Investment companies may also elect to designate other policies which may
be changed only by a shareholder vote. Both types of policies are often referred
to as "fundamental" policies. (In this Proxy Statement, the word "restriction"
is sometimes used to describe a policy.) Some fundamental policies have been
adopted in the past by the Fund to reflect certain regulatory, business or
industry conditions which are no longer in effect. In particular, the National
Securities Markets Improvement Act of 1996 permits investment companies to
eliminate investment restrictions formerly imposed by state securities ("Blue
Sky") regulations. Accordingly, the Trustees authorized a review of the Fund's
fundamental policies to simplify and modernize those policies which are required
to be fundamental, and to eliminate as fundamental any policies which are not
required to be fundamental under the positions of the staff of the Securities
and Exchange Commission in interpreting the Act, in which case, depending on the
circumstances, the policy would be reclassified as a nonfundamental policy in
the same or a modified form, or eliminated. Nonfundamental policies can be
changed by the Trustees without shareholder approval. Revision of fundamental
policies have been approved by shareholders of numerous other funds advised by
EVM, and if these revisions are approved then the uniformity of such policies
would serve to facilitate EVM's compliance efforts.
This Proposal seeks shareholder approval of changes which are intended
to accomplish the foregoing goals. The proposed changes to the fundamental
policies are discussed in detail below. Please refer to the changes to the
policies as set forth in Exhibit B (which does not include the additional
fundamental investment provision to be added if Proposal 1 is approved).
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By reducing to a minimum those policies which can be changed only by
shareholder vote, the Fund would be able to avoid the costs and delay associated
with a future shareholder meeting and the Trustees believe that EVM's ability to
manage the Fund's portfolio in a changing regulatory or investment environment
will be enhanced. Accordingly, investment management opportunities will be
increased. The references to the Fund's investment restrictions correspond to
the paragraphs in Exhibit B. If this Proposal is approved, the restrictions
would be reordered.
The proposed changes will not affect current management of the Fund's
portfolio. Moreover, the changes would be made regardless of whether other
Proposals in this Proxy Statement are approved.
ELIMINATION OF CERTAIN RESTRICTIONS
The Trustees propose to delete Restrictions (2), (6), (12), (13) and
(14) because such restrictions are not required to be fundamental policies under
the Act and/or the practices referred to therein are otherwise governed by the
Act.
Restriction (2) concerning pledging the assets of the Fund is being
deleted as pledging restrictions was formerly only required by "Blue Sky" law.
Restriction (6) concerning investment in other investment companies
prohibits the Fund from investing in securities of other investment companies.
Investment in other investment companies is regulated by the Act (as amended in
October 1996) and this restriction does not contain all of the provisions in
the Act regarding such investments.
Restriction (12) concerning transactions with affiliates generally
prohibits the Fund from buying or selling securities from the Trust's officers
or Trustees or other affiliates. Such transactions are circumscribed by the
Act's provisions on affiliated transactions and EVM maintains a code of ethics
to monitor transactions affecting the Fund.
Restriction (13) concerning the purchase of oil, gas or other mineral
leases was formerly only required by "Blue Sky" laws.
Restriction (14) concerning investing in restricted securities is more
restrictive than necessary under the existing Securities and Exchange Commission
position concerning such investments. The Fund already maintains a
nonfundamental policy providing that the Fund may not invest more than 15% of
its net assets in illiquid securities. Removal of this restriction may result in
increased exposure to such investments. Because of the absence of any public
trading market for these investments it may take longer to liquidate these
positions at fair value than would be the case for publicly traded securities.
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RECLASSIFICATION OF CERTAIN RESTRICTIONS
The Trustees also propose that Restrictions (4), (5), (7) and (10) be
eliminated as fundamental, but be retained as nonfundamental policies of the
Fund (which could be thereafter changed or eliminated by Trustee vote). Each of
these restrictions is required under federal laws, but are not required to be
fundamental policies of the Fund.
Restriction (4) concerning short sales prohibits the Fund from engaging
in such transactions unless they are "against the box." In a short sale, the
Fund would sell a borrowed security with a corresponding obligation to return
the same security. By becoming nonfundamental, the restriction could be revised
in the future to permit other types of short sales if permitted by law.
Restriction (5) concerning diversification of assets is not required to
be a fundamental restriction because the Fund is classified as a
"non-diversified" Fund under the Act. The restriction has been combined with an
existing nonfundamental restriction.
Restriction (7) concerning the investment in affiliated issuers
prohibits the Fund from purchasing a security where individuals affiliated with
the Fund own beneficially more than 5% of that security. If made nonfundamental,
this restriction could be revised in the future to permit such affiliated
investments if relevant law changed.
Restriction (10) concerning investing for control prohibits the Fund
from investing for control or management of other companies. Such investments
would be difficult because of the Internal Revenue Code's diversification
requirements and are regulated by the Act's provisions on affiliated
transactions.
As a result of this proposed reclassification of certain investment
restrictions as nonfundamental, a future change in any of these restrictions
could be effected by the Trustees without shareholder approval if the Trustees
determined that such change was appropriate and desirable. The Trustees have no
present intention of amending or eliminating the foregoing restrictions which
would be reclassified. The Trustees believe, however, that this reclassification
of restrictions will permit the Fund to respond more rapidly to future changes
in the Fund's competitive and regulatory environment.
