EATON VANCE MUTUAL FUNDS TRUST, 485APOS, 1998-12-30

EATON VANCE MUTUAL FUNDS TRUST
485APOS, 1998-12-30

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<PAGE>

As filed with the Securities and Exchange Commission on December 30, 1998
1933 Act File No. 02-90946
1940 Act File No. 811-4015
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933 [x]
POST-EFFECTIVE AMENDMENT NO. 47 [x]
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940 [x]
AMENDMENT NO. 50 [x]

EATON VANCE MUTUAL FUNDS TRUST
------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)

24 FEDERAL STREET, BOSTON, MASSACHUSETTS 02110
----------------------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

(617) 482-8260
--------------
(REGISTRANT'S TELEPHONE NUMBER)

ALAN R. DYNNER, 24 FEDERAL STREET, BOSTON, MASSACHUSETTS 02110
--------------------------------------------------------------
(NAME AND ADDRESS OF AGENT FOR SERVICE)

It is proposed that this filing will become effective pursuant to Rule 485
(check appropriate box):

[ ] immediately upon filing pursuant to paragraph (b)
[x] on February 28, 1999 pursuant to paragraph (a)(1)
[ ] on (date) pursuant to paragraph (b)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on (date) pursuant to paragraph (a)(2)

If appropriate, check the following box:
[ ] this post effective amendment designates a new effective date for a
previously filed post-effective amendment.

High Income Portfolio, Strategic Income Portfolio and Tax-Managed Growth
Portfolio have also executed this Registration Statement.
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<PAGE>
LOGO
Investing
for the
21st
Century

Eaton Vance
Strategic Income
Fund

A mutual fund for investors seeking high income and total return

Prospectus Dated

March 1, 1999

THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR DETERMINED WHETHER THIS PROSPECTUS IS TRUTHFUL OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
Information in this prospectus
Page Page
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
Fund Summary 2 Sales Charges 7
Investment Objective, Policies and Risks 4 Redeeming Shares 8
Management and Organization 5 Shareholder Account Features 8
Valuing Shares 6 Tax Information 9
Purchasing Shares 6 Financial Highlights 11
- -------------------------------------------------------------------------------
</TABLE>
This prospectus contains important information about the Fund and the services
available to shareholders. Please save it for reference.
<PAGE>

FUND SUMMARY

INVESTMENT OBJECTIVE AND PRINCIPAL STRATEGIES. The purpose of the Fund is to
provide a high level of income and total return by investing in a global
portfolio consisting primarily of high grade debt securities. The Fund will
invest in income-producing securities and derivative instruments in different
countries and currencies, and with various credit ratings including those of
below investment grade quality. The Portfolio manager may change investment
strategy frequently.

The Fund will invest primarily (over 50% of net assets) in high grade debt
securities. The Portfolio may invest the remainder of its assets in lower-rated
debt securities (so-called "junk bonds"). The Fund may invest in U.S. and
foreign securities, including U.S. Government mortgage-backed debt obligations,
high yield corporate bonds and sovereign debt of foreign countries, including
emerging market countries.

The Fund currently seeks its objective by investing in Strategic Income
Portfolio, which is itself an open-ended investment company having the same
investment objective as the Fund. In lieu of having the Portfolio invest in
lower-rated debt securities, the Fund may also invest in High Income Portoflio,
another registered investment company advised by the investment adviser.

PRINCIPAL RISK FACTORS. The Fund invests its assets in markets that are subject
to speculative trading and volatility. Because the Fund can invest a significant
portion of assets in foreign securities, the value of Fund shares can also be
adversely affected by changes in currency exchange rates and political and
economic developments abroad. In emerging or less-developed countries, these
risks can be significant. Accordingly, the purchase of Fund shares should be
viewed as a long-term investment.

Lower-rated securities generally offer higher current yields and appreciation
potential than do higher-rated securities, but are subject to greater risks.
Securities in the lower categories are considered to be of poor standing and are
predominantly speculative. Securities in the lowest rating categories may be in
default and are generally regarded by the rating agencies as having extremely
poor prospects of ever attaining any real investment standing. Because lower
quality obligations are more sensitive to the financial soundness of their
issuers than higher quality obligations, Fund shares may fluctuate more in value
than shares of a fund investing solely in high quality obligations.

The value of Fund shares will usually change in response to interest rate
fluctuations. When interest rates decline, the value of Fund shares can be
expected to rise. Conversely, when interest rates rise, the value of Fund shares
can be expected to decline.

The Fund is non-diversified, which means that it may invest a larger portion of
its assets in the obligations of a limited number of issuers than a diversified
fund. The Fund may invest, with respect to 50% of its total assets, more than 5%
(but not more than 25%) of its total assets in securities of any one issuer,
other than U.S. Government securities.

The Fund is not a complete investment program and you may lose money by
investing. An investment in the Fund is not a deposit in a bank and is not
insured or guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.

PERFORMANCE INFORMATION. The following bar chart and table provide information
about the Fund's performance, including a comparison of the Fund's performance
to the performance of a broad-based index of domestic investment grade
fixed-income securities. Although past performance is no guarantee of future
results, this performance information demonstrates the risk that the value of
your investment will change from year-to-year. The following returns are for
Class A shares for each calendar year through December 31, 1997 and do not
reflect a sales charge. If the sales charge was reflected, the returns would be
lower.

(1.45%) 10.51% (5.33)% 11.34% 18.48% 10.44% ---%
1992 1993 1994 1995 1996 1997 1998

The Fund's highest quarterly total return was _____% for the quarter ended
_______________, and its lowest quarterly return was _____% for the
quarter ended _______________________. The year-to-date total return through
the end of the most recent calendar quarter (December 31, 1997 to September 30,
1998) was ______%.

<TABLE>
<CAPTION>
One Five Life of
Average Annual Total Return as of December 31, 1997 Year Years Fund
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Class A Shares -4.8% 31.3% 54.3%
Class B Shares -4.8% 35.8% 61.8%
Class C Shares -1.1% 39.2% 63.7%
Lehman Aggregate Bond Index 9.3% 40.4% 95.6%
Composite of Lipper Fund Category Averages -0.9% 17.1% 29.6%
</TABLE>
2
<PAGE>

These returns reflect the maximum sales charge for Class A (4.75%) and any
applicable CDSC for Class B and Class C. The Class A and Class C performance
shown above for the periods prior to January 23, 1998 and May 25, 1994,
respectively, is the performance of Class B shares, adjusted for the sales
charge that applies to Class A or Class C shares (but not adjusted for any other
differences in the expenses of the classes). The Class B shares commenced
operations on November 26, 1990. Life of Fund returns are calculated from
November 30, 1990.

The Lehman Aggregate Bond Index is an unmanaged, broad-based index containing
only investment grade fixed-income securities traded in the United States.
Securities are included in this Index without regard to their duration;
however, the duration of the Fund's portfolio was restricted to a maximum dollar
weighted average maturity of not more than three years until March 1, 1997.
Investors cannot invest directly an Index. The Composite of Lipper Fund
Category Averages reflects the average of the total returns of mutual funds
included in the same fund category as this Fund. The fund categories are
established by Lipper Analytical Services, Inc., an organization that compiles
mutual fund performance. Funds within a category have similar investment
policies. The Composite is provided because the Fund changed its policies on
March 1, 1997 to eliminate the requirement that the Fund invest in a portfolio
with a dollar weighted average maturity of not more than three years. In
connection with this policy change, the Fund's Lipper category also changed.
The Composite is based on the average total returns of funds in the Lipper
Short World Multi-Market Income Funds category from November 30, 1990 until
March 1, 1997 (when the Fund's duration policy changed) and is based on the
average total returns of funds in the Lipper Multi-Sector Income Funds category
thereafter.

FUND FEES AND EXPENSES. These tables describe the fees and expenses that you
may pay if you buy and hold shares.

Maximum Deferred Sales Charge (as a percentage of the
lower of net asset value at time of purchase or time
of redemption) None 5.00% 1.00%

Sales Charge Imposed on Reinvested

Distributions None None None

Exchange Fee None None None
</TABLE>

Distribution and Service (12b-1) Fees 0.00% 0% 0%

Other Expenses* 0% 0% 0%
------ ---- ----
Total Annual Fund Operating Expenses 0% 0% 0%
</TABLE>
* Other Expenses for Class A shares includes a service fee of 0%.

**Long-term shareholders of Class B and Class C shares may pay more than the
economic equivalent of the front-end sales charge permitted by the National
Association of Securities Dealers, Inc.

EXAMPLE. This Example is intended to help you compare the cost of investing in
the Fund with the cost of investing in other mutual funds. The Example assumes
that you invest $10,000 in the Fund for the time periods indicated and then
redeem all of your shares at the end of those periods. The Example also assumes
that your investment has a 5% return each year and that the operating expenses
remain the same. Although your actual costs may be higher or lower, based on
these assumptions your costs would be:

1 Year 3 Years 5 Years 10 Years
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Class A shares $0 $0 $0 $0
Class B shares $0 $0 $0 $0
Class C shares $0 $0 $0 $0

You would pay the following expenses if you did not redeem your shares:

1 Year 3 Years 5 Years 10 Years
- -------------------------------------------------------------------------------
Class A shares $0 $0 $0 $0
Class B shares $0 $0 $0 $0
Class C shares $0 $0 $0 $0

3
<PAGE>

INVESTMENT OBJECTIVE, POLICIES AND RISKS

The Fund's investment objective is a high level of income and total return by
investing in a global portfolio consisting primarily of high grade debt
securities. The Fund currently seeks its objective by investing in Strategic
Income Portfolio, which is itself an open-ended investment company having the
same investment objective as the Fund.

The investment adviser adjusts the Portfolio's investments and engages in active
management techniques in an effort to take advantage of differences in
securities, countries, currencies and credits based on its perception of various
factors, including the most favorable markets, interest rates and issuers, the
relative yield and appreciation potential of a particular country's securities,
and the relationship of a country's currency to the U. S. dollar. The Portfolio
will normally invest in securities of issuers located in at least three
different countries (which may include the United States), and will not normally
invest more than 25% of its assets in securities of issuers located in a single
foreign country or denominated in any single foreign currency, except the U.S.
dollar and the Euro. The strategy requires the investment adviser to identify
countries and currencies where the Portfolio's investments will out-perform
comparable investments in other countries and currencies and in many cases to
predict changes in economies, markets, political conditions, and other factors.
The success of this strategy will of course, involve the risk that the
investment adviser's predictions may be untimely or incorrect.

The Portfolio will invest primarily (over 50% of net assets) in high grade debt
securities. "High grade" debt securities include secruities issued or guaranteed
as to principal or interest by the U.S. Government or any of its agencies or
instrumentalities and debt securities of foreign governmental and private
issuers rated at least A by Standard & Poor's Rating Group ("S&P"), Moody's
Investors Service, Inc. ("Moody's"), or Duff & Phelps, Inc. (" ").
High grade securities may also include commercial paper or other short-term debt
instruments rated in one of the two highest short-term rating categories by any
of those rating services, (or by Fitch/IBCA). An unrated security will be
considered to be a high grade security if the investment adviser determines that
it is of comparable quality.

The Portfolio may invest the remainder of its assets in lower-rated securities,
including those rated below BBB or Baa and comparable unrated securities.
Lower-rated debt securities are subject to the risk that the issuer's will not
meet principal and interest payments on the obligations (credit risk) and may
also be subject to price volatility due to such factors as interest rate
sensitivity, market perception of the creditworthiness of the issuer and general
market liquidity (market risk). The prices of lower-rated and comparable unrated
securities are also more likely to react to real or perceived developments
affecting market and credit risk than are prices of higher-rated securities,
which react primarily to movements in the general level of interest rates. The
Portfolio may invest a substantial portion of its assets in lower-rated
securities issued in connection with mergers, acquisitions, leveraged buy-outs,
recapitalizations and other highly leveraged transactions, which pose a higher
risk of default or bankruptcy of the issuer than other fixed-income securities
particularly during periods of deteriorating economic conditions and contraction
in the credit markets. The Portfolio may also invest in debt securities not
paying current income in anticipation of possible future income or capital
appreciation. The issuer of such securities may be in bankruptcy or undergoing a
debt restructuring or reorganization. Defaulted securities may be retained. In
the case of a defaulted security, the Portfolio may incur additional expense
seeking recovery of its investment. In the event the rating of a security held
by the Portfolio is downgraded, causing the Fund to have indirectly 50% or more
of its total assets in securities rated below investment grade, the investment
adviser will (in an orderly fashion within a reasonable period of time) dispose
of such securities as it deems necessary in order to comply with this
limitation.

In lieu of having the Portfolio invest in lower-rated debt securities, the Fund
may invest up to 50% of its assets in High Income Portfolio("HI Portfolio"), a
separate registered investment company advised by the investment adviser. The
investment objective of HI Portfolio is to provide a high level of current
income and it may invest in the same types of debt securities (with the same
risks) as the Portfolio. HI Portfolio normally invests at least 65% of its
assets in debt securities of the lowest investment grade, lower-rated
obligations and unrated obligations; at least 80% of its net assets in
fixed-income securities, including convertible securities; and up to 20% of its
net assets in common stocks and other equity securities when consistent with its
objective or acquired as part of a unit combining fixed-income and equity
securities. The Fund will not invest in the HI Portfolio when such Portfolio is
not so invested. Foreign investments of HI Portfolio may not exceed 25% of total
assets. HI Portfolio may purchase and sell derivative instruments similar to
those described in this prospectus, except for swaps. At October 31, 1998, HI
Portfolio had 0.00% of its assets invested in high yield, high risk bonds, and
held no obligations in default.

The Portfolio may purchase or sell derivative instruments (which are instruments
that derive their value from another instrument, security, index or currency) to
enhance return (which may be considered speculative), to hedge against
fluctuations in securities prices, interest rates or currency exchange rates, or
as a substitute for the purchase or sale of securities or currencies.
Transactions in derivative instruments may be in the U. S. or abroad and may
include the purchase or sale of futures contracts on securities, securities

4
<PAGE>

indices, other indices, other financial instruments or currencies; options on
futures contracts; exchange-traded options on securities, indices or currencies;
and forward foreign currency exchange contracts; and interest rate, total
return, default and currency swaps. Transactions in derivative instruments
involve a risk of loss or depreciation due to unanticipated adverse changes in
securities prices, interest rates, the other financial instruments' prices or
currency exchange rates; the inability to close out a position; default by the
counterparty; imperfect correlation between a position and the desired hedge;
tax constraints on closing out positions; and portfolio management constraints
on securities subject to such transactions. The loss on derivative instruments
(other than purchased options) may substantially exceed the initial investment
therein. In addition, the Portfolio may lose the entire premium paid for
purchased options that expire before they can be profitably exercised. The
Portfolio incurs transaction costs in opening and closing positions in
derivative instruments. There can be no assurance that the Adviser's use of
derivative instruments will be advantageous.

For temporary defensive purposes, such as during abnormal market or economic
conditions, the Portfolio may hold all or any portion of its assets in
securities of issures located in the United States and in cash or money market
instruments. It is impossible to predict when, or for how long, the Portfolio
will engage in such strategies.

The values of foreign investments are affected by changes in currency rates or
exchange control regulations, application of foreign tax laws (including
withholding tax), changes in governmental administration or economic or monetary
policy (in this country or abroad) or changed circumstances in dealings between
nations. Exchange rates may fluctuate significantly over short periods of time
causing a Portfolio's net asset value to fluctuate as well. Costs are incurred
in connection with conversions between various currencies. Many European
countries are about to adopt a single European currency, the euro. The
consequences of the euro conversion for foreign exchange rates, interest rates
and the value of European securities eligible for purchase by the Fund are
presently unclear. Such consequences may adversely affect the value and/ or
increase the volatility of securities held by the Fund. In addition, transaction
costs of investing are generally higher than in the United States, and foreign
securities markets may be less liquid, more volatile and less subject to
governmental supervision than in the United States. Investments in foreign
issuers could be affected by other factors not present in the United States,
including expropriation, armed conflict, confiscatory taxation, lack of uniform
accounting and auditing standards, less publicly available financial and other
information and potential difficulties in enforcing contractual obligations.
Transactions in the securities of foreign issuers could be subject to settlement
delays and risk of loss. Investments may include securities issued by the
governments of less-developed countries which are sometimes referred to as
"emerging markets", and other issuers located in such countries. As a result,
the Portfolio may be exposed to greater risk and will be more dependent on the
investment adviser's ability to assess such risk than if the Portfolio invested
solely in more developed countries.

Like most mutual funds, the Fund and Portfolio rely on computers in conducting
daily business and processing information. There is a concern that on January
1, 2000 some computer programs will be unable to recognize the new year and as a
consequence computer malfunctions will occur. Eaton Vance is taking steps that
it believes are reasonably designed to address this potential problem and to
obtain satisfactory assurance from other service providers to the Fund and the
Portfolio that they are also taking steps to address the issue. There can,
however, be no assurance that these steps will be sufficient to avoid any
adverse impact on the Fund and the Portfolio or shareholders. The Year 2000
concern may also adversely impact issuers of obligations held by the Portfolio.

MANAGEMENT AND ORGANIZATION

MANAGEMENT. The Portfolio's investment adviser is Boston Management and Research
("BMR"), a subsidiary of Eaton Vance Management, 24 Federal Street, Boston,
Massachusetts 02110. Eaton Vance has been managing assets since 1924 and
managing mutual funds since 1931. Eaton Vance and its subsidiaries currently
manage over $30 billion on behalf of mutual funds, institutional clients and
individuals.

The investment adviser manages the investments of the Portfolio and provides
related office facilities and personnel. Under its investment advisory
agreement with the Portfolio, BMR receives a monthly advisory fee equal to the
aggregate of a daily asset based fee and a daily income based fee. The fees are
applied on the basis of the following categories.

Annual Daily
Category Daily Net Assets Asset Rate Income Rate
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1 up to $500 million 0.275% 2.75%
2 $500 million but less than $1 billion 0.250% 2.50%
3 $1 billion but less than $1.5 billion 0.225% 2.25%
4 $1.5 billion but less than $2 billion 0.200% 2.00%
5 $2 billion but less than $3 billion 0.175% 1.75%
6 $3 billion and over 0.150% 1.50%

For the fiscal year ended October 31, 1998, the Portfolio paid BMR advisory fees
equivalent to 0.00% of the Portfolio's average net assets for such year.

5
<PAGE>

HI Portfolio also engages BMR to act as its investment adviser pursuant to a fee
schedule similar to but slightly higher than the above schedule. For the fiscal
year ended March 31, 1998, the HI Portfolio paid BMR advisory fees equivalent to
0.00% of HI Portfolio's average daily net assets for such year. The portion of
the Fund's assets invested in the HI Portfolio will be subject to such
Portfolio's advisory fee, but will not be subject to Strategic Income
Portfolio's advisory or administration fee, or a Fund advisory fee.

Mark Venezia is the portfolio manager of the Portfolio (since it commenced
operations). He has been an employee of Eaton Vance for at least 5 years and is
a Vice President of Eaton Vance and BMR.

BMR also administers the business affairs of the Portfolio and receives an
administration fee of 0.15% of the Portfolio's average daily net assets
annually. For the fiscal year ended October 31, 1998, the Portfolio paid BMR
adminstration fees equal to 0.15% of the Portfolio's average daily net assets.

The investment adviser and the Fund and Portfolio have adopted Codes of Ethics
governing personal securities transactions. Under the Codes, Eaton Vance
employees may purchase and sell securities (including securities held by the
Portfolio) subject to certain pre-clearance and reporting requirements and other
procedures.

Eaton Vance serves as administrator of the Fund, providing the Fund with
administrative services and related office facilities. Eaton Vance does not
currently receive a fee for serving as administrator.

ORGANIZATION. The Fund is a series of Eaton Vance Mutual Funds Trust, a
Massachusetts business trust. The Fund does not hold annual shareholder
meetings, but may hold special meetings for matters that require shareholder
approval (like electing or removing trustees, approving management contracts or
changing investment policies that may only be changed with shareholder
approval). Because the Fund invests in the Portfolio, it may be asked to vote
on certain Portfolio matters (like changes in certain Portfolio investment
restrictions). When necessary, the Fund will hold a meeting of its shareholders
to consider the Portfolio matter and then vote its interest in the Portfolio in
proportion to the votes cast by its shareholders. The Fund can withdraw from the
Portfolio at any time.

VALUING SHARES

The Fund values its shares once each day only when the New York Stock Exchange
is open for trading (typically Monday through Friday), as of the close of
regular trading on the Exchange (normally 4:00 p.m. eastern time). The price of
Fund shares is their net asset value, which is derived from Portfolio holdings.
Most debt securities are valued by an independent pricing service. Your
investment dealer must communicate your order to the principal underwriter by a
specific time each day to receive that day's public offering price per share.
It is the investment dealer's responsibility to transmit orders promptly. The
Fund may accept purchase and redemption orders as of the time of their receipt
by certain investment dealers (or their designated intermediaries).

PURCHASING SHARES

You may purchase Fund shares through your investment dealer or by mailing the
account application form included in this prospectus to the transfer agent (see
back cover for address). Your initial investment must be at least $1,000. The
price of Class A shares is the net asset value plus a sales charge. The price
of Class B and Class C shares is the net asset value; however, you may be
subject to a sales charge (called a "contingent deferred sales charge" or
"CDSC") if you redeem Class B shares within six years of purchase or Class C
shares within one year of purchase. The sales charges are described below.
Your investment dealer can help you decide which class of shares suits your
investment needs.

You may purchase Fund shares for cash or in exchange for securities. Please
call 1-800-225-6265 for information about exchanging securities for Fund shares.
If you purchase shares through an investment dealer (which includes brokers,
dealers and other financial institutions), that dealer may charge you a fee for
executing the purchase for you. The Fund may suspend the sale of its shares at
any time and any purchase order may be refused.

After your initial investment, additional investments of $50 or more may be made
at any time by sending a check payable to the order of the Fund or the transfer
agent directly to the transfer agent (see back cover for address). Please
include your name and account number and the name of the Fund and Class with
each investment.

You may also make automatic investments of $50 or more each month or each
quarter from your bank account. You can establish bank automated investing on
the account application or by calling 1-800-262-1122. The minimum initial
investment amount and Fund policy of redeeming accounts with low account
balances are waived for bank automated investing accounts.

6
<PAGE>

SALES CHARGES

FRONT-END SALES CHARGE. Class A shares are offered at net asset value per share
plus a sales charge that is determined by the amount of your investment. The
current sales charge schedule is:

<TABLE>
<CAPTION>
Sales Charge Sales Charge Dealer Commission
as Percentage of as Percentage of Net as a Percentage of
Amount of Purchase Offering Price Amount Invested Offering Price
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Less than $25,000 4.75% 4.99% 4.50%
$25,000 but less than $100,000 4.50% 4.71% 4.25%
$100,000 but less than $250,000 3.75% 3.90% 3.50%
$250,000 but less than $500,000 3.00% 3.09% 2.75%
$500,000 but less than $1,000,000 2.00% 2.04% 2.00%
$1,000,000 or more 0.00* 0.00* See Below

* No sales charge is payable at the time of purchase on investments of $1 million or more.
A CDSC of 1.00% will be imposed on such investments (as described below) in the event of
redemptions within 12 months of purchase.
</TABLE>

A commission on sales of $1 million or more will be paid as follows: 1.00% on
amounts of $1 million or more but less than $3 million; plus 0.50% on amounts
over $3 million but less than $5 million; plus 0.25% on amounts of $5 million or
more. Purchases of $1 million or more will be aggregated over a 12-month period
for purposes of determining the commission. Commissions of up to 1.00% may be
paid for purchases of Class A shares by certain tax-deferred retirement plans.

CONTINGENT DEFERRED SALES CHARGE. Each Class of shares is subject to a CDSC on
certain redemptions. If Class A shares are purchased at net asset value
because the purchase amount is $1 million or more, they are subject to a 1.00%
CDSC if redeemed within 12 months of purchase. Class C shares are subject to a
1.00% CDSC if redeemed within 24 months of purchase. Class B shares are subject
to the following CDSC schedule:

Year of Redemption
After Purchase CDSC
- -------------------------------------
First or Second 5% The CDSC is based on the lower of the
Third 4% net asset value at the time of purchase
Fourth 3% or the time of redemption. Shares acquired
Fifth 2% through the reinvestment of distributions
Sixth 1% are exempt from the CDSC. Redemptions are
Seventh or following 0% made first from shares that are not
subject to a CDSC.

REDUCING OR ELIMINATING SALES CHARGES. Front-end sales charges may be reduced
under the right of accumulation or under a statement of intention. Under the
right of accumulation, sales charges are reduced if the current market value of
your current holdings (shares at current offering price), plus your new
purchases, reach $25,000 or more. Class A shares of other Eaton Vance funds
owned by you can be included as part of your current holdings for this purpose.
Under a statement of intention, purchases of $25,000 or more made over a
13-month period are eligible for reduced sales charges. The principal
underwriter may hold 5% of the dollar amount to be purchased in escrow in the
form of shares registered in your name until the statement is satisfied or the
thirteen-month period expires. See the account application for details.

Class A shares are offered at net asset value through certain wrap fee programs
and other programs sponsored by investment dealers that charge fees for their
services. Ask your investment dealer for details. Certain persons associated
with Eaton Vance, other advisers to Eaton Vance funds, the transfer agent, the
custodian and investment dealers may purchase shares at net asset value.

Class B and Class C CDSCs are waived for redemptions pursuant to a Withdrawal
Plan (see "Shareholder Account Features") and in connection with certain
redemptions from tax-sheltered retirement plans. Call 1-800-225-6265 for
details. The Class B CDSC is also waived following the death of all beneficial
owners of shares, but only if the redemption is requested within one year after
death (a death certificate and other applicable documents may be required).

If you redeem shares, you may reinvest at net asset value any portion or all of
the redemption proceeds in the same class of shares of the Fund (or, for Class A

7
<PAGE>

shares, in Class A shares of any other Eaton Vance fund), provided that the
reinvestment occurs within 60 days of the redemption, and the privilege has not
been used more than once in the prior 12 months. Your account will be credited
with any CDSC paid in connection with the redemption. Reinvestment requests
must be in writing. If you reinvest, you will be sold shares at the next
determined net asset value following receipt of your request.

DISTRIBUTION AND SERVICE FEES. Class B and Class C shares have adopted a plan
under Rule 12b-1 that allows the Fund to pay distribution fees for the sale and
distribution of shares (so-called "12b-1 fees"). Class B and Class C shares pay
distribution fees of .75% of average daily net assets annually. Because these
fees are paid from Fund assets on an ongoing basis, they will increase your cost
over time and may cost you more than paying other types of sales charges. All
classes pay service fees for personal and/or account services not exceeding .25%
of average daily net assets annually. Class A and Class B only pay service fees
on shares that have been outstanding for twelve months.

REDEEMING SHARES

You can redeem shares in any of the following ways:

By Mail Send your request to the transfer agent along with any
certificates and stock powers. The request must be
signed exactly as your account is registered and
signature guaranteed. You can obtain a signature
guarantee at certain banks, savings and loan
institutions, credit unions, securities dealers,
securities exchanges, clearing agencies and registered
securities associations. You may be asked to provide
additional documents if your shares are registered in
the name of a corporation, partnership or fiduciary.

By Telephone You can redeem up to $50,000 b y calling the transfer
agent at 1-800-262-1122 on Monday through Friday, 9:00
a.m. to 4:00 p.m. (eastern time). Proceeds of a
telephone redemption can be mailed only to the account
address. Shares held by corporations, trusts or
certain other entities, or subject to fiduciary
arrangements, cannot be redeemed by telephone.
Through an
Investment
Dealer Your investment dealer is responsible for
transmitting the order promptly. A dealer may charge a
fee for this service.

If you redeem shares, your redemption price will be based on the net asset value
per share next computed after the redemption request is received. Your
redemption proceeds will be paid in cash within seven days, reduced by the
amount of any applicable CDSC and any federal income tax required to be
withheld. Payments will be sent by mail unless you complete the Bank Wire
Redemptions section of the account application.

If you recently purchased shares, the proceeds of a redemption will not be sent
until the check (including a certified or cashier's check) has cleared. If the
purchase check has not cleared, redemption proceeds may be delayed up to 15 days
from the purchase date. If your account value falls below $750 other than due
to market decline, you may be asked to either add to your account or redeem it
within 60 days. If you take no action, your account will be redeemed and the
proceeds sent to you.

SHAREHOLDER ACCOUNT FEATURES

Once you purchase shares, the transfer agent establishes a Lifetime Investing
Account for you. Share certificates are issued only on request.

Distributions. You may have your Fund distributions paid in one of the
following ways:

*Full Reinvest Option Dividends and capital gains are reinvested in
additional shares. This option will be assigned if
you do not specify an option.

*Partial Reinvest Option Dividends are paid in cash and capital gains are
reinvested in additional shares.

*Cash Option Dividends and capital gains are paid in cash.

*Exchange Option Dividends and/or capital gains are reinvested in
additional shares of another Eaton Vance fund
chosen by you. Before selecting this option, you
must obtain a prospectus of the other fund and
consider its objectives and policies carefully.

8
<PAGE>

INFORMATION FROM THE FUND. From time to time, you may be mailed the following:

* Annual and Semi-Annual Reports, containing performance information and
financial statements.
* Periodic account statements, showing recent activity and total share
balance.
* Form 1099 and tax information needed to prepare your income tax returns.
* Proxy materials, in the event a shareholder vote is required.
* Special notices about significant events affecting your Fund.

WITHDRAWAL PLAN. You may redeem shares on a monthly or quarterly basis by
establishing a systematic withdrawal plan. For Class B and Class C shares, your
withdrawals will not be subject to a CDSC if they do not in the aggregate exceed
12% annually of the account balance at the time the plan is established. A
minimum account size of $5,000 is required to establish a systematic withdrawal
plan. Because purchases of Class A shares are subject to a sales charge, you
should not make withdrawals from your account while you are making purchases.

TAX-SHELTERED RETIREMENT PLANS. Class A and and Class C shares are available
for purchase in connection with certain tax-sheltered retirement plans. Call
1-800-225-6265 for information. Distributions will be invested in additional
shares for all tax-sheltered retirement plans.

EXCHANGE PRIVILEGE. You may exchange your Fund shares for shares of the same
class of another Eaton Vance fund. Exchanges are generally made at net asset
value. If you have held Class A shares for less than six months, an additional
sales charge may apply if you exchange. If your shares are subject to a CDSC,
the CDSC will continue to apply to your new shares at the same CDSC rate. For
purposes of the CDSC, your shares will continue to age from the date of your
original purchase.

Before exchanging, you should read the prospectus of the new fund carefully. If
you wish to exchange shares, you may write to the transfer agent (address on
back cover) or call 1-800-262-1122. Periodic automatic exchanges are also
available. The exchange privilege may be changed or discontinued at any time.
You will receive 60 days' notice of any material change to the privilege. This
privilege may not be used for "market timing". If an account (or group of
accounts) makes more than two round-trip exchanges within twelve months, it will
be deemed to be market timing. The exchange privilege may be terminated for
market timing accounts.

TELEPHONE TRANSACTIONS. You can redeem or exchange shares by telephone as
described in this prospectus. The transfer agent and the principal underwriter
have procedures in place to authenticate telephone instructions (such as
verifying personal account information). As long as the transfer agent and
principal underwriter follow these procedures, they will not be responsible for
unauthorized telephone transactions and you bear the risk of possible loss
resulting from telephone transactions. You may decline the telephone redemption
option on the account application. Telephone instructions are tape recorded.

"STREET NAME" ACCOUNTS. If your shares are held in a "street name" account at
an investment dealer, that dealer (and not the Fund or its transfer agent) will
perform all recordkeeping, transaction processing and distribution payments.
Because the Fund will have no record of your transactions, you should contact
your investment dealer to purchase, redeem or exchange shares, to make changes
in your account, or to obtain account information. The transfer of shares in a
"street name" account to an account with another investment dealer or to an
account directly with the Fund involves special procedures and you will be
required to obtain historical information about your shares prior to the
transfer. Before establishing a "street name" account with an investment
dealer, you should determine whether that dealer allows reinvestment of
distributions in "street name" accounts.

ACCOUNT QUESTIONS. If you have any questions about your account or the services
available, please call Eaton Vance Shareholder Services at 1-800-225-6265, or
write to the transfer agent (see back cover for address).

TAX INFORMATION

The Fund intends to pay dividends monthly and to distribute any net realized
capital gains annually. A portion of the Fund's distributions may be eligible
for the corporate dividends-received deduction. Distributions of income and net
short-term capital gains will be taxable as ordinary income. Distributions of
any long-term capital gains are taxable as long-term gains.

Investors who purchase shares shortly before the record date of a distribution
will pay the full price for the shares and then receive some portion of the
price back as a taxable distribution. Certain distributions paid in January
will be taxable to shareholders as if received on December 31 of the prior year.

Shareholders should consult with their advisers concerning the applicability of
state, local and other taxes to an investment.

9
<PAGE>

FINANCIAL HIGHLIGHTS

The financial highlights are intended to help you understand the Fund's
financial performance for the past five years. Certain information in the table
reflects the financial results for a single Fund share. The total returns in
the table represent the rate an investor would have earned (or lost) on an
investment in the Fund (assuming reinvestment of all distributions and not
taking into account a sales charge). This information has been audited by
________________________, independent accountants. The report of
_________________________ and the Fund's financial statements are
incorporated herein by reference and included in the annual report, which is
available on request. The Fund began offering three classes of shares on
November 1, 1997. Prior to that date, the Fund offered only Class B shares.

<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------------------------------------------------------
1998 1997 1996 1995 1994(1)
----------------------------------------------------------------------------------
CLASS A(2) CLASS B CLASS C CLASS B CLASS B CLASS B CLASS B
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value - Beginning of year $ $ $ $ 9.310 $ 8.500 $ 8.290 $ 9.410
-------- --------- --------- --------
Income (loss) from operations
Net investment income $ $ $ $ 0.657 $ 0.655 $ 0.726 $ 0.645
Net realized and unrealized gain (loss) 0.288 0.858 0.167 (1.135)
-------- --------- --------- --------
Total income (loss) from operations $ $ $ $ 0.945 $ 1.513 $ 0.893 $ (0.490)
-------- --------- --------- --------
Less distributions
From net investment income $ $ $ $ (0.657) $ (0.655) $ 0.361) $ (0.343)
In excess of net investment income (0.128) (0.048) -- --
From tax return of capital -- -- (0.322) (0.290)
-- -- -- -------- --------- --------- --------
Total distributions $ $ $ $ (0.785) $ (0.703) $ (0.683) $ (0.633)
-------- --------- --------- --------
Net asset value - End of year $ $ $ $ 9.470 $ 9.310 $ 8.500 $ 8.290
== == == ======== ========= ========= ========
Total return(4) % % % 10.44% 18.48% 11.34% (5.33)%
Ratios/Supplemental Data
Net assets, end of year (000's omitted) $ $ $ $130,596 $129,671 $150,767 $233,139
Ratios (as a percentage of
average daily net assets):
Expenses(3)(5) 2.08% 2.17% 2.18% 2.00%
Net investment income % % % 6.91% 7.38% 7.85% 7.24%
Portfolio Turnover of the Portfolio % % % 77% 71% 78% 70%
</TABLE>

(1) Net Investment Income per share was computed using average shares
outstanding.
(2) For the period from the commencement of offering of Class A shares, January
23, 1998 to October 31, 1998.
(3) Includes the Fund's share of its corresponding Portfolio's allocated
expenses.
(4) Total 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. 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.
(5) The expense ratios for the year ended September 30, 1995 and periods
thereafter, have been adjusted to reflect a change in reporting
requirements. The new reporting guidelines require the Fund, as well as the
Portfolio, to increase its expense ratio by the effect of any expense
offset arrangements with its service providers. The expense ratios for the
prior periods have not been adjusted to reflect this change.

11
<PAGE>

LOGO
Investing
for the
21st
Century

More Information
- --------------------------------------------------------------------------------

About the Fund: More information is available in the statement of
additional information. The statement of additional information is
incorporated by reference into this prospectus. Additional
information about the Portfolio's investments is available in the
annual and semi-annual reports to shareholders. In the annual
report, you will find a discussion of the market conditions and
investment strategies that significantly affected the Fund's
performance during the past year. You may obtain free copies of the
statement of additional information and the shareholder reports by
contacting:

Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
1-800-225-6265
website: www.eatonvance.com

You will find and may copy information about the Fund at the
Securities and Exchange Commission's public reference room in
Washington, DC (call 1-800-SEC-0330 for information); on the SEC's
Internet site (http://www.sec.gov); or upon payment of copying fees
by writing to the SEC's public reference room in Washington, DC
20549-6009.

About Shareholder Accounts: You can obtain more information from
Eaton Vance Share- holder Services (1-800-225-6265). If you own
shares and would like to add to, redeem or change your account,
please write or call the transfer agent:
- --------------------------------------------------------------------------------

First Data Investor Services Group
P.O. Box 5123
Westborough, MA 01581-5123
1-800-262-1122

SEC File No. 811-4015 SIP
<PAGE>
{LOGO} Mutual Funds
EATON VANCE for People
Mutual Funds Who Pay
Taxes(R)

EATON VANCE
TAX-MANAGED
GROWTH FUND

A mutual fund seeking long-term, after-tax returns for investors

Prospectus Dated
March 1, 1999

THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR DETERMINED WHETHER THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

Information in this prospectus
Page Page
- --------------------------------------------------------------------------------
Fund Summary 2 Sales Charge 6
Investment Objective, Policies Redeeming Shares 8
and Risks 4 Shareholder Account
Management and Organization 5 Features 8
Valuing Shares 6 Tax Information 10
Purchasing Shares 6 Financial Highlights 11
- --------------------------------------------------------------------------------

This prospectus contains important information about the Fund and the services
available to shareholders. Please save it for reference.

<PAGE>
FUND SUMMARY
INVESTMENT OBJECTIVE AND PRINCIPAL STRATEGIES. The Fund's investment objective
is to achieve long-term, after-tax returns for its shareholders by investing in
a diversified portfolio of equity securities. The Fund invests primarily in
common stocks of growth companies that are considered to be high in quality and
attractive in their long-term investment prospects. Although it invests
primarily in domestic companies, the Fund may invest up to 25% of its net assets
in foreign companies.

The Fund pursues its investment objective by investing in a separate registered
investment company with the same investment objective and policies as the Fund.
Using this structure allows the Fund to participate in a well-established
investment portfolio without exposing the Fund to unrealized gains accrued prior
to the Fund's inception in March, 1996.

TAX-MANAGED INVESTING. Most mutual funds focus on pre-tax returns and largely
ignore shareholder tax considerations. By contrast, the Fund attempts to achieve
high after-tax returns for its shareholders by balancing investment
considerations and tax considerations. The Fund seeks to achieve returns
primarily in the form of price appreciation (not subject to current tax) and
distributions of net realized long-term capital gains (taxed as capital gains).
The Fund seeks to minimize income distributions and distributions of realized
short-term gains (taxed as ordinary income). Among the techniques and strategies
used in the tax-efficient management of the Fund are the following:

* investing primarily in lower-yielding growth stocks;
* employing a long-term, low turnover approach to investing;
* attempting to avoid net realized short-term gains;
* when appropriate, selling stocks trading below cost to realized losses;
* in selling appreciated stocks, selecting the most tax-favored share
lots; and
* selectively using tax-advantaged hedging techniques as an alternative to
taxable sales.

The Fund can generally be expected to distribute a lesser percentage of returns
each year than most other equity mutual funds. There can be no assurance,
however, that taxable distributions can always be avoided.

PRINCIPAL RISK FACTORS. The value of Fund shares is primarily sensitive to stock
market volatility. If there is a general decline in the value of U.S. stocks,
the value of the Fund's shares will also likely decline. Changes in stock market
values can be sudden and unpredictable. Also, although stock values can rebound,
there is no assurance that values will return to previous levels. The Fund seeks
to minimize stock market risk by diversifying its holdings among many companies
and industries.

PERFORMANCE INFORMATION. The following bar chart and table provide information
about the Fund's pre-tax performance, including a comparison of the Fund's
performance to the performance of an index of domestic common stocks. Although
past performance is no guarantee of future results, this performance information
demonstrates that the value of your investment will change from year-to-year.
The following returns are for Class A shares for each calendar year through
December 31, 1998 and do not reflect a sales charge. If the sales charge was
reflected, the returns would be lower.

18.5% -4.0% 37.1% 10.9% 7.3% 8.8% 32.6% 22.3% 30.5%
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998

The Fund's highest quarterly total return was _____%, for the quarter ended
_______, and its lowest quarterly return was ______%, for the quarter ended
_______. The year-to-date total return through the end of the most recent
calendar quarter (December 31, 1998 to September 30, 1998) was ________%.

2
<PAGE>
<TABLE>
<CAPTION>
One Five Ten
Average Annual Total Return as of December 31, 1998 Year Years Years
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Class A Shares 0.00% 0.00% 0.00%
Class B Shares 0.00% 0.00% 0.00%
Class C Shares 0.00% 0.00% 0.00%
Standard & Poor's 500 Index 0.00% 0.00% 0.00%
</TABLE>
These returns reflect the maximum sales charge for Class A (5.75%) and any
applicable CDSC for Class B and Class C. The Class A and Class C performance
shown above for the period prior to March 28, 1996 and August 2, 1996,
respectively, is the performance of Class B shares and the Portfolio's
predecessor, adjusted for the sales charge that applies to Class A or Class C
shares (but not adjusted for any other differences in the expenses of the
classes). The Standard & Poor's 500 Index is an unmanaged index of common stocks
trading in the U.S. Investors cannot invest directly an Index.

FUND FEES AND EXPENSES. These tables describe the fees and expenses that you
may pay if you buy and hold shares.

