<PAGE>
FIDUCIARY
EXCHANGE FUND
An Eaton Vance
Exchange Fund
Semi-Annual Report
June 30, 1996
<PAGE>
-----------------------------
TO SHAREHOLDERS
AT A SPECIAL MEETING OF THE SHAREHOLDERS HELD ON JUNE 4, 1996, SHAREHOLDERS OF
FIDUCIARY EXCHANGE FUND voted to adopt several important changes in the Fund's
organization and operations recommended by the Fund's Board of Directors. As a
result, effective July 1, 1996, the Fund has adopted the Hub-and-Spoke(R) mutual
fund structure and is pursuing its investment objective through investing in the
Tax-Managed Growth Portfolio (the "Portfolio"), a separate open-end management
investment company with substantially the same investment objective, policies
and restrictions as the Fund as newly revised. Investing through the Portfolio
enables the Fund to participate in an investment portfolio that is substantially
larger, more diversified and potentially more attractive, and to achieve cost
savings over time. As of July 1, 1996, net assets of the Portfolio totalled
$560.5 million.
- --------------------------------------------------------------------------------
FIDUCIARY EXCHANGE FUND HAD A TOTAL RETURN OF 9.7% DURING THE SIX MONTHS ENDED
JUNE 30, 1996.
FIDUCIARY EXCHANGE FUND HAD A TOTAL RETURN OF 9.7% DURING THE SIX MONTHS ENDED
JUNE 30, 1996. That return represented a rise in net asset value per share to
$205.64 from $188.44, and the reinvestment of $1.10 per share in income
dividends.
IN THE PAST SIX MONTHS, THE STOCK MARKET HAS BENEFITED FROM A COMBINATION OF
RELATIVELY STRONG ECONOMIC GROWTH, MODERATE INTEREST RATES, AND LOW INFLATION.
On January 31, the Federal Reserve lowered the Federal funds rate (a key
short-term interest rate benchmark) for the third time in six months to 5.25%,
where it remains. Equities have responded well to these favorable conditions.
The S&P 500, an unmanaged index of large capitalization stocks, had a total
return of 10.1% from December 31, 1995 to June 30, 1996.
WHILE PRICE/EARNINGS MULTIPLES ARE HISTORICALLY HIGH, THERE REMAIN ATTRACTIVE
SECTORS IN THE STOCK MARKET. The price/earnings multiple - a measure of how much
investors are willing to pay for a dollar of current earnings has reached an
average of 17 for the S&P 500. This is higher than a year ago, when the average
was at 15.5, but not remarkably higher. Although large capitalization stocks in
general do not appear to be excessively valued, certain market sectors - notably
small capitalization, aggressive growth stocks (and particularly those with a
connection to the Internet) - are quite richly valued and may be vulnerable to a
substantial correction if economic or market conditions deteriorate.
- -------------------------
[Photo of Landon T. Clay]
- -------------------------
- --------------------------------------------------------------------------------
"THROUGHOUT ITS 30-YEAR HISTORY, FIDUCIARY EXCHANGE FUND HAS BEEN MANAGED FOR
THE LONG TERM, AND WITH CONSIDERATION TO SHAREHOLDER TAXES AND AFTER-TAX
RETURNS."
THE BLUE-CHIP GROWTH COMPANIES IN WHICH THE FUND AND THE PORTFOLIO TYPICALLY
INVEST HAVE BEEN STRONG PERFORMERS AND CONTINUE TO LOOK ATTRACTIVE FOR THE
MONTHS AND YEARS AHEAD. The largest holdings of the Portfolio as of July 1, 1996
include such well-regarded companies as Intel Corp., PepsiCo, Inc.,
Hewlett-Packard Co., Johnson & Johnson and Merck & Co., Inc. Each of these
companies is well established as an industry leader and has attractive financial
characteristics and excellent growth prospects. The Portfolio holds investments
in a diverse group of over 120 companies.
THROUGHOUT ITS 30-YEAR HISTORY, FIDUCIARY EXCHANGE FUND HAS BEEN MANAGED FOR THE
LONG TERM, AND WITH CONSIDERATION TO SHAREHOLDER TAXES AND AFTER-TAX RETURNS.