AMENDMENT OF CERTAIN RESTRICTIONS
The Trustees also propose the amendment of two fundamental policies.
22
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Restriction (1) concerning borrowing has been revised by permitting
borrowing and the issuance of senior securities consistent with the Act. The
positions of staff of the Securities and Exchange Commission on borrowings and
senior securities have evolved in recent years with the development of new
investment strategies, such as reverse repurchase agreements and futures
transactions. The Fund would like the ability to consider use of new investment
techniques consistent with the Act as interpretations of the Act are further
developed.
Restriction (9) concerning lending has been amended to reflect current
regulatory restraints and conform the restriction to the lending policy of other
Eaton Vance funds.
VOTE REQUIRED TO APPROVE PROPOSAL 3
Approval of each part of this Proposal requires the affirmative vote of
a majority of the outstanding voting securities of the Fund as defined under
Proposal 1. Implementation of this Proposal is not dependent upon any other
proposal herein.
The Trustees have considered various factors and believe that this
Proposal will increase investment management flexibility and is in the best
interests of the Fund's shareholders. If the Proposal is not approved, the
Fund's present fundamental restrictions will remain in effect and a shareholder
vote would be required before the Fund could engage in activities prohibited by
a fundamental restriction. The Trustees recommend that the shareholders vote in
favor of the elimination, reclassification and amendment of the Fund's
investment restrictions as described above.
CERTAIN INFORMATION REGARDING BMR, EVM
AND THE OFFICERS OF THE FUND AND THE PORTFOLIO
INVESTMENT ADVISERS
Eaton Vance Management ("EVM") or Boston Management and Research
("BMR") act as investment adviser to investment companies and various individual
and institutional clients, with combined assets under management of over $17
billion. EVM provides administrative and management services to certain Eaton
Vance funds, as well as The Wright Managed Income Trust, The Wright Managed
Equity Trust, The Wright EquiFund Equity Trust and The Wright Managed Blue Chip
Series Trust.
There are no financial conditions known by the Eaton Vance organizations
which would impair the financial ability of BMR to fulfill its commitment to the
Portfolio under the proposed investment advisory agreement. BMR and EVM are
Massachusetts business trusts, and EV is the trustee of BMR and EVM. The
Directors of EV are Landon T. Clay, M. Dozier Gardner, James B. Hawkes and
Benjamin A. Rowland, Jr. The Directors of EVC consist of the same persons and
John G. L. Cabot and Ralph Z. Sorenson. Mr. Clay is chairman, Mr. Gardner is
vice chairman and Mr. Hawkes is president and chief executive officer of EVC,
EVM, BMR and EV. All of the issued and outstanding shares of EVM
23
<PAGE>
and of EV are owned by EVC. All of the issued and outstanding shares of BMR
are owned by EVM. All shares of the outstanding Voting Common Stock of EVC are
deposited in a Voting Trust which expires on December 31, 1997, the Voting
Trustees of which are Messrs. Clay, Gardner, Hawkes, Rowland and Thomas E.
Faust, Jr. The Voting Trustees have unrestricted voting rights for the election
of Directors of EVC. All of the outstanding voting trust receipts issued under
said Voting Trust are owned by certain of the officers of BMR and EVM who are
also officers or officers and Directors of EVC and EV. As of January 31, 1997,
Messrs. Clay, Gardner and Hawkes each owned 24% of such voting trust receipts,
and Messrs. Rowland and Faust owned 15% and 13%, respectively, of such voting
trust receipts. The address of EVC, EVM, BMR, EV and of its Directors or
Trustees is 24 Federal Street, Boston, Massachusetts 02110.
EVC owns all the stock of Energex Energy Corporation, which engages in
oil and gas exploration and development. EVM owns all the stock of Northeast
Properties, Inc., which is engaged in real estate investment. EVC owns all the
stock of Fulcrum Management, Inc. and MinVen, Inc., which are engaged in
precious metal mining venture investment and management. EVC also owns 24% of
the Class A shares of Lloyd George Management (BVI) Limited, a registered
investment adviser based in Hong Kong. EVC, BMR, EVM and EV may also enter into
other businesses.
EATON VANCE DISTRIBUTORS, INC.
Eaton Vance Distributors, Inc. ("EVD") ( a wholly-owned subsidiary of
EVM) acts as Principal Underwriter for over 140 investment companies, each of
which makes a continuous offering of shares. EVD also acts as the Placement
Agent for the Portfolio. The Placement Agent Agreement is renewable annually by
the Portfolio's Board of Trustees (including a majority of the Independent
Trustees), may be terminated on sixty days' notice either by such Trustees or by
vote of a majority of the outstanding voting securities of the Portfolio or on
six months' notice by the Placement Agent and is automatically terminated upon
assignment.