<TABLE>
<CAPTION>
Shareholder Fees
(fees paid directly from your investment) Class A Class B Class C
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
Maximum Sales Charge (as a percentage of
offering price) 5.75% None None
Maximum Deferred Sales Charge (as a
percentage of the lower of net asset
value at time of purchase or time of
redemption) None 5.00% 1.00%
Sales Charge Imposed on Reinvested
Distributions None None None
Exchange Fee None None None
</TABLE>

<TABLE>
<CAPTION>
Annual Fund Operating Expenses (expenses
that are deducted from Fund assets) Class A Class B Class C
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.00% 0.00% 0.00%
Distribution and Service (12b-1) Fees 0.00% 0.00% 0.00%
Other Expenses* 0.00% 0.00% 0.00%
----- ----- -----
Total Annual Fund Operating Expenses 0.00% 0.00% 0.00%
</TABLE>
* Other Expenses for Class A shares includes a service fee of 0.00%.
**Long-term shareholders of Class B and Class C shares may pay more than the
economic equivalent of the front-end sales charge permitted by the National
Association of Securities Dealers, Inc.

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A shares $0 $0 $0 $0
Class B shares $0 $0 $0 $0
Class C shares $0 $0 $0 $0
</TABLE>
You would pay the following expenses if you did not redeem your shares:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A shares $0 $0 $0 $0
Class B shares $0 $0 $0 $0
Class C shares $0 $0 $0 $0
</TABLE>

3
<PAGE>
INVESTMENT OBJECTIVE, POLICIES AND RISKS
The Fund's investment objective is to achieve long-term, after-tax returns for
its shareholders by investing in a diversified portfolio of equity securities.
The Fund currently seeks to meet its objective by investing in Tax-Managed
Growth Portfolio (the "Portfolio"), a separate open-end investment company that
has the same objective and policies as the Fund. The Fund's investment objective
may not be changed without shareholder approval. Certain of the Fund's policies
may be changed by the Trustees without shareholder approval.

The Portfolio invests in a broadly diversified selection of equity securities,
emphasizing common stocks of growth companies that are considered to be high in
quality and attractive in their long-term investment prospects. Stocks are
acquired with the expectation of being held for the long term. Under normal
market conditions, the Portfolio will invest at least 65% of its assets in
common stocks. The Portfolio's holdings will represent a number of different
industries, and less than 25% of the Portfolio's assets will be invested in any
one industry.

The Portfolio seeks to achieve long-term, after-tax returns in part by
minimizing the taxes incurred by shareholders in connection with the Portfolio's
investment income and realized capital gains. Taxes on investment income are
minimized by investing primarily in lower-yielding securities. Taxes on realized
capital gains are minimized by maintaining relatively low portfolio turnover and
avoiding or minimizing the sale of securities with large accumulated capital
gains. The Portfolio generally seeks to avoid net realized short-term capital
gains. When a decision is made to sell a particular appreciated security, the
Portfolio will select for sale the share lots resulting in the most favorable
tax treatment, generally those with holding periods sufficient to qualify for
long-term capital gains treatment that have the highest cost basis. The
Portfolio may sell securities to realize capital losses that can be used to
offset realized gains.

To protect against price declines in securities holdings with large accumulated
gains, the Portfolio may use various hedging techniques (such as purchased put
options, equity collars (combining the purchase of a put option and the sale of
a call option), equity swaps, covered short sales, and the sale of stock index
futures contracts). By using these techniques rather than selling appreciated
securities, the Portfolio can reduce its exposure to price declines in the
securities without realizing substantial capital gains under current tax law.
The use of these hedging techniques is subject to certain limitations and
exposes the Portfolio to certain risks.

The Portfolio seeks to achieve long-term, after-tax returns in part by
minimizing the taxes incurred by shareholders in connection with the Portfolio's
investment income and realized capital gains. Taxes on investment income are
minimized by investing primarily in lower-yielding securities. Taxes on realized
capital gains are minimized by maintaining relatively low portfolio turnover and
avoiding or minimizing the sale of securities with large accumulated capital
gains. The Portfolio generally seeks to avoid net realized short-term capital
gains. When a decision is made to sell a particular appreciated security, the
portfolio manager will select for sale the share lots resulting in the most
favorable tax treatment, generally those with holding periods sufficient to
qualify for long-term capital gains treatment that have the highest cost basis.
The portfolio manager may sell securities to realize capital losses that can be
used to offset realized gains.

To protect against price declines in securities holdings with large accumulated
gains, The Portfolio may use various hedging techniques (such as purchased put
options, equity collars (combining the purchase of a put option and the sale of
a call option), equity swaps, covered short sales, and the sale of stock index
futures contracts). By using these techniques rather than selling appreciated
securities, the Portfolio can reduce its exposure to price declines in the
securities without realizing substantial capital gains under current tax law.
The use of these hedging techniques is subject to certain limitations and
exposes the Portfolio to certain risks.

The Portfolio may invest up to 25% of net assets in foreign securities. The
value of foreign securities is affected by changes in currency rates, foreign
tax laws (including withholding tax), government policies (in this country or
abroad) and relations between nations. In addition, the costs of investing
abroad are generally higher than in the United States, and foreign securities
markets may be less liquid, more volatile and less subject to governmental
supervision than in the United States.

The Portfolio may invest not more than 15% of its net assets in illiquid
securities, which may be difficult to value properly and may involve greater
risks. Illiquid securities include those legally restricted as to resale, and
may include commercial paper issued pursuant to Section 4(2) of the Securities
Act of 1933 and securities eligible for resale pursuant to Rule 144A thereunder.
Certain Section 4(2) and Rule 144A securities may be treated as liquid
securities if the investment adviser determines that such treatment is
warranted. If determined to be liquid, these securities may increase the level
of Portfolio illiquidity if qualified institutional buyers become uninterested
in purchasing them.

During defensive periods in which the investment adviser believes that returns
on common stock investments may be unfavorable, the Portfolio may temporarily
invest up to 65% of its assets in U.S. government obligations and high quality

4
<PAGE>
short-term notes. The Portfolio may temporarily borrow at any time up to 5% of
the value of its total assets to satisfy redemption requests or settle
securities transactions.

BENEFITS OF INVESTING IN THE PORTFOLIO. Investing in the Portfolio enables the
Fund to participate in a large and well-established investment portfolio without
being exposed to potential tax liability for unrealized gains accrued prior to
the Fund's inception. Securities with large accumulated gains that have been
contributed by other investors in the Portfolio constitute a substantial portion
of the assets of the Portfolio. If contributed securities are sold, the gains
accumulated prior to their contribution would be allocated to the contributing
investors and not to the Fund or its shareholders. As a general matter, the
Portfolio does not intend to sell appreciated securities contributed to the
Portfolio, but will instead seek to manage its exposure to these securities by
using hedging techniques as appropriate. The Portfolio follows the practice of
distributing appreciated securities to meet redemptions by investors in the
Portfolio that contributed securities. The Portfolio uses the selection of
securities distributed to meet redemptions as a tax-efficient management tool.
By distributing appreciated securities, the Portfolio can reduce its position in
such securities without realizing capital gains. During periods of net
withdrawals by investors in the Portfolio, using distributions of securities
also enables the Portfolio to avoid the forced sale of securities to raise cash
for meeting redemptions. The Portfolio's ability to select the securities used
to meet redemptions is limited. These limitations could affect the performance
of the Portfolio, and, therefore, the Fund. As described under "Redeeming
Shares", the Fund currently meets redemptions solely in cash, but may adopt in
the future a policy of meeting shareholder redemptions in whole or in part
through the distribution of readily marketable securities.

Like most mutual funds, the Fund and Portfolio rely on computers in conducting
daily business and processing information. There is a concern that on January 1,
2000 some computer programs will be unable to recognize the new year and as a
consequence computer malfunctions will occur. Eaton Vance is taking steps that
it believes are reasonably designed to address this potential problem and to
obtain satisfactory assurance from other service providers to the Fund and the
Portfolio that they are also taking steps to address the issue. There can,
however, be no assurance that these steps will be sufficient to avoid any
adverse impact on the Fund and the Portfolio or shareholders. The Year 2000
concern may also adversely impact issuers of securities held by the Portfolio.

MANAGEMENT AND ORGANIZATION
MANAGEMENT. The Portfolio's investment adviser is Boston Management and Research
("BMR"), a subsidiary of Eaton Vance Management, 24 Federal Street, Boston,
Massachusetts 02110. Eaton Vance has been managing assets since 1924 and
managing mutual funds since 1931. Eaton Vance and its subsidiaries currently
manage over $30 billion on behalf of mutual funds, institutional clients and
individuals.

The investment adviser manages the investments of the Portfolio and provides
related office facilities and personnel. Under its investment advisory agreement
with the Portfolio, BMR receives a monthly advisory fee of /5//\\96\\ of 1%
(equivalent to 0.625% annually) of the average daily net assets of the Portfolio
up to and including $500 million. On net assets of $500 million and over the
annual fee is reduced and the fee is computed as follows:

<TABLE>
<CAPTION>
Annual Fee Rate
Average Daily Net Assets for the Month (for each level)
- --------------------------------------------------------------------------------
<S> <C>
$500 million but less than $1 billion 0.5625%
$1 billion but less than $1.5 billion 0.5000%
$1.5 billion and over 0.4375%
</TABLE>

For the fiscal year ended October 31, 1998, the Portfolio paid BMR advisory fees
equivalent to 0. % of its average daily net assets.

Duncan W. Richardson has acted as the portfolio manager of the Portfolio since
it commenced operations and of its predecessor in investment operations (Capital
Exchange Fund) since 1990. He also manages other Eaton Vance portfolios, has
been an employee of Eaton Vance for at least 5 years, and is a Vice President of
Eaton Vance and BMR.

5
<PAGE>
changing investment policies that may only be changed with shareholder
approval). Because the Fund invests in the Portfolio, it may be asked to vote on
certain Portfolio matters (like changes in certain Portfolio investment
restrictions). When necessary, the Fund will hold a meeting of its shareholders
to consider the Portfolio matter and then vote its interest in the Portfolio in
proportion to the votes cast by its shareholders. The Fund can withdraw from the
Portfolio at any time.

VALUING SHARES
The Fund values its shares once each day only when the New York Stock Exchange
is open for trading (typically Monday through Friday), as of the close of
regular trading on the Exchange (normally 4:00 p.m. eastern time). The price of
Fund shares is their net asset value, which is derived from Portfolio holdings.
Exchange-listed securities are generally valued at closing sale prices. When
purchasing or redeeming Fund shares, your investment dealer must communicate
your order to the principal underwriter by a specific time each day in order for
the purchase price or the redemption price to be based on that day's net asset
value per share. It is the investment dealer's responsibility to transmit orders
promptly. The Fund may accept purchase and redemption orders as of the time of
their receipt by certain investment dealers (or their designated
intermediaries).

PURCHASING SHARES
You may purchase Fund shares through your investment dealer or by mailing the
account application form included in this prospectus to the transfer agent (see
back cover for address). Your initial investment must be at least $1,000. The
price of Class A shares is the net asset value plus a sales charge. The price of
Class B and Class C shares is the net asset value; however, you may be subject
to a sales charge (called a "contingent deferred sales charge" or "CDSC") if you
redeem Class B shares within six years of purchase and Class C shares within one
year of purchase. The sales charges are described below. Your investment dealer
can help you decide which class of shares suits your investment needs.

You may purchase Fund shares for cash or in exchange for securities. Please call
1-800-225-6265 for information about exchanging securities for Fund shares. If
you purchase shares through an investment dealer (which includes brokers,
dealers and other financial institutions), that dealer may charge you a fee for
executing the purchase for you. The Fund may suspend the sale of its shares at
any time and any purchase order may be refused.

SALES CHARGES
FRONT-END SALES CHARGE. Class A shares are offered at net asset value per share
plus a sales charge that is determined by the amount of your investment. The
current sales charge schedule is:

<TABLE>
<CAPTION>
Sales Charge Sales Charge Dealer Commission
as Percentage of as Percentage of Net as a Percentage of
Amount of Purchase Offering Price Amount Invested Offering Price
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Less than $50,000 5.75% 6.10% 5.00%
$50,000 but less than $100,000 4.75% 4.99% 4.00%
$100,000 but less than $250,000 3.75% 3.90% 3.00%
$250,000 but less than $500,000 3.00% 3.09% 2.50%
$500,000 but less than $1,000,000 2.00% 2.04% 1.75%
$1,000,000 or more 0.00* 0.00* See Below
</TABLE>
* No sales charge is payable at the time of purchase on investments of $1
million or more. A CDSC of 1.00% will be imposed on such investments (as
described below) in the event of r edemptions within 12 months of purchase.

6
<PAGE>
million; plus 0.25% on amounts over $5 million. Purchases of $1 million or more
will be aggregated over a 12-month period for purposes of determining the
commission. The principal underwriter may also pay commissions of up to 1.00% on
sales of Class A shares to certain tax-deferred retirement plans.

CONTINGENT DEFERRED SALES CHARGE. Each Class of shares is subject to a CDSC on
certain redemptions. If Class A shares are purchased at net asset value because
the purchase amount is $1 million or more, they are subject to a 1.00% CDSC if
redeemed within 12 months of purchase. Class C shares are subject to a 1.00%
CDSC if redeemed within 12 months of purchase. Class B shares are subject to the
following CDSC schedule:

The CDSC is based on the lower of the net asset value at the time of purchase or
the time of redemption. Shares acquired through the reinvestment of
distributions are exempt from the CDSC. Redemptions are made first from shares
that are not subject to a CDSC.

REDUCING OR ELIMINATING SALES CHARGES. Front-end sales charges may be reduced
under the right of accumulation or under a statement of intention. Under the
right of accumulation, sales charges are reduced if the current market value of
your current holdings (shares at current offering price), plus your new
purchases, reach $50,000 or more. Class A shares of other Eaton Vance funds
owned by you can be included as part of your current holdings for this purpose.
Under a statement of intention, purchases of $50,000 or more made over a
13-month period are eligible for reduced sales charges. The principal
underwriter may hold 5% of the dollar amount to be purchased in escrow in the
form of shares registered in your name until the statement is satisfied or the
thirteen-month period expires. See the account application for details.

The Class B and Class C CDSCs are waived for redemptions pursuant to a
Withdrawal Plan (see "Shareholder Account Features") and in connection with
certain redemptions from tax-sheltered retirement plans. Call 1-800-225-6265 for
details. The Class B CDSC is also waived following the death of all beneficial
owners of shares, but only if the redemption is requested within one year after
death (a death certificate and other applicable documents may be required).

If you redeem shares, you may reinvest at net asset value any portion or all of
the redemption proceeds in the same class of shares of the Fund (or, for Class A
shares, in Class A shares of any other Eaton Vance fund), provided that the
reinvestment occurs within 60 days of the redemption, and the privilege has not
been used more than once in the prior 12 months. Your account will be credited
with any CDSC paid in connection with the redemption. Reinvestment requests must
be in writing. If you reinvest, you will be sold shares at the next determined
net asset value following receipt of your request.

7
<PAGE>
REDEEMING SHARES
You can redeem shares in any of the following ways:

By Mail Send your request to the transfer agent along with any
certificates and stock powers. The request must be signed exactly
as your account is registered and signature guaranteed. You can
obtain a signature guarantee at certain banks, savings and loan
institutions, credit unions, securities dealers, securities
exchanges, clearing agencies and registered securities
associations. You may be asked to provide additional documents if
your shares are registered in the name of a corporation,
partnership or fiduciary.

By Telephone You can redeem up to $50,000 b y calling the transfer agent at
1-800-262-1122 on Monday through Friday, 9:00 a.m. to 4:00 p.m.
(eastern time). Proceeds of a telephone redemption can be mailed
only to the account address. Shares held by corporations, trusts
or certain other entities, or subject to fiduciary arrangements,
cannot be redeemed by telephone.

Through an
Investment
Dealer Your investment dealer is responsible for transmitting the order
promptly. A dealer may charge a fee for this service.

If you recently purchased shares, the proceeds of a redemption will not be sent
until the check (including a certified or cashier's check) has cleared. If the
purchase check has not cleared, redemption proceeds may be delayed up to 15 days
from the purchase date. If your account value falls below $750 other than due to
market decline, you may be asked to either add to your account or redeem it
within 60 days. If you take no action, your account will be redeemed and the
proceeds sent to you.

MEETING REDEMPTIONS BY DISTRIBUTING PORTFOLIO SECURITIES. The Fund currently
will meet redemptions entirely in cash, but in the future may adopt a policy of
meeting redemption requests in whole or in part by distributing appreciated
securities chosen by the investment adviser. The Fund would only distribute
readily marketable securities, which would be valued pursuant to the Portfolio's
valuation procedures. As described under "Investment Objective, Strategies and
Risks", the practice of distributing appreciated securities to meet redemptions
can be a useful tool for tax-efficient management. A policy of meeting
redemptions in whole or in part through the distribution of securities will only
be established after any necessary regulatory approvals are received and in
conjunction with putting in place a program whereby redeeming shareholders who
receive securities could elect to sell the securities received to Eaton Vance,
the Fund's custodian or a designated agent at no cost and at a price equal to
the price used in determining the redemption value of the distributed
securities. Redeeming shareholders who receive securities and who elect to
participate in this program would receive the same amount of cash as if the
redemption had been paid directly in cash and would incur no more or less
taxable gain than if the redemption had been paid directly in cash. Redeeming
shareholders electing not to participate in the program would be required to
take delivery of any securities distributed upon a redemption of shares. Such
shareholders could incur brokerage charges and other costs and may be exposed to
market risk in selling the distributed securities.

If the Fund does adopt a policy of using distributions of securities to meet
redemptions, it may continue to meet redemptions in whole or in part using cash.
At certain times, there may not be sufficient quantities of appreciated
securities available to meet redemptions by shareholders. Moreover, during
periods of volatile market conditions the Fund can be expected to meet
redemptions primarily through distributions of cash.

SHAREHOLDER ACCOUNT FEATURES
Once you purchase shares, the transfer agent establishes a Lifetime Investing
Account for you. Share certificates are issued only on request.

8
<PAGE>
DISTRIBUTIONS. You may have your Fund distributions paid in one of the following
ways:
* Full Reinvest
Option Dividends and capital gains are reinvested in additional
shares. This option will be assigned if you do not specify
an option.
* Partial Reinvest
Option Dividends are paid in cash and capital gains are reinvested
in additional shares.
* Cash Option Dividends and capital gains are paid in cash.
* Exchange
Option Dividends and/or capital gains are reinvested in additional
shares of another Eaton Vance fund chosen by you. Before
selecting this option, you must obtain a prospectus of the
other fund and consider its objectives and policies
carefully.

INFORMATION FROM THE FUND. From time to time, you may be mailed the following:

WITHDRAWAL PLAN. You may redeem shares on a regular quarterly basis by
establishing a systematic withdrawal plan. Withdrawal amounts must be at least
$200 per year, or a specified percentage of net asset value of at least 4% but
not more than 12% annually. For Class B and Class C shares, your withdrawals
will not be subject to a CDSC. A minimum account size of $5,000 is required to
establish a systematic withdrawal plan. Because purchases of Class A shares are
subject to a sales charge, you should not make withdrawals from your account
while you are making purchases.

"STREET NAME" ACCOUNTS. If your shares are held in a "street name" account at an
investment dealer, that dealer (and not the Fund or its transfer agent) will
perform all recordkeeping, transaction processing and distribution payments.
Because the Fund will have no record of your transactions, you should contact
your investment dealer to purchase, redeem or exchange shares, to make changes
in your account, or to obtain account information. The transfer of shares in a
"street name" account to an account with another investment dealer or to an
account directly with the Fund involves special procedures and you will be
required to obtain historical information about your shares prior to the
transfer. Before establishing a "street name" account with an investment dealer,
you should determine whether that dealer allows reinvestment of distributions in
"street name" accounts.

9
<PAGE>
TAX INFORMATION
The Portfolio is managed toward an objective of long-term, after-tax returns for
shareholders. Because distributions of income and realized capital gains give
rise to shareholder taxes, the investments of the Portfolio are generally
selected and managed to minimize distributions. The Fund can generally be
expected to distribute a lesser percentage of returns each year than most other
equity mutual funds. There can be no assurance, however, that taxable
distributions can be avoided. The Fund's distributions generally will not be
eligible for the corporate dividends-received deduction. Distributions of any
income and net realized short-term capital gains will be taxable as ordinary
income. Distributions of any net realized long-term capital gains are taxable as
long-term gains. Any distributions paid will generally be paid annually.

Investors who purchase shares shortly before the record date of a distribution
will pay the full price for the shares and then receive some portion of the
price back as a taxable distribution. Certain distributions paid in January will
be taxable to shareholders as if received on December 31 of the prior year.

Shareholders should consult with their advisers concerning the applicability of
state, local and other taxes to an investment.

10
<PAGE>
FINANCIAL HIGHLIGHTS
The financial highlights are intended to help you understand the Fund's
financial performance for the past five years. Certain information in the table
reflects the financial results for a single Fund share. The total returns in the
table represent the rate an investor would have earned (or lost) on an
investment in the Fund (assuming reinvestment of all distributions and not
taking into account a sales charge). This information has been audited by
_________________, independent accountants. The report of ________________ and
the Fund's financial statements are incorporated herein by reference and
included in the annual report, which is available on request. The Fund began
offering three classes of shares on November 1, 1997. Prior to that date, the
Fund offered only Class B shares.

<TABLE>
Year Ended October 31,
------------------------------------------------
1998 1997 1996*
------------------------------------------------
Class A Class B Class C Class B Class B
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value - Beginning of Year $11.150 $10.000
-------- --------
Income (loss) from operations
Net investment loss $(0.011) $(0.003)
Net realized and unrealized gain
on investments 3.411 1.153
-------- --------
Total income from operations $ 3.400 $ 1.150
-------- --------
Net asset value - End of year $14.550 $11.150
-------- --------
Total Return (1) 30.49% 11.50%

Ratios/Supplemental Data
Net assets, end of year (000's omitted) $574,740 $77,644
Ratio of net expenses to average daily
net assets(2) 1.50 % 1.63 %+
Ratio of net investment loss to average
daily net assets (0.15)% (0.13)%+
Portfolio turnover of the Portfolio 14% 6%
</TABLE>
+ Annualized
* For the period from the start of business, March 28, 1996, to October 31,
1996.
(1) Total 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. Distributions, if any, are assumed to be reinvested at the
net asset value on the ex-dividend date. Total return is not computed on an
annualized basis.
(2) Includes the Fund's share of the Portfolio's allocated expenses.

11
<PAGE>
{LOGO} Mutual Funds
EATON VANCE for People
Mutual Funds Who Pay
Taxes(R)

MORE INFORMATION
- --------------------------------------------------------------------------------

About the Fund: More information is available in the statement of
additional information. The statement of additional information is
incorporated by reference into this prospectus. Additional information
about the Portfolio's investments is available in the annual and
semi-annual reports to shareholders. In the annual report, you will find a
discussion of the market conditions and investment strategies that
significantly affected the Fund's performance during the past year. You may
obtain free copies of the statement of additional information and the
shareholder reports by contacting:

EATON VANCE DISTRIBUTORS, INC.
24 FEDERAL STREETBOSTON, MA 02110
1-800-225-6265
WEBSITE: WWW.EATONVANCE.COM

You will find and may copy information about the Fund at the Securities and
Exchange Commission's public reference room in Washington, DC (call
1-800-SEC-0330 for information); on the SEC's Internet site
(http://www.sec.gov); or upon payment of copying fees by writing to the
SEC's public reference room in Washington, DC 20549-6009.

About Shareholder Accounts: You can obtain more information from Eaton
Vance Share- holder Services (1-800-225-6265). If you own shares and would
like to add to, redeem or change your account, please write or call the
transfer agent:
- --------------------------------------------------------------------------------
FIRST DATA INVESTOR SERVICES GROUP
P.O. BOX 5123WESTBOROUGH, MA 01581-5123
1-800-262-1122

SEC File No. 811-4015 TMGP
<PAGE>
{LOGO} Mutual Funds
EATON VANCE for People
Mutual Funds Who Pay
Taxes(R)

EATON VANCE TAX-MANAGED
EMERGING GROWTH FUND

A mutual fund seeking long-term, after tax returns
by investing in emerging growth companies

EATON VANCE TAX-MANAGED
INTERNATIONAL GROWTH FUND

A mutual fund seeking long-term, after tax returns
by investing in foreign securities

Prospectus Dated

March 1, 1999

THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR DETERMINED WHETHER THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

Information in this prospectus
Page Page
- --------------------------------------------------------------------------------
Fund Summaries 2 Sales Charges 7
Investment Objectives, Policies Redeeming Shares 9
and Risks 5 Shareholder Account
Management and Organization 6 Features 10
Valuing Shares 7 Tax Information 11
Purchasing Shares 7 Financial Highlights 12
- --------------------------------------------------------------------------------

This prospectus contains important information about the Funds and the services
available to shareholders. Please save it for reference.

<PAGE>
FUND SUMMARIES
This section summarizes the investment objectives, and principal strategies and
risks of investing in each Fund. Information about the performance, fees and
expenses of each Fund is presented on the pages that follow.

INVESTMENT OBJECTIVES AND PRINCIPAL STRATEGIES

EATON VANCE TAX-MANAGED EMERGING GROWTH FUND. Tax-Managed Emerging Growth Fund's
investment objective is to achieve long-term, after-tax returns for its
shareholders by investing in a diversified portfolio of equity securities of
emerging growth companies. Emerging growth companies are companies that are
expected to achieve earnings growth and profit margins over the long term that
substantially exceed the average of all publicly-traded stocks in the United
States.

EATON VANCE TAX-MANAGED INTERNATIONAL GROWTH FUND. Tax-Managed International
Growth Fund's investment objective is to achieve long-term, after-tax returns
for its shareholders by investing in a diversified portfolio of foreign equity
securities that are considered to be high in quality and attractive in their
long-term investment prospects. The Fund invests primarily in companies included
in the Morgan Stanley Capital International Europe, Australasia, Far East
("EAFE") Index. The EAFE Index is an unmanaged index of approximately 1,100
companies located in twenty-one countries.

TAX-MANAGED INVESTING

Most mutual funds focus on pre-tax returns and largely ignore shareholder tax
considerations. By contrast, the Funds attempt to achieve high after-tax returns
for shareholders by balancing investment considerations and tax considerations.
The Funds seek to achieve returns primarily in the form of price appreciation
(not subject to current tax) and distributions of net realized long-term capital
gains (taxed as capital gains). The Funds seek to minimize income distributions
and distributions of realized short-term gains (taxed as ordinary income). Among
the techniques and strategies used in the tax-efficient management of the Funds
are the following:

* investing primarily in lower-yielding growth stocks;
* employing a long-term, low turnover approach to investing;
* attempting to avoid net realized short-term gains;
* when appropriate, selling stocks trading below cost to realized losses;
* in selling appreciated stocks, selecting the most tax-favored share lots;
and
* selectively using tax-advantaged hedging techniques as an alternative to
taxable sales.

The Funds can generally be expected to distribute a lesser percentage of returns
each year than most other equity mutual funds. There can be no assurance,
however, that taxable distributions can always be avoided.

PRINCIPAL RISK FACTORS

The value of Fund shares is primarily sensitive to stock market volatility. If
there is a general decline in the value of exchange-listed stocks, the value of
a Fund's shares will also likely decline. Changes in stock market values can be
sudden and unpredictable. Also, although stock values can rebound, there is no
assurance that values will return to previous levels. Each Fund seeks to
minimize stock market risk by diversifying its holdings among many companies and
industries.

Shares of Tax-Managed Emerging Growth Fund are also sensitive to factors
affecting emerging growth companies. The securities of emerging growth companies
are generally subject to greater price fluctuation and investment risk than
securities of more established companies.

Tax-Managed International Fund shares can be adversely affected by changes in
currency exchange rates, and political and economic developments abroad. In
emerging or less developed countries, these risks can be significant.

No Fund is a complete investment program and you may lose money by investing. An
investment in a Fund is not a deposit in a bank and is not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other government agency.

2
<PAGE>
EATON VANCE TAX-MANAGED EMERGING GROWTH FUND

PERFORMANCE INFORMATION. The following bar chart and table provide information
about Tax-Managed Emerging Growth Fund's performance, including a comparison of
the Fund's performance to the performance of domestic and foreign stock indices.
Although past performance is no guarantee of future results, this performance
information demonstrates the risk that the value of your investment will change.
The following returns are for Class B shares for each calendar year through
December 31, 1997 and do not reflect sales charges. If the sales charge was
reflected, the returns would be lower.

The Fund's highest quarterly total return was _______% for the quarter ended
____________, and its lowest quarterly return was ________% for the quarter
ended ______________. The year-to-date total return through the end of the most
recent calendar quarter (December 31, 1997 to September 30, 1998) was ________%.

<TABLE>
One Five Ten
Average Annual Total Return as of December 31, 1997 Year Years Years
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Class A Shares 0.00% 0.00% 0.00%
Class B Shares 0.00% 0.00% 0.00%
Class C Shares 0.00% 0.00% 0.00%
Standard & Poor's 500 Index 0.00% 0.00% 0.00%
</TABLE>
These returns reflect the maximum sales charge for Class A (5.75%) and any
applicable CDSC for Class B and Class C. The Standard & Poor's 500 Index is an
unmanaged index of common stocks trading in the U.S. Index.

TAX-MANANGED EMERGING GROWTH FUND FEES AND EXPENSES. These tables describe the
fees and expenses that you may pay if you buy and hold shares.
<TABLE>
Shareholder Fees
(fees paid directly from your investment) Class A Class B Class C
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
Maximum Sales Charge (as a percentage
of offering price) 5.75% None None
Maximum Deferred Sales Charge (as a
percentage of the lower of net asset
value at time of purchase or time of
redemption) None 5.00% 1.00%
Sales Charge Imposed on Reinvested
Distributions None None None
Exchange Fee None None None
</TABLE>

<TABLE>
Annual Fund Operating Expenses
(expenses that are deducted from Fund assets) Class A Class B Class C
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
Management Fees 0.00% 0.00% 0.00%
Distribution and Service (12b-1) Fees 0.00% 0.00% 0.00%
Other Expenses 0.00% 0.00% 0.00%
----- ----- -----
Total Annual Fund Operating Expenses 0.00% 0.00% 0.00%
</TABLE>
Long-term shareholders of Class B and Class C shares may pay more than the
economic equivalent of the front-end sales charge permitted by the National
Association of Securities Dealers, Inc.

EXAMPLE

This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. The Example assumes that you
invest $10,000 in the Fund for the time periods indicated and then redeem all of
your shares at the end of those periods. The Example also assumes that your
investment has a 5% return each year and that the operating expenses remain the
same. Although your actual costs may be higher or lower, based on these
assumptions your costs would be:
<TABLE>
1 Year 3 Years 5 Years 10 Years
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A shares $0 $0 $0 $0
Class B shares $0 $0 $0 $0
Class C shares $0 $0 $0 $0
</TABLE>
You would pay the following expenses if you did not redeem your shares:
<TABLE>
1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A shares $0 $0 $0 $0
Class B shares $0 $0 $0 $0
Class C shares $0 $0 $0 $0
</TABLE>

3
<PAGE>
EATON VANCE TAX-MANAGED INTERNATIONAL GROWTH FUND

Performance information for the Tax-Managed International Growth Fund is not
presented because the Fund does not yet have a full year of operating history.

TAX-MANAGED INTERNATIONAL GROWTH FUND FEES AND EXPENSES. These tables describe
the fees and expenses that you may pay if you buy and hold shares.

<TABLE>
Shareholder Fees
(fee paid directly from your investment) Class A Class B Class C
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
Maximum Sales Charge (as a percentage of
offering price) 5.75% None None
Maximum Deferred Sales Charge (as a
percentage of the lower of net asset
value at time of purchase or time of
redemption) None 5.00% 1.00%
Sales Charge Imposed on Reinvested
Distributions None None None
Exchange Fee None None None
</TABLE>

Long-term shareholders of Class B and Class C shares may pay more than the
economic equivalent of the front-end sales charge permitted by the National
Association of Securities Dealers, Inc.

EXAMPLE

<TABLE>
1 Year 5 Years
- --------------------------------------------------------------------------------
<S> <C> <C>
Class A shares $0 $0
Class B shares $0 $0
Class C shares $0 $0
</TABLE>

You would pay the following expenses if you did not redeem your shares:

<TABLE>
1 Year 5 Years
- --------------------------------------------------------------------------------
<S> <C> <C>
Class A shares $0 $0
Class B shares $0 $0
Class C shares $0 $0
</TABLE>

4
<PAGE>
INVESTMENT OBJECTIVES, POLICIES AND RISKS
TAX-MANAGED EMERGING GROWTH FUND. Tax-Managed Emerging Growth Fund's investment
objective is to achieve long-term, after-tax returns for its shareholders by
investing in a diversified portfolio of equity securities of emerging growth
companies. The Fund's investment objective may not be changed without
shareholder approval. Certain of the Fund's policies may be changed by the
Trustees without shareholder approval.

Tax-Managed Emerging Growth Fund invests in a broadly diversified selection of
publicly-traded equity securities of emerging growth companies that are believed
to have superior long-term earnings growth prospects. The investment adviser
considers "emerging growth companies" to be companies that are expected to
demonstrate earnings growth rates and profit margins over the long-term that are
substantially in excess of the average of all publicly-traded companies in the
United States. The investment adviser expects that most emerging growth
companies will have annual revenues of between $50 million and $1 billion at the
time they are acquired by the Fund, but the Fund may also invest in larger and
smaller companies identified as having emerging growth characteristics.

Under normal market conditions, the Fund will invest at least 65% of its assets
in common stocks of emerging growth companies. In making investment decisions,
the portfolio manager may draw upon the information provided by, and the
expertise of, the investment adviser's research staff. In addition to the tax
considerations discussed below, management of the Fund involves consideration of
numerous factors (such as overall growth prospects, financial condition,
competitive position, technology, marketing expertise, profit margins, return on
investment, capital resources and management of the company). Many of these
considerations are subjective.

TAX-MANAGED INTERNATIONAL GROWTH FUND. Tax-Managed International Growth Fund's
investment objective is to achieve long-term, after-tax returns for its
shareholders by investing in a diversified portfolio of foreign equity
securities. The Fund's investment objective may not be changed without
shareholder approval. Certain of the Fund's policies may be changed by the
Trustees without shareholder approval.

Under normal market conditions, the Fund will invest at least 65% of its assets
in foreign equity securities. The portfolio manager expects to invest primarily
in companies included in the EAFE Index. The Fund seeks to outperform the EAFE
Index on both a pre-tax and after-tax basis. In making investment decisions, the
portfolio manager may draw upon the information provided by, and the expertise
of, the investment adviser's research staff. In addition to the tax
considerations discussed below, management of the Fund involves consideration of
numerous factors (such as overall growth prospects, financial condition,
competitive position, technology, marketing expertise, profit margins, the
performance expectations of particular foreign stock markets and currencies).
Many of these considerations are subjective. The Fund maintains investments in
not less than five different countries and will not invest more than 25% of
assets in any one country. The Fund generally acquires securities with the
expectation of holding them for at least five years.

Each Fund seeks to achieve long-term, after-tax returns in part by minimizing
the taxes incurred by shareholders in connection with the Fund's investment
income and realized capital gains. Taxes on investment income are minimized by
investing primarily in lower-yielding securities. Taxes on realized capital
gains are minimized by maintaining relatively low portfolio turnover and
avoiding or minimizing the sale of securities with large accumulated capital
gains. Each Fund generally seeks to avoid net realized short-term capital gains.
When a decision is made to sell a particular appreciated security, the portfolio
manager will select for sale the share lots resulting in the most favorable tax
treatment, generally those with holding periods sufficient to qualify for
long-term capital gains treatment that have the highest cost basis. The
portfolio manager may sell securities to realize capital losses that can be used
to offset realized gains.

To protect against price declines in securities holdings with large accumulated
gains, Each Fund may use various hedging techniques (such as purchased put
options, equity collars (combining the purchase of a put option and the sale of
a call option), equity swaps, covered short sales, and the sale of stock index
futures contracts). By using these techniques rather than selling appreciated
securities, the Fund can reduce its exposure to price declines in the securities
without realizing substantial capital gains under current tax law. The use of
these hedging techniques is subject to certain limitations and exposes the Fund
to certain risks.

Tax-Managed International Growth Fund invests in foreign securities and
Tax-Managed Emerging Growth Fund may invest up to 20% of assets in foreign
securities. The values of foreign investments are affected by changes in
currency rates or exchange control regulations, application of foreign tax laws
(including withholding tax), changes in governmental administration or economic
or monetary policy (in this country or abroad) or changed circumstances in
dealings between nations. Because investment in foreign companies will usually
involve currencies of foreign countries, the value of assets of the Fund as
measured by U.S. dollars may be adversely affected by changes in currency
exchange rates. Such rates may fluctuate significantly over short periods of
time causing a Fund's net asset value to fluctuate as well. Costs are incurred

5
<PAGE>
in connection with conversions between various currencies. Many European
countries are about to adopt a single European currency, the euro. The
consequences of the euro conversion for foreign exchange rates, interest rates
and the value of European securities eligible for purchase by the Fund are
presently unclear. Such consequences may adversely affest the value and/or
increase the volatility of securities held by the Fund. In addition, foreign
brokerage commissions, custody fees and other costs of investing are generally
higher than in the United States, and foreign securities markets may be less
liquid, more volatile and less subject to governmental supervision than in the
United States. Investments in foreign issuers could be affected by other factors
not present in the United States, including expropriation, armed conflict,
confiscatory taxation, lack of uniform accounting and auditing standards, less
publicly available financial and other information and potential difficulties in
enforcing contractual obligations. Transactions in the securities of foreign
issuers could be subject to settlement delays and risk of loss.

The Fund may invest not more than 15% of its net assets in illiquid securities,
which may be difficult to value properly and may involve greater risks. Illiquid
securities include those legally restricted as to resale, and may include
commercial paper issued pursuant to Section 4(2) of the Securities Act of 1933
and securities eligible for resale pursuant to Rule 144A thereunder. Certain
Section 4(2) and Rule 144A securities may be treated as liquid securities if the
investment adviser determines that such treatment is warranted. If determined to
be liquid, these securities may increase the level of Fund illiquidity if
qualified institutional buyers become uninterested in purchasing them.

During unusual market conditions, each Fund may temporarily invest up to 100% of
its assets in cash or cash equivalents (such as commercial paper). Each
Portfolio may also temporarily borrow at any time up to 5% of the value of its
total assets to satisfy redemption requests or settle securities transactions.

Like most mutual funds, the Funds rely on computers in conducting daily business
and processing information. There is a concern that on January 1, 2000 some
computer programs will be unable to recognize the new year and as a consequence
computer malfunctions will occur. Eaton Vance is taking steps that it believes
are reasonably designed to address this potential problem and to obtain
satisfactory assurance from other service providers to the Funds that they are
also taking steps to address the issue. There can, however, be no assurance that
these steps will be sufficient to avoid any adverse impact on the Funds or
shareholders. The Year 2000 concern may also adversely impact issuers of
securities held by a Fund.

Each Fund's investment policies include a fundamental investment provision
allowing the Fund to invest its assets in one or more open-end management
investment companies having substantially the same investment policies and
restrictions as the Fund with respect to the assets so invested. This investment
company would be advised by the investment adviser (or an affiliate) and the
Fund would pay no advisory fee with respect to the assets so invested. The Board
of Trustees may implement the new investment policy without shareholder approval
at any time. This structure is commonly referred to as "master-feeder."

MANAGEMENT AND ORGANIZATION
MANAGEMENT. Each Fund's investment adviser is Eaton Vance Management ("Eaton
Vance") 24 Federal Street, Boston, Massachusetts 02110. Eaton Vance has been
managing assets since 1924 and managing mutual funds since 1931. Eaton Vance and
its subsidiaries currently manage over $30 billion on behalf of mutual funds,
institutional clients and individuals.

The investment adviser manages the investments of each Fund and provides related
office facilities and personnel. Under its investment advisory agreement with
the Trust on behalf of the Tax-Managed Emerging Growth Fund, Eaton Vance
receives a monthly advisory fee of /5//\\96\\ of 1% (equivalent to 0.625%
annually) of the average daily net assets of the Fund up to and including $500
million. On net assets of $500 million and over the annual fee is reduced. For
the fiscal year ended October 31, 1998, the Fund paid Eaton Vance advisory fees
equivalent to 0.625% of its average daily net assets.

Under its investment advisory agreement with the Trust on behalf of the
Tax-Managed International Growth Fund, Eaton Vance receives a monthly advisory
fee of 1/12 of 1% (equivalent to 1.00% annually) of the average daily net assets
of the Fund up to $500 million. On net assets of $500 million and over the
annual fee is reduced. For the fiscal year ended October 31, 1998, the Fund paid
Eaton Vance advisory fees equivalent to 1.00% of its average daily net assets.

Edward E. Smiley, Jr. has acted as the portfolio manager of the Tax-Managed
Emerging Growth Fund since it commenced operations. He has been a Vice President
of Eaton Vance and BMR and an employee of Eaton Vance since 1996. Prior to
joining Eaton Vance, he was Senior Product Manager, Equity management for
TradeStreet Investment Associates, Inc., a wholly-owned subsidaiary of
NationsBank.

Armin J. Lang has acted as the portfolio manager of the Tax-Managed
International Growth Fund since it commenced operations. He has been a Vice
President of Eaton Vance and BMR and an employee of Eaton Vance since 1998.

6
<PAGE>
Prior to joining Eaton Vance, he was an international equity protfolio manager
and quantitative strategist at Standish, Ayer & Wood.