Investing in the Portfolio through the Hub and Spoke structure will not alter
this focus, but will enable the Fund to benefit from the Portfolio's greater
size and broader diversification. Looking ahead, Iam confident the Fund will
benefit from the changes being made in its organization and operations, as well
as from the long-term growth of the economy and of stocks of companies
positioned to take advantage of that growth.
Sincerely,
/s/ Landon T. Clay
LANDON T. CLAY
President
August 5, 1996
<PAGE>
FIDUCIARY EXCHANGE FUND, INC.
JUNE 30, 1996
(UNAUDITED)
INVESTMENT CHANGES
SIX MONTHS ENDED JUNE 30, 1996 (UNAUDITED)
- ------------------------------------------------------------------------------
SHARES OWNED
12/31/95 6/30/96
- ------------------------------------------------------------------------------
INCREASES
- ------------------------------------------------------------------------------
Chubb Corp. 26,380 39,800
- ------------------------------------------------------------------------------
Dionex Corp. 42,160 81,070
- ------------------------------------------------------------------------------
Nokia Corp. -- 20,000
- ------------------------------------------------------------------------------
DECREASES*
- ------------------------------------------------------------------------------
Dunn & Bradstreet Corp. 17,160 15,060
- ------------------------------------------------------------------------------
Exxon Corp. 39,000 36,930
- ------------------------------------------------------------------------------
Intel Corp. 52,958 50,928
- ------------------------------------------------------------------------------
Toys "R" Us, Inc. 60,000 --
- ------------------------------------------------------------------------------
*Includes investments paid in kind on redemptions.
OTHER CHANGES
- ------------------------------------------------------------------------------
SHARES
- ------------------------------------------------------------------------------
20,000 Automatic Data Processing Inc. in a 2 for 1 stock split.
- ------------------------------------------------------------------------------
19,900 Chubb Corp. in a 2 for 1 stock split 6,480 shares paid
in kind on redemptions.
- ------------------------------------------------------------------------------
30,484 Johnson & Johnson in a 2 or 1 stock split 2,570 shares
paid in kind on redemptions.
- ------------------------------------------------------------------------------
20,245 Stanley Works in a 2 for 1 stock split.
- ------------------------------------------------------------------------------
<PAGE>
PORTFOLIO OF INVESTMENTS
JUNE 30, 1996
(UNAUDITED)
- --------------------------------------------------------------------------
COMMON STOCKS - 97.9%
- --------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- --------------------------------------------------------------------------
ADVERTISING - 3.1%
Interpublic Group Co., Inc. 40,000 $ 1,875,000
-----------
BUSINESS PRODUCTS & SERVICES - 2.6%
Automatic Data Processing Inc. 40,000 $ 1,545,000
-----------
COMMUNICATIONS - 1.8%
Northern Telecom Ltd. 20,000 $ 1,087,500
-----------
COMMUNICATION EQUIPMENT - 1.2%
Nokia Corp. 20,000 $ 740,000
-----------
CONSUMER PRODUCTS - 1.5%
Stride Rite Corp. 109,640 $ 904,530
-----------
DRUGS & MEDICAL - 20.1%
Bausch & Lomb, Inc. 56,924 $ 2,419,270
Bristol-Myers Squibb Co. 27,860 2,507,400
Johnson & Johnson 60,968 3,017,916
Merck & Co., Inc. 42,894 2,772,025
Pfizer Inc. 18,616 1,328,717
-----------
$12,045,328
-----------
ELECTRONICS - 4.3%
Dionex Corp.* 81,070 $ 2,614,508
-----------
ENERGY - 9.6%
Andarko Petroleum Corp. 11,000 $ 638,000
Exxon Corp. 36,930 3,208,294
Mobil Corp. 16,835 1,887,624
-----------
$ 5,733,918
-----------
FOOD DISTRIBUTION - 2.7%
Super Valu Stores Inc. 51,506 $ 1,622,439
-----------
FOODS - 2.0%
McCormick & Co., Inc., Non-Voting 54,000 $ 1,194,750
-----------
HARDWARE & TOOLS - 2.0%
Stanley Works 40,490 $ 1,204,578
-----------
INFORMATION SERVICES - 3.6%