OFFICERS OF THE TRUST AND THE PORTFOLIO
The officers of the Trust and the Portfolio, with their ages indicated in
parenthesis, are as follows: James B. Hawkes, Jr. (55), President of the Trust
since April 19, 1982 and of the Portfolio; William D. Burt, (58), Vice President
of the Trust since June 19, 1995 and of the Portfolio; William Chisholm (36),
Vice President of the Portfolio; M. Dozier Gardner (63), Vice President of the
Trust since 1971; Michel Normandeau (45), Vice President of the Portfolio;
Raymond O'Neill (34), Vice President of the Portfolio; Barclay Tittmann (65),
Vice President of the Trust since June 19, 1995 and of the Portfolio; James L.
O'Connor (50), Treasurer of the Trust since February 21, 1989 and of the
Portfolio; Thomas Otis (65), Secretary of the Trust since 1972 and of the
Portfolio; Janet E. Sanders (61), Assistant Treasurer and Assistant Secretary of
the Trust since December 16, 1991 and of the Portfolio; William J. Austin, Jr.
(45), Assistant Treasurer of the Trust since December 16, 1991 and of the
Portfolio; Barbara E. Campbell (39), Assistant Treasurer of the Trust since June
19, 1995; M. Katherine Kreider (36), Assistant Treasurer of the Trust since
February 21, 1996; A. John Murphy (34), Assistant Secretary of the Trust since
24
<PAGE>
March 27, 1995 and of the Portfolio; and Eric G. Woodbury (39), Assistant
Secretary of the Trust since June 19, 1995 and of the Portfolio. Except as
indicated, all officers of the Trust have served in that capacity for the last
five years and all officers of the Portfolio have served since February 14,
1997. All of the officers of the Trust and the Portfolio (except for Messrs.
Chisholm, Normandeau and O'Neill who are not employed by BMR, EVM or their
predecessors) have been employed by BMR, EVM or their predecessors for more than
five years except Mr. Burt, Vice President of EVM, BMR and EV since November
1994, was Vice President of The Boston Company from 1990-1994; Mr. Tittmann,
Vice President of EVM, BMR and EV since October 1993, was Vice President of
Invesco Management and Research from 1970-1991; Ms. Kreider, Assistant Vice
President of EVM, BMR and EV since February 5, 1996, was Senior Audit Manager
and Audit Manager Financial Services Industry Practice with Deloitte & Touche
LLP from 1987-1996; Mr. Murphy, Assistant Vice President of EVM, BMR and EV
since March 1, 1994 and an employee of EVM since March 1993 was State
Regulations Supervisor, The Boston Company from 1991-1993; and Mr. Woodbury,
Vice President of EVM, BMR and EV since February 1993, who was an associate
attorney at Dechert, Price & Rhoads and Gaston & Snow prior thereto. Messrs.
Gardner and Hawkes are officers, Directors, and stockholders of EVC, officers
and Directors of EV, and officers of EVM and BMR. Messrs. Burt, Murphy,
O'Connor, Tittmann and Woodbury and Ms. Sanders, Campbell and Kreider are
officers of EVM, BMR and EV, and stockholders of EVC. Mr. Otis is an officer and
stockholder of EVC and an officer of EVM, BMR and EV. Because of their positions
with BMR, EVM and EV or their ownership of stock of EVC, Mr. Hawkes (an Officer
and Trustee of the Trust and officer and trustee of the Portfolio), as well as
the other officers of the Fund and the Portfolio, will benefit from the advisory
fees paid by the Fund to EVM, or by the Portfolio to BMR. Messrs. Chisholm and
Normandeau are Senior Trust Officer and Assistant Manager - Trust Services,
respectively, of The Bank of Nova Scotia Trust Company (Cayman) Limited, The
Bank of Nova Scotia Building, P.O. Box 501, George Town, Grand Cayman, Cayman
Islands, British West Indies. Mr. O'Neill is Managing Director of IBT Trust and
Custodian Services (Ireland) Limited (Earlsfort Terrace, Dublin 2, Ireland)
since January 1995, was Vice President, Atlantic Corporate Management Limited,
Warwick, Bermuda (1991-1994) and Officer, The Bank of Bermuda Limited, Hamilton,
Bermuda (1987-1991).
NOTICE TO BANKS AND BROKER/DEALERS
The Trust has previously solicited all Nominee and Broker/Dealer
accounts as to the number of additional proxy statements required to supply
owners of shares. Should additional proxy material be required for beneficial
owners, please forward such requests to: First Data Investor Services Group,
Eaton Vance Group of Funds, Proxy Department, P.O. Box 9122 Hingham, MA
02043-9717.
ADDITIONAL INFORMATION
The expense of preparing, printing and mailing this Proxy Statement and
enclosures and the cost of soliciting proxies on behalf of the Board of Trustees
of the Trust will be borne by the Fund. Proxies will be solicited by mail and
may be solicited in person or by telephone or telegraph by officers of the
Trust, by personnel of its investment adviser, EVM, its transfer agent, First
Data Investor Services Group, by broker-dealer firms or by a professional
solicitation organization. The expenses connected with the solicitation of these
proxies and with any further proxies which may be solicited by the Trust's
25
<PAGE>
officers, by EVM's personnel, by its transfer agent, First Data Investor
Services Group, or by broker-dealer firms, in person, by telephone or by
telegraph will be borne by the Fund. The Fund will reimburse banks,
broker-dealer firms, and other persons holding shares registered in their names
or in the names of their nominees, for their expenses incurred in sending proxy
material to and obtaining proxies from the beneficial owners of such shares.