The investment adviser and each Fund have adopted Codes of Ethics governing
personal securities transactions. Under the Codes, Eaton Vance employees may
purchase and sell securities (including securities held by a Fund) subject to
certain pre-clearance and reporting requirements and other procedures.

Eaton Vance serves as administrator of each Fund, providing the Fund with
administrative services and related office facilities. Eaton Vance does not
currently receive a fee for serving as administrator.

ORGANIZATION. Each Fund is a series of Eaton Vance Mutual Funds Trust, a
Massachusetts business trust. The Funds do not hold annual shareholder meetings,
but may hold special meetings for matters that require shareholder approval
(like electing or removing trustees, approving management contracts or changing
investment policies that may only be changed with shareholder approval).

Because the Funds use this combined prospectus, a Fund could be held liable for
a misstatement or omission made about another Fund. The Trust's Trustees
considered this in approving the use of a combined prospectus.

VALUING SHARES
Each Fund values its shares once each day only when the New York Stock Exchange
is open for trading (typically Monday through Friday), as of the close of
regular trading on the Exchange (normally 4:00 p.m. eastern time). The price of
Fund shares is their net asset value.. Exchange-listed securities are generally
valued at closing sale prices. When purchasing or redeeming Fund shares, your
investment dealer must communicate your order to the principal underwriter by a
specific time each day in order for the purchase price or the redemption price
to be based on that day's net asset value per share. It is the investment
dealer's responsibility to transmit orders promptly. Each Fund may accept
purchase and redemption orders as of the time of their receipt by certain
investment dealers (or their designated intermediaries).

PURCHASING SHARES
You may purchase Fund shares through your investment dealer or by mailing the
account application form included in this prospectus to the transfer agent (see
back cover for address). Your initial investment must be at least $1,000. The
price of Class A shares is the net asset value plus a sales charge. The price of
Class B and Class C shares is the net asset value; however, you may be subject
to a sales charge (called a "contingent deferred sales charge" or "CDSC") if you
redeem Class B shares within six years of purchase or Class C shares within one
year of purchase. The sales charges are described below. Your investment dealer
can help you decide which class of shares suits your investment needs.

You may purchase Fund shares for cash or in exchange for securities. Please call
1-800-225-6265 for information about exchanging securities for Fund shares. If
you purchase shares through an investment dealer (which includes brokers,
dealers and other financial institutions), that dealer may charge you a fee for
executing the purchase for you. A Fund may suspend the sale of its shares at any
time and any purchase order may be refused.

7
<PAGE>
<TABLE>
Sales Charge Sales Charge Dealer Commission
as Percentage of as Percentage of Net as a Percentage of
Amount of Purchase Offering Price Amount Invested Offering Price
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Less than $50,000 5.75% 6.10% 5.00%
$50,000 but less than $100,000 4.75% 4.99% 4.00%
$100,000 but less than $250,000 3.75% 3.90% 3.00%
$250,000 but less than $500,000 3.00% 3.09% 2.50%
$500,000 but less than $1,000,000 2.00% 2.04% 1.75%
$1,000,000 or more 0.00* 0.00* See Below
</TABLE>
*No sales charge is payable at the time of purchase on investments of $1 million
or more. A CDSC of 1.00% will be imposed on such investments (as described
below) in the event of redemptions within 12 months of purchase.

The principal underwriter will pay a commission to investment dealers on sales
of $1 million or more as follows: 1.00% on amounts of $1 million or more but
less than $3 million; plus 0.50% on amounts over $3 million but less than $5
million; plus 0.25% on amounts over $5 million. Purchases of $1 million or more
will be aggregated over a 12-month period for purposes of determining the
commission. The principal underwriter may also pay commissions of up to 1.00% on
sales of Class A shares to certain tax-deferred retirement plans.

CONTINGENT DEFERRED SALES CHARGE. Each Class of shares is subject to a CDSC on
certain redemptions. If Class A shares are purchased at net asset value because
the purchase amount is $1 million or more, they are subject to a 1.00% CDSC if
redeemed within 12 months of purchase. Class C shares are subject to a 1.00%
CDSC if redeemed within 12 months of purchase. Class B shares are subject to the
following CDSC schedule:

<TABLE>
<CAPTION>
Year of Redemption After Purchase CDSC
- --------------------------------------------------------------------------------
<S> <C>
First or Second 5%
Third 4%
Fourth 3%
Fifth 2%
Sixth 1%
Seventh or following 0%
</TABLE>
The CDSC is based on the lower of the net asset value at the time of purchase or
the time of redemption. Shares acquired through the reinvestment of
distributions are exempt from the CDSC. Redemptions are made first from shares
that are not subject to a CDSC.

REDUCING OR ELIMINATING SALES CHARGES. Front-end sales charges may be reduced
under the right of accumulation or under a statement of intention. Under the
right of accumulation, sales charges are reduced if the current market value of
your current holdings (shares at current offering price), plus your new
purchases, reach $50,000 or more. Class A shares of other Eaton Vance funds
owned by you can be included as part of your current holdings for this purpose.
Under a statement of intention, purchases of $50,000 or more made over a
13-month period are eligible for reduced sales charges. The principal
underwriter may hold 5% of the dollar amount to be purchased in escrow in the
form of shares registered in your name until the statement is satisfied or the
thirteen-month period expires. See the account application for details.

8
<PAGE>
must be in writing. If you reinvest, you will be sold shares at the next
determined net asset value following receipt of your request.

REDEEMING SHARES
You can redeem shares in any of the following ways:

By Mail Send your request to the transfer agent along with any
certificates and stock powers. The request must be signed
exactly as your account is registered and signature
guaranteed. You can obtain a signature guarantee at certain
banks, savings and loan institutions, credit unions,
securities dealers, securities exchanges, clearing agencies
and registered securities associations. You may be asked to
provide additional documents if your shares are registered
in the name of a corporation, partnership or fiduciary.

By Telephone You can redeem up to $50,000 b y calling the transfer agent
at 1-800-262-1122 on Monday through Friday, 9:00 a.m. to
4:00 p.m. (eastern time). Proceeds of a telephone redemption
can be mailed only to the account address. Shares held by
corporations, trusts or certain other entities, or subject
to fiduciary arrangements, cannot be redeemed by telephone.

Through an
Investment Dealer Your investment dealer is responsible for transmitting the
order promptly. A dealer may charge a fee for this service.

If you recently purchased shares, the proceeds of a redemption will not be sent
until the check (including a certified or cashier's check) has cleared. If the
purchase check has not cleared, redemption proceeds may be delayed up to 15 days
from the purchase date. If your account value falls below $750 other than due to
market decline, you may be asked to either add to your account or redeem it
within 60 days. If you take no action, your account will be redeemed and the
proceeds sent to you.

MEETING REDEMPTIONS BY DISTRIBUTING PORTFOLIO SECURITIES. The Fund currently
will meet redemptions entirely in cash, but in the future may adopt a policy of
meeting redemption requests in whole or in part by distributing appreciated
securities chosen by the investment adviser. The Fund would only distribute
readily marketable securities, which would be valued pursuant to the Fund's
valuation procedures. As described under "Investment Objective, Strategies and
Risks", the practice of distributing appreciated securities to meet redemptions
can be a useful tool for tax-efficient management. A policy of meeting
redemptions in whole or in part through the distribution of securities will only
be established after any necessary regulatory approvals are received and in
conjunction with putting in place a program whereby redeeming shareholders who
receive securities could elect to sell the securities received to Eaton Vance,
the Fund's custodian or a designated agent at no cost and at a price equal to
the price used in determining the redemption value of the distributed
securities. Redeeming shareholders who receive securities and who elect to
participate in this program would receive the same amount of cash as if the
redemption had been paid directly in cash and would incur no more or less
taxable gain than if the redemption had been paid directly in cash. Redeeming
shareholders electing not to participate in the program would be required to
take delivery of any securities distributed upon a redemption of shares. Such
shareholders could incur brokerage charges and other costs and may be exposed to
market risk in selling the distributed securities.

9
<PAGE>
securities available to meet redemptions by shareholders. Moreover, during
periods of volatile market conditions the Fund can be expected to meet
redemptions primarily through distributions of cash.

SHAREHOLDER ACCOUNT FEATURES
Once you purchase shares, the transfer agent establishes a Lifetime Investing
Account for you. Share certificates are issued only on request.

DISTRIBUTIONS. You may have your Fund distributions paid in one of the following
ways:
* Full Reinvest
Option Dividends and capital gains are reinvested in additional
shares. This option will be assigned if you do not specify
an option.

* Partial Reinvest
Option Dividends are paid in cash and capital gains are reinvested
in additional shares.

* Cash Option Dividends and capital gains are paid in cash.

* Exchange Option Dividends and/or capital gains are reinvested in additional
shares of another Eaton Vance fund chosen by you. Before
selecting this option, you must obtain a prospectus of the
other fund and consider its objectives and policies
carefully.

Information from the Fund. From time to time, you may be mailed the following:

* Annual and Semi-Annual Reports, containing performance information and
financial statements.
* Periodic account statements, showing recent activity and total share balance.
* Form 1099 and tax information needed to prepare your income tax returns.
* Proxy materials, in the event a shareholder vote is required.
* Special notices about significant events affecting your Fund.

"STREET NAME" ACCOUNTS. If your shares are held in a "street name" account at an
investment dealer, that dealer (and not the Fund or its transfer agent) will
perform all recordkeeping, transaction processing and distribution payments.
Because the Fund will have no record of your transactions, you should contact
your investment dealer to purchase, redeem or exchange shares, to make changes
in your account, or to obtain account information. The transfer of shares in a
"street name" account to an account with another investment dealer or to an
account directly with the Fund involves special procedures and you will be
required to obtain historical information about your shares prior to the

10
<PAGE>
transfer. Before establishing a "street name" account with an investment dealer,
you should determine whether that dealer allows reinvestment of distributions in
"street name" accounts.

TAX INFORMATION
Each Fund is managed toward an objective of long-term, after-tax returns for
shareholders. Because distributions of income and realized capital gains give
rise to shareholder taxes, the investments of a Fund are generally selected and
managed to minimize distributions. Each Fund can generally be expected to
distribute a lesser percentage of returns each year than most other equity
mutual funds. There can be no assurance, however, that taxable distributions can
be avoided. Each Fund's distributions generally will not be eligible for the
corporate dividends-received deduction. Distributions of any income and net
realized short-term capital gains will be taxable as ordinary income.
Distributions of any net realized long-term capital gains are taxable as
long-term gains. Any distributions paid will generally be paid annually.

Investors who purchase shares shortly before the record date of a distribution
will pay the full price for the shares and then receive some portion of the
price back as a taxable distribution. Certain distributions paid in January will
be taxable to shareholders as if received on December 31 of the prior year.

Shareholders should consult with their advisers concerning the applicability of
state, local and other taxes to an investment.

11
<PAGE>
FINANCIAL HIGHLIGHTS
The financial highlights are intended to help you understand a Fund's financial
performance for the past five years. Certain information in the tables reflect
the financial results for a single Fund share. The total returns in the tables
represent the rate an investor would have earned (or lost) on an investment in
the Fund (assuming reinvestment of all distributions and not taking into account
a sales charge). This information has been audited by ______________,
independent accountants. The report of __________________ and each Fund's
financial statements are incorporated herein by reference and included in the
annual report, which is available on request.

<TABLE>
Tax-Managed Emerging Growth Fund
----------------------------------------------------------
Year Ended October 31,
----------------------------------------------------------
1998 1997
----------------------------------------------------------
Class A Class B Class C Class A* Class B* Class C*
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value - Beginning of year $10.000 $10.000 $10.000
-------- -------- --------
Income from operations
Net investment income $ 0.008 $ 0.005 $ 0.003
Net realized and unrealized los on investments (0.268) (0.265) (0.283)
-------- -------- --------
Net loss from operations $(0.260) $(0.260) $(0.280)
-------- -------- --------
Net asset value - End of year $ 9.740 $ 9.740 $ 9.720
======== ======== ========
Total Return (1) (2.60%) (2.60)% (2.80)%

Ratios/Supplemental Data+
Net assets, end of year (000's omitted) $ 3,925 $ 8,613 $ 2,051
Ratio of net expenses to average
daily net assets 0.63%+ 1.37%+ 1.56%+
Ratio of net investment income to
average daily net assets 1.83%+ 1.13%+ 0.90%+

Average Commission Rate (2) $0.0600 $0.0600 $0.0600

Portfolio turnover of the Fund 7.00% 7.00% 7.00%
</TABLE>

(See footnotes on last page.)

12
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED)

<TABLE>
Tax-Managed International Emerging Growth Fund
----------------------------------------------
Year Ended October 31,
----------------------------------------------
1998
----------------------------------------------
Class A* Class B* Class C*
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value - Beginning of year

Income (loss) from operations
Net investment income
Net realized and unrealized gain
(loss) on investments

Total income (loss) from operations

Net asset value - End of year

Total return (3)

Ratios/Supplemental Data
Net assets, end of year (000's omitted)
Ratio of net expenses to average net assets
Ratio of net investment income to
average net assets
Portfolio turnover of the Fund
</TABLE>
+The operating expenses of the Fund reflect a preliminary waiver of the
investment adviser fee. Had such action not been taken, the ratios and
investment income per share would have been as follows:

<TABLE>
<S> <C> <C> <C>
Ratios (as a percentage of average net assets):

Expenses

Net investment income
Net investment income per share
</TABLE>
+ Computed on an annualized basis.

* For the Tax-Managed Emerging Growth Fund for Class A for the period from
the start of business, September 25, 1997, to October 31, 1998 and for
Class B and Class C for the period from the start of business September 29,
1997, to October 31, 1998 and for the Tax-Managed International Growth Fund
for the period from the start of business, April 22, 1998, to October 31,
1998.

(1) Total 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. Distributions, if any, are assumed to be reinvested at the
net asset value on the ex-dividend date. Total return is not computed on an
annualized basis.

(2) Average commmission 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
paid.

13
<PAGE>
{LOGO} Mutual Funds
EATON VANCE for People
Mutual Funds Who Pay
Taxes (R)

MORE INFORMATION
- --------------------------------------------------------------------------------

About the Funds: More information is available in the statement of
additional information. The statement of additional information is
incorporated by reference into this prospectus. Additional information
about each Fund's investments is available in the annual and semi-annual
reports to shareholders. In the annual report, you will find a discussion
of the market conditions and investment strategies that significantly
affected each Fund's performance during the past year. You may obtain free
copies of the statement of additional information and the shareholder
reports by contacting:

EATON VANCE DISTRIBUTORS, INC.
24 FEDERAL STREET
BOSTON, MA 02110
1-800-225-6265
WEBSITE: WWW.EATONVANCE.COM

You will find and may copy information about each Fund at the Securities
and Exchange Commission's public reference room in Washington, DC (call
1-800-SEC-0330 for information); on the SEC's Internet site
(http://www.sec.gov); or upon payment of copying fees by writing to the
SEC's public reference room in Washington, DC 20549-6009.

About Shareholder Accounts: You can obtain more information from Eaton
Vance Share- holder Services (1-800-225-6265). If you own shares and would
like to add to, redeem or change your account, please write or call the
transfer agent:
- --------------------------------------------------------------------------------
FIRST DATA INVESTOR SERVICES GROUP
P.O. BOX 5123
WESTBOROUGH, MA 01581-5123
1-800-262-1122

SEC File No. 811-4015 3/1COMBP
<PAGE>

PART B
INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION

STATEMENT OF
ADDITIONAL INFORMATION
March 1, 1999

EATON VANCE STRATEGIC INCOME FUND
24 Federal Street
Boston, Massachusetts 02110
(800) 225-6265

This Statement of Additional Information ("SAI") provides general
information about the Fund and the Portfolio and High Income Portfolio (the
"HI Portfolio"). Capitalized terms used in this SAI and not otherwise defined
have the meanings given them in the Fund's Prospectus. This SAI contains
additional information about:

Page
Strategies and Risks .............................................. 1
Investment Restrictions ........................................... 5
Management and Organization ....................................... 6
Investment Advisory and Administrative Services ................... 10
Other Service Providers ........................................... 12
Purchasing and Redeeming Shares ................................... 13
Sales Charges ..................................................... 15
Performance ....................................................... 18
Taxes ............................................................. 19
Portfolio Security Transactions ................................... 21
Financial Statements .............................................. 23
Appendicies:
A: Class A Fees, Performance and Ownership .................... a-1
B: Class B Fees, Performance and Ownership .................... b-1
C: Class C Fees, Performance and Ownership .................... c-1
D: Description of Securities Ratings .......................... d-1

THIS IS NOT A PROSPECTUS AND IS AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE
INVESTORS ONLY IF PRECEDED OR ACCOMPANIED BY THE FUND'S PROSPECTUS DATED MARCH
1, 1999, AS SUPPLEMENTED FROM TIME TO TIME, WHICH IS INCORPORATED HEREIN BY
REFERENCE. THIS SAI SHOULD BE READ IN CONJUNCTION WITH THE PROSPECTUS, WHICH
MAY BE OBTAINED BY CALLING 1-800-225-6265.

<PAGE>

STRATEGIES AND RISKS
INCOME PRODUCING SECURITIES. Included in the income producing securities in
which the Portfolio may invest are preferred and preference stocks,
convertible bonds, securities of real estate investment trusts and natural
resource companies, stripped debt obligations, closed-end investment companies
(that invest primarily in debt securities the Portfolio could invest in),
equipment lease certificates, equipment trust certificates and conditional
sales contracts. Preference stocks are stocks that have many characteristics
of preferred stocks, but are typically junior to an existing class of
preferred stocks. Securities of real estate investment trusts, such as
debentures, are affected by conditions in the real estate industry and
interest rates. Securities of natural resource companies are subject to price
fluctuation based upon inflationary pressures and demand for natural
resources. Stripped debt obligations are comprised of principal only or
interest only obligations. The value of closed-end investment company
securities, which are generally traded on an exchange, is affected by demand
for those securities regardless of the demand for the underlying portfolio
assets. Equipment lease certificates are debt obligations secured by leases on
equipment (such as railroad cars, airplanes or office equipment), with the
issuer of the certificate being the owner and lessor of the equipment. The
issuers of equipment lease certificates tend to be industrial, transportation
and leasing companies. Equipment trust certificates are debt obligations
secured by an interest in property (such as railroad cars or airplanes), the
title of which is held by a trustee while the property is being used by the
borrower. Conditional sales contracts are agreements under which the seller of
property continues to hold title to the property until the purchase price is
fully paid or other conditions are met by the buyer. The Portfolio has no
current intention of investing more than 10% of its assets in each of
convertible and preferred equity securities or of investing more than 5% of
its total assets in any of the other types of securities described above.
Equity securities received upon conversion of convertible securities may be
retained by the Portfolio. HI Portfolio may also invest in all of the
foregoing.

The Portfolio (and HI Portfolio) may purchase fixed-rate bonds which have
a demand feature allowing the holder to redeem the bonds at specified times.
These bonds are more defensive than conventional long-term bonds (protecting
to some degree against a rise in interest rates) while providing greater
opportunity than comparable intermediate term bonds, since a Portfolio may
retain the bond if interest rates decline. By acquiring these kinds of bonds a
Portfolio obtains the contractual right to require the issuer of the bonds to
purchase the security at an agreed upon price, which right is contained in the
obligation itself rather than in a separate agreement or instrument. Since
this right is assignable only with the bond, a Portfolio will not assign any
separate value to such right. A Portfolio may also purchase floating or
variable rate obligations and warrants when such warrants are part of a unit
with other securities.

The Portfolio's (and HI Portfolio's) investments in high yield, high risk
obligations rated below investment grade, which have speculative
characteristics, bear special risks. They are subject to greater credit risks,
including the possibility of default or bankruptcy of the issuer. The value of
such investments may also be subject to a greater degree of volatility in
response to interest rate fluctuations, economic downturns and changes in the
financial condition of the issuer. These securities generally are less liquid
than higher quality securities. During periods of deteriorating economic
conditions and contractions in the credit markets, the ability of such issuers
to service their debt, meet projected goals or obtain additional financing may
be impaired. Each Portfolio will take such action as it considers appropriate
in the event of anticipated financial difficulties, default or bankruptcy of
either the issuer of any such obligation or of the underlying source of funds
for debt service. Such action may include retaining the services of various
persons and firms (including affiliates of the Investment Adviser) to evaluate
or protect any real estate, facilities or other assets securing any such
obligation or acquired by each Portfolio as a result of any such event. A
Portfolio will incur additional expenditures in taking protective action with
respect to portfolio obligations in default and assets securing such
obligations.

The Portfolio may invest in obligations of domestic and foreign companies
in the group consisting of the banking and the financial services industries.
Companies in the banking industry include U.S. and foreign commercial banking
institutions (including their parent holding companies). Companies in the
financial services industry include finance companies, diversified financial
services companies and insurance and insurance holding companies. Companies
engaged primarily in the investment banking, securities, investment advisory
or investment company business are not deemed to be in the financial services
industry for this purpose. The securities held by the Portfolio may be
affected by economic or regulatory developments in or related to such
industries. Sustained increases in interest rates can adversely affect the
availability and cost of funds for an institution's lending activities, and a
deterioration in general economic conditions could increase the institution's
exposure to credit losses.

A bank from whom a Portfolio acquires a loan participation interest may be
treated as a co-issuer for tax diversification purposes to the extent that the
Portfolio does not have direct recourse against the borrower of the underlying
loan and is therefore relying on the credit of such bank. For industry
concentration purposes, the Investment Adviser will consider all relevant
factors in determining the issuer of a loan interest, including: the credit
quality of the borrower, the amount and quality of the collateral, the terms
of the loan agreement and the other relevant agreements (including inter-
creditor agreements), the degree to which the credit of such interpositioned
person was deemed material to the decision to purchase the loan interest, the
interest rate environment, and general economic conditions applicable to the
borrower and such interpositioned person.

MORTGAGE ROLLS. The Portfolio may enter into mortgage "dollar rolls" in which
the Portfolio sells mortgage-backed securities for delivery in the current
month and simultaneously contracts to repurchase substantially similar (same
type, coupon and maturity) securities on a specified future date. During the
roll period, the Portfolio foregoes principal and interest paid on the
mortgage-backed securities. The Portfolio is compensated by the difference
between the current sales price and the lower forward price for the future
purchase (often referred to as the "drop") as well as by the interest earned
on the cash proceeds of the initial sale. A "covered roll" is a specific type
of dollar roll for which there is an offsetting cash position or a cash
equivalent security position which matures on or before the forward settlement
date of the dollar roll transaction. The Portfolio will only enter into
covered rolls. Covered rolls are not treated as a borrowing or other senior
security and will be excluded from the calculation of the Portfolio's
borrowings and other senior securities.

LENDING OF PORTFOLIO SECURITIES. Each Portfolio may seek to increase its
income by lending portfolio securities to broker-dealers or other
institutional borrowers. Under present regulatory policies of the Commission,
such loans are required to be secured continuously by collateral in cash, cash
equivalents or U.S. Government securities held by the Portfolio's custodian
and maintained on a current basis at an amount at least equal to the market
value of the securities loaned, which will be marked to market daily. Cash
equivalents include certificates of deposit, commercial paper and other short-
term money market instruments. A Portfolio would have the right to call a
loan and obtain the securities loaned at any time on up to five business days'
notice. During the existence of a loan, a Portfolio will continue to receive
the equivalent of the interest paid by the issuer on the securities loaned and
will also receive a fee or all of a portion of the interest on investment of
the collateral, if any. However, a Portfolio may pay lending fees to such
borrowers. A Portfolio would not have the right to vote any securities having
voting rights during the existence of a loan, but would call the loan in
anticipation of an important vote to be taken among holders of the securities
or the giving or withholding of their consent on a material matter affecting
the investment. As with other extensions of credit there are risks of delay in
recovery or even loss of rights in the securities by the Investment Adviser to
be of good standing and when the consideration which can be earned from
securities loans of this type, net of administrative expenses and any finders
fees, justifies the attendant risk. The financial condition of the borrower
will be monitored by the Investment Adviser on an ongoing basis. If the
Investment Adviser determines to make securities loans, it is not intended
that the value of the securities loaned would exceed 30% of a Portfolio's
total assets. Securities lending involves risks of delay in recovery or even
loss of rights on the securities loaned if the borrower fails financially. As
of the present time, the Trustees of neither Portfolio have made a
determination to engage in this activity, and have no present intention of
making such a determination during the current fiscal year.

FOREIGN INVESTMENTS. Since foreign companies are not subject to uniform
accounting, auditing and financial reporting standards, practices and
requirements comparable to those applicable to U.S. companies, there may be
less publicly available information about a foreign company than about a
domestic company. Volume and liquidity in most foreign bond markets is less
than in the United States and securities of some foreign companies are less
liquid and more volatile than securities of comparable U.S. companies. Fixed
commissions on foreign stock exchanges are generally higher than negotiated
commissions on U.S. exchanges, although each Portfolio endeavors to achieve
the most favorable net results on its portfolio transactions. There is
generally less government supervision and regulation of securities exchanges,
broker-dealers and listed companies than in the United States. Mail service
between the United States and foreign countries may be slower or less reliable
than within the United States, thus increasing the risk of delayed settlements
of portfolio transactions or loss of certificates for portfolio securities. A
Portfolio may be required to pay for securities before delivery. In addition,
with respect to certain foreign countries, there is the possibility of
expropriation or confiscatory taxation, political or social instability, or
diplomatic developments which could affect a Portfolio's investments in those
countries. Moreover, individual foreign economies may differ favorably or
unfavorably from the U.S. economy in such respects as growth of gross national
product, rate of inflation, capital reinvestment, resource self-sufficiency
and balance of payments position.

FOREIGN CURRENCY TRANSACTIONS. The value of the assets of a Portfolio as
measured in U.S. dollars may be affected favorably or unfavorably by changes
in foreign currency exchange rates and exchange control regulations. Currency
exchange rates can also be affected unpredictably by intervention by U.S. or
foreign governments or central banks, or the failure to intervene, or by
currency controls or political developments in the U.S. or abroad. A Portfolio
may conduct its foreign currency exchange transactions on a spot (i.e., cash)
basis at the spot rate prevailing in the foreign currency exchange market or
through entering into swaps, forward contracts, options or futures on
currency. In spot transactions, foreign exchange dealers do not charge a fee
for conversion, but they do realize a profit based on the difference (the
"spread") between the prices at which they are buying and selling various
currencies. Thus, a dealer may offer to sell a foreign currency to a Portfolio
at one rate, while offering a lesser rate of exchange should the Portfolio
desire to resell that currency to the dealer.

Currency swaps require maintenance of a segregated account as described
under "Asset Coverage Requirements" below. The Portfolio will not enter into
any currency swap unless the credit quality of the unsecured senior debt or
the claims-paying ability of the other party thereto is considered to be
investment grade by the Investment Adviser.

Each Portfolio may enter into forward foreign currency exchange contracts
in several circumstances. First, when a Portfolio enters into a contract for
the purchase or sale of a security denominated in a foreign currency, or when
a Portfolio anticipates the receipt in a foreign currency of dividend or
interest payments on such a security which it holds, the Portfolio may desire
to "lock in" the U.S. dollar price of the security or the U.S. dollar
equivalent of such dividend or interest payment, as the case may be. By
entering into a forward contract for the purchase or sale, for a fixed amount
of dollars, of the amount of foreign currency involved in the underlying
transactions, the Portfolio will attempt to protect itself against an adverse
change in the relationship between the U.S. dollar and the subject foreign
currency during the period between the date on which the security is purchased
or sold, or on which the dividend or interest payment is declared, and the
date on which such payments are made or received.

Additionally, when management of a Portfolio believes that the currency of
a particular foreign country may suffer a substantial decline against the U.S.
dollar, it may enter into a forward contract to sell, for a fixed amount of
dollars, the amount of foreign currency approximating the value of some or all
of the securities held by the Portfolio denominated in such foreign currency.
The precise matching of the forward contract amounts and the value of the
securities involved will not generally be possible because the future value of
such securities in foreign currencies will change as a consequence of market
movements in the value of those securities between the date on which the
contract is entered into and the date it matures. The precise projection of
short-term currency market movements is not possible, and short-term hedging
provides a means of fixing the dollar value of only a portion of the
Portfolio's foreign assets. Each Portfolio generally will not enter into a
forward contract with a term of greater than one year.

RISKS ASSOCIATED WITH DERIVATIVE INSTRUMENTS. Entering into a derivative
instrument involves a risk that the applicable market will move against a
Portfolio's position and that the Portfolio will incur a loss. For derivative
instruments other than purchased options, this loss may exceed the amount of
the initial investment made or the premium received by the Portfolio.
Derivative instruments may sometimes increase or leverage a Portfolio's
exposure to a particular market risk. Leverage enhances a Portfolio's exposure
to the price volatility of derivative instruments it holds. Success in using
derivative instruments to hedge portfolio assets depends on the degree of
price correlation between the derivative instruments and the hedged asset.
Imperfect correlation may be caused by several factors, including temporary
price disparities among the trading markets for the derivative instrument, the
assets underlying the derivative instrument and a Portfolio's assets. Over-
the-counter ("OTC") derivative instruments involve an enhanced risk that the
issuer or counterparty will fail to perform its contractual obligations. Some
derivative instruments are not readily marketable or may become illiquid under
adverse market conditions. In addition, during periods of market volatility, a
commodity exchange may suspend or limit trading in an exchange-traded
derivative instrument, which may make the contract temporarily illiquid and
difficult to price. Commodity exchanges may also establish daily limits on the
amount that the price of a futures contract or futures option can vary from
the previous day's settlement price. Once the daily limit is reached, no
trades may be made that day at a price beyond the limit. This may prevent a
Portfolio from closing out positions and limiting its losses. The staff of the
Commission takes the position that certain purchased OTC options, and assets
used as cover for written OTC options, are subject to each Portfolio's 15%
limit on illiquid investments. A Portfolio's ability to terminate OTC
derivative instruments may depend on the cooperation of the counterparties to
such contracts. For thinly traded derivative instruments, the only source of
price quotations may be the selling dealer or counterparty. In addition,
certain provisions of the Code, limit the extent to which a Portfolio may
purchase and sell derivative instruments. Each Portfolio will engage in
transactions in futures contracts and related options only to the extent such
transactions are consistent with the requirements of the Code for maintaining
the qualification of the Fund as a regulated investment company ("RIC") for
federal income tax purposes. See "Taxes".

LIMITATIONS ON FUTURES CONTRACTS AND OPTIONS. Each Portfolio may enter into
futures contracts (and options thereon) traded on a foreign exchange if it is
determined by the Investment Adviser that trading on such exchange does not
subject the Portfolio to risks, including credit and liquidity risks, that are
materially greater than the risks associated with trading on United States
exchanges regulated by the Commodity Futures Trading Commission ("CFTC").

A Portfolio will only write a put option on a security which it intends to
ultimately acquire for its portfolio. The Portfolio does not intend to
purchase any options if after such transaction more than 5% of its net assets,
as measured by the aggregate of all premiums paid for all such options held by
the Portfolio, would be so invested.

To the extent that the Portfolio enters into futures contracts, options on
futures contracts and options on foreign currencies traded on an exchange
regulated by the CFTC, in each case that are not for bona fide hedging
purposes (as defined by the CFTC), the aggregate initial margin and premiums
required to establish these positions (excluding the amount by which options
are "in-the-money") may not exceed 5% of the liquidation value of the
Portfolio's investments, after taking into account unrealized profits and
unrealized losses on any contracts the Portfolio has entered into.

INTEREST RATE AND CURRENCY SWAPS. Interest rate swaps involve the exchange by
the Portfolio with another party of their respective commitments to pay or
receive interest, e.g., an exchange of fixed rate payments for floating rate
payments. Currency swaps involve the exchange of their respective rights to
make or receive payments in specified currencies. The Portfolio will only
enter into interest rate swaps on a net basis, i.e., the two payment streams
are netted out with the Portfolio receiving or paying, as the case may be,
only the net amount of the two payments. If the other party to an interest
rate swap defaults, the Portfolio's risk of loss consists of the net amount of
interest payments that the Portfolio is contractually entitled to receive. In
contrast, currency swaps usually involve the delivery of the entire payment
stream in one designated currency in exchange for the entire payment stream in
the other designated currency. Therefore, the entire principal value of a
currency swap is subject to the risk that the other party to the swap will
default on its contractual delivery obligations. The net amount of the excess,
if any, of the Portfolio's obligations over its entitlements will be
maintained in a segregated account by the Portfolio's custodian. The Portfolio
will not enter into any interest rate or currency swap unless the credit
quality of the unsecured senior debt or the claims-paying ability of the other
party thereto is considered to be investment grade by the Investment Adviser.
If there is a default by the other party to such a transaction, the Portfolio
will have contractual remedies pursuant to the agreements related to the
transaction. The swap market has grown substantially in recent years with a
large number of banks and investment banking firms acting both as principals
and as agents utilizing standardized swap documentation. As a result, the swap
market has become relatively liquid in comparison with the markets for other
similar instruments which are traded in the interbank market.

REVERSE REPURCHASE AGREEMENTS. Each Portfolio may enter into reverse
repurchase agreements. Under a reverse repurchase agreement, a Portfolio
temporarily transfers possession of a portfolio instrument to another party,
such as a bank or broker-dealer, in return for cash. At the same time, a
Portfolio agrees to repurchase the instrument at an agreed upon time (normally
within seven days) and price, which reflects an interest payment. A Portfolio
may enter into such agreements when it is able to invest the cash acquired at
a rate higher than the cost of the agreement, which would increase earned
income. A Portfolio could also enter into reverse repurchase agreements as a
means of raising cash to satisfy redemption requests without the necessity of
selling portfolio assets.

When a Portfolio enters into a reverse repurchase agreement, any
fluctuations in the market value of either the securities transferred to
another party or the securities in which the proceeds may be invested would
affect the market value of the Portfolio's assets. As a result, such
transactions may increase fluctuations in the market value of the Portfolio's
assets. While there is a risk that large fluctuations in the market value of
the Portfolio's assets could affect the Fund's net asset value per share, this
risk is not significantly increased by entering into reverse repurchase
agreements, in the opinion of the Investment Adviser. Because reverse
repurchase agreements may be considered to be the practical equivalent of
borrowing funds, they constitute a form of leverage. If the Portfolio
reinvests the proceeds of a reverse repurchase agreement at a rate lower than
the cost of the agreement, entering into the agreement will lower the Fund's
yield. Reverse repurchase agreements will be included within "borrowings"
contained in the Fund's investment restriction (2) set forth below.

ASSET COVERAGE REQUIREMENTS. Transactions involving reverse repurchase
agreements, swaps, forward contracts or futures contracts and options (other
than options that the Portfolio has purchased) expose a Portfolio to an
obligation to another party. A Portfolio will not enter into any such
transactions unless it owns either (1) an offsetting ("covered") position in
securities or other options, forward contracts or futures contracts, or (2)
cash or liquid securities (such as readily marketable obligations and money
market instruments) with a value sufficient at all times to cover its
potential obligations not covered as provided in (1) above. (Only the net
obligation of a swap will be covered). The Portfolio will comply with
Commission guidelines regarding cover for these instruments and, if the
guidelines so require, set aside cash, U.S. Government securities or other
liquid, high grade debt securities in a segregated account with its custodian
in the prescribed amount. The securities in the segregated account will be
marked to market daily. Assets used as cover or held in a segregated account
maintained by the Portfolio's custodian cannot be sold while the position
requiring coverage or segregation is outstanding unless they are replaced with
other appropriate assets. As a result, the commitment of a large portion of a
Portfolio's assets to segregated accounts or to cover could impede portfolio
management or the Portfolio's ability to meet redemption requests or other
current obligations.

PORTFOLIO TURNOVER. Neither Portfolio can accurately predict its portfolio
turnover rate, but it is anticipated that the annual turnover rate will
generally not exceed 100% (excluding turnover of securities having a maturity
of one year or less). A 100% annual turnover rate could occur, for example, if
all the securities held by a Portfolio were replaced in a period of one year.
A high turnover rate (such as 100% or more) necessarily involves greater
expenses to a Portfolio and may result in the realization of substantial net
short-term capital gains. The Portfolio may engage in active short-term
trading to benefit from yield disparities among different issues of securities
or among the markets for fixed income securities of different countries, to
seek short-term profits during periods of fluctuating interest rates, or for
other reasons. Such trading will increase the Portfolio's rate of turnover and
may increase the incidence of net short-term capital gains allocated to the
Fund by the Portfolio which, upon distribution by the Fund, are taxable to
Fund shareholders as ordinary income. For the fiscal years ended October 31,
1998 and 1997, the portfolio turnover rates of the Portfolio were % and 77%,
respectively.

INVESTMENT RESTRICTIONS

The following investment restrictions of the Fund are designated as
fundamental policies and as such cannot be changed without the approval of the
holders of a majority of the Fund's outstanding voting securities, which as
used in this SAI means the lesser of (a) 67% of the shares of the Fund present
or represented by proxy at a meeting if the holders of more than 50% of the
outstanding shares are present or represented at the meeting or (b) more than
50% of the outstanding shares of the Fund. Accordingly, the Fund may not:

(1) Purchase any security (other than securities issued or guaranteed by
the U.S. Government or any of its agencies or instrumentalities) if such
purchase, at the time thereof, would cause 25% or more of the Fund's total
assets (taken at market value) to be invested in the securities of issuers in
any single industry, provided that the electric, gas and telephone utility
industries shall be treated as separate industries for purposes of this
restriction;

(2) Borrow money or issue senior securities except as permitted by the
1940 Act;

(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). The deposit or payment by the Fund of initial, maintenance or
variation margin in connection with all types of options and futures contract
transactions is not considered the purchase of a security on margin;

(4) Underwrite or participate in the marketing of securities of others,
except insofar as it may technically be deemed to be an underwriter in selling
a portfolio security under circumstances which may require the registration of
the same under the Securities Act of 1933;

(5) Purchase or sell real estate, although it may purchase and sell
securities which are secured by real estate and securities of companies which
invest or deal in real estate;

(6) Purchase or sell physical commodities or futures contracts for the
purchase or sale of physical commodities, provided that the Fund may enter
into all types of futures and forward contracts on currency, securities and
securities, economic and other indices and may purchase and sell options on
such futures contracts; or

(7) Make loans to any person, except by (a) the acquisition of debt
instruments and making portfolio investments, (b) entering into repurchase
agreements, and (c) lending portfolio securities.

Notwithstanding the investment policies and restrictions of the Fund, the
Fund may invest its investable 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.

The Portfolio has adopted substantially the same fundamental investment
restrictions as the foregoing investment restrictions adopted by the Fund;
such restrictions cannot be changed without the approval of a "majority of the
outstanding voting securities" of the Portfolio.

The Fund and the Portfolio have adopted the following investment policies
which may be changed by the Trustees with respect to the Fund without
shareholder approval or with respect to the Portfolio without approval by the
Fund or its other investors. The Fund and the Portfolio will not:

(a) invest more than 15% of net assets in investments which are not
readily marketable, including restricted securities and repurchase agreements
with a maturity longer than seven days. Restricted securities for the purposes
of this limitation do not include securities eligible for resale pursuant to
Rule 144A under the Securities Act of 1933 and commercial paper issued
pursuant to Section 4(2) of said Act that the Board of Trustees of the Trust
or the Portfolio, or their delegate, determines to be liquid. If the Fund or
Portfolio invests in Rule 144A securities, the level of portfolio illiquidity
may be increased to the extent that eligible buyers become uninterested in
purchasing such securities; or

(b) make short sales of securities or maintain a short position, unless at
all times when a short position is open it owns an equal amount of such
securities or securities convertible into or exchangeable, without payment of
any further consideration, for securities of the same issue as, and equal in
amount to, the securities sold short, and unless no more than 25% of its net
assets (taken at current value) is held as collateral for such sales at any
one time.

HI Portfolio has substantially the same fundamental and nonfundamental
policies as the Fund and the Portfolio except that HI Portfolio has the
following additional fundamental policy: With respect to 75% of total assets
of the Portfolio, the Portfolio may not purchase any security if such
purchase, at the time thereof, would cause more than 5% of the total assets of
the Portfolio (taken at market value) to be invested in the securities of a
single issuer, or cause more than 10% of the total outstanding voting
securities of such issuer to be held by the Portfolio, except obligations
issued or guaranteed by the U.S. Government, its agencies or instrumentalities
and except securities of other investment companies.

Whenever an investment policy or investment restriction set forth in the
Prospectus or this SAI states a maximum percentage of assets that may be
invested in any security or other asset, or describes a policy regarding
quality standards, such percentage limitation or standard shall be determined
immediately after and as a result of the Fund's or a Portfolio's acquisition
of such security or asset. Accordingly, any later increase or decrease
resulting from a change in values, assets or other circumstances, or any
subsequent rating change below investment grade made by a rating service, will
not compel the Fund or a Portfolio, as the case may be, to dispose of such
security or other asset. Notwithstanding the foregoing, the Fund and each
Portfolio must always be in compliance with the borrowing policy set forth
above and may not invest more than 15% of net assets in illiquid securities.

MANAGEMENT AND ORGANIZATION

FUND MANAGEMENT. The Trustees of the Trust are responsible for the overall
management and supervision of the Trust's affairs. The Trustees and officers
of the Trust and the Portfolio are listed below. Except as indicated, each
individual has held the office shown or other offices in the same company for
the last five years. Unless otherwise noted, the business address of each
Trustee and officer is 24 Federal Street, Boston, Massachusetts 02110. Those
Trustees who are "interested persons" of the Trust or the Portfolio, as
defined in the 1940 Act are indicated by an asterisk(*).