Reuters Holdings PLC, ADR 29,670 $ 2,151,075
-----------
INSURANCE - 6.4%
Chubb Corp. 39,800 $ 1,985,025
St. Paul Companies, Inc. 8,440 451,540
MGIC Investment Corp. 25,000 1,403,125
-----------
$ 3,839,690
-----------
MACHINERY & EQUIPMENT - 1.4%
Gould Pumps, Inc. 31,709 $ 812,543
-----------
MANUFACTURING - 4.8%
Dover Corp. 63,000 $ 2,905,875
-----------
METALS & MINING - 1.3%
Nucor Corp. 15,000 $ 759,375
-----------
PUBLISHING & PRINTING - 8.4%
Dun & Bradstreet Corp. 15,060 $ 941,250
Gannett Co., Inc. 37,050 2,621,287
Harcourt General, Inc. 30,000 1,500,000
-----------
$ 5,062,537
-----------
RETAIL - 4.5%
Wal-Mart Stores, Inc. 105,690 $ 2,681,884
-----------
SEMI-CONDUCTORS - 9.3%
Intel Corp. 50,928 $ 3,740,025
Texas Instruments, Inc. 36,390 1,814,951
-----------
$ 5,554,976
-----------
SPECIALTY CHEMICALS - 5.5%
Ecolab Inc. 62,820 $ 2,073,060
Nalco Chemical Co. 40,000 1,260,000
-----------
$ 3,333,060
-----------
TRANSPORTATION - 1.8%
FlightSafety International, Inc. A 20,000 $ 1,085,000
-----------
TOTAL COMMON STOCKS
(Identified cost, $12,451,812)
$58,753,566
-----------
- --------------------------------------------------------------------------
SHORT-TERM OBLIGATION - 1.7%
- --------------------------------------------------------------------------
Face Amount
Name of Company (000 Omitted) Value
- --------------------------------------------------------------------------
Ford Motor Credit Corp. 5.37%,
due 7/03/96 at amortized cost $1,000 $ 999,701
-----------
TOTAL INVESTMENTS - 99.6%
(identified cost, $13,451,513) $59,753,267
OTHER ASSETS, LESS LIABILITIES - .4% 241,382
-----------
NET ASSETS - 100% $59,994,649
===========
*Non-income producing security.
See notes to financial statements
<PAGE>
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
- ------------------------------------------------------------------------------
June 30, 1996 (Unaudited)
- ------------------------------------------------------------------------------
ASSETS:
Investments, at value (Note 1A) (identified cost,
$13,451,513) $59,753,267
Cash 162,049
Dividends receivable 93,153
Other assets 260
-----------
Total assets $60,008,729
LIABILITIES:
Payable to affiliate --
Directors' fees $ 1,680
Accrued expenses 12,400
-------
Total liabilities 14,080
-----------
NET ASSETS for 291,749 shares of capital stock outstanding $59,994,649
===========
SOURCES OF NET ASSETS:
Accumulated net realized gain on investment transactions
(computed on the basis of identified cost), less the
excess of cost of capital stock redeemed over proceeds
from sales of capital stock (including shares issued
to shareholders electing to receive payment of
distributions in capital stock) $23,414,856
Accumulated distributions of net realized gain on
investments as computed for federal income tax purposes (606,077)
Unrealized appreciation of investments (computed on
the basis of identified cost) 46,301,754
Federal tax on undistributed net realized long-term
capital gain, paid on behalf of shareholders (9,172,557)
Undistributed net investment income 56,673
-----------
Total $59,994,649
===========
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE
($59,994,649 / 291,749 shares of capital stock
outstanding) $205.64
=======
See notes to financial statements
<PAGE>
STATEMENT OF OPERATIONS
- ------------------------------------------------------------------------------
For the Six Months Ended June 30, 1996 (Unaudited)
- ------------------------------------------------------------------------------
INVESTMENT INCOME:
Income --
Dividends (net of foreign withholding tax of
$6,400) $ 534,998
Interest 28,369
----------
Total income $ 563,367
Expenses --
Investment adviser fee (Note 4) $ 182,843
Compensation of Directors not members of the
Investment Adviser's organization 3,534
Legal and accounting services 21,833
Custodian fees 15,006
Printing and postage 12,098
Transfer and dividend disbursing agent fees 5,679
Miscellaneous 4,494
----------
Total expenses 245,487
----------
Net investment income $ 317,880