All proxy cards solicited by the Board of Trustees that are properly
executed and received by the Secretary prior to the meeting, and which are not
revoked, will be voted at the meeting. Shares represented by such proxies will
be voted in accordance with the instructions thereon. If no specification is
made on the proxy card, it will be voted for the matters specified on the proxy
card. All proxies not voted, will not be counted toward establishing a quorum.
Broker non-votes will be counted toward establishing a quorum and for
determining whether sufficient votes have been received for approval of the
Proposal to be acted upon. Shareholders should note that while votes to abstain
will count toward establishing a quorum, passage of any Proposal being
considered at the meeting will occur only if a sufficient number of votes are
cast for the Proposal. Accordingly, votes to abstain, broker non-votes and votes
against will have the same effect in determining whether a Proposal is approved.
In the event that sufficient votes by the shareholders of the Fund in
favor of any Proposal set forth in the Notice of this meeting are not received
by March 27, 1997, the persons named as attorneys in the enclosed proxy may
propose one or more adjournments of the meeting to permit further solicitation
of proxies. A shareholder vote may be taken on one or more of the Proposals in
this Proxy Statement prior to such adjournment if sufficient votes have been
received and it is otherwise appropriate. Any such adjournment will require the
affirmative vote of the holders of a majority of the shares present in person or
by proxy at the session of the meeting to be adjourned. The persons named as
attorneys in the enclosed proxy will vote in favor of such adjournment those
proxies which they are entitled to vote in favor of the Proposal for which
further solicitation of proxies is to be made. They will vote against any such
adjournment those proxies required to be voted against such Proposal. The costs
of any such additional solicitation and of any adjourned session will be borne
by the Fund.
SUBMISSION OF SHAREHOLDER PROPOSALS. The Trust and the Fund do not hold
annual shareholders' meetings. Shareholders wishing to submit proposals for
inclusion in a proxy statement for a subsequent shareholders' meeting should
send their written proposals to: Secretary, Eaton Vance Growth Trust, 24 Federal
Street, Boston, Massachusetts 02110. Proposals must be received in advance of a
proxy solicitation to be included and the mere submission of a proposal does not
guarantee inclusion in the proxy statement because certain federal securities
law rules must be complied with.
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THE FUND WILL FURNISH, WITHOUT CHARGE A COPY OF THE FUND'S ANNUAL
REPORT TO ANY SHAREHOLDER UPON REQUEST. SHAREHOLDERS DESIRING TO OBTAIN A COPY
OF SUCH REPORTS SHOULD DIRECT ALL WRITTEN REQUESTS TO: THOMAS OTIS, SECRETARY,
EATON VANCE GROWTH TRUST, 24 FEDERAL, STREET, BOSTON, MASSACHUSETTS 02110, OR
SHOULD CALL EATON VANCE SHAREHOLDER SERVICES AT 1-800-225-6265.
February 19, 1997
27
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EXHIBIT A
WORLDWIDE DEVELOPING RESOURCES PORTFOLIO
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 14th day of February, 1997, between Worldwide
Developing Resources Portfolio, a New York trust (the "Trust"), and Boston
Management and Research, a Massachusetts business trust (the "Adviser").
1. DUTIES OF THE ADVISER. The Trust hereby employs the Adviser to act
as investment adviser for and to manage the investment and reinvestment of the
assets of the Trust and to administer its affairs, subject to the supervision of
the Trustees of the Trust, for the period and on the terms set forth in this
Agreement.
The Adviser hereby accepts such employment, and undertakes to afford to
the Trust the advice and assistance of the Adviser's organization in the choice
of investments and in the purchase and sale of securities for the Trust and to
furnish for the use of the Trust office space and all necessary office
facilities, equipment and personnel for servicing the investments of the Trust
and for administering its affairs and to pay the salaries and fees of all
officers and Trustees of the Trust who are members of the Adviser's organization
and all personnel of the Adviser performing services relating to research and
investment activities. The Adviser shall for all purposes herein be deemed to be
an independent contractor and shall, except as otherwise expressly provided or
authorized, have no authority to act for or represent the Trust in any way or
otherwise be deemed an agent of the Trust.
The Adviser shall provide the Trust with such investment management and
supervision as the Trust may from time to time consider necessary for the proper
supervision of the Trust. As investment adviser to the Trust, the Adviser shall
furnish continuously an investment program and shall determine from time to time
what securities and other investments shall be acquired, disposed of or
exchanged and what portion of the Trust's assets shall be held uninvested,
subject always to the applicable restrictions of the Declaration of Trust,
By-Laws and registration statement of the Trust under the Investment Company Act
of 1940, all as from time to time amended. Should the Trustees of the Trust at
any time, however, make any specific determination as to investment policy for
the Trust and notify the Adviser thereof in writing, the Adviser shall be bound
by such determination for the period, if any, specified in such notice or until
similarly notified that such determination has been revoked. The Adviser shall
take, on behalf of the Trust, all actions which it deems necessary or desirable
to implement the investment policies of the Trust.