JESSICA M. BIBLIOWICZ (39), Trustee
President and Chief Operating Officer of John A. Levin & Co. (a registered
investment advisor) (since July, 1997) and a Director of Baker, Fentress &
Company which owns John A. Levin & Co. (since July, 1997). Formerly
Executive Vice President of Smith Barney Mutual Funds (from July, 1994 to
June, 1997). Elected Trustee October 30, 1998. Trustee of various investment
companies managed by Eaton Vance or BMR since October 30, 1998.
Address: One Rockefeller Plaza, New York, New York 10020

JAMES B. HAWKES (57), President and Trustee*
Chairman, President and Chief Executive Officer of BMR, Eaton Vance and their
corporate parent and trustee (EVC and EV); Director of EVC and EV. Trustee
and officer of various investment companies managed by Eaton Vance or BMR.

DONALD R. DWIGHT (67), Trustee
President of Dwight Partners, Inc. (a corporate relations and communications
company). Trustee of various investment companies managed by Eaton Vance or
BMR.
Address: Clover Mill Lane, Lyme, New Hampshire 03768

SAMUEL L. HAYES, III (64), Trustee
Jacob H. Schiff Professor of Investment Banking Emeritus, Harvard University
Graduate School of Business Administration. Trustee of the Kobrick - Cedant
Investment Trust (mutual funds). Trustee of various investment companies
managed by Eaton Vance or BMR.
Address: 345 Nahatan Road, Westwood, Massachusetts 02090

NORTON H. REAMER (63), Trustee
Chairman of the Board and Chief Executive Officer -- United Asset Management
Corporation (a holding company owning institutional investment management
firms); Chairman, President and Director, UAM Funds (mutual funds). Trustee
of various investment companies managed by Eaton Vance or BMR.
Address: One International Place, Boston, Massachusetts 02110

LYNN A. STOUT (41), Trustee
Professor of Law, Georgetown University Law Center. Elected Trustee October
30, 1998. Trustee of various investment companies managed by Eaton Vance or
BMR since October 30, 1998.
Address: 600 New Jersey Avenue, NW, Washington, DC 20001

JOHN L. THORNDIKE (72), Trustee
Formerly Director of Fiduciary Company Incorporated. Trustee of various
investment companies managed by Eaton Vance or BMR.
Address: 175 Federal Street, Boston, Massachusetts 02110

JACK L. TREYNOR (69), Trustee
Investment Adviser and Consultant. Trustee of various investment companies
managed by Eaton Vance or BMR.
Address: 504 Via Almar, Palos Verdes Estates, California 90274

WILLIAM H. AHERN, JR. (39), Vice President of the Trust
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

THOMAS J. FETTER (55), Vice President of the Trust
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

ROBERT B. MACINTOSH (41), Vice President
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

MARK VENEZIA (49), Vice President of the Portfolio
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

MICHAEL B. TERRY (56), Vice President of the Trust
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

JAMES L. O'CONNOR (53), Treasurer
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

ALAN R. DYNNER (58), Secretary
Vice President and Chief Legal Officer of BMR, Eaton Vance, EVC and EV since
November 1, 1996. Previously, Mr. Dynner was a Partner of the law firm of
Kirkpartrick & Lockhart LLP, New York and Washington, D.C., and was
Executive Vice President of Neuberger & Berman Management, Inc., a mutual
fund management company. Officer of various investment companies managed by
Eaton Vance or BMR. Mr. Dynner was elected Secretary on June 23, 1997.

JANET E. SANDERS (63), Assistant Treasurer and Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

A. JOHN MURPHY (36), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

ERIC G. WOODBURY (41), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

Messrs. Hayes (Chairman), Reamer and Thorndike are members of the Special
Committee of the Board of Trustees of the Trust and of the Portfolio. The
purpose of the Special Committee is to consider, evaluate and make
recommendations to the full Board of Trustees concerning (i) all contractual
arrangements with service providers to the Fund and the Portfolio, including
investment advisory (Portfolio only), administrative, 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 Fund, the Portfolio or investors therein.

The Nominating Committee of the Board of Trustees of the Trust and the
Portfolio is comprised of four Trustees who are not "interested persons" as
that term is defined under the 1940 Act ("noninterested Trustees"). The
Committee has four-year staggered terms, with one member rotating off the
Committee to be replaced by another noninterested Trustee. 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 of the Board of
Trustees is independent of Eaton Vance and its affiliates.

Messrs. Treynor (Chairman) and Dwight are members of the Audit Committee
of the Board of Trustees of the Trust and of the Portfolio. The Audit
Committee's functions include making recommendations to the Trustees regarding
the selection of the independent 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 Trust and of the Portfolio.

Trustees of the Portfolio who are not affiliated with the Investment
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 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 Trust nor the Portfolio has a
retirement plan for its Trustees.

The fees and expenses of the noninterested Trustees of the Trust and the
Portfolio are paid by the Fund (and the other series of the Trust) and the
Portfolio, respectively. (The Trustees of the Trust and the Portfolio who are
members of the Eaton Vance organization receive no compensation from the Trust
or the Portfolio.) During the fiscal year ended October 31, 1998, the
noninterested Trustees of the Trust and the Portfolio received the following
compensation in their capacities as Trustees from the Trust, the Portfolio,
and the funds in the Eaton Vance fund complex(1):

<TABLE>
<CAPTION>
AGGREGATE AGGREGATE TOTAL COMPENSATION
COMPENSATION COMPENSATION FROM TRUST AND
NAME FROM TRUST(2) FROM PORTFOLIO FUND COMPLEX
- ---- ------------- -------------- ------------
<S> <C> <C> <C>

Jessica M. Bibliowicz(9) ...................... $ $ $
Donald R. Dwight .............................. (3) (6)
Samuel L. Hayes, III .......................... (4) (7)
Norton H. Reamer ..............................
Lynn A Stout(9) ...............................
John L. Thorndike ............................. (5) (8)
Jack L. Treynor ...............................

(1) As of March 1, 1999, the Eaton Vance fund complex consists of 143 registered investment companies or series
thereof.
(2) The Trust consisted of 12 Funds as of October 31, 1998.
(3) Includes $ of deferred compensation.
(4) Includes $ of deferred compensation.
(5) Includes $ of deferred compensation.
(6) Includes $ of deferred compensation.
(7) Includes $ of deferred compensation.
(8) Includes $ of deferred compensation.
(9) Ms. Bibliowicz and Ms. Stout were elected Trustees on October 30, 1998 and will recieve compensation approximating
the other Trustees after November 1, 1998.
</TABLE>

ORGANIZATION. The Fund is a series of the Trust, which is organized under
Massachusetts law and is operated as an open-end management investment
company. The Fund (formerly EV Marathon Strategic Income Fund) established 3
classes of shares on November 1, 1997 -- Class A shares (formerly EV
Traditional Strategic Income Fund), Class B shares and Class C shares
(formerly EV Classic Strategic Income Fund) of Eaton Vance Strategic Income
Fund. Information herein prior to such date is for the Fund before it became a
multiple-class fund.

The Trust may issue an unlimited number of shares of beneficial interest
(no par value per share) in one or more series (such as the Fund). The
Trustees of the Trust have divided the shares of the Fund into multiple
classes. Each class represents an interest in the Fund, but is subject to
different expenses, rights and privileges. The Trustees have the authority
under the Declaration of Trust to create additional classes of shares with
differing rights and privileges. When issued and outstanding, shares are fully
paid and nonassessable by the Trust. Shareholders are entitled to one vote for
each full share held. Fractional shares may be voted proportionately. Shares
of the Fund will be voted together except that only shareholders of a
particular class may vote on matters affecting only that class. Shares have no
preemptive or conversion rights and are freely transferable. In the event of
the liquidation of the Fund, shareholders of each class are entitled to share
pro rata in the net assets attributable to that class available for
distribution to shareholders.

The Trustees of the Trust have considered the advantages and disadvantages
of investing the assets of the Fund in the Portfolio, as well as the
advantages and disadvantages of the two-tier format. The Trustees believe that
the structure offers opportunities for growth in the assets of the Portfolio,
may afford the potential for economies of scale for the Fund and may over time
result in lower expenses for the Fund.

As permitted by Massachusetts law, there will normally be no meetings of
shareholders for the purpose of electing Trustees unless and until such time
as less than a majority of the Trustees of the Trust holding office have been
elected by shareholders. In such an event the Trustees then in office will
call a shareholders' meeting for the election of Trustees. Except for the
foregoing circumstances and unless removed by action of the shareholders in
accordance with the Trust's By-laws, the Trustees shall continue to hold
office and may appoint successor Trustees.

The Declaration of Trust provide that no person shall serve as a Trustee
if shareholders holding two-thirds of the outstanding shares have removed him
from that office either by a written declaration filed with the Trust's
custodian or by votes cast at a meeting called for that purpose. The
Declaration of Trust further provide that under certain circumstances the
shareholders may call a meeting to remove a Trustee and that the Trust is
required to provide assistance in communication with shareholders about such a
meeting.

The Trust's Declaration of Trust may be amended by the Trustees when
authorized by vote of a majority of the outstanding voting securities of the
Trust, the financial interests of which are affected by the amendment. The
Trustees may also amend the Declaration of Trust without the vote or consent
of shareholders to change the name of the Trust or any series or to make such
other changes (such as reclassifying series of classes of shares or
restructuring the Trust) as do not have a materially adverse effect on the
financial interests of shareholders or if they deem it necessary to conform it
to applicable federal or state laws or regulations. The Trust or any series or
class thereof may be terminated by: (1) the affirmative vote of the holders of
not less than two-thirds of the shares outstanding and entitled to vote at any
meeting of shareholders of the Trust or the appropriate series or class
thereof, or by an instrument or instruments in writing without a meeting,
consented to by the holders of two-thirds of the shares of the Trust or a
series or class thereof, provided, however, that, if such termination is
recommended by the Trustees, the vote of a majority of the outstanding voting
securities of the Trust or a series or class thereof entitled to vote thereon
shall be sufficient authorization; or (2) by means of an instrument in writing
signed by a majority of the Trustees, to be followed by a written notice to
shareholders stating that a majority of the Trustees has determined that the
continuation of the Trust or a series or a class thereof is not in the best
interest of the Trust, such series or class or of their respective
shareholders.

The Declaration of Trust further provides that the Trustees will not be
liable for errors of judgment or mistakes of fact or law; but nothing in the
Declaration of Trust protects a Trustee against any liability to which he
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the conduct of his
office.

Under Massachusetts law, if certain conditions prevail, shareholders of a
Massachusetts business trust (such as the Trust) could be deemed to have
personal liability for the obligations of the Trust. Numerous investment
companies registered under the 1940 Act have been formed as Massachusetts
business trusts, and management is not aware of an instance where such
liability has been imposed. The Trust's Declaration of Trust contains an
express disclaimer of liability on the part of the Fund shareholders and the
Trust's By-laws provide that the Trust shall assume the defense on behalf of
any Fund shareholders. (The Declaration of Trust also contains provisions
limiting the liability of a series or class to that series or class).
Moreover, the Trust's By-laws also provide for indemnification out of the
property of the Fund of any shareholder held personally liable solely by
reason of being or having been a shareholder for all loss or expense arising
from such liability. The assets of the Fund are readily marketable and will
ordinarily substantially exceed its liabilities. In light of the nature of the
Fund's business and the nature of its assets, management believes that the
possibility of the Fund's liability exceeding its assets, and therefore the
shareholder's risk of personal liability, is remote.

The Portfolio is organized as a trust under the laws of the state of New
York and intends to be treated as a partnership for federal tax purposes. In
accordance with the Declaration of Trust of the Portfolio, there will normally
be no meetings of the investors for the purpose of electing Trustees unless
and until such time as less than a majority of the Trustees of the Portfolio
holding office have been elected by investors. In such an event the Trustees
of the Portfolio then in office will call an investors' meeting for the
election of Trustees. Except for the foregoing circumstances and unless
removed by action of the investors in accordance with the Portfolio's
Declaration of Trust, the Trustees shall continue to hold office and may
appoint successor Trustees.

The Declaration of Trust of the Portfolio provides that no person shall
serve as a Trustee if investors holding two-thirds of the outstanding interest
have removed him from that office either by a written declaration filed with
the Portfolio's custodian or by votes cast at a meeting called for that
purpose. The Declaration of Trust further provides that under certain
circumstances the investors may call a meeting to remove a Trustee and that
the Portfolio is required to provide assistance in communicating with
investors about such a meeting.

The Portfolio's Declaration of Trust provides that the Fund and other
entities permitted to invest in the Portfolio (e.g., other U.S. and foreign
investment companies, and common and commingled trust funds) will each be
liable for all obligations of the Portfolio. However, the risk of the Fund
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. Accordingly, the Trustees of the
Trust believe that neither the Fund nor its shareholders will be adversely
affected by reason of the Fund investing in the Portfolio.

Whenever the Fund as an investor in a Portfolio is requested to vote on
matters pertaining to the Portfolio (other than the termination of the
Portfolio's business, which may be determined by the Trustees of the Portfolio
without investor approval), the Fund will hold a meeting of Fund shareholders
and will vote its interest in the Portfolio for or against such matters
proportionately to the instructions to vote for or against such matters
received from Fund shareholders. The Fund shall vote shares for which it
receives no voting instructions in the same proportion as the shares for which
it receives voting instructions. Other investors in the Portfolio may alone or
collectively acquire sufficient voting interests in the Portfolio to control
matters relating to the operation of the Portfolio, which may require the Fund
to withdraw its investment in the Portfolio or take other appropriate action.
Any such withdrawal could result in a distribution "in kind" of portfolio
securities (as opposed to a cash distribution from the Portfolio). If
securities are distributed, the Fund could incur brokerage, tax or other
charges in converting the securities to cash. In addition, the distribution in
kind may result in a less diversified portfolio of investments or adversely
affect the liquidity of the Fund. Notwithstanding the above, there are other
means for meeting shareholder redemption requests, such as borrowing.

The Fund may withdraw (completely redeem) all its assets from the
Portfolio at any time if the Board of Trustees of the Trust determines that it
is in the best interest of the Fund to do so. In the event the Fund withdraws
all of its assets from the Portfolio, or the Board of Trustees of the Trust
determines that the investment objective of the Portfolio is no longer
consistent with the investment objective of the Fund, the Trustees would
consider what action might be taken, including investing the assets of the
Fund in another pooled investment entity or retaining an investment adviser to
manage the Fund's assets in accordance with its investment objective. The
Fund's investment performance may be affected by a withdrawal of all its
assets (or the assets of another investor in the Portfolio) from the
Portfolio.

The noninterested Trustees of HI Portfolio are the same persons as those
of the Portfolio and James B. Hawkes is the only additional Trustee. The
Committee structure and Trustee compensation policies of HI Portfolio are
identical to that of the Portfolio.

INVESTMENT ADVISORY AND ADMINISTRATIVE SERVICES

INVESTMENT ADVISORY SERVICES. BMR manages the investments and affairs of the
Portfolio subject to the supervision of the Portfolio's Board of Trustees. BMR
furnishes to the Portfolio investment research, advice and supervision,
furnishes an investment program and determines what securities will be
purchased, held or sold by the Portfolio and what portion, if any, of the
Portfolio's assets will be held uninvested. The Investment Advisory Agreement
requires BMR to pay the salaries and fees of all officers and Trustees of the
Portfolio who are members of the BMR organization and all personnel of BMR
performing services relating to research and investment activities.

For a description of the compensation that the Portfolio pays BMR under
the Investment Advisory Agreement, see the prospectus. As of October 31, 1998,
the Portfolio had net assets of $ . For the fiscal years ended
October 31, 1998, 1997 and 1996, the Portfolio paid BMR advisory fees of
$ , $679,210 and $744,744, respectively, (equivalent to %, 0.52%
and 0.54% of the Portfolio's average daily net assets for each such year).

The investment advisory agreement of HI Portfolio with BMR is
substantially the same as that of the Portfolio. With respect to assets of the
Fund invested in HI Portfolio, BMR's monthly fee is equal to the aggregate of

(a) a daily asset based fee computed by applying the annual asset rate
applicable to that portion of the total daily net assets in each
Category as indicated below, plus

(b) a daily income based fee computed by applying the daily income rate
applicable to that portion of the total daily gross income (which
portion shall bear the same relationship to the total daily gross
income on such day as that portion of the total daily net assets in
the same Category bears to the total daily net assets on such day) in
each Category as indicated below:

<TABLE>
<CAPTION>
ANNUAL DAILY
CATEGORY DAILY NET ASSETS ASSET RATE INCOME RATE
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>

1 up to $500 million 0.300% 3.00%
2 $500 million but less than $1 billion 0.275% 2.75%
3 $1 billion but less than $1.5 billion 0.250% 2.50%
4 $1.5 billion but less than $2 billion 0.225% 2.25%
5 $2 billion but less than $3 billion 0.200% 2.00%
6 $3 billion and over 0.175% 1.75%
</TABLE>

For the fiscal years ended March 31, 1998, 1997 and 1996, HI Portfolio
advisory fees equaled %, 0.61% and 0.63%, respectively, of average daily
net assets.

The Investment Advisory Agreement with BMR continues in effect from year
to year for so long as such continuance is approved at least annually (i) by
the vote of a majority of the noninterested Trustees of the Portfolio cast in
person at a meeting specifically called for the purpose of voting on such
approval and (ii) by the Board of Trustees of the Portfolio or by vote of a
majority of the outstanding voting securities of the Portfolio. The Agreement
may be terminated at any time without penalty on sixty days' written notice by
the Board of Trustees of either party, or by vote of the majority of the
outstanding voting securities of the Portfolio, and the Agreement will
terminate automatically in the event of its assignment. The Agreement provides
that BMR may render services to others. The Agreement also provides that BMR
shall not be liable for any loss incurred in connection with the performance
of its duties, or action taken or omitted under that Agreement, in the absence
of willful misfeasance, bad faith, 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 sustained in the acquisition, holding or
disposition of any security or other investment.

ADMINISTRATIVE SERVICES. As indicated in the prospectus, Eaton Vance serves as
administrator of the Fund, but currently receives no compensation for
providing administrative services to the Fund. Under its Administrative
Services Agreement with the Trust, Eaton Vance has been engaged to administer
the Fund's affairs, subject to the supervision of the Trustees of the Trust,
and shall furnish for the use of the Fund office space and all necessary
office facilities, equipment and personnel for administering the affairs of
the Fund.

INFORMATION ABOUT BMR AND EATON VANCE. BMR and Eaton Vance are business trusts
organized under Massachusetts law. Eaton Vance, Inc. ("EV") serves as trustee
of BMR and Eaton Vance. BMR, Eaton Vance and EV are wholly-owned subsidiaries
of Eaton Vance Corporation ("EVC"), a Maryland corporation and publicly-held
holding company. EVC through its subsidiaries and affiliates engages primarily
in investment management, administration and marketing activities. The
Directors of EVC are James B. Hawkes, Benjamin A. Rowland, Jr., John G.L.
Cabot, John M. Nelson, Vincent M. O'Reilly and Ralph Z. Sorenson. All of the
issued and outstanding shares of Eaton Vance are owned by EVC. All of the
issued and outstanding shares of BMR are owned by Eaton Vance. All shares of
the outstanding Voting Common Stock of EVC are deposited in a Voting Trust,
the Voting Trustees of which are Messrs. Hawkes and Rowland, Alan R. Dynner,
Thomas E. Faust, Jr., Thomas J. Fetter, Duncan W. Richardson, William M.
Steul, and Wharton P. Whitaker. 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 Eaton Vance who are also officers, or officers and
Directors of EVC and EV. As indicated under "Management and Organization", all
of the officers of the Trust (as well as Mr. Hawkes who is also a Trustee)
hold positions in the Eaton Vance organization.

Eaton Vance, its affiliates and its predecessor companies have been
managing assets of individuals and institutions since 1924 and managing
investment companies since 1931. They maintain a large staff of experienced
fixed-income and equity investment professionals to service the needs of their
clients. The fixed-income division focuses on all kinds of taxable investment-
grade and high-yield securities, tax-exempt investment-grade and high-yield
securities, and U.S. Government securities. The equity division covers stocks
ranging from blue chip to emerging growth companies.

Eaton Vance and its affiliates act as adviser to a family of mutual funds,
and individual and various institutional accounts, including corporations,
hospitals, retirement plans, universities, foundations and trusts. Eaton Vance
mutual funds feature international equities, domestic equities, tax-free
municipal bonds, and U.S. government and corporate bonds. Lloyd George
Management has advised Eaton Vance's international equity funds since 1992.
Founded in 1991, Lloyd George is headquartered in Hong Kong with offices in
London and Mumbai, India. It has established itself as a leader in investment
management in Asian equities and other global markets. Lloyd George features
an experienced team of investment professionals that began working together in
the mid-1980s. Lloyd George analysts cover East Asia, the India subcontinent,
Russia and Eastern Europe, Latin America, Australia and New Zealand from
offices in Hong Kong, London and Mumbai. Together Eaton Vance and Lloyd George
manage over $31 billion in assets. Eaton Vance mutual funds are distributed by
the principal underwriter both within the United States and offshore.

The principal underwriter believes that an investment professional can
provide valuable services to you to help you reach your investment goals.
Meeting investment goals requires time, objectivity and investment savvy.
Before making an investment recommendation, a representative can help you
carefully consider your short- and long-term financial goals, your tolerance
for investment risk, your investment time frame, and other investments you may
already own. Your professional investment representatives are knowledgeable
about financial markets, as well as the wide range of investment opportunities
available. A representative can help you decide when to buy, sell or persevere
with your investments. A professional investment representative can provide
you with tailored financial advice.

EXPENSES. The Fund and Portfolio are each responsible for all expenses not
expressly stated to be payable by another party (such as the investment
adviser under the Investment Advisory Agreement, Eaton Vance under the
Administrative Services Agreement or the principal underwriter under the
Distribution Agreement). In the case of expenses incurred by the Trust, the
Fund is responsible for its pro rata share of those expenses. The only
expenses of the Fund allocated to a particular class are those incurred under
the Distribution or Service Plan applicable to that class and the fee paid to
the principal underwriter for handling share repurchases.

OTHER SERVICE PROVIDERS

PRINCIPAL UNDERWRITER. Eaton Vance Distributors, Inc. ("EVD"), 24 Federal
Street, Boston, MA 02110, is the Fund's principal underwriter. The principal
underwriter acts as principal in selling shares under a Distribution Agreement
with the Trust. The expenses of printing copies of prospectuses used to offer
shares and other selling literature and of advertising are borne by the
principal underwriter. The fees and expenses of qualifying and registering and
maintaining qualifications and registrations of the Fund and its shares under
federal and state securities laws are borne by the Fund. The Distribution
Agreement as it applies to Class A shares is renewable annually by the Board
of Trustees of the Trust (including a majority of the noninterested Trustees)
may be terminated on six months' notice by either party and is automatically
terminated upon assignment. The Distribution Agreement as it applies to Class
B and Class C shares is renewable annually by the Trust's Board of Trustees
(including a majority of the noninterested Trustees who have no direct or
indirect financial interest in the operation of the Distribution Plan or the
Distribution Agreement), may be terminated on sixty days' notice either by
such Trustees or by vote of a majority of the outstanding shares of the
relevant class or on six months' notice by the principal underwriter and is
automatically terminated upon assignment. The principal underwriter
distributes shares on a "best efforts" basis under which it is required to
take and pay for only such shares as may be sold. The principal underwriter
allows investment dealers discounts from the applicable public offering price
which are alike for all investment dealers. See "Sales Charges." EVD is a
wholly-owned subsidiary of EVC. M. Hawkes is a Vice President and Director and
Messrs. Dynner and O'Connor are Vice Presidents of EVD.

CUSTODIAN. Investors Bank & Trust Company ("IBT"), 200 Clarendon Street,
Boston, MA 02116, serves as custodian to the Fund and Portfolio. IBT has the
custody of all cash and securities representing the Fund's interest in the
Portfolio, has custody of the Portfolio's assets, maintains the general ledger
of the Portfolio and the Fund and computes the daily net asset value of
interests in the Portfolio and the net asset value of shares of the Fund. In
such capacity it attends to details in connection with the sale, exchange,
substitution, transfer or other dealings with the Portfolio's investments,
receives and disburses all funds and performs various other ministerial duties
upon receipt of proper instructions from the Trust and the Portfolio. IBT also
provides services in connection with the preparation of shareholder reports
and the electronic filing of such reports with the SEC. EVC and its affiliates
and their officers and employees from time to time have transactions with
various banks, including IBT. It is Eaton Vance's opinion that the terms and
conditions of such transactions were not and will not be influenced by
existing or potential custodial or other relationships between the Fund or the
Portfolio and such banks.

INDEPENDENT ACCOUNTANTS. PricewaterhouseCoopers LLP, One Post Office Square,
Boston, Massachusetts, are the independent accountants of the Fund and the
Portfolio, providing audit services, tax return preparation, and assistance
and consultation with respect to the preparation of filings with the SEC.

TRANSFER AGENT. First Data Investor Services Group, P.O. Box 5123,
Westborough, MA 01581-5123, serves as transfer and dividend disbursing agent
for the Fund.

PURCHASING AND REDEEMING SHARES

CaLCULATION OF NET ASSET VALUE. The net asset value of the Portfolio is
computed by IBT (as agent and custodian for the Portfolio) by subtracting the
liabilities of the Portfolio from the value of its total assets. The Fund and
the Portfolio will be closed for business and will not price their respective
shares or interests on the following business holidays: New Year's Day, Martin
Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving Day and Christmas Day.

Each investor in the Portfolio, including the Fund, may add to or reduce
its investment in the Portfolio on each day the New York Stock Exchange (the
"Exchange") is open for trading ("Portfolio Business Day") as of the close of
regular trading on the Exchange (the "Portfolio Valuation Time"). The value of
each investor's interest in the Portfolio will be determined by multiplying
the net asset value of the Portfolio by the percentage, determined on the
prior Portfolio Business Day, which represented that investor's share of the
aggregate interests in the Portfolio on such prior day. Any additions or
withdrawals for the current Portfolio Business Day will then be recorded. Each
investor's percentage of the aggregate interest in the Portfolio will then be
recomputed as a percentage equal to a fraction (i) the numerator of which is
the value of such investor's investment in the Portfolio as of the Portfolio
Valuation Time on the prior Portfolio Business Day plus or minus, as the case
may be, the amount of any additions to or withdrawals from the investor's
investment in the Portfolio on the current Portfolio Business Day and (ii) the
denominator of which is the aggregate net asset value of the Portfolio as of
the Portfolio Valuation Time on the prior Portfolio Business Day plus or
minus, as the case may be, the amount of the net additions to or withdrawals
from the aggregate investment in the Portfolio on the current Portfolio
Business Day by all investors in the Portfolio. The percentage so determined
will then be applied to determine the value of the investor's interest in the
Portfolio for the current Portfolio Business Day.

The Trustees of the Portfolio have established the following procedures
for the fair valuation of the Portfolio's assets under normal market
conditions. Securities listed on foreign or U.S. securities exchanges or in
the NASDAQ National Market System generally are valued at closing sale prices
or, if there were no sales, at the mean between the closing bid and asked
prices therefor on the exchange where such securities are principally traded
or on such National Market 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. An option is valued at the last sale price as
quoted on the principal exchange or board of trade on which such option or
contract is traded, or in the absence of a sale, at the mean between the last
bid and asked prices. Futures positions on securities or currencies are
generally valued at closing settlement prices. Short-term debt securities with
a remaining maturity of 60 days or less are valued at amortized cost. If
securities were acquired with a remaining maturity of more than 60 days, their
amortized cost value will be based on their value on the sixty-first day prior
to maturity. Other fixed income and debt securities, including listed
securities and securities for which price quotations are available, will
normally be valued on the basis of valuations furnished by a pricing service.
All other securities are valued at fair value as determined in good faith by
or at the direction of the Trustees.

Generally, trading in the foreign securities owned by the Portfolio is
substantially completed each day at various times prior to the close of the
Exchange. The values of these securities used in determining the net asset
value of the Portfolio's shares generally are computed as of such times.
Occasionally, events affecting the value of foreign securities may occur
between such times and the close of the Exchange which will not be reflected
in the computation of the Portfolio's net asset value (unless the Portfolio
deems that such events would materially affect its net asset value, in which
case an adjustment would be made and reflected in such computation). Foreign
securities and currency held by the Portfolio will be valued in U.S. dollars;
such values will be computed by the custodian based on foreign currency
exchange rate quotations supplied by Reuters Information Service.

ADDITIONAL INFORMATION ABOUT PURCHASES. Fund shares are continuously offered
through investment dealers which have entered agreements with the principal
underwriter. The public offering price is the net asset value next computed
after receipt of the order, plus, in the case of Class A shares, a variable
percentage (sales charge) depending upon the amount of purchase as indicated
by the sales charge table set forth in the prospectus. The sales charge is
divided between the principal underwriter and the investment dealer. The
sales charge table is applicable to purchases of a Fund alone or in
combination with purchases of certain other funds offered by the principal
underwriter, made at a single time by (i) an individual, or an individual, his
spouse and their children under the age of twenty-one, purchasing shares for
his or their own account, and (ii) a trustee or other fiduciary purchasing
shares for a single trust estate or a single fiduciary account. The table is
also presently applicable to (1) purchases of Class A shares pursuant to a
written Statement of Intention; or (2) purchases of Class A shares pursuant to
the Right of Accumulation and declared as such at the time of purchase. See
"Sales Charges".

The Trust may, in its absolute discretion, suspend, discontinue or limit
the offering of one or more of its classes of shares at any time. In
determining whether any such action should be taken, the Trust's management
intends to consider all relevant factors, including (without limitation) the
size of the Fund or class, the investment climate and market conditions, the
volume of sales and redemptions of shares, and in the case of Class B and
Class C shares, the amount of uncovered distribution charges of the principal
underwriter. The Class B and Class C Distribution Plans may continue in effect
and payments may be made under the Plans following any such suspension,
discontinuance or limitation of the offering of shares; however, there is no
contractual obligation to continue any Plan for any particular period of time.
Suspension of the offering of shares would not, of course, affect a
shareholder's ability to redeem shares.

ACQUIRING FUND SHARES IN EXCHANGE FOR SECURITIES. IBT, as escrow agent, will
receive securities acceptable to Eaton Vance, as administrator, in exchange
for Fund shares. The minimum value of securities (or securities and cash)
accepted for deposit is $5,000. Securities accepted will be sold on the day of
their receipt or as soon thereafter as possible. The number of Fund shares to
be issued in exchange for securities will be the aggregate proceeds from the
sale of such securities, divided by the applicable public offering price of
Class A shares or the net asset value of Class B and Class C shares on the day
such proceeds are received. Eaton Vance will use reasonable efforts to obtain
the then current market price for such securities but does not guarantee the
best available price. Eaton Vance will absorb any transaction costs, such as
commissions, on the sale of the securities. Securities determined to be
acceptable should be transferred via book entry or physically delivered, in
proper form for transfer, through an investment dealer, together with a
completed and signed Letter of Transmittal in approved form (available from
investment dealers). Investors who are contemplating an exchange of securities
for shares, or their representatives, must contact Eaton Vance to determine
whether the securities are acceptable before forwarding such securities. Eaton
Vance reserves the right to reject any securities. Exchanging securities for
shares may create a taxable gain or loss. Each investor should consult his or
her tax adviser with respect to the particular federal, state and local tax
consequences of exchanging securities.

ADDITIONAL INFORMATION ABOUT REDEMPTIONS. The right to redeem shares of the
Fund can be suspended and the payment of the redemption price deferred when
the Exchange is closed (other than for customary weekend and holiday
closings), during periods when trading on the Exchange is restricted as
determined by the SEC, or during any emergency as determined by the SEC which
makes it impracticable for the Portfolio to dispose of its securities or value
its assets, or during any other period permitted by order of the SEC for the
protection of investors.

While normally payments will be made in cash for redeemed shares, the
Trust, subject to compliance with applicable regulations, has reserved the
right to pay the redemption price of shares of the Fund, either totally or
partially, by a distribution in kind of readily marketable securities
withdrawn from the Portfolio. The securities so distributed would be valued
pursuant to the Portfolio's valuation procedures. If a shareholder received a
distribution in kind, the shareholder could incur brokerage or other charges
in converting the securities to cash.

SYSTEMATIC WITHDRAWAL PLAN. The transfer agent will send to the shareholder
regular monthly or quarterly payments of any permitted amount designated by
the shareholder based upon the value of the shares held. The checks will be
drawn from share redemptions and hence, may require the recognition of taxable
gain or loss. Income dividends and capital gains distributions in connection
with withdrawal plan accounts will be credited at net asset value as of the
record date for each distribution. Continued withdrawals in excess of current
income will eventually use up principal, particularly in a period of declining
market prices. A shareholder may not have a withdrawal plan in effect at the
same time he or she has authorized Bank Automated Investing or is otherwise
making regular purchases of Fund shares. The shareholder, the transfer agent
or the principal underwriter will be able to terminate the withdrawal plan at
any time without penalty.

SALES CHARGES

DEALER COMMISSIONS. The principal underwriter may, from time to time, at its
own expense, provide additional incentives to investment dealers which employ
registered representatives who sell Fund shares and/or shares of other funds
distributed by the principal underwriter. In some instances, such additional
incentives may be offered only to certain investment dealers whose
representatives sell or are expected to sell significant amounts of shares. In
addition, the principal underwriter may from time to time increase or decrease
the sales commissions payable to investment dealers. The principal underwriter
may allow, upon notice to all investment dealers with whom it has agreements,
discounts up to the full sales charge during the periods specified in the
notice. During periods when the discount includes the full sales charge, such
investment dealers may be deemed to be underwriters as that term is defined in
the Securities Act of 1933.

SALES CHARGE WAIVERS. Class A shares may be sold at net asset value to current
and retired Directors and Trustees of Eaton Vance funds, including the
Portfolio; to clients and current and retired officers and employees of Eaton
Vance, its affiliates and other investment advisers of Eaton Vance sponsored
funds; to registered representatives and employees of investment dealers and
bank employees who refer customers to registered representatives of invetment
dealers; to officers and employees of IBT and the transfer agent; and to such
persons' spouses, parents, siblings and children and their beneficial
accounts. Class A shares may also be issued at net asset value (1) in
connection with the merger of an investment company or series thereof with the
Fund, (2) to investors making an investment as part of a fixed fee program
whereby an entity unaffiliated with the investment adviser provides multiple
investment services, such as management, brokerage and custody, and (3) to
investment advisors, financial planners or other intermediaries who place
trades for their own accounts or the accounts of their clients and who charge
a management, consulting or other fee for their services; clients of such
investment advisors, financial planners or other intermediaries who place
trades for their own accounts if the accounts are linked to the master account
of such investment advisor, financial planner or other intermediary on the
books and records of the broker or agent; and retirement and deferred
compensation plans and trusts used to fund those plans, including, but not
limited to, those defined in Section 401(a), 403(b) or 457 of the Internal
Revenue Code of 1986, as amended (the "Code") and "rabbi trusts". Subject to
the applicable provisions of the 1940 Act, the Trust may issue Class A shares
at net asset value in the event that an investment company (whether a
regulated or private investment company or a personal holding company) is
merged or consolidated with or acquired by the Class. Normally no sales
charges will be paid in connection with an exchange of Class A shares for the
assets of such investment company. Class A shares may be sold at net asset
value to any investment advisory, agency, custodial or trust account managed
or administered by Eaton Vance or by any parent, subsidiary or other affiliate
of Eaton Vance. Class A shares are offered at net asset value to the foregoing
persons and in the foregoing situations because either (i) there is no sales
effort involved in the sale of shares or (ii) the investor is paying a fee
(other than the sales charge) to the investment dealer involved in the sale.

The CDSC applicable to Class B shares will be waived in connection with
minimum required distributions from tax-sheltered retirement plans by applying
the rate required to be withdrawn under the applicable rules and regulations
of the Internal Revenue Service to the balance of Class B shares in your
account.

STATEMENT OF INTENTION. If it is anticipated that $25,000 or more of Class A
shares and shares of other funds exchangeable for Class A shares of another
Eaton Vance fund will be purchased within a 13-month period, a Statement of
Intention should be signed so that shares may be obtained at the same reduced
sales charge as though the total quantity were invested in one lump sum.
Shares held under Right of Accumulation (see below) as of the date of the
Statement will be included toward the completion of the Statement. The
Statement authorizes the transfer agent to hold in escrow sufficient shares
(5% of the dollar amount specified in the Statement) which can be redeemed to
make up any difference in sales charge on the amount intended to be invested
and the amount actually invested. Execution of a Statement does not obligate
the shareholder to purchase or the Fund to sell the full amount indicated in
the Statement, and should the amount actually purchased during the 13-month
period be more or less than that indicated on the Statement, price adjustments
will be made. Any investor considering signing a Statement of Intention should
read it carefully.

RIGHT OF ACCUMULATION. The applicable sales charge level for the purchase of
Class A shares is calculated by taking the dollar amount of the current
purchase and adding it to the value (calculated at the maximum current
offering price) of the Class A shares the shareholder owns in his or her
account(s) in the Fund, and shares of other funds exchangeable for Class A
shares. The sales charge on the shares being purchased will then be at the
rate applicable to the aggregate. Shares purchased (i) by an individual, his
or her spouse and their children under the age of twenty-one, and (ii) by a
trustee, guardian or other fiduciary of a single trust estate or a single
fiduciary account, will be combined for the purpose of determining whether a
purchase will qualify for the Right of Accumulation and if qualifying, the
applicable sales charge level. For any such discount to be made available, at
the time of purchase a purchaser or his or her investment dealer must provide
the principal underwriter (in the case of a purchase made through an
investment dealer) or the transfer agent (in the case of an investment made by
mail) with sufficient information to permit verification that the purchase
order qualifies for the accumulation privilege. Confirmation of the order is
subject to such verification. The Right of Accumulation privilege may be
amended or terminated at any time as to purchases occurring thereafter.

TAX-SHELTERED RETIREMENT PLANS: Class A and Class C shares are available for
purchase in connection with certain tax-sheltered retirement plans. Detailed
information concerning these plans, including certain exceptions to minimum
investment requirements, and copies of the plans are available from the
principal underwriter. This information should be read carefully and
consultation with an attorney or tax adviser may be advisable. The information
sets forth the service fee charged for retirement plans and describes the
federal income tax consequences of establishing a plan. Participant accounting
services (including trust fund reconciliation services) will be offered only
through third party recordkeepers and not by the principal underwriter. Under
all plans, dividends and distributions will be automatically reinvested in
additional shares.

DISTRIBUTION AND SERVICE PLANS. The Trust has adopted a Service Plan (the
"Class A Plan") for the Fund's Class A shares that is designed to meet the
service fee requirements of the sales charge rule of the National Association
of Securities Dealers, Inc. (the "NASD"). (Management believes service fee
payments are not distribution expenses governed by Rule 12b-1 under the 1940
Act, but has chosen to have the Plan approved as if that Rule were
applicable.) The Class A Plan provides that the Class A may make service fee
payments for personal services and/or the maintenance of shareholder accounts
to the principal underwriter, investment dealers and other persons in amounts
not exceeding .25% of its average daily net assets for any fiscal year. The
Trustees of the Trust have initially implemented the Class A Plan by
authorizing Class A to make quarterly service fee payments to the principal
underwriter and investment dealers in amounts not expected to exceed .25% of
its average daily net assets for any fiscal year which is based on the value
of Class A shares sold by such persons and remaining outstanding for at least
twelve months. For the service fees paid by Class A shares, see Appendix A.

The Trust has also adopted compensation-type Distribution Plans (the
"Class B and Class C Plans") pursuant to Rule 12b-1 under the 1940 Act for the
Fund's Class B and Class C shares. The Class B and Class C Plans are designed
to permit an investor to purchase shares through an investment dealer without
incurring an initial sales charge and at the same time permit the principal
underwriter to compensate investment dealers in connection therewith. The
Class B and Class C Plans provide that the Fund will pay sales commissions and
distribution fees to the principal underwriter only after and as a result of
the sale of shares. On each sale of shares (excluding reinvestment of
distributions), the Fund will pay the principal underwriter amounts
representing (i) sales commissions equal to 5% for Class B shares and 6.25%
for Class C shares of the amount received by the Fund for each share sold and
(ii) distribution fees calculated by applying the rate of 1% over the prime
rate then reported in The Wall Street Journal to the outstanding balance of
uncovered distribution charges (as described below) of the principal
underwriter. To pay these amounts, each Class pays the principal underwriter a
fee, accrued daily and paid monthly, at an annual rate not exceeding .75% of
its average daily net assets to finance the distribution of its shares. Such
fees compensate the principal underwriter for sales commissions paid by it to
investment dealers on the sale of shares and for interest expenses. For sales
of Class B shares, the principal underwriter uses its own funds to pay sales
commissions (except on exchange transactions and reinvestments) to investment
dealers at the time of sale equal to 4% of the purchase price of the Class B
shares sold by such dealers. For Class C shares, the principal underwriter
currently expects to pay to an investment dealer (a) sales commissions (except
on exchange transactions and reinvestments) at the time of sale equal to .75%
of the purchase price of the shares sold by such dealer, and (b) monthly sales
commissions approximately equivalent to 1/12 of .75% of the value of shares
sold by such dealer and remaining outstanding for at least one year. During
the first year after a purchase of Class C shares, the principal underwriter
will retain the sales commission as reimbursement for the sales commissions
paid to investment dealers at the time of sale. CDSCs paid to the principal
underwriter will be used to reduce amounts owed to it. The Class B and Class C
Plans provide that the Fund will make no payments to the principal underwriter
in respect of any day on which there are no outstanding uncovered distribution
charges of the principal underwriter. CDSCs and accrued amounts will be paid
by the Trust to the principal underwriter whenever there exist uncovered
distribution charges. Because payments to the principal underwriter under the
Class B and Class C Plans are limited, uncovered distribution charges (sales
commissions paid by the principal underwriter plus interest, less the above
fees and CDSCs received by it) may exist indefinitely. For the sales
commissions and CDSCs paid on (and uncovered distribution charges of) Class B
and Class C shares, see Appendix B and Appendix C, respectively.