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments, computed on the
basis of identified cost $1,453,277
Increase in unrealized appreciation of investments 3,637,842
----------
Net realized and unrealized gain on
investments 5,091,119
----------
Net increase in net assets from
operations $5,408,999
==========
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
- ----------------------------------------------------------------------------------------------
SIX MONTHS ENDED
JUNE 30, 1996 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1995
---------------- -----------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 317,880 $ 667,806
Net realized gain on investment transactions 1,453,277 7,662,357
Increase in unrealized appreciation of investments 3,637,842 8,140,251
------------ ------------
Increase in net assets from operations $ 5,408,999 $ 16,470,414
------------ ------------
Distributions to shareholders --
From net investment income $ (317,880) $ (667,806)
In excess of net investment income (3,524) (8,476)
------------ ------------
Total distributions to shareholders $ (321,404) $ (676,282)
------------ ------------
Provision for federal tax on undistributed net
realized long-term gain (Note 1B) -- $ (33,033)
------------ ------------
Net decrease from capital stock transactions (Note 2) $ (1,423,716) $ (8,263,018)
------------ ------------
Net increase in net assets $ 3,663,879 $ 7,498,081
NET ASSETS:
At beginning of period 56,330,770 48,832,689
------------ ------------
At end of period (including undistributed net
investment income of $56,673 and $60,197, respectively) $ 59,994,649 $ 56,330,770
============ ============
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
- -----------------------------------------------------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 1996 --------------------------------------------------------------------
(UNAUDITED) 1995 1994 1993 1992 1991
---------------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, beginning of year $188.440 $141.160 $149.470 $151.610 $148.620 $104.510
-------- -------- -------- -------- -------- --------
INCOME FROM OPERATIONS:
Net investment income $ 1.093 $ 2.103 $ 1.997 $ 1.639 $ 1.570 $ 1.770
Net realized and
unrealized gain (loss)
on investments 17.207 47.388 (8.329) (1.168) 3.180 44.340
-------- -------- -------- -------- -------- --------
Total income (loss)
from operations $ 18.300 $ 49.491 $ (6.332) $ 0.471 $ 4.750 $ 46.110
-------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
From net investment income $ (1.088) $ (2.074) $ (1.850) $ (1.600) $ (1.760) $ (1.650)
In excess of net investment income (0.012) (0.026) -- -- -- --
From net realized gain on
investments -- -- -- (0.900) -- (0.140)
-------- -------- -------- -------- -------- --------
Total distributions $ (1.100) $ (2.100) $ (1.850) $ (2.500) $ (1.760) $ (1.790)
-------- -------- -------- -------- -------- --------
PROVISION FOR FEDERAL TAX ON
UNDISTRIBUTED NET REALIZED
LONG-TERM GAIN (NOTE 1B) $ -- $ (0.111) $ (0.128) $ (0.111) $ -- $ (0.210)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, end of year $205.640 $188.440 $141.160 $149.470 $151.610 $148.620
======== ======== ======== ======== ======== ========
TOTAL RETURN(1) 9.72% 35.18% (4.25)% 0.34% 3.26% 44.38%
RATIOS/SUPPLEMENTAL DATA (TO
AVERAGE DAILY NET ASSETS):
Net assets at end of period
(000's omitted) $ 59,995 $ 56,331 $ 48,833 $ 58,113 $ 60,653 $ 62,793
Expenses 0.84% + 0.82% 0.83% 0.81% 0.83% 0.82%
Net investment income 1.09% + 1.20% 1.37% 1.11% 1.11% 1.38%
PORTFOLIO TURNOVER 1% 3% 5% 6% 5% 5%
AVERAGE COMMISSION RATE PAID(2) $ 0.0600 -- -- -- -- --
<FN>
+ Annualized.
(1) Total investment return is calculated assuming a purchase at the net asset value on the first day and a sale at the net
asset value on the last day of each period reported. Dividends and distributions, if any, are assumed to be reinvested at
the net asset value on the payable date. Total return is not computed on an annualized basis.