The Adviser shall place all orders for the purchase or sale of
portfolio securities for the account of the Trust either directly with the
issuer or with brokers or dealers selected by the Adviser, and to that end the
Adviser is authorized as the agent of the Trust to give instructions to the
custodian of the Trust as to deliveries of securities and payments of cash for
the account of the Trust. In connection with the selection of such brokers or
dealers and the placing of such orders, the Adviser shall use its best efforts
to seek to execute security transactions at prices which are advantageous to the
Trust and (when a disclosed commission is being charged) at reasonably
competitive commission rates. In selecting brokers or dealers qualified to
execute a particular transaction, brokers or dealers may be selected who also
A-1
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provide brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) to the Adviser and the
Adviser is expressly authorized to pay any broker or dealer who provides such
brokerage and research services a commission for executing a security
transaction which is in excess of the amount of commission another broker or
dealer would have charged for effecting that transaction if the Adviser
determines in good faith that such amount of commission is reasonable in
relation to the value of the brokerage and research services provided by such
broker or dealer, viewed in terms of either that particular transaction or the
overall responsibilities which the Adviser and its affiliates have with respect
to accounts over which they exercise investment discretion. Subject to the
requirement set forth in the second sentence of this paragraph, the Adviser is
authorized to consider, as a factor in the selection of any broker or dealer
with whom purchase or sale orders may be placed, the fact that such broker or
dealer has sold or is selling shares of any one or more investment companies
sponsored by the Adviser or its affiliates or shares of any other investment
company investing in the Trust.
2. COMPENSATION OF THE ADVISER. For the services, payments and
facilities to be furnished hereunder by the Adviser, the Adviser shall be
entitled to receive from the Trust compensation in an amount equal to the
following of the average daily net assets of the Trust throughout each month:
Average Daily Net Monthly Fee Rate
Assets for the Month (For Each Level)
-------------------- ----------------
Up to $500 million 1/16 of 1%
$500 million but less than $1 billion 11/192 of 1%
$1 billion but less than $1.5 billion 5/96 of 1%
$1.5 billion but less than $2 billion 3/64 of 1%
$2 billion but less than $3 billion 1/24 of 1%
$3 billion and over 7/192 of 1%
Such compensation shall be paid monthly in arrears on the last business day of
each month. The Trust's daily net assets shall be computed in accordance with
the Declaration of Trust of the Trust and any applicable votes and
determinations of the Trustees of the Trust. In case of initiation or
termination of the Agreement during any month with respect to the Trust, the fee
for that month shall be based on the number of calendar days during which it is
in effect.
The Adviser may, from time to time, waive all or a part of the above
compensation.
3. ALLOCATION OF CHARGES AND EXPENSES. It is understood that the Trust
will pay all expenses other than those expressly stated to be payable by the
Adviser hereunder, which expenses payable by the Trust shall include, without
implied limitation, (i) expenses of maintaining the Trust and continuing its
existence, (ii) registration of the Trust under the Investment Company Act of
1940, (iii) commissions, fees and other expenses connected with the acquisition,
holding and disposition of securities and other investments, (iv) auditing,
accounting and legal expenses, (v) taxes and interest, (vi) governmental fees,
(vii) expenses of issue, sale and redemption of Interests in the Trust, (viii)
expenses of registering and qualifying the Trust and Interests in the Trust
under federal and state securities laws and of preparing and printing
registration statements or other offering statements or memoranda for such
purposes and for distributing the same to Holders and investors, and fees and
expenses of registering and maintaining registrations of the Trust and of the
A-2
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Trust's placement agent as broker-dealer or agent under state securities laws,
(ix) expenses of reports and notices to Holders and of meetings of Holders and
proxy solicitations therefor, (x) expenses of reports to governmental officers
and commissions, (xi) insurance expenses, (xii) association membership
dues, (xiii) fees, expenses and disbursements of custodians and subcustodians
for all services to the Trust (including without limitation safekeeping of
funds, securities and other investments, keeping of books, accounts and records,
and determination of net asset values, book capital account balances and tax
capital account balances), (xiv) fees, expenses and disbursements of transfer
agents, dividend disbursing agents, Holder servicing agents and registrars for
all services to the Trust, (xv) expenses for servicing the account of Holders,
(xvi) any direct charges to Holders approved by the Trustees of the Trust,
(xvii) compensation and expenses of Trustees of the Trust who are not members of
the Adviser's organization, and (xviii) such non-recurring items as may arise,
including expenses incurred in connection with litigation, proceedings and
claims and the obligation of the Trust to indemnify its Trustees, officers and
Holders with respect thereto.
4. OTHER INTERESTS. It is understood that Trustees and officers of the
Trust and Holders of Interests in the Trust are or may be or become interested
in the Adviser as trustees, shareholders or otherwise and that trustees,
officers and shareholders of the Adviser are or may be or become similarly
interested in the Trust, and that the Adviser may be or become interested in the
Trust as Holder or otherwise. It is also understood that trustees, officers,
employees and shareholders of the Adviser may be or become interested (as
directors, trustees, officers, employees, shareholders or otherwise) in other
companies or entities (including, without limitation, other investment
companies) which the Adviser may organize, sponsor or acquire, or with which it
may merge or consolidate, and which may include the words "Eaton Vance" or
"Boston Management and Research" or any combination thereof as part of their
name, and that the Adviser or its subsidiaries or affiliates may enter into
advisory or management agreements or other contracts or relationships with such
other companies or entities.