In calculating daily the amount of uncovered distribution charges,
distribution charges will include the aggregate amount of sales commissions
and distribution fees theretofore paid plus the aggregate amount of sales
commissions and distribution fees which the principal underwriter is entitled
to be paid under the Plan since its inception. Payments theretofore paid or
payable under the Class B and Class C Plans by the Trust to the principal
underwriter and CDSCs theretofore paid or payable to the principal underwriter
will be subtracted from such distribution charges; if the result of such
subtraction is positive, a distribution fee (computed at 1% over the prime
rate then reported in The Wall Street Journal) will be computed on such amount
and added thereto, with the resulting sum constituting the amount of
outstanding uncovered distribution charges with respect to such day. The
amount of outstanding uncovered distribution charges of the principal
underwriter calculated on any day does not constitute a liability recorded on
the financial statements of the Fund.

The amount of uncovered distribution charges of the principal underwriter
at any particular time depends upon various changing factors, including the
level and timing of sales of shares, the nature of such sales (i.e., whether
they result from exchange transactions, reinvestments or from cash sales
through investment dealers), the level and timing of redemptions of shares
upon which a CDSC will be imposed, the level and timing of redemptions of
shares upon which no CDSC will be imposed (including redemptions of shares
pursuant to the exchange privilege which result in a reduction of uncovered
distribution charges), changes in the level of the net assets of the Class,
and changes in the interest rate used in the calculation of the distribution
fee under the Class B and Class C Plans.

The Class B and Class C Plans also authorize each Class to make payments
of service fees to the principal underwriter, investment dealers and other
persons in amounts not exceeding .25% of its average daily net assets for
personal services, and/or the maintenance of shareholder accounts. This fee is
paid quarterly in arrears based on the value of Class B shares sold by such
persons and remaining outstanding for at least twelve months. For Class C,
investment dealers currently receive (a) a service fee (except on exchange
transactions and reinvestments) at the time of sale equal to .25% of the
purchase price of the Class C shares sold by such dealer, and (b) monthly
service fees approximately equivalent to 1/12 of .25% of the value of Class C
shares sold by such dealer and remaining outstanding for at least one year.
During the first year after a purchase of Class C shares, the principal
underwriter will retain the service fee as reimbursement for the service fee
payment made to investment dealers at the time of sale. For the service fees
paid by Class B and Class C shares, see Appendix B and Appendix C,
respectively.

Currently, payments of sales commissions and distribution fees and of
service fees may equal 1% of a Class's average daily net assets per annum. The
Trust believes that the combined rate of all these payments may be higher than
the rate of payments made under distribution plans adopted by other investment
companies pursuant to Rule 12b-1. Although the principal underwriter will use
its own funds (which may be borrowed from banks) to pay sales commissions at
the time of sale, it is anticipated that the Eaton Vance organization will
profit by reason of the operation of the Class B and Class C Plans through an
increase in the Fund's assets (thereby increasing the advisory fee payable to
BMR by the Portfolio) resulting from sale of shares and through the amounts
paid to the principal underwriter, including CDSCs, pursuant to the Plans. The
Eaton Vance organization may be considered to have realized a profit under the
Class B and Class C Plans if at any point in time the aggregate amounts
theretofore received by the principal underwriter pursuant to the Class B or
Class C Plan and from CDSCs have exceeded the total expenses theretofore
incurred by such organization in distributing shares. Total expenses for this
purpose will include an allocable portion of the overhead costs of such
organization and its branch offices, which costs will include without
limitation leasing expense, depreciation of building and equipment, utilities,
communication and postage expense, compensation and benefits of personnel,
travel and promotional expense, stationery and supplies, literature and sales
aids, interest expense, data processing fees, consulting and temporary help
costs, insurance, taxes other than income taxes, legal and auditing expense
and other miscellaneous overhead items. Overhead is calculated and allocated
for such purpose by the Eaton Vance organization in a manner deemed equitable
to the Trust.

The Class A and Class B and Class C Plans continue in effect from year to
year so long as such continuance is approved at least annually by the vote of
both a majority of (i) the noninterested Trustees of the Trust who have no
direct or indirect financial interest in the operation of the Plan or any
agreements related to the Plan (the "Plan Trustees") and (ii) all of the
Trustees then in office. Each Plan may be terminated at any time by vote of a
majority of the Plan Trustees or by a vote of a majority of the outstanding
voting securities of the applicable Class. Each Plan requires quarterly
Trustee review of a written report of the amount expended under the Plan and
the purposes for which such expenditures were made. The Plans may not be
amended to increase materially the payments described therein without approval
of the shareholders of the affected Class and the Trustees. So long as a Plan
is in effect, the selection and nomination of the noninterested Trustees shall
be committed to the discretion of such Trustees. The Class A Plan was
initially approved by the Trustees, including the Plan Trustees on November 1,
1997, and the Class B and Class C Plans were initially approved by the
Trustees, including the Plan Trustees, on June 23, 1997.

The Trustees of the Trust believe that each Plan will be a significant
factor in the expected growth of each Fund's assets, and will result in
increased investment flexibility and advantages which have benefitted and will
continue to benefit the Fund and its shareholders. Payments for sales
commissions and distribution fees made to the principal underwriter under the
Class B and Class C Plans will compensate the principal underwriter for its
services and expenses in distributing those classes of shares. Service fee
payments made to the principal underwriter and investment dealers provide
incentives to provide continuing personal services to investors and the
maintenance of shareholder accounts. By providing incentives to the principal
underwriter and investment dealers, each Plan is expected to result in the
maintenance of, and possible future growth in, the assets of the Fund. Based
on the foregoing and other relevant factors, the Trustees of the Trust have
determined that in their judgment there is a reasonable likelihood that each
Plan will benefit the Fund and its shareholders.

PERFORMANCE

Average annual total return is determined separately for each Class of the
Fund by multiplying a hypothetical initial purchase order of $1,000 by the
average annual compound rate of return (including capital appreciation/
depreciation, and distributions paid and reinvested) for the stated period and
annualizing the result. The calculation assumes (i) that all distributions
are reinvested at net asset value on the reinvestment dates during the period,
(ii) the deduction of the maximum sales charge from the initial $1,000
purchase order for Class A shares, (iii) a complete redemption of the
investment and, (iv) the deduction of any CDSC at the end of the period. For
further information concerning the total return of the Classes of the Fund,
see Appendix A, Appendix B and Appendix C.

Yield is computed separately for each Class of a Fund pursuant to a
standardized formula by dividing the net investment income per share earned
during a recent thirty-day period by the maximum offering price (including the
maximum initial sales charge for Class A shares) per share on the last day of
the period and annualizing the resulting figure. Net investment income per
share is calculated from the yields to maturity of all debt obligations held
by the Portfolio based on prescribed methods, reduced by accrued Fund and
Class expenses for the period with the resulting number being divided by the
average daily number of Class shares outstanding and entitled to receive
distributions during the period. This yield figure does not reflect the
deduction of any CDSCs which (if applicable) are imposed upon certain
redemptions at the rates set forth under "Sales Charges" in the prospectus.
Yield calculations assume the current maximum initial sales charge for Class A
shares set forth under "Sales Charges" in the prospectus. (Actual yield may be
affected by variations in sales charges on investments). The Fund may also
publish total return figures for each Class which do not take into account any
sales charge. Any performance figure which does not take into account a sales
charge would be reduced to the extent such charge is imposed. The Fund's
performance may be compared in publications to the performance of various
indices and investments for which reliable data is available, and to averages,
performance rankings, or other information prepared by recognized mutual fund
statistical services. The Fund's performance may differ from that of other
investors in the Portfolio, including other investment companies.

The Fund's total return may be compared to relevant indices, such as the
Consumer Price Index and various domestic securities indices. The Fund's total
return and comparisons with these indices may be used in advertisements and in
information furnished to present or prospective shareholders. The Fund's
performance may differ from that of other investors in the Portfolio,
including any other investment companies. In addition, evaluations of the
Fund's performance, ratings, or rankings of mutual funds (which include the
Fund) made by independent sources may be used in advertisements and in
information furnished to present or prospective shareholders. Information,
charts and illustrations showing the effect of compounding interest or
relating to inflation and taxes (including their effects on the dollar and the
return on stocks and other investment vehicles) may also be included in
advertisements and material furnished to present and prospective investors.

Information used in advertisements and in materials furnished to present
or prospective shareholders may include statistics, data and performance
studies prepared by independent organizations reflecting the investment
performance or return achieved by various classes and types of investments
(e.g., common stocks, small company stocks, long-term corporate bonds, long-
term government bonds, intermediate-term government bonds, U.S. Treasury
bills) over various periods of time. This information may be used to
illustrate the benefits of long-term investments in common stocks. Information
about the portfolio allocation, portfolio turnover and holdings of the
Portfolio may be included in advertisements and other material furnished to
present and prospective shareholders.

The Trust (or Principal Underwriter) may also provide investors and
prospective investors with information on the Fund's duration and duration's
relationship to the stability or volatility of a security's price. Information
may also be provided concerning the diversification of the portfolios (on such
basis as country of issuer's origin, industry sector of security type), as
well as the allocation of securities held by the Portfolios across various
rating categories. In addition, information on the Portfolios' turnover rate
may be provided to investors and prospective investors.

Information about portfolio allocation and holdings of the Portfolio at a
particular date may be included in advertisements and other material furnished
to present and prospective shareholders.

Information used in advertisements and materials furnished to present and
prospective investors may include statements or illustrations relating to the
appropriateness of certain types of securities and/or mutual funds to meet
specific financial goals. Such information may address:

- cost associated with aging parents;
- funding a college education (including its actual and estimated
cost);
- health care expenses (including actual and projected expenses);
- long-term disabilities (including the availability of, and coverage
provided by, disability insurance); and
- retirement (including the availability of social security benefits,
the tax treatment of such benefits and statistics and other
information relating to maintaining a particular standard of living
and outliving existing assets).

Such information may also address different methods for saving money and
the results of such methods, as well as the benefits of investing in equity
securities. Such information may describe: the potential for growth; the
performance of equities as compared to other investment vehicles; and the
value of investing as early as possible and regularly, as well as staying
invested. The benefits of investing in equity securities by means of a mutual
fund may also be included (such benefits may include diversification,
professional management and the variety of equity mutual fund products).

Information in advertisements and materials furnished to present and
prospective investors may include profiles of different types of investors
(i.e., investors with different goals and assets) and different investment
strategies for meeting specific financial goals. Such information may provide
hypothetical illustrations which include: results of various investment
strategies; performance of an investment in the Fund over various time
periods; and results of diversifying assets among several investments with
varying performance. Information in advertisements and materials furnished to
present and prospective investors may also include quotations (including
editorial comments) and statistics concerning investing in securities, as well
as investing in particular types of securities and the performance of such
securities.

The Trust (or principal underwriter) may provide information about Eaton
Vance, its affiliates and other investment advisers to the funds in the Eaton
Vance Family of Funds in sales material or advertisements provided to
investors or prospective investors. Such material or advertisements may also
provide information on the use of investment professionals by such investors.

TAXES

Each series of the Trust is treated as a separate entity for federal
income tax purposes. The Fund has elected to be treated and intends to qualify
each year, as a RIC under the Code. Accordingly, the Fund intends to satisfy
certain requirements relating to sources of its income and diversification of
its assets and to distribute substantially all of its net investment ordinary
income and net income in accordance with the timing requirements imposed by
the Code, so as to maintain its RIC status and avoid paying any federal income
or excise tax. The Fund so qualified for its fiscal year ended October 31,
1998. Because the Fund invests substantially all of its assets in the
Portfolios, the Portfolios normally must satisfy the applicable source of
income and diversification requirements in order for the Fund to also satisfy
these requirements. Each Portfolio will allocate at least annually among its
investors, including the Fund, each investor's distributive share of the
Portfolio's net taxable and tax-exempt (if any) investment income, net
realized capital gains, and any other items of income, gain, loss, deduction
or credit. For purposes of applying the requirements of the Code regarding
qualification as a RIC, the Fund (i) will be deemed to own its proportionate
share of each of the assets of a Portfolio and (ii) will be entitled to the
gross income of a Portfolio attributable to such share.

In order to avoid incurring a federal excise tax obligation, the Code
requires that the Fund distribute (or be deemed to have distributed) by
December 31 of each calendar year at least 98% of its ordinary income for such
year, at least 98% of its capital gain net income (which is the excess of its
realized capital gains over its realized capital losses), generally computed
on the basis of the one-year period ending on October 31 of such year, after
reduction by (i) any available capital loss carryforwards, and (ii) 100% of
any income from the prior year (as previously computed) that was not paid out
during such year and on which the Fund paid no federal income tax. Under
current law, provided that the Fund qualifies as a RIC and the Portfolios are
treated as partnerships for Massachusetts and federal tax purposes, neither
the Fund nor a Portfolio should be liable for any income, corporate excise or
franchise tax in the Commonwealth of Massachusetts.

Certain foreign exchange gains and losses realized by the Portfolio in
connection with investments in foreign securities and forward contracts may be
treated as ordinary income and losses under special tax rules. Certain forward
contracts of the Portfolio may be required to be "marked to market" (i.e.,
treated as if closed out) on the last day of each taxable year, and any gain
or loss realized with respect to these contracts generally will be treated as
ordinary income or loss. Certain options and futures contracts are also
subject to these mark to market rules, except that gains or losses on these
contracts, in connection with a marking to market or an actual disposition,
will generally be treated as 60% long-term and 40% short-term capital gain or
loss. Positions of the Portfolio in securities and offsetting options, futures
or forward contracts may be treated as "straddles," which are subject to tax
rules that may cause deferral of Portfolio losses, adjustments in the holding
periods of Portfolio securities, and other changes in the short-term or long-
term characterization of capital gains and losses, the effect of which may be
to change the amount, timing and character of the Fund's distributions to
shareholders. The Portfolio intends to limit its options and futures
transactions and its activities in foreign currency and related forward
contracts to the extent necessary to preserve the Fund's ability to qualify as
a RIC.

The Portfolio may be subject to foreign income tax withholding or other
foreign taxes with respect to income (possibly including, in some cases,
capital gains) arising from certain transactions in foreign securities. These
taxes may be reduced or eliminated under the terms of an applicable tax
convention between certain countries and the U.S. It is not expected that more
than 50% of the value of the total assets of the Fund taking into account its
allocable share of the Portfolios' total assets at the close of any taxable
year will consist of securities issued by foreign corporations. Accordingly,
under the Code, the Fund will not be eligible to pass through to its
shareholders their proportionate share of foreign tax credits or deductions
for foreign taxes paid by the Portfolio and allocated to the Fund. Certain
foreign exchange gains and losses realized by the Fund will be treated as
ordinary income and losses. Certain uses of foreign currency, foreign currency
options, futures and forward contracts, and interest rate and currency swaps,
and investment by the Portfolios in certain "passive foreign investment
companies" ("PFICs") may be limited or a tax election may be made, if
available, in order to seek to preserve the Fund's qualification as a RIC and/
or avoid imposition of an income tax on the Fund.

A Portfolio's investment in zero coupon, and certain securities will cause
it to realize income prior to the receipt of cash payments with respect to
these securities. Such income will be allocated daily to interests in a
Portfolio, and in order to distribute its proportionate share of this income
and avoid a tax payable by the Fund, the Portfolio may be required to
liquidate securities that it might otherwise have continued to hold in order
to generate cash that the Fund may withdraw from the Portfolio to make
distributions to Fund shareholders.

The appropriate tax accounting for dollar rolls is also uncertain in some
respects, and the Portfolio's use of such rolls may accordingly be limited in
order to preserve the Fund's qualification as a RIC.

Investments in lower-rated or unrated securities may present special tax
issues for a Portfolio and, hence, for the Fund to the extent that the issuers
of these securities default on their obligations pertaining thereto. The Code
is not entirely clear regarding the federal income tax consequences of the
Portfolio's taking certain positions in connection with ownership of such
distressed securites. For example, the Code is unclear regarding: (i) when a
Portfolio may cease to accrue interest, original issue discount, or market
discount; (ii) when and to what extent deductions may be taken for bad debts
or worthless securities; (iii) how payments received on obligations in default
should be allocated between principal and income; and (iv) whether exchanges
of debt obligations in a workout context are taxable.

Distributions of the excess of net long-term capital gain over net short-
term capital loss (including any capital losses carried forward from prior
years) earned by the Portfolio and allocated to the Fund are taxable to
shareholders of the Fund as long-term capital gains, whether received in cash
or in additional shares and regardless of the length of time their shares have
been held. Certain distributions declared in October, November or December and
paid the following January will be taxed to shareholders as if received on
December 31 of the year in which they are declared.

Any loss realized upon the sale or exchange of shares of the Fund with a
tax holding period of 6 months or less will be treated as a long-term capital
loss to the extent of any distribution of net long-term capital gains with
respect to such shares. In addition, all or a portion of a loss realized on a
redemption or other disposition of Fund shares may be disallowed under "wash
sale" rules if other Fund shares are acquired (whether through reinvestment of
dividends or otherwise) within a period beginning 30 days before and ending 30
days after the date of such redemption or other disposition. Any disallowed
loss will result in an adjustment to the shareholder's tax basis in some or
all of the other shares acquired.

Special tax rules apply to Individual Retirement Accounts ("IRAs") and
other retirement plans, and persons investing through such plans should
consult their tax advisers for more information. The deductibility of
contributions to IRAs may be restricted or eliminated for particular
shareholders. Amounts paid by the Fund to individuals and certain other
shareholders who have not provided the Fund with their correct taxpayer
identification number ("TIN") and certain certifications required by the
Internal Revenue Service (the "IRS"), as well as shareholders with respect to
whom the Fund has received certain information from the IRS or a broker, may
be subject to "backup" withholding of federal income tax arising from the
Fund's taxable dividends and other distributions as well as the proceeds of
redemption transactions (including repurchases and exchanges), at a rate of
31%. An individual's TIN is generally his or her social security number.

The foregoing discussion does not address the special tax rules applicable
to certain classes of investors, such as IRAs and other retirement plans, tax-
exempt entities, insurance companies and financial institutions. Shareholders
should consult their own tax advisers with respect to special tax rules that
may apply in their particular situations, as well as the state, local and,
where applicable, foreign tax consequences of investing in the Fund.

PORTFOLIO SECURITY TRANSACTIONS

Decisions concerning the execution of portfolio security transactions,
including the selection of the market and the broker-dealer firm, are made by
BMR. BMR is also responsible for the execution of transactions for all other
accounts managed by it.

BMR places the security transactions of the Portfolio and of all other
accounts managed by it for execution with many broker-dealer firms. BMR uses
its best efforts to obtain execution of portfolio transactions at prices which
are advantageous to the Portfolio and at reasonably competitive spreads or
(when a disclosed commision is being charged) at reasonably competitive
commission rates. In seeking such execution, BMR will use its best judgment in
evaluating the terms of a transaction, and will give consideration to various
relevant factors, including without limitation the full range and quality of
the broker-dealer's services, the value of the brokerage and research services
provided, the responsiveness of the broker-dealer to BMR, the size and type of
the transaction, the general execution and operational capabilities of the
broker-dealer, the nature and character of the market for the security, the
confidentiality, speed and certainty of effective execution required for the
transaction, the reputation, reliability, experience and financial condition
of the broker-dealer, the value and quality of services rendered by the
broker-dealer in this and other transactions, and the reasonableness of the
commission or spread, if any. Transactions on United States stock exchanges
and other agency transactions involve the payment by the Portfolio of
negotiated brokerage commissions. Such commissions vary among different
broker-dealer firms, and a particular broker-dealer may charge different
commissions according to such factors as the difficulty and size of the
transaction and the volume of business done with such broker-dealer.
Transactions in foreign securities often involve the payment of brokerage
commissions, which may be higher than those in the United States. There is
generally no stated commission in the case of securities traded in the over-
the-counter markets, but the price paid or received by the Portfolio usually
includes an undisclosed dealer markup or markdown. In an underwritten offering
the price paid by the Portfolio often includes a disclosed fixed commission or
discount retained by the underwriter or dealer. Although spreads or
commissions paid on portfolio security transactions will, in the judgment of
BMR, be reasonable in relation to the value of the services provided,
commissions exceeding those which another firm might charge may be paid to
broker-dealers who were selected to execute transactions on behalf of the
Portfolio and BMR's other clients in part for providing brokerage and research
services to BMR.

As authorized in Section 28(e) of the Securities Exchange Act of 1934, a
broker or dealer who executes a portfolio transaction on behalf of a Portfolio
may receive a commission which is in excess of the amount of commission
another broker or dealer would have charged for effecting that transaction if
BMR determines in good faith that such compensation was reasonable in relation
to the value of the brokerage and research services provided. This
determination may be made on the basis of either that particular transaction
or on the basis of overall responsibilities which BMR and its affiliates have
for accounts over which they exercise investment discretion. In making any
such determination, BMR will not attempt to place a specific dollar value on
the brokerage and research services provided or to determine what portion of
the commission should be related to such services. Brokerage and research
services may include advice as to the value of securities, the advisability of
investing in, purchasing, or selling securities, and the availability of
securities or purchasers or sellers of securities; furnishing analyses and
reports concerning issuers, industries, securities, economic factors and
trends, portfolio strategy and the performance of accounts; effecting
securities transactions and performing functions incidental thereto (such as
clearance and settlement); and the "Research Services" referred to in the next
paragraph.

It is a common practice of the investment advisory industry and of the
advisers of investment companies, institutions and other investors to receive
research, analytical, statistical and quotation services, data, information
and other services, products and materials which assist such advisers in the
performance of their investment responsibilities ("Research Services") from
broker-dealer firms which execute portfolio transactions for the clients of
such advisers and from third parties with which such broker-dealers have
arrangements. Consistent with this practice, BMR receives Research Services
from many broker-dealer firms with which BMR places the Portfolio transactions
and from third parties with which these broker-dealers have arrangements.
These Research Services include such matters as general economic political,
business and market information, industry and company reviews, evaluations of
securities and portfolio strategies and transactions proxy voting data and
analysis services, technical analysis of various aspects of the securities
markets, and recommendations as to the purchase and sale of securities and
other portfolio transactions, financial, industry and trade publications, news
and information services, pricing and quotation equipment and services, and
research oriented computer hardware, software, data bases and services. Any
particular Research Service obtained through a broker-dealer may be used by
BMR in connection with client accounts other than those accounts which pay
commissions to such broker-dealer. Any such Research Service may be broadly
useful and of value to BMR in rendering investment advisory services to all or
a significant portion of its clients, or may be relevant and useful for the
management of only one client's account or of a few clients' accounts, or may
be useful for the management of merely a segment of certain clients' accounts,
regardless of whether any such account or accounts paid commissions to the
broker-dealer through which such Research Service was obtained. The advisory
fee paid by the Portfolios is not reduced because BMR receives such Research
Services. BMR evaluates the nature and quality of the various Research
Services obtained through broker-dealer firms and attempts to allocate
sufficient portfolio security transactions to such firms to ensure the
continued receipt of Research Services which BMR believes are useful or of
value to it in rendering investment advisory services to its clients.

The Fund and BMR may also receive Research Services from underwriters and
dealers in fixed price offerings, which Research Services are reviewed and
evaluated by BMR in connection with its investment responsibilities. The
investment companies sponsored by BMR or Eaton Vance may allocate brokerage
commissions to acquire information relating to the performance, fees and
expenses of such companies and other mutual funds, which information is used
by the Trustees of such companies to fulfill their responsibility to oversee
the quality of the services provided by various entities, including BMR, to
such companies. Such companies may also pay cash for such information.

Subject to the requirement that BMR shall use its best efforts to seek and
execute portfolio security transactions at advantageous prices and at
reasonably competitive spreads or commission rates, BMR is authorized to
consider as a factor in the selection of any broker-dealer firm with whom
Portfolio orders may be placed the fact that such firm has sold or is selling
shares of the Fund or of other investment companies sponsored by BMR or Eaton
Vance. This policy is not inconsistent with a rule of the NASD, which rule
provides that no firm which is a member of the NASD shall favor or disfavor
the distribution of shares of any particular investment company or group of
investment companies on the basis of brokerage commissions received or
expected by such firm from any source.

Securities considered as investments for the Portfolio may also be
appropriate for other investment accounts managed by BMR or its affiliates.
Whenever decisions are made to buy or sell securities by the Portfolio and one
or more of such other accounts simultaneously, BMR will allocate the security
transactions (including "hot" issues) in a manner which it believes to be
equitable under the circumstances. As a result of such allocations, there may
be instances where the Portfolio will not participate in a transaction that is
allocated among other accounts. If an aggregate order cannot be filled
completely, allocations will generally be made on a pro rata basis. An order
may not be allocated on a pro rata basis where, for example: (i) consideration
is given to portfolio managers who have been instrumental in developing or
negotiating a particular investment; (ii) consideration is given to an account
with specialized investment policies that coincide with the particulars of a
specific investment; (iii) pro rata allocation would result in odd-lot or de
minimis amounts being allocated to a portfolio or other client; or (iv) where
BMR reasonably determines that departure from a pro rata allocation is
advisable. While these aggregation and allocation policies could have a
detrimental effect on the price or amount of the securities available to the
Portfolio from time to time, it is the opinion of the Trustees of the Trust
and the Portfolio that the benefits from the BMR organization outweigh any
disadvantage that may arise from exposure to simultaneous transactions.

For the fiscal years ended October 31, 1998, 1997 and 1996, the Portfolio
paid brokerage commissions of $ , $14,023 and $23,792, respectively, with
respect to portfolio transactions. Of these amounts, approximately $ ,
$14,023 and $23,792, respectively, was paid in respect of portfolio security
transactions aggregating approximately $ , $182,150,347 and $245,268,131,
respectively, to firms which provided some Research Services to BMR or its
affiliates, (although many of such firms may have been selected in any
particular transaction primarily because of their execution capabilities).

In connection with telephone redemptions and exchanges, the Trust, the
Principal Underwriter and the Transfer Agent generally will verify personal
account information in order to determine that instructions communicated are
genuine.

The right to redeem shares of the Fund can be suspended and the payment of
the redemption price deferred when the Exchange is closed (other than for
customary weekend and holiday closings), during periods when trading on the
Exchange is restricted as determined by the Commission, or during any
emergency as determined by the Commission which makes it impracticable for a
Portfolio to dispose of its securities or value its assets, or during any
other period permitted by order of the Commission for the protection of
investors.

FINANCIAL STATEMENTS

The audited financial statements and the independent accountants reports
for the Fund and the Portfolio, appear in the Fund's most recent annual report
to shareholders, which is incorporated by reference into this SAI. A copy of
the Fund's annual report accompanies this SAI. Consistent with applicable law,
duplicate mailings of shareholder reports and certain other Fund information
to shareholders residing at the same address may be eliminated.

<PAGE>

APPENDIX A

CLASS A FEES, PERFORMANCE AND OWNERSHIP

SERVICE FEES
For the fiscal year ended October 31, 1998, Class A made service fee
payments under the Plan aggregating $ , of which $ was paid to
investment dealers and the balance of which was retained by the principal
underwriter.

PRINCIPAL UNDERWRITER
The total sales charges paid in connection with sales of Class A shares
during the fiscal year ended October 31, 1998 was $ , of which $
was received by the principal underwriter. For the fiscal year ended October
31, 1998 Authorized Firms received $ from the total sales charges.

PERFORMANCE INFORMATION

The table below indicates the cumulative and average total return on a
hypothetical investment in shares of $1,000. Total return for Class A prior to
November 1, 1997 reflects the total return of Class B, adjusted to reflect the
Class A sales charge. The Class B total return has not been adjusted to
reflect certain other expenses (such as distribution and/or service fees). If
such adjustments were made, the Class A total return would be different. The
"Value of Initial Investment" reflects the deduction of the maximum sales
charge of 4.75%. Past performance is not indicative of future results.
Investment return and principal value will fluctuate; shares, when redeemed,
may be worth more or less than their original cost.

VALUE OF A $1,000 INVESTMENT

<TABLE>
<CAPTION>
TOTAL RETURN TOTAL RETURN
EXCLUDING MAXIMUM INCLUDING MAXIMUM
VALUE OF VALUE OF SALES CHARGE SALES CHARGE
INVESTMENT INVESTMENT INITIAL INVESTMENT --------------------------- ---------------------------
PERIOD DATE INVESTMENT ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------------------- ------------- -------------- -------------- ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Life of the Fund 11/26/90 $ $ % % % %
5 Years Ended
10/31/98 10/31/93 $ $ % % % %
1 Year Ended
10/31/98 10/31/97 $ $ % % % %
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As of November 30, 1998, the Trustees and officers of the Trust, as a
group, owned in the aggregate less than 1% of the outstanding Class A shares
of the Fund. As of November 30, 1998, NFSC FEBO #C1B-506397, Roger S. Coolidge
Irrevocable Trust, Charles Moizeau, U/A 08/04/1993, 33 Old Forge Rd.,
Millington, NJ 07946 owned beneficially and of record 19.5% of the outstanding
Class A shares of the Fund. In addition, as of such date, Vivian M. Mitchell,
Herndon, PA owned beneficially and of record 7.0% of the outstanding shares of
Class A shares of the Fund and Olde Discount FBO 03808334, 751 Griswold
Street, Detroit, MI 48226 owned beneficially and of record 5.6% of the
outstanding shares of Class A shares of the Fund and Olde Discount FBO
03808863, 751 Griswold Street, Detroit, MI 48226 owned beneficially and of
record 5.6% of the outstanding shares of Class A shares of the Fund. To the
knowledge of the Trust, no other person owned of record or beneficially 5% or
more of the Fund's outstanding Class A shares as of such date.

<PAGE>

APPENDIX B:

CLASS B FEES, PERFORMANCE AND OWNERSHIP

DISTRIBUTION PLAN
During the fiscal year ended October 31, 1998, the Principal Underwriter
paid to investment dealers sales commissions of $ on sales of Class B
shares. During the same period, the Fund made payments under the Plan to the
principal underwriter aggregating $ and the principal underwriter
received approximately $ in CDSCs imposed on early redeeming
shareholders. These payments reduced uncovered distribution charges under the
Plan. As at October 31, 1998, the outstanding uncovered distribution charges
of the principal underwriter calculated under the Plan amounted to
approximately $ . During the fiscal year ended October 31, 1998,
Class B made service fee payments to the principal underwriter and investment
dealers aggregating $ , of which $ was paid to investment dealers
and the balance of which was retained by the principal underwriter.

PRINCIPAL UNDERWRITER
The Trust has authorized the principal underwriter to act as its agent in
repurchasing shares at the rate of $2.50 for each repurchase transaction
handled by the principal underwriter. For the fiscal year ended October 31,
1998, the Fund paid the Principal Underwriter $ for repurchase
transactions handled by the Principal Underwriter.

PERFORMANCE INFORMATION

The table below indicates the cumulative and average annual total return
on a hypothetical investment of $1,000 in Class B shares for the periods shown
in the table. Past performance is not indicative of future results. Investment
return and principal value will fluctuate; shares, when redeemed, may be worth
more or less than their original cost.

VALUE OF A $1,000 INVESTMENT

<TABLE>
<CAPTION>
VALUE OF VALUE OF
INVESTMENT INVESTMENT TOTAL RETURN BEFORE TOTAL RETURN AFTER
BEFORE AFTER DEDUCTING DEDUCTING
DEDUCTING DEDUCTING THE CDSC THE CDSC
INVESTMENT INVESTMENT AMOUNT OF THE CDSC THE CDSC -------------------------- --------------------------
PERIOD DATE INVESTMENT ON 10/31/98 ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ------------ ----------- --------------- --------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of
the Fund 11/26/90 $1,000 $ $ % % %
5 Years
Ended
10/31/98 10/31/93 $1,000 $ $ % % % %
1 Year
Ended
10/31/98 10/31/97 $1,000 $ $ % % % %
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at November 30, 1998, the Trustees and officers of the Trust, as a
group, owned in the aggregate less than 1% of the outstanding Class B shares
of the Fund. As of November 30, 1998, Merrill Lynch, Pierce, Fenner & Smith,
Inc., Jacksonville, FL 32246 was the record owner of approximately 29.0% of
the outstanding Class B shares, which were held on behalf of its customers who
are the beneficial owners of such shares, and as to which it had voting power
under certain limited circumstances. To the knowledge of the Trust, no other
person owned of record or beneficially 5% or more of the Fund's outstanding
Class B shares as of such date.

<PAGE>

APPENDIX C

CLASS C FEES, PERFORMANCE AND OWNERSHIP

DISTRIBUTION AND SERVICE FEES
During the fiscal year ended October 31, 1998, the principal underwriter
paid to investment dealers sales commissions of $ on sales of Class C
shares. During the same period, the Fund made distribution payments to the
principal underwriter under the Distribution Plan aggregating $ and the
principal underwriter received approximately $ in CDSCs imposed on early
redeeming shareholders. During the fiscal year ended October 31, 1998, Class C
made service fee payments to the principal underwriter and investment dealers
aggregating $ of which $ was paid to investment dealers and the
balance of which was retained by the principal underwriter.

PRINCIPAL UNDERWRITER
The Trust has authorized the principal underwriter to act as its agent in
repurchasing shares at the rate of $2.50 for each repurchase transaction
handled by the principal underwriter. For the fiscal year ended October 31,
1998, Class C paid the principal underwriter $ for repurchase
transactions handled by it.

PERFORMANCE INFORMATION

The table below indicates the cumulative and average annual total return
on a hypothetical investment in shares of $1,000. Total return for the period
prior to November 1, 1997 reflects the total return of the predecessor to
Class C. Total return prior to May 25, 1994 reflects the total return of Class
B, adjusted to reflect the Class C sales charge. The Class B total return has
not been adjusted to reflect certain other expenses (such as distribution and/
or service fees). If such adjustments were made, the Class C total return
would be different. Past performance is not indicative of future results.
Investment return and principal value will fluctuate; shares, when redeemed,
may be worth more or less than their original cost. Two asterisk(**) indicates
subsidized expenses. Return would have been lower without subsidies.

VALUE OF A $1,000 INVESTMENT

<TABLE>
<CAPTION>
VALUE OF VALUE OF
INVESTMENT INVESTMENT TOTAL RETURN BEFORE TOTAL RETURN AFTER
BEFORE AFTER DEDUCTING DEDUCTING
DEDUCTING DEDUCTING THE CDSC THE CDSC
INVESTMENT INVESTMENT AMOUNT OF THE CDSC THE CDSC -------------------------- --------------------------
PERIOD DATE INVESTMENT ON 10/31/98 ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ------------ ----------- --------------- --------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of
Fund 11/26/90 $1,000 $ $ % % % %
5 Years
Ended
10/31/98** 10/31/93 $1,000 $ $ % % % %
1 Year
Ended
10/31/98
10/31/97 $1,000 $ $ % % % %
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As of November 30, 1998, the Trustees and officers of the Trust, as a
group, owned in the aggregate less than 1% of the outstanding Class C shares
of the Fund. As of November 30, 1998, Merrill Lynch, Pierce, Fenner & Smith,
Inc., Jacksonville, FL 32246 was the record owner of approximately 16.3% of
the outstanding Class C shares which were held on behalf of its customers who
are beneficial owners of such shares, and as to which it had voting power
under certain limited circumstances. To the knowledge of the Trust, no other
person owned of record or beneficially 5% or more of the Fund's outstanding
Class C shares as of such date.

<PAGE>

APPENDIX D

DESCRIPTION OF SECURITIES RATINGS(1)

DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC.'S CORPORATE BOND RATINGS:

Aaa: Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt-edged". Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such issues.

Aa: Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally known
as high grade bonds. They are rated lower than the best bonds because margins
of protection may not be as large as in Aaa securities or fluctuations of
protective elements may be of greater amplitude or there may be other elements
present which make the long-term risk appear somewhat larger than in Aaa
securities.

A: Bonds which are rated A possess many favorable investment attributes and
are to be considered as upper-medium-grade obligations. Factors giving
security to principal and interest are considered adequate, but elements may
be present which suggest a susceptibility to impairment sometime in the
future.

Baa: Bonds which are rated Baa are considered as medium-grade obligations,
(i.e., they are neither highly protected nor poorly secured). Interest
payments and principal security appear adequate for the present but certain
protective elements may be lacking or may be characteristically unreliable
over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.

Ba: Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well-assured. Often the protection of interest
and principal payments may be very moderate, and thereby not well safe-guarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.

B: Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.

Caa: Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal
or interest.

Ca: Bonds which are rated Ca represent obligations which are speculative in a
high degree. Such issues are often in default or have other marked
shortcomings.

C: Bonds which are rated C are the lowest rated class of bonds, and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.

NOTE: Moody's applies numerical modifiers, 1, 2 and 3 in each generic rating
classification from Aa to B. The modifier 1 indicates that the Company ranks
in the higher end of its generic rating category; the modifier 2 indicates a
mid-range ranking; and the modifier 3 indicates that the Company ranks in the
lower end of its generic rating category.

SHORT-TERM DEBT

Moody's short-term debt ratings are opinions of the ability of issuers to
repay punctually promissory obligations not having an original maturity in
excess of one year.

Issuers rated PRIME-1 or P-1 (or supporting institutions) have a superior
ability for repayment of senior short-term debt obligations. Prime-1 or P-1
repayment ability will often be evidenced by many of the following
characteristics:

-- Leading market positions in well established industries.

-- High rates of return on funds employed.

-- Conservative capitalization structure with moderate reliance on debt
and ample asset protection.

-- Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.

-- Well established access to a range of financial markets and assured
sources of alternate liquidity.

Issuers rated PRIME-2 or P-2 (or supporting institutions) have a strong
ability for repayment of senior short-term debt obligations. This will
normally be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, may be more
subject to variation. Capitalization characteristics, while still appropriate,
may be more affected by external conditions. Ample alternate liquidity is
maintained.

DESCRIPTION OF STANDARD & POOR'S RATINGS GROUP'S CORPORATE BOND RATINGS:

INVESTMENT GRADE

AAA: Debt rated AAA has the highest rating assigned by S&P's to a debt
obligation. Capacity to pay interest and repay principal is extremely strong.

AA: Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the higher rated issues only in small degree.

A: Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than bonds in higher rated categories.

BBB: Debt rated BBB is regarded as having an adequate capacity to pay interest
and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.

SPECULATIVE GRADE

Debt rated BB, B, CCC, CC, and C is regarded as having predominantly
speculative characteristics with respect to capacity to pay interest and repay
principal. BB indicates the least degree of speculation and C the highest.
While such debt will likely have some quality and protective characteristics,
these are outweighed by large uncertainties or major exposures to adverse
conditions.

BB: Debt rated BB has less near-term vulnerability to default than other
speculative issues. However, it faces major ongoing uncertainties or exposure
to adverse business, financial, or economic conditions which could lead to
inadequate capacity to meet timely interest and principal payments. The BB
rating category is also used for debt subordinated to senior debt that is
assigned an actual or implied BBB- rating.

B: Debt rated B has a greater vulnerability to default but currently has the
capacity to meet interest payments and principal repayments. Adverse business,
financial, or economic conditions will likely impair capacity or willingness
to pay interest and repay principal. The B rating category is also used for
debt subordinated to senior debt that is assigned an actual or implied BB or
BB- rating.

CCC: Debt rated CCC has a currently identifiable vulnerability to default, and
is dependent upon favorable business, financial, and economic conditions to
meet timely payment of interest and repayment of principal. In the event of
adverse business, financial, or economic conditions, it is not likely to have
the capacity to pay interest and repay principal. The CCC rating category is
also used for debt subordinated to senior debt that is assigned an actual or
implied B or B- rating.

CC: The rating CC is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC debt rating.

C: The rating C is typically applied to debt subordinated to senior debt which
is assigned an actual or implied CCC- debt rating. The C rating may be used to
cover a situation where a bankruptcy petition has been filed, but debt service
payments are continued.

C1: The Rating C1 is reserved for income bonds on which no interest is being
paid.

D: Debt rated D is in payment default. The D rating category is used when
interest payments or principal payments are not made on the date due even if
the applicable grace period has not expired, unless Standard & Poor's believes
that such payments will be made during such grace period. The D rating also
will be used upon the filing of a bankruptcy petition if debt service payments
are jeopardized.

PLUS (+) OR MINUS (-): The ratings from AA to CCC may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.

NR: Bonds may lack a S&P's rating because no public rating has been requested,
because there is insufficient information on which to base a rating, or
because S&P's does not rate a particular type of obligation as a matter of
policy.

COMMERCIAL PAPER

A: S&P's commercial paper rating is a current assessment of the likelihood of
timely payment of debt considered short-term in the relevant market.

A-1: This highest category indicates that the degree of safety regarding
timely payment is strong. Those issues determined to possess extremely strong
safety characteristics are denoted with a plus (+) sign designation.

A-2: Capacity for timely payment on issues with this designation is
satisfactory. However, the relative degree of safety is not as high as for
issues designated "A-1".

A-3: Issues carrying this designation have adequate capacity for timely
payment. They are, however, more vulnerable to the adverse effects of changes
in circumstances than obligations carrying the higher designations.

FITCH INVESTORS SERVICE, INC.

INVESTMENT GRADE BOND RATINGS

AAA: Bonds considered to be investment grade and of the highest credit
quality. The obligor has an exceptionally strong ability to pay interest and
repay principal, which is unlikely to be affected by reasonably foreseeable
events.

AA: Bonds considered to be investment grade and of very high credit quality.
The obligor's ability to pay interest and repay principal is very strong,
although not quite as strong as bonds rated "AAA". Because bonds rated in the
"AAA" and "AA" categories are not significantly vulnerable to foreseeable
future developments, short-term debt of these issuers is generally rated
"F-1+".