(2) For fiscal years beginning on or after September 1, 1995, a Fund is required to disclose its average commission rate per
share for security trades on which commissions are charged. Average commission rate paid is computed by dividing the total
dollar amount of commissions paid during the fiscal year by the total number of shares purchased and sold during the
fiscal year for which commissions were charged.
</TABLE>
See notes to financial statements
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
- --------------------------------------------------------------------------------
(1) SIGNIFICANT ACCOUNTING POLICIES
The Fund is registered under the Investment Company Act of 1940, as amended, as
a diversified, open-end management investment company. The following is a
summary of significant accounting policies consistently followed by the Fund in
the preparation of its financial statements. The policies are in conformity with
generally accepted accounting principles.
A. INVESTMENT VALUATIONS -- Investments listed on security exchanges or in the
NASDAQ National Market are valued at closing sale prices. Listed or unlisted
investments for which closing sale prices are not available are valued at
closing bid prices. Short-term obligations, maturing in 60 days or less, are
valued at amortized cost, which approximates value.
B. FEDERAL TAXES -- The Fund's policy is to comply with the provisions of the
Internal Revenue Code available to regulated investment companies and to
distribute to shareholders each year all of its taxable income from dividends,
interest, and net realized short-term capital gain. Accordingly, no provision
for federal income or excise tax is necessary on such income. The Fund generally
designates as undistributed any taxable net realized long-term gain (but
reserves the right to distribute such gain in any year) and pays the federal tax
thereon on behalf of shareholders. Provision for such tax is recorded on the
Fund's records on the last business day of the Fund's fiscal year because the
Internal Revenue Code provides that such tax is allocated among shareholders of
record on that date.
C. OTHER -- Investment transactions are accounted for on a trade date basis.
Dividend income and dividends to shareholders are recorded on the ex-dividend
date.
D. DISTRIBUTIONS -- Generally accepted accounting principles require that
differences in the recognition or classification of income between the financial
statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes, are classified as
distributions in excess of net investment income or accumulated net realized
gains.
E. USE OF ESTIMATES -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenue and expense during the reporting period. Actual results could differ
from those estimates.
F. INTERIM FINANCIAL INFORMATION -- The interim financial statements relating to
June 30, 1996 and for the six-month period then ended have not been audited by
independent certified public accountants, but in the opinion of the Fund's
management, reflect all adjustments, consisting only of normal recurring
adjustments, necessary for the fair presentation of the financial statements.
- ------------------------------------------------------------------------------
(2) CAPITAL STOCK
At June 30, 1996, there were 5,005,000 shares of $1.00 par value capital stock
authorized. Transactions in capital stock were as follows:
SIX MONTHS ENDED JUNE
30, 1996 YEAR ENDED DECEMBER 31,
(UNAUDITED) 1995
----------------------- -----------------------
SHARES AMOUNT SHARES AMOUNT
--------- ------------ --------- ------------
Redemptions 294 $ 59,779 880 $ 153,851
Issued to shareholders
electing to receive
payment of dividends in
capital stock (7,483) (1,483,495) (47,886) (8,416,869)
-------- ----------- -------- -----------
Net decrease (7,189) $(1,423,716) (47,006) $(8,263,018)
====== =========== ======= ===========
- ------------------------------------------------------------------------------
(3) INVESTMENT TRANSACTIONS
Purchases and sales of investments, other than short-term obligations,
aggregated $748,767 and $1,283,421, respectively. In addition, investments
having an aggregate market value of $1,423,325 at dates of redemption were
distributed in payment for capital stock redeemed, resulting in a realized
capital gain of $1,362,256, for book purposes.
- ------------------------------------------------------------------------------
(4) INVESTMENT ADVISER FEE AND OTHER
TRANSACTIONS WITH AFFILIATES
The investment adviser fee, computed at the monthly rate of 5/96 of 1% (5/8 of
1% annually) of the Fund's average monthly net assets, was paid to Eaton Vance
Management (EVM) as compensation for management and investment advisory services
rendered to the Fund. Except as to directors of the Fund who are not members of
EVM's organization, officers and directors receive remuneration for their
services to the Fund out of such investment adviser fee. Certain of the officers
and directors of the Fund are officers and directors/trustees of the above
organizations.