5. LIMITATION OF LIABILITY OF THE ADVISER. The services of the Adviser
to the Trust are not to be deemed to be exclusive, the Adviser being free to
render services to others and engage in other business activities. In the
absence of willful misfeasance, bad faith, gross negligence or reckless
disregard of obligations or duties hereunder on the part of the Adviser, the
Adviser shall not be subject to liability to the Trust or to any Holder of
Interests in the Trust for any act or omission in the course of, or connected
with, rendering services hereunder or for any losses which may be sustained in
the acquisition, holding or disposition of any security or other investment.
6. SUB-INVESTMENT ADVISERS. The Adviser may employ one or more
sub-investment advisers from time to time to perform such of the acts and
services of the Adviser, including the selection of brokers or dealers to
execute the Trust's portfolio security transactions, and upon such terms and
conditions as may be agreed upon between the Adviser and such investment adviser
and approved by the Trustees of the Trust, all as permitted by the Investment
Company Act of 1940.
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7. DURATION AND TERMINATION OF THIS AGREEMENT. This Agreement shall
become effective upon the date of its execution, and, unless terminated as
herein provided, shall remain in full force and effect through and including
February 28, 1998 and shall continue in full force and effect indefinitely
thereafter, but only so long as such continuance after February 28, 1998 is
specifically approved at least annually (i) by the Board of Trustees of the
Trust or by vote of a majority of the outstanding voting securities of the Trust
and (ii) by the vote of a majority of those Trustees of the Trust who are not
interested persons of the Adviser or the Trust cast in person at a meeting
called for the purpose of voting on such approval.
Either party hereto may, at any time on sixty (60) days' prior written
notice to the other, terminate this Agreement without the payment of any
penalty, by action of Trustees of the Trust or the trustees of the Adviser, as
the case may be, and the Trust may, at any time upon such written notice to the
Adviser, terminate this Agreement by vote of a majority of the outstanding
voting securities of the Trust. This Agreement shall terminate automatically in
the event of its assignment.
8. AMENDMENTS OF THE AGREEMENT. This Agreement may be amended by a
writing signed by both parties hereto, provided that no amendment to this
Agreement shall be effective until approved (i) by the vote of a majority of
those Trustees of the Trust who are not interested persons of the Adviser or the
Trust cast in person at a meeting called for the purpose of voting on such
approval, and (ii) by vote of a majority of the outstanding voting securities of
the Trust.
9. LIMITATION OF LIABILITY. The Adviser expressly acknowledges the
provision in the Declaration of Trust of the Trust (Section 5.2 and 5.6)
limiting the personal liability of the Trustees and officers of the Trust, and
the Adviser hereby agrees that it shall have recourse to the Trust for payment
of claims or obligations as between the Trust and the Adviser arising out of
this Agreement and shall not seek satisfaction from any Trustee or officer of
the Trust.
10. CERTAIN DEFINITIONS. The terms "assignment" and "interested
persons" when used herein shall have the respective meanings specified in the
Investment Company Act of 1940 as now in effect or as hereafter amended subject,
however, to such exemptions as may be granted by the Securities and Exchange
Commission by any rule, regulation or order. The term "vote of a majority of the
outstanding voting securities" shall mean the vote, at a meeting of Holders, of
the lesser of (a) 67 per centum or more of the Interests in the Trust present or
represented by proxy at the meeting if the Holders of more than 50 per centum of
the outstanding Interests in the Trust are present or represented by proxy at
the meeting, or (b) more than 50 per centum of the outstanding Interests in the
Trust. The terms "Holders" and "Interests" when used herein shall have the
respective meanings specified in the Declaration of Trust of the Trust.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in Hamilton, Bermuda on the day and year first above written.
WORLDWIDE DEVELOPING RESOURCES PORTFOLIO
By: /s/ James B. Hawkes
---------------------------------------
James B. Hawkes, President
BOSTON MANAGEMENT AND RESEARCH
By: /s/ M. Dozier Gardner
---------------------------------------
M. Dozier Gardner, Vice Chairman
and not individually
A-5
<PAGE>
EXHIBIT B
INVESTMENT RESTRICTIONS
[Proposed Additions in Italics and Proposed Deletions in Brackets]
As a matter of fundamental policy, the Fund may not:
(1) Borrow money OR ISSUE SENIOR SECURITIES EXCEPT AS PERMITTED BY THE
INVESTMENT COMPANY ACT OF 1940; [, except that it may borrow
(i) from banks to purchase or carry securities, commodities, commodities
contracts or other investments, or
(ii) from banks for temporary or emergency purposes not in excess of 10%
of its gross assets taken at market value, or
(iii) by entering into reverse repurchase agreements,
if, immediately after any such borrowing, the value of the Fund's assets,
including all borrowings then outstanding, less its liabilities, is equal to at
least 300% of the aggregate amount of borrowings then outstanding (for the
purpose of determining the 300% asset coverage, the Fund's liabilities will not
include amounts borrowed). Any such borrowings may be secured or unsecured. The
Fund may issue securities (including senior securities) appropriate to evidence
the indebtedness, including reverse repurchase agreements, which the Fund is
permitted to incur.]