A: Bonds considered to be investment grade and of high credit quality. The
obligors ability to pay interest and repay principal is considered to be
strong, but may be more vulnerable to adverse changes in economic conditions
and circumstances than bonds with higher ratings.

BBB: Bonds considered to be investment grade and of satisfactory credit
quality. The obligor's ability to pay interest and repay principal is
considered to be adequate. Adverse changes in economic conditions and
circumstances, however, are more likely to have adverse impact on these bonds,
and therefore, impair timely payment. The likelihood that the ratings of these
bonds will fall below investment grade is higher than for bonds with higher
ratings.

HIGH YIELD BOND RATINGS

BB: Bonds are considered speculative. The obligor's ability to pay interest
and repay principal may be affected over time by adverse economic changes.
However, business and financial alternatives can be identified which could
assist the obligor in satisfying its debt service requirements.

B: Bonds are considered highly speculative. While bonds in this class are
currently meeting debt service requirements, the probability of continued
timely payment of principal and interest reflects the obligor's limited margin
of safety and the need for reasonable business and economic activity
throughout the life of the issue.

CCC: Bonds have certain identifiable characteristics which, if not remedied,
may lead to default. The ability to meet obligations requires an advantageous
business and economic environment.

CC: Bonds are minimally protected. Default in payment of interest and/or
principal seems probable over time.

C: Bonds are in imminent default in payment of interest or principal.

DDD, DD, AND D: Bonds are in default of interest and/or principal payments.
Such bonds are extremely speculative and should be valued on the basis of
their ultimate recovery value in liquidation or reorganization of the obligor.
"DDD" represents the highest potential for recovery on these bonds, and"D"
represents the lowest potential for recovery.

PLUS (+) OR MINUS (-): The ratings from AA to C may be modified by the
addition of a plus or minus sign to indicate the relative position of a credit
within the rating category.

NR: Indicates that Fitch does not rate the specific issue.

CONDITIONAL: A conditional rating is premised on the successful completion of
a project or the occurrence of a specific event.

INVESTMENT GRADE SHORT-TERM RATINGS

Fitch's short-term ratings apply to debt obligations that are payable on
demand or have original maturities of generally up to three years, including
commercial paper, certificates of deposit, medium-term notes, and municipal
and investment notes.

F-1+: Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.

F-1: Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated
"F-1+".

F-2: Good Credit Quality. Issues assigned this rating have a satisfactory
degree of assurance for timely payment, but the margin of safety is not as
great as the "F-1+" and "F-1" categories.

F-3: Fair Credit Quality. Issues assigned this rating have characteristics
suggesting that the degree of assurance for timely payment is adequate,
however, near-term adverse changes could cause these securities to be rated
below investment grade.

DUFF & PHELPS

INVESTMENT GRADE BOND RATINGS

AAA: Highest credit quality. The risk factors are negligible, being only
slightly more than for risk-free U.S. Treasury debt.

AA+, AA, AND AA-: High credit quality. Protection factors are strong. Risk is
modest but may vary slightly from time to time because of economic conditions.

A+, A, AND A-: Protection factors are average but adequate. However, risk
factors are more variable and greater in periods of economic stress.

BBB+, BBB, AND BBB-: Below average protection factors but still considered
sufficient for prudent investment. Considerable variability in risk during
economic cycles.

HIGH YIELD BOND RATINGS

BB+, BB, AND BB-: Below investment grade but deemed likely to meet obligations
when due. Present or prospective financial protection factors fluctuate
according to industry conditions or company fortunes. Overall quality may move
up or down frequently within this category.

B+, B, AND B-: Below investment grade and possessing risk that obligations
will not be met when due. Financial protection factors will fluctuate widely
according to economic cycles, industry conditions and/or company fortunes.
Potential exists for frequent changes in the rating within this category or
into a higher or lower rating grade.

CCC: Well below investment grade securities. Considerable uncertainty exists
as to timely payment of principal interest or preferred dividends. Protection
factors are narrow and risk can be substantial with unfavorable economic/
industry conditions, and/or with unfavorable company developments.

Preferred stocks are rated on the same scale as bonds but the preferred rating
gives weight to its more junior position in the capital structure. Structured
Financings are also rated on this scale.

COMMERCIAL PAPER/CERTIFICATES OF DEPOSIT

CATEGORY 1: TOP GRADE

DUFF 1 PLUS: Highest certainty of timely payment. Short-term liquidity
including internal operating factors and/or ready access to alternative
sources of funds, is outstanding, and safety is just below risk-free U.S.
Treasury short-term obligations.

DUFF 1: Very high certainty of timely payment. Liquidity factors are excellent
and supported by good fundamental protection factors. Risk factors are minor.

DUFF 1 MINUS: High certainty of timely payment. Liquidity factors are strong
and supported by good fundamental protection factors. Risk factors are very
small.

CATEGORY 2: GOOD GRADE

DUFF 2: Good certainty of timely payment. Liquidity factors and company
fundamentals are sound. Although ongoing funding needs may enlarge total
financing requirements, access to capital markets is good. Risk factors are
small.

CATEGORY 3: SATISFACTORY GRADE

DUFF 3: Satisfactory liquidity and other protection factors qualify issue as
to investment grade. Risk factors are larger and subject to more variation.
Nevertheless timely payment is expected.

No ratings are issued for companies whose paper is not deemed to be of
investment grade.

* * * *

NOTES:
(1) The ratings indicated herein are believed to be the most recent ratings
available at the date of this Statement of Additional Information for the
securities listed. Ratings are generally given to securities at the time
of issuance. While the rating agencies may from time to time revise such
ratings, they undertake no obligation to do so, and the ratings indicated
do not necessarily represent ratings which would be given to these
securities on the date of the Portfolio's fiscal year end.

Bonds which are unrated expose the investor to risks with respect to capacity
to pay interest or repay principal which are similar to the risks of lower-
rated bonds. The Portfolio is dependent on the Investment Adviser's judgment,
analysis and experience in the evaluation of such bonds.

Investors should note that the assignment of a rating to a bond by a
rating service may not reflect the effect of recent developments on the
issuer's ability to make interest and principal payments.
<PAGE>

PART B
INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION

STATEMENT OF
ADDITIONAL INFORMATION
March 1, 1999

EATON VANCE TAX-MANAGED GROWTH FUND
24 Federal Street
Boston, Massachusetts 02110
(800) 225-6265

This Statement of Additional Information ("SAI") provides general
information about the Fund and the Portfolio. The Fund is a series of Eaton
Vance Mutual Funds Trust. Capitalized terms used in this SAI and not otherwise
defined have the meanings given to them in the prospectus. This SAI contains
additional information about:
Page
Strategies and Risks ............................................. 2
Investment Restrictions .......................................... 5
Management and Organization ...................................... 6
Investment Advisory and Administrative Services .................. 10
Other Service Providers .......................................... 11
Purchasing and Redeeming Shares .................................. 12
Sales Charges .................................................... 13
Performance ...................................................... 17
Taxes ............................................................ 18
Portfolio Security Transactions .................................. 19
Financial Statements ............................................. 21

Appendices:
A: Class A Fees, Performance and Ownership ....................... a-1
B: Class B Fees, Performance and Ownership ....................... b-1
C: Class C Fees, Performance and Ownership ....................... c-1

<PAGE>

STRATEGIES AND RISKS

TAX-MANAGED GROWTH PORTFOLIO. It is the policy of the Portfolio to invest in
a broadly diversified selection of equity securities, emphasizing common
stocks of domestic and foreign growth companies that are considered to be high
in quality and attractive in their long-term investment prospects. Under
normal market conditions, the Portfolio will invest at least 65% of its total
assets in common stocks. Although the Portfolio may invest in investment-grade
preferred stocks and debt securities, purchase of such securities will
normally be limited to securities convertible into common stocks and temporary
investments in short-term notes or government obligations. The Portfolio's
holdings will represent a number of different industries, and less than 25% of
the Portfolio's assets will be invested in any one industry. During defensive
periods in which the Adviser believes that returns on common stock investments
may be unfavorable, the Portfolio may temporarily invest up to 65% of its
assets in U.S. government obligations and high quality short-term notes.

FOREIGN SECURITIES. Investing in securities issued by companies whose
principal business activities are outside the United States may involve
significant risks not present in domestic investments. For example, there is
generally less publicly available information about foreign companies,
particularly those not subject to the disclosure and reporting requirements of
the U.S. securities laws. Foreign issuers are generally not bound by uniform
accounting, auditing, and financial reporting requirements and standards of
practice comparable to those applicable to domestic issuers. Investments in
foreign securities also involve the risk of possible adverse changes in
investment or exchange control regulations, expropriation or confiscatory
taxation, limitation on the removal of funds or other assets, political or
financial instability or diplomatic and other developments which could affect
such investments. Further, economies of particular countries or areas of the
world may differ favorably or unfavorably from the economy of the United
States. It is anticipated that in most cases the best available market for
foreign securities will be on exchanges or in over-the-counter markets located
outside of the United States. Foreign stock markets, while growing in volume
and sophistication, are generally not as developed as those in the United
States, and securities of some foreign issuers (particularly those located in
developing countries) may be less liquid and more volatile than securities of
comparable U.S. companies. In addition, foreign brokerage commissions are
generally higher than commissions on securities traded in the United States
and may be non-negotiable. In general, there is less overall governmental
supervision and regulation of foreign securities markets, broker-dealers, and
issuers than in the United States.

FOREIGN CURRENCY TRANSACTIONS. The value of foreign assets as measured in
U.S. dollars may be affected favorably or unfavorably by changes in foreign
currency exchange rates and exchange control regulations. Currency exchange
rates can also be affected unpredictably by intervention by U.S. or foreign
governments or central banks, or the failure to intervene, or by currency
controls or political developments in the U.S. or abroad. Foreign currency
exchange transactions may be conducted on a spot (i.e., cash) basis at the
spot rate prevailing in the foreign currency exchange market or through
entering into swaps, forward contracts, options or futures on currency. On
spot transactions, foreign exchange dealers do not charge a fee for
conversion, but they do realize a profit based on the difference (the
"spread") between the prices at which they are buying and selling various
currencies. Thus, a dealer may offer to sell a foreign currency at one rate,
while offering a lesser rate of exchange should the Adviser desire to resell
that currency to the dealer.

FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS AND CURRENCY FUTURES. Forward
foreign currency contracts ("forward contracts") are individually negotiated
and privately traded by currency traders and their customers. A forward
contract involves an obligation to purchase or sell a specific currency (or
basket of currencies) for an agreed price at a future date, which may be any
fixed number of days from the date of the contract. The Adviser may enter into
a forward contract in connection with the purchase or sale of a security
denominated in a foreign currency, or when it anticipates the receipt in a
foreign currency of dividend or interest payments on such a security which it
holds, to "lock" in the U.S. dollar price of the security or the U.S. dollar
equivalent of such dividend or interest payment, as the case may be.
Additionally, when the Investment Adviser believes that the currency of a
particular foreign country may suffer a substantial decline against the U.S.
dollar, it may enter into a forward contract to sell, for a fixed amount of
dollars, the amount of foreign currency approximating the value of some or all
of the securities denominated in such foreign currency. The precise matching
of the forward contract amounts and the value of the securities involved will
not generally be possible. Forward contracts with a term of greater than one
year generally will not be entered into.

Currency futures contracts are exchange traded instruments that may be
used for the purposes described in the preceding paragraphs as an alternative
to the purchase or sale of forward currency exchange contracts. Currency
futures contracts are similar in structure to stock index futures contracts,
but change in value to reflect the movements of a currency or basket of
currencies rather than a stock index. Investments in currency contracts are
subject to limitations and restrictions similar to those set forth for
investments in stock index futures and options on stock index futures.

RISKS ASSOCIATED WITH DERIVATIVE INSTRUMENTS. Entering into a derivative
instrument involves a risk that the applicable market will move against the
position held and that a loss will result. For derivative instruments other
than purchased options, this loss may exceed the amount of the initial
investment made or the premium received. Derivative instruments may sometimes
increase or leverage exposure to a particular market risk. Leverage enhances
exposure to the price volatility of derivative instruments. Success in using
derivative instruments to hedge portfolio assets depends on the degree of
price correlation between the derivative instruments and the hedged asset.
Imperfect correlation may be caused by several factors, including temporary
price disparities among the trading markets for the derivative instrument, the
assets underlying the derivative instrument and other assets held in the
portfolio. Over-the-counter ("OTC") derivative instruments involve an enhanced
risk that the issuer or counterparty will fail to perform its contractual
obligations. Some derivative instruments are not readily marketable or may
become illiquid under adverse market conditions. In addition, during periods
of market volatility, a commodity exchange may suspend or limit trading in an
exchange-traded derivative instrument, which may make the contract temporarily
illiquid and difficult to price. Commodity exchanges may also establish daily
limits on the amount that the price of a futures contract or futures option
can vary from the previous day's settlement price. Once the daily limit is
reached, no trades may be made that day at a price beyond the limit. This may
prevent the closing out of positions and limiting losses. The staff of the
Commission takes the position that certain purchased OTC options, and assets
used as cover for written OTC options, are subject to the 15% limit on
illiquid investments. The ability to terminate OTC derivative instruments may
depend on the cooperation of the counterparties to such contracts. For thinly
traded derivative instruments, the only source of price quotations may be the
selling dealer or counterparty. In addition, certain provisions of the Code
limit the extent to which derivative instruments may be purchased and sold.
Transactions in futures contracts and related options will be entered into
only to the extent such transactions are consistent with the requirements of
the Code for maintaining qualification as a regulated investment company for
federal income tax purposes. See "Taxes".

LIMITATIONS ON FUTURES CONTRACTS AND OPTIONS. Futures contracts, and options
on futures contracts, traded on an exchange regulated by the Commodity Futures
Trading Commission (the "CFTC") and on foreign exchanges may be entered into,
but, with respect to foreign exchange-traded futures contracts and options on
such futures contracts, only if the Investment Adviser determines that trading
on each such foreign exchange does not subject the Fund to risks, including
credit and liquidity risks, that are materially greater than the risks
associated with trading on CFTC-regulated exchanges.

All futures contracts will be traded on exchanges or boards of trade that
are licensed and regulated by the CFTC and must be executed through a futures
commission merchant or brokerage firm that is a member of the relevant
exchange. Under CFTC regulations, futures contracts may only be entered into
if, immediately thereafter, the value of the aggregate initial margin with
respect to all currently outstanding non-hedging positions in futures
contracts does not exceed 5% of net asset value, after taking into account
unrealized profits and losses on such positions.

In order to hedge current or anticipated portfolio positions, futures
contracts on securities held or on securities with characteristics similar to
those of the securities held may be used. If, in the opinion of the Investment
Adviser, there is a sufficient degree of correlation between price trends for
the securities held and futures contracts based on other financial
instruments, securities indices or other indices, such futures contracts may
also be entered into as part of its hedging strategy.

All call options on securities written will be covered. This means that,
the Portfolio will own the securities subject to the call option or an
offsetting call option so long as the call option is outstanding.

SHORT SALES AGAINST-THE-BOX. The Portfolio may sell securities short where it
owns at least an equal amount of the security sold short or another security
convertible or exchangeable for an equal amount of the security sold short
without payment of further compensation (a short sale against-the-box). A
short sale against-the-box requires that the short seller absorb certain costs
so long as the position is open. In a short sale against-the-box, the short
seller is exposed to the risk of being forced to deliver appreciated stock to
close the position if the borrowed stock is called in, causing a gain to be
recognized. The Adviser expects normally to close short sale against-the-box
transactions by delivering newly-acquired stock. No more than 25% of assets is
expected to be subject to short-sales against-the-box at any one time.

LENDING PORTFOLIO SECURITIES. Under present regulatory policies of the
Commission, securities loans are required to be secured continuously by
collateral in cash, cash equivalents or U.S. Government securities held by the
custodian and maintained on a current basis at an amount at least equal to the
market value of the securities loaned, which will be marked to market daily.
Cash equivalents include certificates of deposit, commercial paper and other
short-term money market instruments. Securities will be loaned only to
borrowers whose credit quality or claims paying ability is considered to be
investment grade by the Investment Adviser. The financial condition of the
borrower will be monitored by the Investment Adviser on an ongoing basis. If a
borrower of securities defaults on a securities loan, the Potfolio will, under
proposed Treasury Regulations, be considered to have disposed of the
securities in a taxable transaction. Delays may be experienced in the recovery
or loss of rights in loaned securities if a borrower of securities fails
financially. The lender of the securities would continue to receive the
equivalent of the interest or dividends paid by the issuer on the securities
loaned and would also receive a fee, or all or a portion of the interest on
investment of the collateral. The lender of the securities would have the
right to call a loan and obtain the securities loaned at any time on up to
five business days' notice. The lender would not have the right to vote any
securities having voting rights during the existence of a loan, but could call
the loan in anticipation of an important vote to be taken among holders of the
securities or the giving or withholding of their consent on a material matter
affecting the investment. Securities lending involves administrative expenses,
including finders' fees. If the Investment Adviser decides to make securities
loans, it is intended that the value of the securities loaned would not exceed
30% of the Portfolio's total assets.

ASSET COVERAGE REQUIREMENTS. Transactions involving swaps, short sales,
forward contracts, futures contracts and options (other than options that the
Portfolio has purchased) create an obligation to another party. The Portfolio
will not enter into any such transactions unless it owns either (1) an
offsetting ("covered") position in securities, currencies, swaps, or other
options, futures contracts or forward contracts, or (2) cash or liquid
securities (such as readily marketable common stock and money market
instruments) with a value sufficient at all times to cover its potential
obligations not covered as provided in (1) above. Only the net obligation of a
swap will be covered. The Portfolio will comply with Commission guidelines
regarding cover for these instruments and, if the guidelines so require, set
aside cash or liquid securities in a segregated account with its custodian in
the prescribed amount. The securities in the segregated account will be marked
to market daily.

Assets used as cover or held in a segregated account maintained by the
custodian cannot be sold while the position requiring coverage or segregation
is outstanding, unless they are replaced with other appropriate assets. As a
result, the commitment of a large portion of assets to segregated accounts or
to cover could impede portfolio management or the ability to meet redemption
requests or other current obligations.

SELECTION OF SECURITIES USED TO MEET REDEMPTIONS. Investors in the Portfolio
(including the Fund) may redeem all or a portion of their interests in the
Portfolio at net asset value on a daily basis. Redemptions by the Fund's
shareholders currently are met entirely in cash, but distributions of
securities generally are used to meet redemptions by investors in the
Portfolio who have contributed securities and may in the future be used to
meet redemptions by the Fund's shareholders. See "Redeeming Shares" in the
prospectus. The Portfolio's ability to select the securities used to meet
redemptions is limited with respect to redemptions by investors who
contributed securities, and with respect to the securities contributed by such
investors. Within seven years of any contribution of securities (or, for
securities contributed prior to June 9, 1997, five years), (the "holding
period") the Portfolio will not distribute such securities to any investor
other than the contributing investor. In meeting a redemption of an investor
within the holding period of a contribution of securities by such investor,
the Portfolio will not, unless requested by the redeeming investor, distribute
any securities other than the securities contributed by the redeeming investor
while retaining all or a portion of the securities contributed by such
investor. If the Portfolio were to do otherwise, certain investors who
contributed securities could realize taxable gain. In addition, upon the
request at any time of a redeeming investor in the Portfolio that contributed
securities, the Portfolio will utilize securities held in the Portfolio that
were contributed by such investor to meet the redemption. After expiration of
the holding period, investors in the Portfolio can request a diversified
basket of securities, which may be distributed in the Investment Adviser's
discretion. These redemption practices constrain the selection of securities
distributed to meet redemptions (particularly during the holding period) and,
consequently, may adversely affect the performance of the Portfolio and the
Fund. The Trustees of the Portfolio believe that the potential advantages for
the Portfolio to be derived from attracting contributions of securities that
would not be made in the absence of these redemption practices outweigh the
potential disadvantages of reduced flexibility to select securities to meet
redemptions. It is impossible to predict whether the net result will be
beneficial or detrimental to the Fund's performance.

PORTFOLIO TURNOVER. The Portfolio cannot accurately predict its portfolio
turnover rate, but it is anticipated that the annual turnover rate will
generally be lower than that of most other equity mutual funds and will
generally not exceed 20% (excluding turnover of securities having a maturity
of one year or less). A 100% annual turnover rate could occur, for example, if
all the securities in the portfolio were replaced once in a period of one
year. A high turnover rate (100% or more) necessarily involves greater
expenses to the Portfolio. The Portfolio turnover rate of the Portfolio for
the fiscal years ended October 31, 1998 and 1997 was % and 14%.

INVESTMENT RESTRICTIONS

The following investment restrictions of the Fund are designated as
fundamental and as such cannot be changed without the approval of the holders
of a majority of the Fund's outstanding voting securities, which as used in
this SAI means the lesser of (a) 67% of the shares of the Fund, present or
represented by proxy at a meeting if the holders of more than 50% of the
outstanding shares are present or represented at the meeting or (b) more than
50% of the outstanding shares of the Fund. Accordingly, the Fund may not:

(1) Borrow money or issue senior securities except as permitted by the
Investment Company Act of 1940;

(2) Purchase any securities or evidences of interest therein on
"margin," that is to say in a transaction in which it has borrowed all or
a portion of the purchase price and pledged the purchased securities or
evidences of interest therein as collateral for the amount so borrowed;

(3) Engage in the underwriting of securities; or

(4) Buy or sell real estate (although it may purchase and sell
securities which are secured by real estate and securities of companies
which invest or deal in real estate), commodities or commodity contracts
for the purchase or sale of physical commodities;

(5) Make loans to other persons, except by (a) the acquisition of debt
securities and making portfolio investments, (b) entering into repurchase
agreements and (c) lending portfolio securities;

(6) With respect to 75% of its total assets, invest more than 5% of
its total assets (taken at current value) in the securities of any one
issuer, or invest in more than 10% of the outstanding voting securities of
any one issuer, except obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities and except securities of
other investment companies; or

(7) Concentrate its investments in any particular industry, but, if
deemed appropriate for the Fund's objective, up to 25% of the value of its
assets may be invested in any one industry.

Notwithstanding the investment policies and restrictions of the Fund, the
Fund may invest its investable assets in an open-end management investment
company with substantially the same investment objective, policies and
restrictions as the Fund. Notwithstanding the investment policies and
restrictions of the Portfolio, the Portfolio may invest part of its assets in
another investment company consistent with the 1940 Act.

The Fund and the Portfolio have adopted the following investment policies
which may be changed by the Trustees with respect to the Fund without
shareholder approval or with respect to the Portfolio without approval of the
Fund or its other investors. The Fund and the Porffolio will not:

(a) invest more than 15% of its net assets in investments which are
not readily marketable, including restricted securities and repurchase
agreements with a maturity longer than seven days. Restricted securities
for the purposes of this limitation do not include securities eligible for
resale pursuant to Rule 144A under the Securities Act of 1933 and
commercial paper issued pursuant to Section 4(2) of said Act that the
Board of Trustees of the Trust, or its delegate, determines to be liquid.
If the Fund or the Portfolio invests in Rule 144A securities, the level of
portfolio illiquidity may be increased to the extent that eligible buyers
become uninterested in purchasing such securities; or

(b) sell or contract to sell any security which it does not own unless
by virtue of its ownership of other securities it has at the time of sale
a right to obtain securities equivalent in kind and amount to the
securities sold and provided that if such right is conditional the sale is
made upon the same conditions.

Whenever an investment policy or investment restriction set forth in the
Prospectus or this SAI states a maximum percentage of assets that may be
invested in any security or other asset, such percentage limitation shall be
determined immediately after and as a result of the Portfolio's acquisition of
such security or asset. Accordingly, any later increase or decrease resulting
from a change in values, assets or other circumstances, will not compel the
Portfolio to dispose of such security or other asset. Notwithstanding the
foregoing, under normal market conditions the Portfolio must take actions
necessary to comply with the policy of investing at least 65% of total assets
in common stock. Moreover, the Portfolio must always be in compliance with the
borrowing policy and 15% limitation on investing in illiquid securities set
forth above.

MANAGEMENT AND ORGANIZATION

JAMES B. HAWKES (57), President and Trustee*
Chairman, President and Chief Executive Officer of Eaton Vance, BMR and their
corporate parent and trustee (EVC and EV); Director of EVC and EV. Trustee
and officer of various investment companies managed by Eaton Vance or BMR.

JESSICA M. BIBLIOWICZ (38), Trustee
President and Chief Operating Officer of John A. Levin & Co. (a registered
investment advisor) (since July, 1997) and a Director of Baker, Fentress &
Company which owns John A. Levin & Co. (since July, 1997). Formerly
Executive Vice President of Smith Barney Mutual Funds (from July, 1994 to
June, 1997). Elected Trustee October 30, 1998. Trustee of various investment
companies managed by Eaton Vance or BMR since October 30, 1998.
Address: One Rockefeller Plaza, New York, NY 10020

SAMUEL L. HAYES, III (64), Trustee
Jacob H. Schiff Professor of Investment Banking Emeritus, Harvard University
Graduate School of Business Administration. Trustee of the Kobrick-Cendant
Investment Trust (mutual funds). Trustee of various investment companies
managed by Eaton Vance or BMR.
Address: 345 Nahatan Road, Westwood Massachusetts 02090

NORTON H. REAMER (63), Trustee
Chairman of the Board and Chief Executive Officer, United Asset Management
Corporation (a holding company owning institutional investment management
firms); Chairman, President and Director, UAM Funds (mutual funds). Trustee
of various investment companies managed by Eaton Vance or BMR.
Address: One International Place, Boston, Massachusetts 02110

LYNN A. STOUT (41), Trustee of the Trust
Professor of Law, Georgetown University Law Center. Elected Trustee October
30, 1998. Trustee of various investment companies managed by Eaton Vance or
BMR since October 30, 1998.
Address: 600 New Jersey Avenue, NW, Washington, DC 20001

JOHN L. THORNDIKE (72), Trustee
Former Director of Fiduciary Company Incorporated. Trustee of various
investment companies managed by Eaton Vance or BMR.
Address: 175 Federal Street, Boston, Massachusetts 02110

JACK L. TREYNOR (69), Trustee
Investment Adviser and Consultant. Trustee of various investment companies
managed by Eaton Vance or BMR.
Address: 504 Via Almar, Palos Verdes Estates, California 90274

WILLIAM H. AHERN, JR. (39), Vice President of the Trust
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

THOMAS J. FETTER (55), Vice President of the Trust
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

ROBERT B. MACINTOSH (42), Vice President of the Trust
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

DUNCAN W. RICHARDSON (41), Vice President of the Portfolio
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

MICHAEL B. TERRY (56), Vice President of the Trust
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

JAMES L. O'CONNOR (53), Treasurer
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

ALAN R. DYNNER (58), Secretary
Vice President and Chief Legal Officer of Eaton Vance, BMR, EVC and EV since
November 1, 1996. Previously, he was a Partner of the law firm of
Kirkpatrick & Lockhart LLP, New York and Washington, D.C., and was Executive
Vice President of Neuberger & Berman Management, Inc., a mutual fund
management company. Officer of various investment companies managed by Eaton
Vance or BMR.

JANET E. SANDERS (63), Assistant Treasurer and Assistant Secretary
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

A. JOHN MURPHY (36), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

ERIC G. WOODBURY (41), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

Messrs. Treynor (Chairman) and Dwight are members of the Audit Committee
of the Board of Trustees of the Trust and of the Portfolio. The Audit
Committee's functions include making recommendations to the Board of Trustees
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 Trust and of the Portfolio.

Trustees of the Portfolio who not affiliated with the Investment 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 Fund 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 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 Trustees. Neither the Portfolio nor the Trust has a
retirement plan for its Trustees.

The fees and expenses of the noninterested Trustees of the Trust and of
the Portfolio are paid by the Fund (and the other series of the Trust) and of
the Portfolio, respectively. (The Trustees of the Trust and of the Portfolio
who are members of the Eaton Vance organization receive no compensation from
the Trust or the Portfolio.) During the fiscal year ended October 31, 1998,
the noninterested Trustees of the Trust and the Portfolio received the
following compensation in their capacities as Trustees of the Trust, the
Portfolio and the funds in the Eaton Vance fund complex(1):

<TABLE>
<CAPTION>
SOURCE OF JESSICA M. DONALD R. SAMUEL L. NORTON H. LYNN A. JOHN L. JACK L.
COMPENSATION BIBLIOWICZ(6) DWIGHT HAYES, III REAMER STOUT(6) THORNDIKE TREYNOR
------------ ------------- ------ ---------- ------ -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Trust(2) ............... $ $ $ $ $ $ $
Portfolio ..............
Trust and Fund
Complex ..............

- ----------
(1) As of March 1, 1999, the Eaton Vance Fund complex consists of 143 registered investment companies or series thereof.
(2) The Trust consisted of 12 Funds as of October 31, 1998.
(3) Includes $ of deferred compensation.
(4) Includes $ of deferred compensation.
(5) Includes $ of deferred compensation.
(6) Ms. Bibliowicz and Ms. Stout were elected Trustees on October 30, 1998 and will receive compensation approximating the other
Trustees after November 1, 1998.
</TABLE>

ORGANIZATION. The Fund is a series of the Trust, which is organized under
Massachusetts law and is operated as an open-end management investment
company. The Fund (formerly EV Marathon Tax-Managed Growth Fund) established 3
classes of shares on November 1, 1997 -- Class A shares (formerly EV
Traditional Tax-Managed Growth Fund), Class B shares and Class C shares
(formerly EV Classic Tax-Managed Growth Fund) of Eaton Vance Tax-Managed
Growth Fund. Information herein prior to such date is for the Fund before it
became a multiple-class fund. Class A and Class C are successors to the
operations of separate series of the Trust.

The Declaration of Trust may be amended by the Trustees when authorized by
vote of a majority of the outstanding voting securities of the Trust, the
financial interests of which are affected by the amendment. The Trustees may
also amend the Declaration of Trust without the vote or consent of
shareholders to change the name of the Trust or any series or to make such
other changes (such as reclassifying series or classes of shares or
restructuring the Trust) as do not have a materially adverse effect on the
financial interests of shareholders or if they deem it necessary to conform it
to applicable federal or state laws or regulations. The Trust's By-laws
provide that the Trust will indemnify its Trustees and officers against
liabilities and expenses incurred in connection with any litigation or
proceeding in which they may be involved because of their offices with the
Trust. However, no indemnification will be provided to any Trustee or officer
for any liability to the Trust or its shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office. The Trust or any series or class
thereof may be terminated by: (1) the affirmative vote of the holders of not
less than two-thirds of the shares outstanding and entitled to vote at any
meeting of shareholders of the Trust or the appropriate series or class
thereof, or by an instrument or instruments in writing without a meeting,
consented to by the holders of two-thirds of the shares of the Trust or a
series or class thereof, provided, however, that, if such termination is
recommended by the Trustees, the vote of a majority of the outstanding voting
securities of the Trust or a series or class thereof entitled to vote thereon
shall be sufficient authorization; or (2) by means of an instrument in writing
signed by a majority of the Trustees, to be followed by a written notice to
shareholders stating that a majority of the Trustees has determined that the
continuation of the Trust or a series or a class thereof is not in the best
interest of the Trust, such series or class or of their respective
shareholders.

Under Massachusetts law, if certain conditions prevail, shareholders of a
Massachusetts business trust (such as the Trust) could be deemed to have
personal liability for the obligations of the Trust. Numerous investment
companies registered under the 1940 Act have been formed as Massachusetts
business trusts, and management is not aware of an instance where such
liability has been imposed. The Trust's Declaration of Trust contains an
express disclaimer of liability on the part of the Fund shareholders and the
Trust's By-laws provide that the Trust shall assume the defense on behalf of
any Fund shareholders. The Declaration of Trust also contains provisions
limiting the liability of a series or class to that series or class. Moreover,
the Trust's By-laws also provide for indemnification out of the property of
the Fund of any shareholder held personally liable solely by reason of being
or having been a shareholder for all loss or expense arising from such
liability. The assets of the Fund are readily marketable and will ordinarily
substantially exceed its liabilities. In light of the nature of the Fund's
business and the nature of its assets, management believes that the
possibility of the Fund's liability exceeding its assets, and therefore the
shareholder's risk of personal liability, is remote.

INVESTMENT ADVISORY AND ADMINISTRATIVE SERVICES

For a description of the compensation that the Portfolio pays BMR under
the Investment Advisory Agreement, see the prospectus. As of October 31, 1998,
the Portfolio had net assets of $ . For the fiscal years ended
October 31, 1998, 1997 and 1996, the Portfolio paid BMR advisory fees of
$ , $ and $ , respectively, (equivalent to 0.625% of
the Portfolio's average daily net assets for each such year).

ADMINISTRATIVE SERVICES. As indicated in the prospectus, Eaton Vance serves
as administrator of the Fund, but currently receives no compensation for
providing administrative services to the Fund. Under its Administrative
Services Agreement with the Trust, Eaton Vance has been engaged to administer
the Fund's affairs, subject to the supervision of the Trustees of the Trust,
and shall furnish for the use of the Fund office space and all necessary
office facilities, equipment and personnel for administering the affairs of
the Fund.

INFORMATION ABOUT BMR AND EATON VANCE. BMR and Eaton Vance are business
trusts organized under Massachusetts law. Eaton Vance, Inc. ("EV") serves as
trustee of BMR and Eaton Vance. BMR, Eaton Vance and EV are wholly-owned
subsidiaries of Eaton Vance Corporation ("EVC"), a Maryland corporation and
publicly-held holding company. EVC through its subsidiaries and affiliates
engages primarily in investment management, administration and marketing
activities. The Directors of EVC are James B. Hawkes, Benjamin A. Rowland,
Jr., John G.L. Cabot, John M. Nelson, Vincent M. O'Reilly and Ralph Z.
Sorenson. All of the issued and outstanding shares of Eaton Vance are owned by
EVC. All of the issued and outstanding shares of BMR are owned by Eaton Vance.
All shares of the outstanding Voting Common Stock of EVC are deposited in a
Voting Trust, the Voting Trustees of which are Messrs. Hawkes, and Rowland,
Alan R. Dynner, Thomas E. Faust, Jr., Thomas J. Fetter, Duncan W. Richardson,
William M. Steul, and Wharton P. Whitaker. 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 Eaton Vance who are also officers, or
officers and Directors of EVC and EV. As indicated under "Management and
Organization", all of the officers of the Trust (as well as Mr. Hawkes who is
also a Trustee) hold positions in the Eaton Vance organization.

EXPENSES. The Fund and Portfolio are each responsible for all expenses not
expressly stated to be payable by another party (such as the investment
adviser under the Investment Advisory Agreement, Eaton Vance under the
Administrative Services Agreement or the principal underwriter under the
Distribution Agreement). In the case of expenses incurred by the Trust, the
Fund is responsible for its pro rata share of those expenses. The only
expenses of the Fund allocated to a particular class are those incurred under
the Distribution or Service Plan applicable to that class and those resulting
from the fee paid to the principal underwriter for repurchase transactions.

OTHER SERVICE PROVIDERS

INDEPENDENT ACCOUNTANTS. Deloitte & Touche LLP, 125 Summer Street, Boston,
Massachusetts, are the independent accountants of the Fund and the Portfolio,
providing audit services, tax return preparation, and assistance and
consultation with respect to the preparation of filings with the SEC.

TRANSFER AGENT. First Data Investor Services Group, P.O. Box 5123,
Westborough, MA 01581-5123, serves as transfer and dividend disbursing agent
for the Fund.

PURCHASING AND REDEEMING SHARES

CALCULATION OF NET ASSET VALUE. The net asset value of the Portfolio is
computed by IBT (as agent and custodian for the Portfolio) by subtracting the
liabilities of the Portfolio from the value of its total assets. The Fund and
the Portfolio will be closed for business and will not price their respective
shares or interests on the following business holidays: New Year's Day, Martin
Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving Day and Christmas Day.

Each investor in the Portfolio, including the Fund, may add to or reduce
its investment in the Portfolio on each day the Exchange is open for trading
("Portfolio Business Day") as of the close of regular trading on the Exchange
(the "Portfolio Valuation Time"). The value of each investor's interest in the
Portfolio will be determined by multiplying the net asset value of the
Portfolio by the percentage, determined on the prior Portfolio Business Day,
which represented that investor's share of the aggregate interests in the
Portfolio on such prior day. Any additions or withdrawals for the current
Portfolio Business Day will then be recorded. Each investor's percentage of
the aggregate interest in the Portfolio will then be recomputed as the
percentage equal to a fraction (i) the numerator of which is the value of such
investor's investment in the Portfolio as of the close of Portfolio Valuation
Time on the prior Portfolio Business Day plus or minus, as the case may be,
that amount of any additions to or withdrawals from the investor's investment
in the Portfolio on the current Portfolio Business Day, and (ii) the
denominator of which is the aggregate net asset value of the Portfolio as of
the Portfolio Valuation Time on the prior Portfolio Business Day plus or
minus, as the case may be, the amount of the net additions to or withdrawals
from the aggregate investment in the Portfolio on the current Portfolio
Business Day by all investors in the Portfolio. The percentage so determined
will then be applied to determine the value of the investor's interest in the
Portfolio for the current Portfolio Business Day.

The Trustees of the Portfolio have established the following procedures
for the fair valuation of the Portfolio's assets under normal market
conditions. Securities listed on foreign or U.S. securities exchanges or in
the NASDAQ National Market System generally are valued at the last sale prices
or, if there were no sales on a particular day, at the mean between the
closing bid and asked prices therefor on the exchange where such securities
are principally traded or on such National Market 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. An option is valued at the last
sale price as quoted on the principal exchange or board of trade on which such
option or contract is traded, or in the absence of a sale, at the mean between
the last bid and asked price. Futures positions on securities or currencies
are generally valued at closing settlement prices. Short term debt securities
with a remaining maturity of 60 days or less are valued at amortized cost. If
securities were acquired with a remaining maturity of more than 60 days, their
amortized cost value will be based on their value on the sixty-first day prior
to maturity. Other fixed income and debt securities, including listed
securities and securities for which price quotations are available, will
normally be valued on the basis of valuations furnished by a pricing service.
All other securities are valued at fair value as determined in good faith by
or at the direction of the Trustees.

ACQUIRING FUND SHARES IN EXCHANGE FOR SECURITIES. IBT, as escrow agent, will
receive securities acceptable to Eaton Vance, as administrator, in exchange
for Fund shares. The minimum value of securities (or securities and cash)
accepted for deposit is $5,000. Securities accepted will be sold on the day of
their receipt or as soon thereafter as possible. The number of Fund shares to
be issued in exchange for securities will be the aggregate proceeds from the
sale of such securities, divided by the applicable public offering price of
Class A shares or net asset value of Class B and Class C shares on the day
such proceeds are received. Eaton Vance will use reasonable efforts to obtain
the then current market price for such securities but does not guarantee the
best available price. Eaton Vance will absorb any transaction costs, such as
commissions, on the sale of securities. Securities determined to be acceptable
should be transferred via book entry or physically delivered, in proper form
for transfer, through an investment dealer, together with a completed and
signed Letter of Transmittal in approved form (available from investment
dealers). Investors who are contemplating an exchange of securities for
shares, or their representatives, must contact Eaton Vance to determine
whether the securities are acceptable before forwarding such securities. Eaton
Vance reserves the right to reject any securities. Exchanging securities for
shares may create a taxable gain or loss. Each investor should consult his or
her tax adviser with respect to the particular federal, state and local tax
consequences of exchanging securities.

SALES CHARGES

SALES CHARGE WAIVERS. Class A shares may be sold at net asset value to
current and retired Directors and Trustees of Eaton Vance funds, including the
Portfolio; to clients and current and retired officers and employees of Eaton
Vance, its affiliates and other investment advisers of Eaton Vance sponsored
funds; to registered representatives and employees of investment dealers and
bank employees who refer customers to registered representatives of invetment
dealers; to officers and employees of IBT and the transfer agent; and to such
persons' spouses, parents, siblings and children and their beneficial
accounts. Class A shares may also be issued at net asset value (1) in
connection with the merger of an investment company or series thereof with the
Fund, (2) to investors making an investment as part of a fixed fee program
whereby an entity unaffiliated with the investment adviser provides multiple
investment services, such as management, brokerage and custody, and (3) to
investment advisors, financial planners or other intermediaries who place
trades for their own accounts or the accounts of their clients and who charge
a management, consulting or other fee for their services; clients of such
investment advisors, financial planners or other intermediaries who place
trades for their own accounts if the accounts are linked to the master account
of such investment advisor, financial planner or other intermediary on the
books and records of the broker or agent; and retirement and deferred
compensation plans and trusts used to fund those plans, including, but not
limited to, those defined in Section 401(a), 403(b) or 457 of the Internal
Revenue Code of 1986, as amended (the "Code") and "rabbi trusts". Subject to
the applicable provisions of the 1940 Act, the Trust may issue Class A shares
at net asset value in the event that an investment company (whether a
regulated or private investment company or a personal holding company) is
merged or consolidated with or acquired by the Class. Normally no sales
charges will be paid in connection with an exchange of Class A shares for the
assets of such investment company. Class A shares may be sold at net asset
value to any investment advisory, agency, custodial or trust account managed
or administered by Eaton Vance or by any parent, subsidiary or other affiliate
of Eaton Vance. Class A shares are offered at net asset value to the foregoing
persons and in the foregoing situations because either (i) there is no sales
effort involved in the sale of shares or (ii) the investor is paying a fee
(other than the sales charge) to the investment dealer involved in the sale.