Directors of the Fund that are not affiliated with the Investment Adviser
may elect to defer receipt of all or a portion of their annual fees in
accordance with the terms of the Trustee Deferred Compensation Plan. For the six
months ended June 30, 1996, no significant amounts have been deferred.
- ------------------------------------------------------------------------------
(5) LINE OF CREDIT
The Fund participates with other funds managed by EVM and affiliates in a $120
million unsecured line of credit agreement with a bank. The line of credit
consists of a $20 million committed facility and a $100 million discretionary
facility. Borrowings will be made by the Fund solely to facilitate the handling
of unusual and/or unanticipated short-term cash requirements. Interest is
charged to each fund based on its borrowings at an amount above either the
bank's adjusted certificate of deposit rate, a variable adjusted certificate of
deposit rate, or a federal funds effective rate. In addition, a fee computed at
an annual rate of 1/4 of 1% on the $20 million committed facility and on the
daily unused portion of the $100 million discretionary facility is allocated
among the participating funds at the end of each quarter. The Fund did not have
any significant borrowings or allocated fees during the period.
- ------------------------------------------------------------------------------
(6) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation/depreciation in value of the investments
owned at June 30, 1996, as computed on a federal income tax basis, are as
follows:
Aggregate cost $13,451,513
===========
Gross unrealized appreciation $46,310,521
Gross unrealized depreciation 8,767
-----------
Net unrealized appreciation $46,301,754
===========
- ------------------------------------------------------------------------------
(7) SUBSEQUENT EVENT
On July 1, 1996, the Fund transferred substantially all of its investable assets
to the Tax-Managed Growth Portfolio (the Portfolio) for an interest in the
Portfolio. The Portfolio has substantially the same investment objective,
policies and restrictions as the Fund. In addition, the Fund changed its fiscal
year end to October 31.
<PAGE>
- ------------------------------------------------------------------------------
(8) SPECIAL MEETING OF STOCKHOLDERS (UNAUDITED)
Fiduciary Exchange Fund, Inc. (the "Fund") held a special meeting of
stockholders on June 4, 1996. On April 15, 1996, the record date of the meeting,
the Fund had 292,800.022 shares outstanding, of which 196,440.372 shares were
represented at the meeting. The votes at the meeting were as follows:
<TABLE>
Item 1: To adopt a new investment policy to authorize the Fund to invest its
investable assets in a specific corresponding open-end management
investment company having substantially the same investment objective,
policies and restrictions as the Fund, and to supplement investment
restrictions to permit such investment.
<CAPTION>
NUMBER OF SHARES
----------------
<S> <C>
Affirmative 171,589.326
Against 12,908.284
Abstain 7,680.762
Item 2: To approve an Amendment to the By-Laws of the Fund to change the
fiscal year end of the Fund to October 31.
NUMBER OF SHARES
----------------
Affirmative 173,892.355
Against 13,047.255
Abstain 7,680.762
Item 3: To approve the revision of the Fund's investment objective and
certain of the Fund's investment policies as follows:
A. Reclassification and amendment of the investment objective.
NUMBER OF SHARES
----------------
Affirmative 169,690.772
Against 14,806.838
Abstain 7,680.762
B. Eliminate the restriction concerning investment in other
investment companies.
NUMBER OF SHARES
----------------
Affirmative 169,690.772
Against 12,908.284
Abstain 9,579.316
C. Eliminate the restriction concerning pledging.
NUMBER OF SHARES
----------------
Affirmative 167,953.363
Against 14,645.693
Abstain 9,579.316
D. Reclassify the restriction concerning investment in unseasoned
issuers.
NUMBER OF SHARES
----------------
Affirmative 167,002.842
Against 15,596.214
Abstain 9,579.316
E. Reclassify the restriction concerning investing for control.
NUMBER OF SHARES
----------------
Affirmative 167,805.915
Against 14,518.141
Abstain 9,854.316
F. Amend the restriction concerning diversification.
NUMBER OF SHARES
----------------
Affirmative 169,415.772
Against 12,908.284
Abstain 9,854.316
G. Amend the restriction concerning borrowing and senior securities.
NUMBER OF SHARES
----------------
Affirmative 166,813.863
Against 15,510.193
Abstain 9,854.316
H. Amend the restriction concerning lending.
NUMBER OF SHARES
----------------
Affirmative 167,088.863
Against 15,510.193
Abstain 9,579.316
I. Amend the restriction concerning real estate and commodities.
NUMBER OF SHARES
----------------
Affirmative 167,092.388
Against 15,506.668
Abstain 9,579.316
Item 4: To approve an amendment to the Articles of Organization.