(2) [Pledge its assets, except that the Fund may pledge not more than
one-third of its total assets (taken at current value) to secure borrowings made
in accordance with investment restriction (1) above; for the purpose of this
restriction the deposit of cash, cash equivalents, portfolio securities or other
assets in a segregated account with the Fund's custodian in connection with any
of the Fund's investment transactions is not considered to be a pledge.]
(3) Purchase securities on margin (but the Fund may obtain such
short-term credits as may be necessary for the clearance of purchases and sales
of securities).
(4)* Make short sales of securities, unless at all times when a short
sale position is open the Fund either owns an equal amount of such securities or
owns securities convertible into or exchangeable for securities of the same
issue as, and equal in amount to, the securities sold short.
- ------------------------
*This restriction would become nonfundamental if Proposal 3 is approved.
B-1
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(5)* Purchase securities of any issuer (other than securities or
obligations issued or guaranteed by the U.S. Government or any of its agencies
or instrumentalities) if such purchase, at the time thereof, would cause more
than 10% of the total outstanding voting securities of such issuer to be held by
the Fund; this restriction will not apply (i) during periods when management of
the Fund anticipates significant economic, political or financial instability or
(ii) to investments in certificates of deposit, bankers' acceptances or time
deposits of banking and thrift institutions.
(6) [Purchase securities issued by any other investment company, except
in connection with a merger, consolidation, acquisition of assets or
reorganization, or by purchase in the open market of securities of closed-end
investment companies where no underwriter's or dealer's commission or profit,
other than customary broker's commission, is involved and only if immediately
thereafter not more than 10% of the Fund's total assets (taken at current value)
would be invested in such securities.]
(7)* Purchase or retain in its portfolio any securities issued by an
issuer any of whose officers, directors, trustees or security holders is an
officer or Trustee of the Trust or is a member, officer, director or trustee of
any investment adviser of the Fund, if after the purchase of the securities of
such issuer by the Fund one or more of such persons owns beneficially more than
1/2 of 1% of the shares or securities or both (all taken at current value) of
such issuer and such persons owning more than 1/2 of 1% of such shares or
securities together own beneficially more than 5% of such shares or securities
or both (all taken at current value).
(8) Underwrite securities issued by other persons, except insofar as it
may technically be deemed to be an underwriter under the Securities Act of 1933
in selling or disposing of a portfolio security.
(9) Make loans to other persons, except by (a) the acquisition of
[money market instruments,] debt securities and MAKING PORTFOLIO INVESTMENTS,
[other obligations in which the Fund is authorized to invest in accordance with
its investment objective and policies, ] (b) entering into repurchase agreements
and (c) lending [its] portfolio securities.
(10)* Invest for the purpose of gaining control of a company's
management.
(11) Purchase or sell real estate, although it may purchase and sell
securities which are secured by interests in real estate or interests therein
and securities of issuers (including real estate investment trusts) which invest
or deal in real estate or interests therein.
(12) [Buy investment securities from or sell them to any of its
officers or Trustees, its investment adviser or its principal underwriter, as
principal; provided, however, that any such person or firm may be employed as a
broker upon customary terms.]
- -----------------------
*This restriction would become nonfundamental if Proposal 3 is approved.
B-2
<PAGE>
(13) [Purchase oil, gas or other mineral leases or purchase partnership
interests in oil, gas or other mineral exploration or development programs; this
restriction shall not be deemed to limit or restrict the Fund's investments in
securities issued by companies that engage in oil, gas or other mineral
exploration or development activities.]
(14) [Knowingly (i) purchase a security issued by a Venture Capital
Company (a company the securities of which have no public market at the time the
investment is made) or which at the time of purchase cannot be readily resold
because of legal or contractual restrictions or for which at the time of
purchase there is clearly no readily available market, (ii) invest in options on
foreign currencies which are not traded on an exchange or board of trade or
(iii) enter into a repurchase agreement maturing in more than seven days if, as
a result, more than 10% of the Fund's total assets (taken at current value)
would be invested in such securities, options and repurchase agreements. The
following securities are not subject to this restriction: securities which the
Fund has a right to convert or exchange into a readily marketable security in
which it could otherwise invest upon not less than seven days notice; securities
which the Fund has the option to put to the issuer or a stand-by bank or broker
and receive the principal amount of redemption price less transaction costs on
not more than seven days notice; and securities (purchased by the Fund at a time
when the issuer was a Venture Capital Company) of a company which has ceased to
be a Venture Capital Company provided that such securities are readily
marketable.]