STATEMENT OF INTENTION. If it is anticipated that $50,000 or more of Class A
shares and shares of other funds exchangeable for Class A shares of another
Eaton Vance fund will be purchased within a 13-month period, a Statement of
Intention should be signed so that shares may be obtained at the same reduced
sales charge as though the total quantity were invested in one lump sum.
Shares held under Right of Accumulation (see below) as of the date of the
Statement will be included toward the completion of the Statement. The
Statement authorizes the transfer agent to hold in escrow sufficient shares
(5% of the dollar amount specified in the Statement) which can be redeemed to
make up any difference in sales charge on the amount intended to be invested
and the amount actually invested. Execution of a Statement does not obligate
the shareholder to purchase or the Fund to sell the full amount indicated in
the Statement, and should the amount actually purchased during the 13-month
period be more or less than that indicated on the Statement, price adjustments
will be made. Any investor considering signing a Statement of Intention should
read it carefully.

TAX-SHELTERED RETIREMENT PLANS. Class A and Class C shares are available for
purchase in connection with certain tax-sheltered retirement plans. Detailed
information concerning these plans, including certain exceptions to minimum
investment requirements, and copies of the plans are available from the
principal underwriter. This information should be read carefully and
consultation with an attorney or tax adviser may be advisable. The information
sets forth the service fee charged for retirement plans and describes the
federal income tax consequences of establishing a plan. Participant accounting
services (including trust fund reconciliation services) will be offered only
through third party recordkeepers and not by the principal underwriter. Under
all plans, dividends and distributions will be automatically reinvested in
additional shares.

The Class A and Class B and Class C Plans continue in effect from year to
year so long as such continuance is approved at least annually by the vote of
both a majority of (i) the noninterested Trustees of the Trust who have no
direct or indirect financial interest in the operation of the Plan or any
agreements related to the Plan (the "Plan Trustees") and (ii) all of the
Trustees then in office. Each Plan may be terminated at any time by vote of a
majority of the Plan Trustees or by a vote of a majority of the outstanding
voting securities of the applicable Class. Each Plan requires quarterly
Trustee review of a written report of the amount expended under the Plan and
the purposes for which such expenditures were made. The Plans may not be
amended to increase materially the payments described therein without approval
of the shareholders of the affected Class and the Trustees. So long as a Plan
is in effect, the selection and nomination of the noninterested Trustees shall
be committed to the discretion of such Trustees. The Class A, Class B and
Class C Plans were initially approved by the Trustees, including the Plan
Trustees, on June 23, 1997.

PERFORMANCE

Average annual total return is determined separately for each Class of the
Fund by multiplying a hypothetical initial purchase order of $1,000 by the
average annual compound rate of return (including capital appreciation/
depreciation, and distributions paid and reinvested) for the stated period and
annualizing the result. The calculation assumes (i) that all distributions are
reinvested at net asset value on the reinvestment dates during the period,
(ii) the deduction of the maximum sales charge from the initial $1,000
purchase order for Class A shares, (iii) a complete redemption of the
investment, and (iv) the deduction of any CDSC at the end of the period. For
information concerning the total return of the Classes of the Fund, see
Appendix A, Appendix B and Appendix C.

The Fund may use total return figures showing after-tax returns, including
comparisons to tax-deferred vehicles such as Individual Retirement Accounts
("IRAs") and variable annuities. In calculating after-tax returns, the Fund
will, in general, assume that its shareholders are U.S. individual taxpayers
subject to federal income taxes at the highest marginal rate then applicable
to ordinary income and long-term capital gains. After-tax returns may also be
calculated using different tax rate assumptions and taking into account state
and local income taxes as well as federal taxes. In calculating after-tax
returns, distributions made by the Fund are assumed to be reduced by the
amount of taxes payable on the distribution, and the after-tax proceeds of the
distribution are reinvested in the Fund at net asset value on the reinvestment
date.

Total return may be compared to relevant indices, such as the Consumer
Price Index and various domestic and foreign securities indices. The Fund's
total return and comparisons with these indices may be used in advertisements
and in information furnished to present or prospective shareholders. In
addition, evaluations of the Fund's performance or rankings of mutual funds
(which include the Fund) made by independent sources may be used in
advertisements and in information furnished to present or prospective
shareholders. Information, charts and illustrations showing the effect of
compounding interest or relating to inflation and taxes (including their
effects on the dollar and the return on stocks and other investment vehicles)
may also be included in advertisements and materials furnished to present and
prospective investors. The Fund's performance may differ from that of other
investors in the Portfolio, and other investment companies.

Information used in advertisements and in materials furnished to present
or prospective shareholders may include statistics, data and performance
studies prepared by independent organizations or included in various
publications reflecting the investment performance or return achieved by
various classes and types of investments (e.g. common stocks, small company
stocks, long-term corporate bonds, long-term government bonds, intermediate-
term government bonds, U.S. Treasury bills) over various periods of time. This
information may be used to illustrate the benefits of long-term investments in
common stocks.

Information about the allocation and holdings of investments in the
Portfolio may be included in advertisements and other material furnished to
present and prospective shareholders.

-- costs associated with aging parents;
-- funding a college education (including its actual and estimated cost);
-- health care expenses (including actual and projected expenses);
-- long-term disabilities (including the availability of, and coverage
provided by, disability insurance); and
-- retirement (including the availability of social security benefits, the
tax treatment of such benefits and statistics and other information
relating to maintaining a particular standard of living and outliving
existing assets).

The Trust (or Principal Underwriter) may provide information about Eaton
Vance, its affiliates and other investment advisers to the funds in the Eaton
Vance Family of Funds in sales material or advertisements provided to
investors or prospective investors. Such material or advertisements may also
provide information on the use of investment professionals by such investors.

TAXES

Each series of the Trust, is treated as a separate entity for federal
income tax purposes. The Fund intends to elect to be treated, and to qualify
each year as a regulated investment company ("RIC") under the Code.
Accordingly, the Fund intends to satisfy certain requirements relating to
sources of its income and diversification of its assets and to distribute
substantially all of its ordinary income and net income in accordance with the
timing requirements imposed by the Code, so as to maintain its RIC status and
to avoid paying any federal income or excise tax.

Because the Fund invests its assets in the Portfolio, the Portfolio
normally must satisfy the applicable source of income and diversification
requirements in order for the Fund to also satisfy them, and the Portfolio
intends to do so. For federal income tax purposes, the Portfolio intends to be
treated as a partnership that is not a "publicly traded partnership" and, as a
result, will not be subject to federal income tax. The Fund, as an investor in
the Portfolio, will be required to take into account in determining its
federal income tax liability its share of the Portfolio's income, gains,
losses, deductions, and credits, without regard to whether it has received any
cash distributions from the Portfolio.

The Portfolio will allocate at least annually among its investors,
including the Fund, each investor's distributive share of the Portfolio's net
investment income, net realized capital gains, and any other items of income,
gain, loss, deduction or credit. For purposes of applying the requirements of
the Code regarding qualification as a RIC, the Fund (i) will be deemed to own
its proportionate share of each of the assets of the Portfolio and (ii) will
be entitled to the gross income of the Portfolio attributable to such share.

In order to avoid excise tax, the Code requires the Fund to distribute by
the end of each calendar year substantially all of its ordinary income for
such year and capital gain net income for the one-year period ending on
October 31 of such year, plus certain other amounts. Under current law,
provided the Fund qualifies as a RIC and the Portfolio is treated as a
partnership for Massachusetts and federal tax purposes, neither the Fund nor
the Portfolio should be liable for any income, corporate excise or franchise
tax in the Commonwealth of Massachusetts.

The Fund may retain for investment its net capital gain. However, if the
Fund does so, it will be subject to a tax of 35% on the amount retained. In
that event, the Fund expects to designate the retained amount as undistributed
capital gain in a notice to its Shareholders, who (i) will be required to
include in income for tax purposes, as long-term capital gain, their
proportionate shares of such undistributed amount, (ii) will be entitled to
credit their proportionate shares of the 35% tax paid by the Fund against
their federal income tax liabilities, if any, and to claim refunds to the
extent the credit exceeds those liabilities, and (iii) will increase the tax
basis of their Fund Shares by an amount equal to 65% of the amount of
undistributed capital gain included in their gross income.

A portion of distributions made by the Fund (that are derived from
dividends received by the Portfolio) from domestic corporations and allocated
to the Fund may qualify for the dividends-received deduction ("DRD") for
corporations. The DRD is reduced to the extent the shares of the Fund with
respect to which the dividends are received are treated as debt-financed under
the Code and is eliminated if the shares are deemed to have been held for less
than a minimum period, generally 46 days. Receipt of certain distributions
qualifying for the DRD may result in reduction of the tax basis of the
corporate shareholder's shares. Distributions eligible for the DRD may give
rise to or increase an alternative minimum tax for certain corporations.

Under the Code, the redemption or exchange of shares of a RIC normally
results in capital gain or loss if such shares are held as capital assets.
However, a loss realized on a redemption or other disposition of Fund shares
may be disallowed under certain "wash sale" rules if shares of the Fund are
acquired within a period beginning 30 days before and ending 30 days after the
date of such redemption or other disposition. Any disallowed loss will result
in an adjustment to the shareholder's tax basis in some or all of the other
shares acquired.

Any loss realized upon the redemption or exchange of a Fund with a tax
holding period of six months or less will be treated as a long-term capital
loss to the extent of any distribution of net long-term capital gains with
respect to such shares.

Certain investors in the Portfolio, including RICs, have acquired
interests in the Portfolio by contributing securities. Due to tax
considerations, during the first seven years following the contribution of
securities (or within five years for securities contributed prior to June 9,
1997) to the Portfolio by an investor, such securities will not be distributed
to any investor other than the investor who contributed those securities.
Investors who acquire an interest in the Portfolio by contributing securities
and who redeem that interest within the applicable time period will generally
receive back one or more of the securities they contributed. In partial
redemptions by such investors during this period, the Portfolio will attempt
to accommodate requests to distribute initially those contributed securities
and share lots with the highest cost basis.

The Portfolio has significant holdings of highly appreciated securities
that were contributed to the Portfolio by investors other than the Fund. If
such securities were to be sold, the resulting capital gain would be allocated
disproportionately among the Portfolio's investors, with the result that the
Fund would not be subject to taxation on any gain arising prior to the
contribution of the securities to the Portfolio.

PORTFOLIO SECURITY TRANSACTIONS

Decisions concerning the execution of portfolio security transactions,
including the selection of the market and the executing firm, are made by BMR.
BMR is also responsible for the execution of transactions for all other
accounts managed by it.

BMR places the portfolio security transactions of the Portfolio and of
certain other accounts managed by it for execution with many firms. BMR uses
its best efforts to obtain execution of portfolio transactions at prices which
are advantageous and (when a disclosed commission is being charged) at
reasonably competitive commission rates. In seeking such execution, BMR will
use its best judgment in evaluating the terms of a transaction, and will give
consideration to various relevant factors, including without limitation the
full range and quality of the broker-dealer's services, the value of the
brokerage and research services provided, the responsiveness of the broker-
dealer to BMR, the size and type of the transaction, the nature and character
of the market for the security, the confidentiality, speed and certainty of
effective execution required for the transaction, the general execution and
operational capabilities of the executing firm, the reputation, reliability,
experience and financial condition of the firm, the value and quality of
services rendered by the firm in this and other transactions, and the
reasonableness of the commission, if any. Transactions on stock exchanges and
other agency transactions involve the payment of negotiated brokerage
commissions. Such commissions vary among different firms, and a particular
broker-dealer may charge different commissions according to such factors as
the difficulty and size of the transaction and the volume of business done
with such broker-dealer. Transactions in foreign securities usually involve
the payment of fixed brokerage commissions, which are generally higher than
those in the United States. There is generally no stated commission in the
case of securities traded in the over-the-counter markets, but the price paid
or received usually includes an undisclosed dealer markup or markdown. In an
underwritten offering the price paid includes a disclosed fixed commission or
discount retained by the underwriter or dealer. Although commissions paid on
portfolio transactions will, in the judgment of BMR, be reasonable in relation
to the value of the services provided, commissions exceeding those which
another firm might charge may be paid to firms who were selected to execute
transactions on behalf of the Portfolio and BMR's other clients providing
brokerage and research services to BMR.

As authorized in Section 28(e) of the Securities Exchange Act of 1934, a
broker or dealer who executes a portfolio transaction may receive a commission
which is in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction if BMR determines in good faith
that such compensation was reasonable in relation to the value of the
brokerage and research services provided. This determination may be made
either on the basis of that particular transaction or on the basis of overall
responsibilities which BMR and its affiliates have for accounts over which it
exercises investment discretion. In making any such determination, BMR will
not attempt to place a specific dollar value on the brokerage and research
services provided or to determine what portion of the commission should be
related to such services. Brokerage and research services may include advice
as to the value of securities, the advisability of investing in, purchasing or
selling securities, and the availability of securities or purchasers or
sellers of securities; furnishing analyses and reports concerning issuers,
industries, securities, economic factors and trends, portfolio strategy and
the performance of accounts; and effecting securities transactions and
performing functions incidental thereto (such as clearance and settlement);
and the "Research Services" referred to in the next paragraph.

It is a common practice of the investment advisory industry for the
advisers of investment companies, institutions and other investors to receive
research, analytical, statistical and quotation services, data, information
and other services, products and materials which assist such advisers in the
performance of their investment responsibilities ("Research Services") from
broker-dealers which execute portfolio transactions for the clients of such
advisers and from third parties with which such broker-dealers have
arrangements. Consistent with this practice, BMR may receive Research Services
from broker-dealer firms with which it places the portfolio transactions and
from third parties with which these broker-dealers have arrangements. These
Research Services may include such matters as general economic, political,
business and market information, industry and company reviews, evaluations of
securities and portfolio strategies and transactions, proxy voting data and
analysis services, technical analysis of various aspects of the securities
markets, and recommendations as to the purchase and sale of securities and
other portfolio transactions, financial, industry and trade publications, news
and information services, pricing and quotation equipment and services, and
research oriented computer hardware, software, data bases and services. Any
particular Research Service obtained through a broker-dealer may be used by
BMR in connection with client accounts other than those accounts which pay
commissions to such broker-dealer. Any such Research Service may be broadly
useful and of value to BMR in rendering investment advisory services to all or
a significant portion of its clients, or may be relevant and useful for the
management of only one client's account or of a few clients' accounts, or may
be useful for the management of merely a segment of certain clients' accounts,
regardless of whether any such account or accounts paid commissions to the
broker-dealer through which such Research Service was obtained. The advisory
fee paid by the Portfolio is not reduced because BMR receives such Research
Services. BMR evaluates the nature and quality of the various Research
Services obtained through broker-dealer firms and attempts to allocate
sufficient portfolio securitiy transactions to such firms to ensure the
continued receipt of Research Services which BMR believes are useful or of
value to it in rendering investment advisory services to its clients.

Subject to the requirement that BMR shall use its best efforts to seek to
execute portfolio security transactions of the Fund at advantageous prices and
at reasonably competitive commission rates or spreads, BMR is authorized to
consider as a factor in the selection of any broker-dealer firm with whom
Portfolio orders may be placed the fact that such firm has sold or is selling
shares of the Fund or of other investment companies sponsored by Eaton Vance.
This policy is not inconsistent with a rule of the NASD, which rule provides
that no firm which is a member of the NASD shall favor or disfavor the
distribution of shares of any particular investment company or group of
investment companies on the basis of brokerage commissions received or
expected by such firm from any source.

Securities considered as investments for the Portfolio may also be
appropriate for other investment accounts managed by BMR or its affiliates.
Whenever decisions are made to buy or sell securities by the Porttolio and one
or more of such other accounts simultaneously, BMR will allocate the security
transactions (including "hot" issues) in a manner which it believes to be
equitable under the circumstances. As a result of such allocations, there may
be instances where the Portfolio will not participate in a transaction that is
allocated among other accounts. If an aggregated order cannot be filled
completely, allocations will generally be made on a pro rata basis. An order
may not be allocated on a pro rata basis where, for example: (i) consideration
is given to portfolio managers who have been instrumental in developing or
negotiating a particular investment; (ii) consideration is given to an account
with specialized investment policies that coincide with the particulars of a
specific investment; (iii) pro rata allocation would result in odd-lot or de
minimis amounts being allocated to a portfolio or other client; or (iv) where
BMR reasonably determines that departure from a pro rata allocation is
advisable. While these aggregation and allocation policies could have a
detrimental effect on the price or amount of the securities available to the
Portfolio from time to time, it is the opinion of the Trustees of the
Portfolio that the benefits from BMR's organization outweigh any disadvantage
that may arise from exposure to simultaneous transactions.

For the fiscal years ended October 31, 1998 and 1997 and for the period
from the Portfolio's start of business, December 1, 1995, to October 31, 1996,
the Portfolio paid brokerage commissions of $ , $1,019,496 and
$144,815, respectively, on portfolio security transactions. Of these amounts,
approximately $ , $832,436 and $112,018, respectively, was paid in
respect of portfolio security transactions aggregating approximately
$ , $740,796,988 and $89,523,457, respectively, to firms which
provided some Research Services to the Investment Adviser's organization
(although many of such firms may have been selected in any particular
transaction primarily because of their execution capabilities).

FINANCIAL STATEMENTS

The audited financial statements of and the independent auditors' reports
for the Fund and the Portfolio, appear in the Fund's most recent annual report
to shareholders, which is incorporated by reference into this SAI. A copy of
the Fund's annual report accompanies this SAI. Consistent with applicable law,
duplicate mailings of shareholder reports and certain other Fund information
to shareholders residing at the same address may be eliminated.

<PAGE>

APPENDIX A

CLASS A FEES, PERFORMANCE AND OWNERSHIP

PRINCIPAL UNDERWRITER
The total sales charges paid in connection with sales of Class A shares
during the fiscal years ended October 31, 1998, 1997 and 1996, were $ ,
$322,629 and $855,011, respectively, of which $ , $802,762 and $105,722,
respectively, was received by the principal underwriter. For the fiscal years
ended October 31, 1998, 1997 and 1996, Authorized Firms received $ ,
$4,519,867 and $749,239, respectively, from the total sales charges.

PERFORMANCE INFORMATION

The table below indicates the cumulative and average annual total return
on a hypothetical investment of $1,000. Total return prior to November 1, 1997
reflects the total return of the predecessor to Class A. Total return prior to
March 28, 1996 reflects the total return of Class B, adjusted to reflect the
Class A sales charge. The Class B total return has not been adjusted to
reflect certain other expenses (such as distribution and/or service fees). If
such adjustments were made, the Class A total return would be different. The
"Value of Initial Investment" reflects the deduction of the maximum sales
charge of 5.75%. Past performance is not indicative of future results.
Investment return and principal value will fluctuate; shares, when redeemed,
may be worth more or less than their original cost.

VALUE OF $1,000 INVESTMENT

<TABLE>
<CAPTION>
TOTAL RETURN TOTAL RETURN
EXCLUDING MAXIMUM INCLUDING MAXIMUM
VALUE OF VALUE OF SALES CHARGE SALES CHARGE
INVESTMENT INVESTMENT INITIAL INVESTMENT ------------------------------ ------------------------------
PERIOD DATE INVESTMENT ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
------ ---- ---------- ----------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
10 Years Ended
10/31/98 10/31/88 $ $ % % % %
5 Years Ended
10/31/98 10/31/93
1 Year Ended
10/31/98 10/31/97
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As of December 1, 1998, the Trustees and officers of the Trust, as a
group, owned in the aggregate less than 1% of the outstanding Class A shares
of the Fund. As of December 1, 1998, Merrill Lynch, Pierce, Fenner & Smith,
Inc., Jacksonville, FL was the record owner of approximately 10.7% of the
outstanding Class A shares, which it held on behalf of its customers who are
the beneficial owners of such shares, and as to which they had voting power
under certain limited circumstances. To the knowledge of the Trust, no other
person owned of record or beneficially 5% or more of the Fund's outstanding
Class A shares as of such date.

<PAGE>

APPENDIX B

CLASS B FEES, PERFORMANCE AND OWNERSHIP

DISTRIBUTION AND SERVICE FEES
During the fiscal year ended October 31, 1998, the principal underwriter
paid to investment dealers sales commissions of $ on sales of Class B
shares. During the same period, the Fund made distribution payments to the
principal underwriter under the Distribution Plan aggregating $ and
the principal underwriter received approximately $ in CDSCs imposed
on early redeeming shareholders. These sales commissions and CDSC payments
reduced uncovered distribution charges under the Plan. As at October 31, 1998,
the outstanding uncovered distribution charges of the principal underwriter
calculated under the Plan amounted to approximately $ . During the
fiscal year ended October 31, 1998, Class B made service fee payments to the
principal underwriter and investment dealers aggregating $ , of which
$ was paid to investment dealers and the balance of which was retained
by the principal underwriter.

PRINCIPAL UNDERWRITER
The Trust has authorized the principal underwriter to act as its agent in
repurchasing shares at the rate of $2.50 for each repurchase transaction
handled by the principal underwriter. For the fiscal year ended October 31,
1998, Class B paid the principal underwriter $ for repurchase
transactions handled by it.

PERFORMANCE INFORMATION

The table below indicates the cumulative and average annual total return
on a hypothetical investment of $1,000 in Class B shares of the Fund. Total
return for Class B prior to March 28, 1996 reflects the total return of
another investor in the Portfolio, adjusted to reflect the Class B sales
charge. This total return has not been adjusted to reflect certain other Class
B expenses (such as distribution and/or service fees). If such adjustments
were made, the performance would be lower. Past performance is not indicative
of future results. Investment return and principal vaue will fluctuate;
shares, when redeemed, may be worth more or less than their original cost.

VALUE OF A $1,000 INVESTMENT

VALUE OF VALUE OF
INVESTMENT INVESTMENT
BEFORE AFTER TOTAL RETURN BEFORE TOTAL RETURN AFTER
DEDUCTING THE DEDUCTING THE DEDUCTING THE CDSC DEDUCTING THE CDSC
INVESTMENT INVESTMENT AMOUNT OF CDSC CDSC -------------------------- -------------------------
PERIOD DATE INVESTMENT ON 10/31/98 ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
------ ---- ---------- ----------- ----------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
10 Years
Ended
10/31/98 10/31/88 $1,000 $ $ % % % %
5 Years
Ended
10/31/98 10/31/93 $1,000 $ $ % % % %
1 Year Ended
8/31/98 10/31/97 $1,000 $ $ % % % %
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at December 1, 1998, the Trustees and officers of the Trust, as a
group, owned in the aggregate less than 1% of the outstanding Class B shares
of the Fund. As of December 1, 1998, Merrill Lynch, Pierce, Fenner & Smith,
Inc., Jacksonville, FL was the record owner of approximately 19.6% of the
outstanding Class B shares, which it held on behalf of its customers who are
the beneficial owners of such shares, and as to which they had voting power
under certain limited circumstances. To the knowledge of the Trust, no other
person owned of record or beneficially 5% or more of the Fund's outstanding
Class B shares as of such date.

<PAGE>

APPENDIX C

CLASS C FEES, PERFORMANCE AND OWNERSHIP

PRINCIPAL UNDERWRITER
The Trust has authorized the principal underwriter to act as its agent in
repurchasing shares at the rate of $2.50 for each repurchase transaction
handled by the principal underwriter. For the fiscal year ended October 31,
1998, Class C paid the principal underwriter $ for repurchase
transactions handled by it.

PERFORMANCE INFORMATION

The table below indicates the cumulative and average annual total return
on a hypothetical investment of $1,000. Total return prior to November 1, 1997
reflects the total return of the predecessor to Class C. Total return prior to
August 2, 1996 reflects the total return of Class B adjusted to reflect the
Class C sales charge. The Class B total return has not been adjusted to
reflect certain other expenses (such as distribution and/or service fees). If
such adjustments were made, the Class C total return would be different. Past
performance is not indicative of future results. Investment return and
principal value will fluctuate; shares, when redeemed, may be worth more or
less than their original cost.

VALUE OF A $1,000 INVESTMENT

<TABLE>
<CAPTION>
VALUE OF VALUE OF
INVEST- INVEST- TOTAL RETURN BEFORE TOTAL RETURN AFTER
MENT BEFORE DE- MENT AFTER DE- DEDUCTING THE CDSC DEDUCTING THE CDSC
DUCTING THE DUCTING THE
INVESTMENT INVESTMENT AMOUNT OF CDSC CDSC -------------------------- --------------------------
PERIOD DATE INVESTMENT ON 10/31/98 ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ------------ ----------- --------------- --------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
10 Years
Ended
10/31/98 10/31/88 $1,000 $ $ % % % %
5 Years
Ended
10/31/98 10/31/93 $1,000 $ $ % % % %
1 Year
Ended
10/31/98 10/31/97 $1,000 $ $ % % % %
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at December 1, 1998, the Trustees and officers of the Trust, as a
group, owned in the aggregate less than 1% of the outstanding Class C shares
of the Fund. As at December 1, 1998, Merrill Lynch, Pierce, Fenner & Smith,
Jacksonville, FL was the record owner of approximately 31.1% of the
outstanding Class C shares which are held on behalf of their customers who are
the beneficial owners of such shares, and as to which they have voting power
under certain limited circumstances. To the knowledge of the Trust, no other
person owned of record or beneficially 5% or more of the Fund's outstanding
Class C shares as of such date.

<PAGE>

PART B
INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION

STATEMENT OF
ADDITIONAL INFORMATION
March 1, 1999

EATON VANCE TAX-MANAGED EMERGING GROWTH FUND
EATON VANCE TAX-MANAGED INTERNATIONAL
GROWTH FUND
24 Federal Street
Boston, Massachusetts 02110
(800) 225-6265

This Statement of Additional Information ("SAI") provides general
information about the Funds listed above. Each Fund is a series of Eaton Vance
Mutual Funds Trust. Capitalized terms used in this SAI and not otherwise
defined have the meanings given to them in the prospectus. This SAI contains
additional information about:

Page
Strategies and Risks ........................................... 2
Investment Restrictions ........................................ 4
Management and Organization .................................... 5
Investment Advisory and Administrative Services ................ 8
Other Service Providers ........................................ 10
Purchasing and Redeeming Shares ................................ 11
Determination of Net Asset Value ............................... 11
Sales Charges .................................................. 12
Performance .................................................... 16
Taxes .......................................................... 17
Portfolio Security Transactions ................................ 18
Financial Statements ........................................... 20

Appendices:
A: Class A Fees, Performance and Ownership ..................... a-1
B: Class B Fees, Performance and Ownership ..................... b-1
C: Class C Fees, Performance and Ownership ..................... c-1

Although each Fund offers only its shares of beneficial interest, it is
possible that a Fund (or Class) might become liable for a misstatement or
omission in this SAI regarding another Fund (or Class) because the Funds use
this combined SAI. The Trustees of the Trust have considered this factor in
approving the use of a combined SAI.

THIS SAI IS NOT A PROSPECTUS AND IS AUTHORIZED FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS ONLY IF PRECEDED OR ACCOMPANIED BY THE FUNDS' PROSPECTUS
DATED MARCH 1, 1999, AS SUPPLEMENTED FROM TIME TO TIME, WHICH IS INCORPORATED
HEREIN BY REFERENCE. THIS SAI SHOULD BE READ IN CONJUNCTION WITH THE
PROSPECTUS, WHICH MAY BE OBTAINED BY CALLING 1-800-225-6265.

<PAGE>

STRATEGIES AND RISKS

TAX-MANAGED EMERGING GROWTH FUND. Under normal market conditions, the Tax-
Managed Emerging Growth Fund will invest at least 65% of its total assets in
equity securities of emerging growth companies. For this purpose, equity
securities include common stocks and securities convertible into common
stocks. In selecting companies for investment, the Adviser may consider
overall growth prospects, financial condition, competitive position,
technology, marketing expertise, profit margins, return on investment, capital
resources, management and other factors. The Fund may invest up to 35% of its
assets in preferred stocks, warrants, money market instruments (to meet
anticipated redemption requests or while investment of cash is pending) and
other securities and instruments. For temporary defensive purposes, such as
during abnormal market or economic conditions, the Fund may also invest
without limitation in various money market instruments and high grade debt
obligations.

TAX-MANAGED INTERNATIONAL GROWTH FUND. Under normal market conditions, the
Tax-Managed International Growth Fund will invest at least 65% of its total
assets in foreign equity securities. For this purpose, equity securities
include common stocks and securities convertible into common stocks. In
selecting companies for investment, the Adviser may consider overall growth
prospects, financial condition, competitive position, technology, marketing
expertise, profit margins, return on investment, capital resources, management
and other factors. In selecting investments, the Adviser will also take into
account industry and country considerations, including performance
expectations for different foreign stock markets and currencies, as well as
the Fund's current position with respect to such markets and currencies. The
Fund may invest up to 35% of its assets in preferred stocks, warrants, money
market instruments (to meet anticipated redemption requests or while
investment of cash is pending) and other securities and instruments. For
temporary defensive purposes, such as during abnormal market or economic
conditions, the Fund may also invest without limitation in various money
market instruments and high grade debt obligations.

FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS AND CURRENCY FUTURES. Forward
foreign currency contracts ("forward contracts") are individually negotiated
and privately traded by currency traders and their customers. A forward
contract involves an obligation to purchase or sell a specific currency (or
basket of currencies) for an agreed price at a future date, which may be any
fixed number of days from the date of the contract. The Adviser may enter into
a forward contract in connection with the purchase or sale of a security
denominated in a foreign currency, or when it anticipates the receipt in a
foreign currency of dividend or interest payments on such a security, to
"lock" in the U.S. dollar price of the security or the U.S. dollar equivalent
of such dividend or interest payment, as the case may be. Additionally, when
the Adviser believes that the currency of a particular foreign country may
suffer a substantial decline against the U.S. dollar, it may enter into a
forward contract to sell, for a fixed amount of dollars, the amount of foreign
currency approximating the value of some or all of the securities denominated
in such foreign currency. The precise matching of the forward contract amounts
and the value of the securities involved will not generally be possible.
Forward contracts with a term of greater than one year generally will not be
entered into.

LIMITATIONS ON FUTURES CONTRACTS AND OPTIONS. Futures contracts, and options
on futures contracts traded on an exchange regulated by the Commodity Futures
Trading Commission (the "CFTC ") and on foreign exchanges may be entered into,
but, with respect to foreign exchange-traded futures contracts and options on
such futures contracts, only if the Adviser determines that trading on each
such foreign exchange does not result in risks, including credit and liquidity
risks, that are materially greater than the risks associated with trading on
CFTC-regulated exchanges.

In order to hedge current or anticipated portfolio positions, futures
contracts on securities held or on securities with characteristics similar to
those of the securities held may be used. If, in the opinion of an Adviser,
there is a sufficient degree of correlation between price trends for the
securities held and futures contracts based on other financial instruments,
securities indices or other indices, such futures contracts may also be
entered into as part of its hedging strategy.

All call options on securities written will be covered. This means that,
each Fund will own the securities subject to the call option or an offsetting
call option so long as the call option is outstanding.

SHORT SALES AGAINST-THE-BOX. Securities may be sold short where a Fund owns
at least an equal amount of the security sold short or another security
convertible or exchangeable for an equal amount of the security sold short
without payment of further compensation (a short sale against-the-box). A
short sale against-the-box requires that the short seller absorb certain costs
so long as the position is open. In a short sale against-the-box, the short
seller is exposed to the risk of being forced to deliver appreciated stock to
close the position if the borrowed stock is called in, causing a gain to be
recognized. The Adviser expects normally to close short sale against-the-box
transactions by delivering newly-acquired stock. No more than 25% of assets is
expected to be subject to short-sales against-the-box at any one time.

LENDING PORTFOLIO SECURITIES. Under present regulatory policies of the
Commission, securities loans are required to be secured continuously by
collateral in cash, cash equivalents or U.S. Government securities held by the
custodian and maintained on a current basis at an amount at least equal to the
market value of the securities loaned, which will be marked to market daily.
Cash equivalents include certificates of deposit, commercial paper and other
short-term money market instruments. Securities will be loaned only to
borrowers whose credit quality or claims paying ability is considered to be
investment grade by the Adviser. The financial condition of the borrower will
be monitored by the Adviser on an ongoing basis. If a borrower of securities
defaults on a securities loan, the lender (i.e., a Fund will, under proposed
Treasury Regulations, be considered to have disposed of the securities in a
taxable transaction. Delays may be experienced in the recovery or loss of
rights in loaned securities if a borrower of securities fails financially. The
lender of the securities would continue to receive the equivalent of the
interest or dividends paid by the issuer on the securities loaned and would
also receive a fee, or all or a portion of the interest on investment of the
collateral. The lender of the securities would have the right to call a loan
and obtain the securities loaned at any time on up to five business days'
notice. The lender would not have the right to vote any securities having
voting rights during the existence of a loan, but could call the loan in
anticipation of an important vote to be taken among holders of the securities
or the giving or withholding of their consent on a material matter affecting
the investment. Securities lending involves administrative expenses, including
finders' fees.

ASSET COVERAGE REQUIREMENTS. Transactions involving swaps, short sales,
forward contracts, futures contracts and options (other than options that the
Fund has purchased) create an obligation to another party. A Fund will not
enter into any such transactions unless it owns either (1) an offsetting
("covered") position in securities, currencies, swaps, or other options,
futures contracts or forward contracts, or (2) cash or liquid securities (such
as readily marketable common stock and money market instruments) with a value
sufficient at all times to cover its potential obligations not covered as
provided in (1) above. (Only the net obligations of a swap will be covered.)
The Funds will comply with Commission guidelines regarding cover for these
instruments and, if the guidelines so require, set aside cash or liquid
securities in a segregated account with its custodian in the prescribed
amount. The securities in the segregated account will be marked to market
daily.

Assets used as cover or held in a segregated account maintained by the
custodian cannot be sold while the position requiring coverage or segregation
is outstanding unless they are replaced with other appropriate assets. As a
result, the commitment of a large portion of assets to segregated accounts or
to cover could impede portfolio management or the ability to meet redemption
requests or other current obligations.

PORTFOLIO TURNOVER. A Fund cannot accurately predict its portfolio turnover
rate, but it is anticipated that the annual turnover rate will generally be
lower than that of most other equity mutual funds and will generally not
exceed 20% (excluding turnover of securities having a maturity of one year or
less). For the portfolio turnover rate of each Fund, see "Financial
Highlights" or "Supplementary Data" in the "Financial Statements."

INVESTMENT RESTRICTIONS

The following investment restrictions of each Fund are designated as
fundamental policies and as such cannot be changed without the approval of the
holders of a majority of the Fund's outstanding voting securities, which as
used in this SAI means the lesser of (a) 67% of the shares of the Fund present
or represented by proxy at a meeting if the holders of more than 50% of the
outstanding shares are present or represented at the meeting or (b) more than
50% of the outstanding shares of the Fund. Accordingly, a Fund may not:

(1) Borrow money or issue senior securities except as permitted by the
Investment Company Act of 1940;

(3) Engage in the underwriting of securities;

(5) Make loans to other persons, except by (a) the acquisition of debt
securities and making portfolio investments, (b) entering into repurchase
agreements and (c) lending portfolio securities;

(7) Concentrate its investments in any particular industry, but, if
deemed appropriate for the Fund's objective, up to 25% of the value of its
assets may be invested in any one industry.

Notwithstanding their investment policies and restrictions, each 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 placement agent or investment
adviser as the Fund (or an affiliate thereof) if, with respect to such assets,
the other companies' permitted investments are substantially the same as those
of the Fund.

Each Fund has adopted the following investment policies which may be
changed by the Trustees with respect to a Fund without approval by that Fund's
shareholders. Each Fund will not:

(a) invest more than 15% of its net assets in investments which are
not readily marketable, including restricted securities and repurchase
agreements with a maturity longer than seven days. Restricted securities
for the purposes of this limitation do not include securities eligible for
resale pursuant to Rule 144A under the Securities Act of 1933 and
commercial paper issued pursuant to Section 4(2) of said Act that the
Board of Trustees of the Trust or the Portfolio, or their delegate,
determines to be liquid. If the Fund invests in Rule 144A Securities, the
level of portfolio illiquidity may be increased to the extent that
eligible buyers become uninterested in purchasing such securities;

Whenever an investment policy or investment restriction set forth in the
Prospectus or this SAI states a maximum percentage of assets that may be
invested in any security or other asset, such percentage limitation shall be
determined immediately after and as a result of a Fund's acquisition of such
security or asset. Accordingly, any later increase or decrease resulting from
a change in values, assets or other circumstances, will not compel a Fund to
dispose of such security or other asset. Notwithstanding the foregoing, under
normal market conditions Tax-Managed Emerging Growth must take action to
comply with its policy of investing at least 65% of total assets in equity
securities of emerging growth companies and Tax-Managed International Growth
must take action to comply with its policy of investing at least 65% of total
assets in foreign equity securities. Moreover, the Funds must always be in
compliance with the borrowing policy and 15% limitation on investing in
illiquid securities set forth above.

MANAGEMENT AND ORGANIZATION

FUND MANAGEMENT. The Trustees and officers of the Trust are listed below.
Except as indicated, each individual has held the office shown or other
offices in the same company for the last five years. Unless otherwise noted,
the business address of each Trustee and officer is 24 Federal Street, Boston,
Massachusetts 02110. Those Trustees who are "interested persons" of the Trust,
as defined in the 1940 Act, are indicated by an asterisk(*).

JAMES B. HAWKES (57), President and Trustee*
Chairman, President and Chief Executive Officer of Eaton Vance, BMR and their
corporate parent and trustee (EVC and EV). Director of EVC and EV. Trustee
and officer of various investment companies managed by Eaton Vance or BMR.

JESSICA M. BIBLIOWICZ (38), Trustee
President and Chief Operating Officer of John A. Levin & Co. (a registered
investment advisor) (since July 1997) and a Director of Baker, Fentress &
Company which owns John A. Levin & Co. (since July 1997). Formerly Executive
Vice President of Smith Barney Mutual Funds (from July 1994 to June 1997).
Formerly Elected Trustee October 30, 1998. Trustee of various investment
companies managed by Eaton Vance or BMR since October 30, 1998.
Address: One Rockefeller Plaza, New York, NY 10020

SAMUEL L. HAYES, III (64), Trustee
Jacob H. Schiff Professor of Investment Banking Emeritus, Harvard University
Graduate School of Business Administration. Trustee of the Kobrick-Cendant
Investment Trust (mutual funds). Trustee of various investment companies
managed by Eaton Vance or BMR.
Address: 345 Nahatan Road, Westwood, Massachusetts 02090

JACK L. TREYNOR (69), Trustee
Investment Adviser and Consultant. Trustee of various investment companies
managed by Eaton Vance or BMR.
Address: 504 Via Almar, Palos Verdes Estates, California 90274

WILLIAM H. AHERN, JR. (39), Vice President
Assistant Vice President of BMR and Eaton Vance. Officer of various investment
companies managed by Eaton Vance or BMR.

THOMAS J. FETTER (55), Vice President
Vice President of BMR, Eaton Vance and EV. Officer of various investment
companies managed by Eaton Vance or BMR.

ROBERT B. MACINTOSH (42), Vice President
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

MICHAEL B. TERRY (56), Vice President
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

JAMES L. O'CONNOR (53), Treasurer
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

JANET E. SANDERS (63), Assistant Treasurer and Assistant Secretary
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

A. JOHN MURPHY (36), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

ERIC G. WOODBURY (41), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

Messrs. Hayes (Chairman), Reamer and Thorndike are members of the Special
Committee of the Board of Trustees of the Trust. The purpose of the Special
Committee is to consider, evaluate and make recommendations to the full Board
of Trustees concerning (i) all contractual arrangements with service providers
to the Funds, including investment advisory, administrative, 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 Funds or their shareholders.

The Nominating Committee of the Board of Trustees of the Trust is
comprised of four Trustees who are not "interested persons" as that term is
defined under the 1940 Act ("noninterested Trustees"). The Committee has four-
year staggered terms, with one member rotating off the Committee to be
replaced by another noninterested Trustee. 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 of the Board of Trustees is independent of
Eaton Vance and its affiliates.

Messrs. Treynor (Chairman) and Dwight are members of the Audit Committee
of the Board of Trustees of the Trust. The Audit Committee's functions include
making recommendations to the Trustees 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 Trust.

Trustees of the Trust 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 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 of
Trustees' fees in accordance with the Trustees' Plan will have a negligible
effect on a Fund's assets, liabilities, and net income per share, and will not
obligate a Fund to retain the services of any Trustee or obligate a Fund to
pay any particular level of compensation to the Trustees. The Trust does not
have a retirement plan for its Trustees.

The fees and expenses of the noninterested Trustees of the Trust are paid
by the Funds (and the other series of the Trust). (The Trustees of the Trust
who are members of the Eaton Vance organization receive no compensation from
the Trust.) During the fiscal year ended October 31, 1998, the noninterested
Trustees of the Trust received the following compensation in their capacities
as Trustees of the Trust and of the other funds in the Eaton Vance fund
complex(1):

<TABLE>
<CAPTION>
SOURCE OF JESSICA M. DONALD R. SAMUEL L. NORTON H. LYNN A. JOHN L. JACK L.
COMPENSATION BIBLIOWICZ(6) DWIGHT HAYES, III REAMER STOUT(6) THORNDIKE TREYNOR
------------ ------------- ------ ---------- ------ -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Trust(2) $ $ $ $ $ $ $
Trust and Fund
Complex $ $ (3) $ (4) $ $ $ (5) $

- ----------
(1) As of March 1, 1999, the Eaton Vance complex consists of 143 registered investment companies or series thereof.
(2) The Trust consisted of 12 Funds as of October 31, 1998.
(3) Includes $ of deferred compensation.
(4) Includes $ of deferred compensation.
(5) Includes $ of deferred compensation.
(6) Ms. Bibliowicz and Ms. Stout were elected as Trustees on October 30, 1998 and will receive compensation approximating the
other Trustees after November 1, 1998.
</TABLE>

ORGANIZATION. Each Fund is a series of the Trust, which is organized under
Massachusetts law, and is operated as an open-end management investment
company. The Trust may issue an unlimited number of shares of beneficial
interest (no par value per share) in one or more series (such as the Funds).
The Trustees of the Trust have divided the shares of each Fund into multiple
classes. Each class represents an interest in a Fund, but is subject to
different expenses, rights and privileges. The Trustees have the authority
under the Declaration of Trust to create additional classes of shares with
differing rights and privileges. When issued and outstanding, shares are fully
paid and nonassessable by the Trust. Shareholders are entitled to one vote for
each full share held. Fractional shares may be voted proportionately. Shares
of a Fund will be voted together except that only shareholders of a particular
class may vote on matters affecting only that class. Shares have no preemptive
or conversion rights and are freely transferable. In the event of the
liquidation of a Fund, shareholders of each class are entitled to share pro
rata in the net assets attributable to that class available for distribution
to shareholders.