NUMBER OF SHARES
----------------
Affirmative 203,743.906
Against 13,172.284
Abstain 8,829.762
Item 5: To elect Landon T. Clay, Donald R. Dwight, Samuel L. Hayes, III,
Norton H. Reamer, John L. Thorndike, and Jack L. Treynor as Directors
of the Fund
<CAPTION>
NUMBER OF SHARES
NOMINEES FOR ----------------
DIRECTOR AFFIRMATIVE WITHHELD
------------ ----------- --------
<S> <C> <C>
Landon T. Clay 184,465.488 11,974.884
Donald R. Dwight 184,465.488 11,974.884
Samuel L. Hayes, III 184,465.488 11,974.884
Norton H. Reamer 184,465.488 11,974.884
John L. Thorndike 184,465.488 11,974.884
Jack L. Treynor 184,465.488 11,974.884
Item 6: To ratify the selection of Deloitte & Touche LLP as independent
certified public accountants of the Fund.
<CAPTION>
NUMBER OF SHARES
----------------
<S> <C>
Affirmative 190,005.501
Against 0.000
Abstain 6,434.871
</TABLE>
<PAGE>
-----------------------------
INVESTMENT MANAGEMENT
FIDUCIARY OFFICERS AND STAFF INDEPENDENT DIRECTORS
EXCHANGE
FUND, INC. LANDON T. CLAY DONALD R. DWIGHT
24 Federal Street President, Director President, Dwight Partners, Inc.
Boston, MA 02110 Chairman, Newspapers of
JAMES B. HAWKES New England, Inc.
Vice President
SAMUEL L. HAYES, III
DUNCAN W. RICHARDSON Jacob H. Schiff Professor of
Vice President and Investment Banking, Harvard
Portfolio Manager University Graduate School of
Business Administration
JAMES L. O'CONNOR
Treasurer NORTON H. REAMER
President and Director,
THOMAS OTIS United Asset Management
Clerk Corporation
JOHN L. THORNDIKE
Director, Fiduciary Company
Incorporated
JACK L. TREYNOR
Investment Adviser and
Consultant
------------------------------------------------------
FIDUCIARY EXCHANGE TRANSFER AND DIVIDEND
FUND, INC. DISBURSING AGENT
24 Federal Street First Data Investor Services
Boston, MA 02110 Group, Inc.
P.O. Box 1559
INVESTMENT ADVISER Boston, MA 02104
Eaton Vance Management
24 Federal Street
Boston, MA 02110
CUSTODIAN
Investors Bank & Trust
Company
89 South Street
P.O. Box 1537
Boston, MA 02205-1537
<PAGE>
FIDUCIARY EXCHANGE
FUND, INC.
PERFORMANCE RESULTS+
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AVERAGE ANNUAL TOTAL RETURNS
(STANDARDIZED SEC PERFORMANCE DATA
FOR THE PERIODS ENDED JUNE 30, 1996)
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One year 19.4%
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Five years 11.9%
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Ten years 12.9%
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Life of Fund (3/17/67) 11.3%
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CUMULATIVE TOTAL RETURN
LIFE OF FUND
(3/17/67 TO 6/30/96)
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Fiduciary Exchange Fund 2,200.0%
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Dow Jones Industrial Average 2,124.3%
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Standard & Poor's 500 2,175.9%
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+Past performance is no guarantee of future results. Investment returns and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost.
The Dow Jones Industrial Average and the Standard & Poor's 500 are unmanaged
lists of common stocks.
This report must be preceded or accompanied by a prospectus which contains more
complete information on the Fund including its distribution plan, sales charges
and expenses. Please read the prospectus carefully before investing.
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EATON VANCE
The Boston Tradition
Funds offered through
Eaton Vance Distributors, Inc.
24 Federal Street, Boston, Massachusetts 02110
8/96