In addition, as a matter of fundamental policy:
(A) During normal market conditions the Fund will invest at least 25%
of its total assets in the natural resource group of industries, except when
such percentage is reduced as a result of a decrease in value of the assets so
invested or during such times when management believes that the assets so
invested should be redeployed for defensive purposes or during such times when
management believes that the assets so invested should be redeployed in
obligations or other securities, the principal amount, redemption terms or
conversion terms of which are related to the market price of some natural
resource asset such as gold bullion; the Fund may invest more than 25% of its
total assets in any industry in the natural resource group of industries; and
the Fund may invest up to 25% of its total assets, taken at market value at the
time of each investment, in any other industry. For the purposes of this policy,
an investment by the Fund in gold or silver bullion, other precious metals,
strategic metals, or gold or silver coins, or in securities issued by companies
deemed by the Fund's investment adviser to be engaged in the natural resource
investment sector (as from time to time described in the Fund's Prospectus),
shall be considered as an investment in the natural resource group of
industries.
(B) The Fund may purchase and sell commodities and commodities
contracts (including without limitation futures contracts and options on futures
contracts) of all types and kinds.
B-3
<PAGE>
EV MARATHON WORLDWIDE DEVELOPING THIS PROXY IS SOLICITED ON BEHALF OF
RESOURCES FUND THE BOARD OF TRUSTEES OF THE TRUST
(FORMERLY EV MARATHON GOLD & NATURAL
RESOURCES FUND)
(A SERIES OF EATON VANCE GROWTH TRUST)
KNOW ALL MEN BY THESE PRESENTS: That the undersigned, revoking previous proxies
for such shares, hereby appoints Alan R. Dynner, James B. Hawkes and Eric G.
Woodbury, or any of them, attorneys of the undersigned, with full power of
substitution, to vote all shares of EV Marathon Worldwide Developing Resources
Fund, which the undersigned is entitled to vote at the Special Meeting of the
Shareholders of said Fund to be held on March 27, 1997 at the principal office
of the Trust, 24 Federal Street, Boston, Massachusetts 02110, at 10:00 A.M.
(Boston time), and at any and all adjournments thereof. Receipt of the Notice of
and Proxy Statement for said Meeting is acknowledged.
The shares represented by this proxy will be voted on the following matters as
specified below and on the reverse side by the undersigned. If no specification
is made, this proxy will be voted in favor of all such matters. Note: This proxy
must be returned in order for your shares to be voted.
1. To adopt a new investment policy and
to supplement investment restrictions FOR [ ] AGAINST [ ] ABSTAIN [ ]1
to permit a new investment structure
as described in the Proxy Statement.
2.A. To authorize the Fund to vote at a FOR [ ] WITHHOLD [ ]2A
meeting of holders of interests in the nominees except AUTHORITY
the Portfolio to elect six trustees those whose names to vote for any
of the Portfolio. are inserted on the of the nominees.
line below.
J.B. Hawkes, D.R. Dwight, S.L.
Hayes, III, N.H. Reamer, J.L.
Thorndike, J.L. Treynor
-----------------------------------------
2.B. To authorize the Fund to vote at a FOR [ ] AGAINST [ ] ABSTAIN [ ]2B
meeting of holders of interests in the
Portfolio to ratify the selection of
Deloitte & Touche as independent
accountants of the Portfolio.
2.C. To authorize the Fund to vote at a FOR [ ] AGAINST [ ] ABSTAIN [ ]2C
meeting of holders of interests in
the Portfolio to approve the
Investment Advisory Agreement between
the Portfolio and Boston Management
and Research as set forth in Exhibit A
to the Proxy Statement.
<PAGE>
3. To approve the revision of certain of the Fund's investment policies as
set forth in Exhibit B to the Proxy Statement as follows:
3.A. Eliminate the restriction concerning FOR [ ] AGAINST [ ] ABSTAIN [ ]3A
pledging.
3.B. Eliminate the restriction concerning
investment in other investment companies. FOR [ ] AGAINST [ ] ABSTAIN [ ]3B
3.C. Eliminate the restriction concerning
transactions with affiliates. FOR [ ] AGAINST [ ] ABSTAIN [ ]3C
3.D. Eliminate the restriction concerning
oil, gas or other mineral leases. FOR [ ] AGAINST [ ] ABSTAIN [ ]3D
3.E. Eliminate the restriction concerning
investment in restricted securities. FOR [ ] AGAINST [ ] ABSTAIN [ ]3E
3.F. Reclassify the restriction concerning
short sales. FOR [ ] AGAINST [ ] ABSTAIN [ ]3F
3.G. Reclassify the restriction on
diversification. FOR [ ] AGAINST [ ] ABSTAIN [ ]3G
3.H. Reclassify the restriction on investment
in affiliated issuers. FOR [ ] AGAINST [ ] ABSTAIN [ ]3H
3.I. Reclassify the restriction concerning
investing for control. FOR [ ] AGAINST [ ] ABSTAIN [ ]3I
3.J. Amend the restriction concerning
borrowing. FOR [ ] AGAINST [ ] ABSTAIN [ ]3J
3.K. Amend the restriction concerning lending. FOR [ ] AGAINST [ ] ABSTAIN [ ]3K
As to any other matter, or if any of the nominees named in the Proxy Statement
are not available for election, said attorneys shall vote in accordance with
their judgment.
THE TRUSTEES RECOMMEND A VOTE IN FAVOR OF
ALL MATTERS
--------------------------------------
--------------------------------------
Please sign exactly as your name or names
appear at left.
Dated:____________________, 1997