The Trust's Declaration of Trust may be amended by the Trustees when
authorized by vote of a majority of the outstanding voting securities of the
Trust, the financial interests of which are affected by the amendment. The
Trustees may also amend the Declaration of Trust without the vote or consent
of shareholders to change the name of the Trust or any series or to make such
other changes (such as reclassifying series or classes of shares or
restructuring the Trust) as do not have a materially adverse effect on the
rights or interests of shareholders or if they deem it necessary to conform it
to applicable federal or state laws or regulations. The Trust's By-laws
provide that the Trust will indemnify its Trustees and officers against
liabilities and expenses incurred in connection with any litigation or
proceeding in which they may be involved because of their offices with the
Trust. However, no indemnification will be provided to any Trustee or officer
for any liability to the Trust or its shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office. The Trust or any series or class
thereof may be terminated by: (1) the affirmative vote of the holders of not
less than two-thirds of the shares outstanding and entitled to vote at any
meeting of shareholders of the Trust or the appropriate series or class
thereof, or by an instrument or instruments in writing without a meeting,
consented to by the holders of two-thirds of the shares of the Trust or a
series or class thereof, provided, however, that, if such termination is
recommended by the Trustees, the vote of a majority of the outstanding voting
securities of the Trust or a series or class thereof entitled to vote thereon
shall be sufficient authorization; or (2) by means of an instrument in writing
signed by a majority of the Trustees, to be followed by a written notice to
shareholders stating that a majority of the Trustees has determined that the
continuation of the Trust or a series or a class thereof is not in the best
interest of the Trust, such series or class or of their respective
shareholders.

Under Massachusetts law, if certain conditions prevail, shareholders of a
Massachusetts business trust (such as the Trust) could be deemed to have
personal liability for the obligations of the Trust. Numerous investment
companies registered under the 1940 Act have been formed as Massachusetts
business trusts, and management is not aware of an instance where such
liability has been imposed. The Trust's Declaration of Trust contains an
express disclaimer of liability on the part of the Fund shareholders and the
Trust's By-laws provide that the Trust shall assume the defense on behalf of
any Fund shareholders. The Declaration of Trust also contains provisions
limiting the liability of a series or class to that series or class. Moreover,
the Trust's By-laws also provide for indemnification out of the property of
the Fund of any shareholder held personally liable solely by reason of being
or having been a shareholder for all loss or expense arising from such
liability. The assets of the Fund are readily marketable and will ordinarily
substantially exceed its liabilities. In light of the nature of the Fund's
business and the nature of its assets, management believes that the
possibility of the Fund's liability exceeding its assets, and therefore the
shareholder's risk of personal liability, is remote.

INVESTMENT ADVISORY AND ADMINISTRATIVE SERVICES

INVESTMENT ADVISORY SERVICES. The Trust has engaged Eaton Vance to act as
investment adviser to Tax-Managed Emerging Growth Fund and Tax-Managed
International Growth Fund. As investment adviser to the Funds, Eaton Vance
manages the Funds' investments, subject to the supervision of the Board of
Trustees of the Trust. Eaton Vance is also responsible for effecting all
security transactions on behalf of the Funds, including the allocation of
principal transactions and portfolio brokerage and the negotiation of
commissions.

Eaton Vance furnishes to the Funds investment research, 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 Eaton Vance organization to serve
without salary as officers or Trustees of the Trust. Each Fund is responsible
for all expenses not expressly stated to be payable by Eaton Vance under the
Investment Advisory Agreement, including, without limitation, the fees and
expenses of its custodian and transfer agent, including those incurred for
determining the Fund's net asset value and keeping its books; the cost of
share certificates; membership dues in investment company organizations;
brokerage commissions and fees; fees and expenses of registering its shares;
expenses of reports to shareholders, proxy statements, and other expenses of
shareholders' meetings; insurance premiums; printing and mailing expenses;
interest, taxes and corporate fees; legal and accounting expenses; and
compensation and expenses of Trustees not affiliated with Eaton Vance. The
Funds will also bear expenses incurred in connection with litigation,
proceedings and claims and any legal obligation of the Trust to indemnify its
officers and Trustees with respect thereto, to the extent not covered by
insurance.

For a description of the compensation that Tax-Managed Emerging Growth
Fund pays Eaton Vance see the prospectus. As of October 31, 1998, Tax-Managed
Emerging Growth Fund had net assets of $ . For the fiscal year ended
October 31, 1998 and for the period from the start of business, September 25,
1997, to October 31, 1997, Eaton Vance earned advisory fees of $ and
$ , respectively.

For a description of the compensation that Tax-Managed International
Growth Fund pays Eaton Vance, see the prospectus. As of October 31, 1998, the
Tax-Managed International Growth Fund had net assets of $ . For the
period from the start of business April 22, 1998 to the fiscal year ended
October 31, 1998, Eaton Vance earned advisory fees of $ .

Each Investment Advisory Agreement continues in effect from year to year
so long as such continuance is approved at least annually (i) by the vote of a
majority of the noninterested Trustees of the Trust cast in person at a
meeting specifically called for the purpose of voting on such approval and
(ii) by the Board of Trustees of the Trust or by vote of a majority of the
outstanding voting securities of a Fund. Each Agreement may be terminated at
any time without penalty on sixty days' written notice by the Board of
Trustees of either party or by vote of the majority of the outstanding voting
securities of a Fund, and each Agreement will terminate automatically in the
event of its assignment. Each Agreement provides that the Adviser may render
services to others. Each Agreement also provides that the Adviser shall not be
liable for any loss incurred in connection with the performance of its duties,
or action taken or omitted under that Agreement, in the absence of willful
misfeasance, bad faith, 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 sustained in the acquisition, holding or disposition of any
security or other investment.

ADMINISTRATIVE SERVICES. As indicated in the Prospectus, Eaton Vance serves
as Administrator of the Funds, but currently receives no compensation for
providing administrative services to the Funds. Under its agreement with the
Trust, Eaton Vance has been engaged to administer the Funds' affairs, subject
to the supervision of the Trustees of the Trust, and shall furnish for the use
of the Funds office space and all necessary office facilities, equipment and
personnel for administering the affairs of each Fund.

INFORMATION ABOUT EATON VANCE AND BMR. Eaton Vance and BMR are business
trusts organized under Massachusetts law. Eaton Vance, Inc. ("EV") serves as
trustee of Eaton Vance and BMR. Eaton Vance, BMR and EV are wholly-owned
subsidiaries of Eaton Vance Corporation ("EVC"), a Maryland corporation and
publicly-held holding company. EVC through its subsidiaries and affiliates
engages primarily in investment management, administration and marketing
activities. The Directors of EVC are James B. Hawkes, Benjamin A. Rowland,
Jr., John G.L. Cabot, John M. Nelson, Vincent M. O'Reilly and Ralph Z.
Sorenson. All of the issued and outstanding shares of Eaton Vance are owned by
EVC. All of the issued and outstanding shares of BMR are owned by Eaton Vance.
All shares of the outstanding Voting Common Stock of EVC are deposited in a
Voting Trust, the Voting Trustees of which are Messrs. Hawkes and Rowland,
Alan R. Dynner, Thomas E. Faust, Jr., Thomas J. Fetter, Duncan W. Richardson,
William M. Steul, and Wharton P. Whitaker. 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 Eaton Vance who are also officers, or
officers and Directors of EVC and EV. As indicated under "Management and
Organization," all of the officers of the Trust (as well as Mr. Hawkes who is
also a Trustee) hold positions in the Eaton Vance organization.

Eaton Vance is among the oldest mutual funds organizations in the country.
As an experienced mutual fund provider, Eaton Vance has contributed to making
the securities market more widely accessible to investors. Eaton Vance equity
funds provide a way to take advantage of the potentially higher returns of
individual stocks. Eaton Vance has a staff of more than 25 investment
professionals specializing in security analysis and equity management.

The Eaton Vance investment process stresses intensive fundamental
research. Portfolios are built on a stock-by-stock basis and the process
includes visits to companies under consideration. The process also focuses on
well-managed companies with the following characteristics: strong underlying
value or franchise; solid earnings growth; steady cash flow, strong balance
sheet; innovative products or services; potential for sustained growth;
seasoned, creative management; or ability to survive variable market
conditions.

By investing in diversified portfolios and employing prudent and
professional management, Eaton Vance mutual funds can provide attractive
return, while exposing shareholders to less risk than if they were to build
investment portfolios on their own. Eaton Vance employs rigorous buy and sell
disciplines. For instance, purchases are made with an eye to both relative and
absolute growth rates and price-earning ratios, and sales are made when a
stock is fully valued, fundamentals deteriorate, management fails to execute
its strategy, or more attractive alternatives are available.

Eaton Vance and its affiliates act as adviser to a family of mutual funds,
and individual and various institutional accounts, including corporations,
hospitals, retirement plans, universities, foundations and trusts. Eaton Vance
mutual funds feature international equities, domestic equities, tax-free
municipal bonds, and U.S. government and corporate bonds. Lloyd George
Management has advised Eaton Vance's international equity funds since 1992.
Founded in 1991, Lloyd George is headquartered in Hong Kong with offices in
London and Mumbai. It has established itself as a leader in investment
management in Asian equities and other global markets. Lloyd George features
an experienced team of investment professionals that began working together in
the mid-1980s. Lloyd George analysts cover East Asia, the India subcontinent,
Russia and Eastern Europe, Latin America, Australia and New Zealand from
offices in Hong Kong, London and Mumbai. Together Eaton Vance and Lloyd George
manage over $31 billion in assets. Eaton Vance mutual funds are distributed by
the Principal Underwriter both within the United States and offshore.

EXPENSES. Each Fund is responsible for all expenses not expressly stated to
be payable by another party (such as the investment adviser under the
Investment Advisory Agreement or the principal underwriter under the
Distribution Agreement). In the case of expenses incurred by the Trust, each
Fund is responsible for its pro rata share of those expenses. The only
expenses of a Fund allocated to a particular class are those incurred under
the Distribution or Service Plan applicable to that class and those resulting
from the fee paid to the principal underwriter for repurchase transactions.

OTHER SERVICE PROVIDERS

PRINCIPAL UNDERWRITER. Eaton Vance Distributors, Inc. ("EVD"), 24 Federal
Street, Boston, MA 02110, is the Funds' principal underwriter. The principal
underwriter acts as principal in selling shares under a Distribution Agreement
with the Trust. The expenses of printing copies of prospectuses used to offer
shares and other selling literature and of advertising are borne by the
principal underwriter. The fees and expenses of qualifying and registering and
maintaining qualifications and registrations of a Fund and its shares under
federal and state securities laws are borne by that Fund. The Distribution
Agreement as it applies to Class A shares is renewable annually by the Board
of Trustees of the Trust (including a majority of the noninterested Trustees)
may be terminated on six months' notice by either party and is automatically
terminated upon assignment. The Distribution Agreement as it applies to Class
B and Class C shares is renewable annually by the Trust's Board of Trustees
(including a majority of the noninterested Trustees who have no direct or
indirect financial interest in the operation of the Distribution Plan or the
Distribution Agreement), may be terminated on sixty days' notice either by
such Trustees or by vote of a majority of the outstanding shares of the
relevant class or on six months' notice by the principal underwriter and is
automatically terminated upon assignment. The principal underwriter
distributes shares on a "best efforts" basis under which it is required to
take and pay for only such shares as may be sold. The principal underwriter
allows investment dealers discounts from the applicable public offering price
which are alike for all investment dealers. See "Sales Charges." EVD is a
wholly-owned subsidiary of EVC. Mr. Hawkes is a Vice President and Director
and Messrs. Dynner and O'Connor are Vice Presidents of EVD.

CUSTODIAN. Investors Bank & Trust Company ("IBT"), 200 Clarendon Street,
Boston, MA 02116, serves as custodian to the Funds. IBT has the custody of all
cash and securities of a Fund maintains the general ledger of each Fund and
computes the daily net asset value of shares of the Fund. In such capacity it
attends to details in connection with the sale, exchange, substitution,
transfer or other dealings with the Funds' investments, receives and
disburses all funds and performs various other ministerial duties upon receipt
of proper instructions from the Trust. IBT also provides services in
connection with the preparation of shareholder reports and the electronic
filing of such reports with the SEC. EVC and its affiliates and their officers
and employees from time to time have transactions with various banks,
including IBT. It is Eaton Vance's opinion that the terms and conditions of
such transactions were not and will not be influenced by existing or potential
custodial or other relationships between a Fund and such banks.

INDEPENDENT ACCOUNTANTS. Deloitte & Touche LLP, 125 Summer Street, Boston,
Massachusetts, are the independent accountants of the Funds, providing audit
services, tax return preparation, and assistance and consultation with respect
to the preparation of filings with the SEC.

TRANSFER AGENT. First Data Investor Services Group, P.O. Box 5123,
Westborough, MA 01581-5123, serves as transfer and dividend disbursing agent
for the Funds.

PURCHASING AND REDEEMING SHARES

CALCULATION OF NET ASSET VALUE. The net asset value of each Fund is computed
by IBT (as agent and custodian for the Funds) in the manner described in the
prospectus. The Funds will be closed for business and will not price their
respective shares on the following business holidays: New Year's Day, Martin
Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving Day and Christmas Day.

The Trustees of the Trust have established the following procedures for
the fair valuation of the Funds' assets under normal market conditions.
Securities listed on foreign or U.S. securities exchanges or in the NASDAQ
National Market System generally are valued at the last sale prices or, if
there were no sales on a particular day, at the mean between the closing bid
and asked prices therefor on the exchange where such securities are
principally traded or on such National Market 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. An option is valued at the last
sale price as quoted on the principal exchange or board of trade on which such
option or contract is traded, or in the absence of a sale, at the mean between
the last bid and asked prices. Futures positions on securities or currencies
are generally valued at closing settlement prices. Short-term debt securities
with a remaining maturity of 60 days or less are valued at amortized cost. If
securities were acquired with a remaining maturity of more than 60 days, their
amortized cost value will be based on their value on the sixty-first day prior
to maturity. Other fixed income and debt securities, including listed
securities and securities for which price quotations are available, will
normally be valued on the basis of valuations furnished by a pricing service.
All other securities are valued at fair value as determined in good faith by
or at the direction of the Trustees.

Generally, trading in the foreign securities owned by a Fund is
substantially completed each day at various times prior to the close of the
Exchange. The values of these securities used in determining the net asset
value of the Fund's shares generally are computed as of such times.
Occasionally, events affecting the value of foreign securities may occur
between such times and the close of the Exchange which will not be reflected
in the computation of the Fund's net asset value (unless the Fund deems that
such events would materially affect its net asset value, in which case an
adjustment would be made and reflected in such computation). Foreign
securities and currency held by a Fund will be valued in U.S. dollars; such
values will be computed by the custodian based on foreign currency exchange
rate quotations supplied by an independent quotation service.

The Trust may, in its absolute discretion, suspend, discontinue or limit
the offering of one or more of its classes of shares at any time. In
determining whether any such action should be taken, the Trust's management
intends to consider all relevant factors, including (without limitation) the
size of a Fund or class, the investment climate and market conditions, the
volume of sales and redemptions of shares, and in the case of Class B and
Class C shares, the amount of uncovered distribution charges of the principal
underwriter. The Class B and Class C Distribution Plans may continue in effect
and payments may be made under the Plans following any such suspension,
discontinuance or limitation of the offering of shares; however, there is no
contractual obligation to continue any Plans for any particular period of
time. Suspension of the offering of shares would not, of course, affect a
shareholder's ability to redeem shares.

ACQUIRING FUND SHARES IN EXCHANGE FOR SECURITIES. IBT, as escrow agent, will
receive securities acceptable to Eaton Vance, as administrator, in exchange
for Fund shares. The minimum value of securities (or securities and cash)
accepted for deposit is $5,000. Securities accepted will be sold on the day of
their receipt or as soon thereafter as possible. The number of Fund shares to
be issued in exchange for securities will be the aggregate proceeds from the
sale of such securities, divided by the applicable public offering price of
Class A shares or net asset value of Class B and Class C shares on the day
such proceeds are received. Eaton Vance will use reasonable efforts to obtain
the then current market price for such securities but does not guarantee the
best available price. Eaton Vance will absorb any transaction costs, such as
commissions, on the sale of securities. Securities determined to be acceptable
should be transferred via book entry or physically delivered, in proper form
for transfer, through an investment dealer, together with a completed and
signed Letter of Transmittal in approved form (available from investment
dealers). Investors who are contemplating an exchange of securities for
shares, or their representatives, must contact Eaton Vance to determine
whether the securities are acceptable before forwarding such securities. Eaton
Vance reserves the right to reject any securities. Exchanging securities for
shares may create a taxable gain or loss. Each investor should consult his or
her tax adviser with respect to the particular federal, state and local tax
consequences of exchanging securities.

ADDITIONAL INFORMATION ABOUT REDEMPTIONS. The right to redeem shares of a
Fund can be suspended and the payment of the redemption price deferred when
the Exchange is closed (other than for customary weekend and holiday
closings), during periods when trading on the Exchange is restricted as
determined by the Commission, or during any emergency as determined by the
Commission which makes it impracticable for a Portfolio to dispose of its
securities or value its assets, or during any other period permitted by order
of the Commission for the protection of investors.

While normally payments will be made in cash for redeemed shares, the
Trust, subject to compliance with applicable regulations, has reserved the
right to pay the redemption price of shares of a Fund, either totally or
partially, by a distribution in kind of readily marketable securities
withdrawn from its corresponding Portfolio. The securities so distributed
would be valued pursuant to the Portfolio's valuation procedures. If a
shareholder received a distribution in kind, the shareholder could incur
brokerage or other charges in converting the securities to cash.

SALES CHARGES

SALES CHARGE WAIVERS. Class A shares may be sold at net asset value to
current and retired Directors and Trustees of Eaton Vance funds; to clients
and current and retired officers and employees of Eaton Vance, its affiliates
and other investment advisers of Eaton Vance sponsored funds; to registered
representatives and employees of investment dealers and bank employees who
refer customers to registered representatives of invetment dealers; to
officers and employees of IBT and the transfer agent; and to such persons'
spouses, parents, siblings and children and their beneficial accounts. Class A
shares may also be issued at net asset value (1) in connection with the merger
of an investment company or series thereof with a Fund, (2) to investors
making an investment as part of a fixed fee program whereby an entity
unaffiliated with the investment adviser provides multiple investment
services, such as management, brokerage and custody, and (3) to investment
advisors, financial planners or other intermediaries who place trades for
their own accounts or the accounts of their clients and who charge a
management, consulting or other fee for their services; clients of such
investment advisors, financial planners or other intermediaries who place
trades for their own accounts if the accounts are linked to the master account
of such investment advisor, financial planner or other intermediary on the
books and records of the broker or agent; and retirement and deferred
compensation plans and trusts used to fund those plans, including, but not
limited to, those defined in Section 401(a), 403(b) or 457 of the Internal
Revenue Code of 1986, as amended (the "Code") and "rabbi trusts". Subject to
the applicable provisions of the 1940 Act, the Trust may issue Class A shares
at net asset value in the event that an investment company (whether a
regulated or private investment company or a personal holding company) is
merged or consolidated with or acquired by the Class. Normally no sales
charges will be paid in connection with an exchange of Class A shares for the
assets of such investment company. Class A shares may be sold at net asset
value to any investment advisory, agency, custodial or trust account managed
or administered by Eaton Vance or by any parent, subsidiary or other affiliate
of Eaton Vance. Class A shares are offered at net asset value to the foregoing
persons and in the foregoing situations because either (i) there is no sales
effort involved in the sale of shares or (ii) the investor is paying a fee
(other than the sales charge) to the investment dealer involved in the sale.

DISTRIBUTION AND SERVICE PLANS. The Trust has adopted a Service Plan (the
"Class A Plan") for each Fund's Class A shares that is designed to meet the
service fee requirements of the sales charge rule of the National Association
of Securities Dealers, Inc. (the "NASD"). (Management believes service fee
payments are not distribution expenses governed by Rule 12b-1 under the 1940
Act, but has chosen to have the Plan approved as if that Rule were
applicable.) The Class A Plan provides that each Class A may make service fee
payments for personal services and/or the maintenance of shareholder accounts
to the principal underwriter, investment dealers and other persons in amounts
not exceeding .25% of its average daily net assets for any fiscal year. For
the service fees paid by Class A shares, see Appendix A.

The Trust has also adopted compensation-type Distribution Plans (the
"Class B and Class C Plans") pursuant to Rule 12b-1 under the 1940 Act for
each Fund's Class B and Class C shares. The Class B and Class C Plans are
designed to permit an investor to purchase shares through an investment dealer
without incurring an initial sales charge and at the same time permit the
principal underwriter to compensate investment dealers in connection
therewith. The Class B and Class C Plans provide that each Fund will pay sales
commissions and distribution fees to the principal underwriter only after and
as a result of the sale of shares. On each sale of shares (excluding
reinvestment of distributions), each Fund will pay the principal underwriter
amounts representing (i) sales commissions equal to 5% for Class B shares and
6.25% for Class C shares of the amount received by the Fund for each share
sold and (ii) distribution fees calculated by applying the rate of 1% over the
prime rate then reported in The Wall Street Journal to the outstanding balance
of uncovered distribution charges (as described below) of the principal
underwriter. To pay these amounts, each Class pays the principal underwriter a
fee, accrued daily and paid monthly, at an annual rate not exceeding .75% of
its average daily net assets to finance the distribution of its shares. Such
fees compensate the principal underwriter for sales commissions paid by it to
investment dealers on the sale of shares and for interest expenses. For sales
of Class B shares, the principal underwriter uses its own funds to pay sales
commissions (except on exchange transactions and reinvestments) to investment
dealers at the time of sale equal to 4% of the purchase price of the Class B
shares sold by such dealers. For Class C shares, the principal underwriter
currently expects to pay to an investment dealer (a) sales commissions (except
on exchange transactions and reinvestments) at the time of sale equal to .75%
of the purchase price of the shares sold by such dealer, and (b) monthly sales
commissions approximately equivalent to 1/12 of .75% of the value of shares
sold by such dealer and remaining outstanding for at least one year. During
the first year after a purchase of Class C shares, the principal underwriter
will retain the sales commission as reimbursement for the sales commissions
paid to investment dealers at the time of sale. CDSCs paid to the principal
underwriter will be used to reduce amounts owed to it. The Class B and Class C
Plans provide that each Fund will make no payments to the principal
underwriter in respect of any day on which there are no outstanding uncovered
distribution charges of the principal underwriter. CDSCs and accrued amounts
will be paid by the Trust to the principal underwriter whenever there exist
uncovered distribution charges. Because payments to the principal underwriter
under the Class B and Class C Plans are limited, uncovered distribution
charges (sales commissions paid by the principal underwriter plus interest,
less the above fees and CDSCs received by it) may exist indefinitely. For the
sales commissions and CDSCs paid on (and uncovered distribution charges of)
Class B and Class C shares, see Appendix B and Appendix C, respectively.

The Class A and Class B and Class C Plans continue in effect from year to
year so long as such continuance is approved at least annually by the vote of
both a majority of (i) the noninterested Trustees of the Trust who have no
direct or indirect financial interest in the operation of the Plan or any
agreements related to the Plan (the "Plan Trustees") and (ii) all of the
Trustees then in office. Each Plan may be terminated at any time by vote of a
majority of the Plan Trustees or by a vote of a majority of the outstanding
voting securities of the applicable Class. Each Plan requires quarterly
Trustee review of a written report of the amount expended under the Plan and
the purposes for which such expenditures were made. The Plans may not be
amended to increase materially the payments described therein without approval
of the shareholders of the affected Class and the Trustees. So long as a Plan
is in effect, the selection and nomination of the noninterested Trustees shall
be committed to the discretion of such Trustees. The Class A, Class B and
Class C Plans were initially approved by the Trustees, including the Plan
Trustees, on August 11, 1997 for Tax-Managed Emerging Growth and on January 6,
1998 for Tax-Managed International Growth.

PERFORMANCE

Average annual total return is determined seperately for each Class of a
Fund by multiplying a hypothetical initial purchase order of $1,000 by the
average annual compound rate of return (including capital appreciation/
depreciation, and distributions paid and reinvested) for the stated period and
annualizing the result. The calculation assumes (i) that all distributions are
reinvested at net asset value on the reinvestment dates during the period,
(ii) the deduction of the maximum sales charge from the initial $1,000
purchase order for Class A shares, (iii) a complete redemption of the
investment and, (iv) the deduction of any CDSC at the end of the period. For
information concerning the total return of the Classes of a Fund, see Appendix
A, Appendix B and Appendix C.

Each Fund may use total return figures showing after-tax returns,
including comparisons to tax-deferred vehicles such as Individual Retirement
Accounts ("IRAs") and variable annuities. In calculating after-tax returns,
the Fund will, in general, assume that its shareholders are U.S. individual
taxpayers subject to federal income taxes at the highest marginal rate then
applicable to ordinary income and long-term capital gains. After-tax returns
may also be calculated using different tax rate assumptions and taking into
account state and local income taxes as well as federal taxes. In calculating
after-tax returns, distributions made by the Fund are assumed to be reduced by
the amount of taxes payable on the distribution, and the after-tax proceeds of
the distribution are reinvested in the Fund at net asset value on the
reinvestment date.

Total return may be compared to relevant indices, such as the Consumer
Price Index and various domestic and foreign securities indices. In addition,
evaluations of a Fund's performance or rankings of mutual funds (which include
a Fund) made by independent sources may be used in advertisements and in
information furnished to present or prospective shareholders. Information,
charts and illustrations showing the effect of compounding interest or
relating to inflation and taxes (including their effects on the dollar and the
return on stocks and other investment vehicles) may also be included in
advertisements and materials furnished to present and prospective investors.

Information used in advertisements and in materials furnished to present
or prospective shareholders may include statistics, data and performance
studies prepared by independent organizations or included in various
publications reflecting the investment performance or return achieved by
various classes and types of investments (e.g. common stocks, small company
stocks, long-term corporate bonds, long-term government bonds, intermediate-
term government bonds, U.S. Treasury bills) over various periods of time. This
information may be used to illustrate the benefits of long-term investments in
common stocks.

Information in advertisements and materials furnished to present and
prospective investors may include profiles of different types of investors
(i.e., investors with different goals and assets) and different investment
strategies for meeting specific financial goals. Such information may provide
hypothetical illustrations which include: results of various investment
strategies; performance of an investment in a Fund over various time periods;
and results of diversifying assets among several investments with varying
performance. Information in advertisements and materials furnished to present
and prospective investors may also include quotations (including editorial
comments) and statistics concerning investing in securities, as well as
investing in particular types of securities and the performance of such
securities.

TAXES

Each series of the Trust is treated as a separate entity for federal
income tax purposes. Each Fund has elected to be treated and intends to
qualify each year as a regulated investment company ("RIC") under the Code to
avoid federal income tax. Accordingly, each Fund intends to satisfy certain
requirements relating to sources of its income and diversification of its
assets and to distribute a sufficient amount of its investment company taxable
income so as to effect such qualification. Each Fund may also distribute part
or all of its net investment income and net realized capital gains in
accordance with the timing requirements imposed by the Code, so as to reduce
or avoid any federal income or excise tax.

In order to avoid incurring a federal excise tax obligation, the Code
requires that each Fund distribute (or be deemed to have distributed) by
December 31 of each calendar year at least 98% of its ordinary income for such
year, at least 98% of its capital gain net income (which is the excess of its
realized capital gains over its realized capital losses), generally computed
on the basis of the one-year period ending on October 31 of such year, after
reduction by (i) any available capital loss carryforwards and (ii) 100% of any
income and capital gains from the prior year (as previously computed) that was
not paid out during such year and on which the Fund paid no federal income
tax. Under current law, provided that each Fund qualifies as a RIC for federal
income tax purposes, the Fund should not be liable for any income, corporate
excise or franchise tax in the Commonwealth of Massachusetts.

Each Fund may retain for investment its net capital gain. However, if the
Fund does so, it will be subject to a tax of 35% on the amount retained. In
that event, each Fund expects to designate the retained amount as
undistributed capital gain in a notice to its Shareholders, who (i) will be
required to include in income for tax purposes, as long-term capital gain,
their proportionate shares of such undistributed amount, (ii) will be entitled
to credit their proportionate shares of the 35% tax paid by the Fund against
their federal income tax liabilities, if any, and to claim refunds to the
extent the credit exceeds those liabilities, and (iii) will increase the tax
basis of their Fund Shares by an amount equal to 65% of the amount of
undistributed capital gain included in their gross income.

Foreign exchange gains and losses realized by a Fund in connection with
its investments in foreign securities and certain options, futures or forward
contracts or foreign currency may be treated as ordinary income and losses
under special tax rules. Certain options, futures or forward contracts of the
Fund may be required to be marked to market (i.e., treated as if closed out)
on the last day of each taxable year, and any gain or loss realized with
respect to these contracts may be required to be treated as 60% long-term and
40% short-term gain or loss. Positions of the Fund in securities and
offsetting options, swaps, futures or forward contracts may be treated as
"straddles" and be subject to other special rules that may affect the amount,
timing and character of the Fund's distributions to shareholders. Certain uses
of foreign currency and foreign currency derivatives such as options, futures,
forward contracts and swaps and investment by the Fund in certain "passive
foreign investment companies" may be limited or a tax election may be made, if
available, in order to preserve the Fund's qualification as a RIC or avoid
imposition of a tax on the Fund.

Distributions by a Fund of the excess of net long-term capital gains over
short-term capital losses earned by the Fund, taking into account any capital
loss carryforwards that may be available to the Fund in years after its first
taxable year, are taxable to shareholders of the Fund as long-term capital
gains, whether received in cash or in additional shares and regardless of the
length of time their shares have been held. Certain distributions, if declared
in October, November or December and paid the following January, will be taxed
to shareholders as if received on December 31 of the year in which they are
declared.

Any loss realized upon the redemption or exchange of shares of a Fund with
a tax holding period of 6 months or less will be treated as a long-term
capital loss to the extent of any distribution of net long-term capital gains
with respect to such shares. All or a portion of a loss realized upon a
taxable disposition of Fund shares may be disallowed under "wash sale" rules
if other Fund shares are purchased (whether through reinvestment of dividends
or otherwise) within 30 days before or after the disposition. Any disallowed
loss will result in an adjustment to the shareholder's tax basis in some or
all of the other shares acquired.

Amounts paid by each Fund to individuals and certain other shareholders
who have not provided the Fund with their correct taxpayer identification
number ("TIN") and certain certifications required by the Internal Revenue
Service (the "IRS"), as well as shareholders with respect to whom the Fund has
received certain information from the IRS or a broker, may be subject to
"backup" withholding of federal income tax arising from the Fund's taxable
dividends and other distributions as well as the proceeds of redemption
transactions (including repurchases and exchanges) at a rate of 31%. An
individual's TIN is generally his or her social security number.

Non-resident alien individuals, foreign corporations and certain other
foreign entities generally will be subject to a U.S. withholding tax at a rate
of 30% on a Fund's distributions from its ordinary income and the excess of
its net short-term capital gain over its net long-term capital loss, unless
the tax is reduced or eliminated by an applicable tax convention.
Distributions from the excess of a Fund's net long-term capital gain over its
net short-term capital loss received by such shareholders and any gain from
the sale or other disposition of shares of the Fund generally will not be
subject to U.S. federal income taxation, provided that non-resident alien
status has been certified by the shareholder. Different U.S. tax consequences
may arise if: (i) the shareholder is engaged in a trade or business in the
United States; (ii) the shareholder is present in the United States for a
sufficient period of time during a taxable year to be treated as a U.S.
resident (generally 180 days or more); or (iii) the shareholder fails to
provide any required certifications regarding its status as a non-resident
alien investor. Foreign shareholders should consult their tax advisers
regarding the U.S. and foreign tax consequences of an investment in a Fund.

The foregoing discussion does not address the special tax rules applicable
to certain other classes of investors, such as other retirement plans, tax-
exempt entities, insurance companies and financial institutions. Shareholders
should consult their own tax advisers with respect to special tax rules that
may apply in their particular situations, as well as the state, local, and,
where applicable, foreign tax consequences of investing in a Fund.

PORTFOLIO SECURITY TRANSACTIONS

Decisions concerning the execution of portfolio security transactions,
including the selection of the market and the broker-dealer firm, are made by
the Adviser. The Adviser is also responsible for the execution of transactions
for all other accounts managed by it.

The Adviser places the portfolio security transactions of a Fund and of
certain other accounts managed by it for execution with many broker-dealer
firms. The Adviser uses its best efforts to obtain execution of portfolio
security transactions at prices which are advantageous and (when a disclosed
commission is being charged) at reasonably competitive commission rates. In
seeking such execution, the Adviser will use its best judgment in evaluating
the terms of a transaction, and will give consideration to various relevant
factors, including without limitation the full range and quality of the
broker-dealer's services, the value of the brokerage and research services
provided, the responsiveness of the broker-dealer to Eaton Vance, the size and
type of the transaction, the general execution and operational capabilities of
the broker-dealer, the nature and character of the market for the security,
the confidentiality, speed and certainty of effective execution required for
the transaction, the reputation, reliability, experience and financial
condition of the broker-dealer, the value and quality of services rendered by
the broker-dealer in this and other transactions, and the reasonableness of
the commission or spread, if any. Transactions on stock exchanges and other
agency transactions involve the payment of negotiated brokerage commissions.
Such commissions vary among different broker-dealer firms, and a particular
broker-dealer may charge different commissions according to such factors as
the difficulty and size of the transaction and the volume of business done
with such broker-dealer. Transactions in foreign securities usually involve
the payment of fixed brokerage commissions, which are generally higher than
those in the United States. There is generally no stated commission in the
case of securities traded in the over-the-counter markets, but the price paid
or received usually includes an undisclosed dealer markup or markdown. In an
underwritten offering the price paid includes a disclosed fixed commission or
discount retained by the underwriter or dealer. Although commissions paid on
portfolio transactions will, in the judgment of the Adviser, be reasonable in
relation to the value of the services provided, commissions exceeding those
which another firm might charge may be paid to broker-dealers who were
selected to execute transactions on behalf of the Funds and the Adviser's
other clients in part for providing brokerage and research services to the
Adviser.

As authorized in Section 28(e) of the Securities Exchange Act of 1934, a
broker or dealer who executes a portfolio transaction may receive a commission
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 compensation was reasonable in relation to the value of the
brokerage and research services provided. This determination may be made on
the basis of either that particular transaction or on the basis of overall
responsibilities which the Adviser and its affiliates have for accounts over
which it exercises investment discretion. In making any such determination,
the Adviser will not attempt to place a specific dollar value on the brokerage
and research services provided or to determine what portion of the commission
should be related to such services. Brokerage and research services may
include advice as to the value of securities, the advisability of investing
in, purchasing or selling securities, and the availability of securities or
purchasers or sellers of securities; furnishing analyses and reports
concerning issuers, industries, securities, economic factors and trends,
portfolio strategy and the performance of accounts; and effecting securities
transactions and performing functions incidental thereto (such as clearance
and settlement); and the "Research Services" referred to in the next
paragraph.

It is a common practice of the investment advisory industry for the
advisers of investment companies, institutions and other investors to receive
research, analytical, statistical and quotation services, data, information
and other services, products and materials which assist such advisers in the
performance of their investment responsibilities ("Research Services") from
broker-dealers which execute portfolio transactions for the clients of such
advisers and from third parties with which such broker-dealers have
arrangements. Consistent with this practice, the Adviser may receive Research
Services from broker-dealer firms with which the Adviser places portfolio
transactions and from third parties with which these broker-dealers have
arrangements. These Research Services may include such matters as general
economic, political, business and market information, industry and company
reviews, evaluations of securities and portfolio strategies and transactions,
proxy voting data and analysis services, technical analysis of various aspects
of the securities markets, and recommendations as to the purchase and sale of
securities and other portfolio transactions, financial, industry and trade
publications, news and information services, pricing and quotation equipment
and services, and research oriented computer hardware, software, data bases
and services. Any particular Research Service obtained through a broker-dealer
may be used by an Adviser in connection with client accounts other than those
accounts which pay commissions to such broker-dealer. Any such Research
Service may be broadly useful and of value to the Adviser in rendering
investment advisory services to all or a significant portion of its clients,
or may be relevant and useful for the management of only one client's account
or of a few clients' accounts, or may be useful for the management of merely a
segment of certain clients' accounts, regardless of whether any such account
or accounts paid commissions to the broker-dealer through which such Research
Service was obtained. The advisory fee paid by each Fund is not reduced
because the Adviser receives such Research Services. The Adviser evaluates the
nature and quality of the various Research Services obtained through broker-
dealer firms and attempts to allocate sufficient portfolio security
transactions to such firms to ensure the continued receipt of Research
Services which the Adviser believes are useful or of value to it in rendering
investment advisory services to its clients.

The Funds and Eaton Vance may also receive Research Services from
underwriters and dealers in fixed price offerings, which Research Services are
reviewed and evaluated by Eaton Vance in connection with its investment
responsibilities. The investment companies sponsored by Eaton Vance or BMR may
allocate brokerage commissions to acquire information relating to the
performance, fees and expenses of such companies and other mutual funds, which
information is used by the Trustees of such companies to fulfill their
responsibility to oversee the quality of the services provided by various
entities, including Eaton Vance, to such companies. Such companies may also
pay cash for such information.

Subject to the requirement that the Adviser shall use its best efforts to
seek to execute portfolio security transactions at advantageous prices and at
reasonably competitive commission rates or spreads, the Adviser is authorized
to consider as a factor in the selection of any broker-dealer firm with whom
portfolio orders may be placed the fact that such firm has sold or is selling
shares of the Funds or of other investment companies sponsored by Eaton Vance.
This policy is not inconsistent with a rule of the NASD, which rule provides
that no firm which is a member of the NASD shall favor or disfavor the
distribution of shares of any particular investment company or group of
investment companies on the basis of brokerage commissions received or
expected by such firm from any source.

Securities considered as investments for the Funds may also be appropriate
for other investment accounts managed by the Adviser or its affiliates.
Whenever decisions are made to buy or sell securities for a Fund and one or
more of such other accounts simultaneously, the Adviser will allocate the
security transactions (including "hot" issues) in a manner which it believes
to be equitable under the circumstances. As a result of such allocations,
there may be instances where a Fund will not participate in a transaction that
is allocated among other accounts. If an aggregated order cannot be filled
completely, allocations will generally be made on a pro rata basis. An order
may not be allocated on a pro rata basis where, for example: (i) consideration
is given to portfolio managers who have been instrumental in developing or
negotiating a particular investment; (ii) consideration is given to an account
with specialized investment policies that coincide with the particulars of a
specific investment; (iii) pro rata allocation would result in odd-lot or de
minimis amounts being allocated to a portfolio or other client; or (iv) where
the Adviser reasonably determines that departure from a pro rata allocation is
advisable. While these aggregation and allocation policies could have a
detrimental effect on the price or amount of the securities available to the
Fund from time to time, it is the opinion of the Trustees of the Trust that
the benefits from the Adviser's organization outweigh any disadvantage that
may arise from exposure to simultaneous transactions.

For the fiscal year ended October 31, 1998 and for the period from the
start of business, September 25, 1997, to October 31, 1997, Tax-Managed
Emerging Growth paid brokerage commissions of $ and $9,058,
respectively, with respect to portfolio transactions. Of these amounts,
approximately $ and $8,926, respectively, were paid in respect of
portfolio security transactions aggregating approximately $ and
$5,484,898, respectively, to firms which provided some Research Services to
the Adviser's organization (although many of such firms may have been selected
in any particular transaction primarily because of their execution
capabilities).

For the period from the start of business, April 22, 1998, to October 31,
1998, Tax-Managed International Growth paid brokerage commissions of $
with respect to portfolio transactions. Of this amount, approximately $
was paid in respect of portfolio security transactions aggregating
approximately $ to firms which provided some Research Services to the
Adviser's organization (although many of such firms may have been selected in
any particular transaction primarily because of their execution capabilities).

FINANCIAL STATEMENTS

The audited financial statements of and the independent auditors' reports
for the Funds, appear in each Fund's most recent annual report to
shareholders, which are incorporated by reference into this SAI. A copy of
each Fund's annual report accompanies this SAI. Consistent with applicable
law, duplicate mailings of shareholder reports and certain other Fund
information to shareholders residing at the same address may be eliminated.

<PAGE>

APPENDIX A

CLASS A FEES, PERFORMANCE AND OWNERSHIP

SERVICE FEES
For the fiscal year ended October 31, 1998, the following table shows (1)
amount of service fees paid or accrued on Class A shares paid under the Plan,
and (2) amount of service fees on Class A shares paid to investment dealers.
The fees paid by the Funds that were not paid to investment dealers were
retained by the principal underwriter.

SERVICE FEES TO
CLASS A SERVICE FEES INVESTMENT DEALERS
- ------- ------------ ------------------
Tax-Managed Emerging Growth .......... $ $
Tax-Managed International Growth* ....
- ----------
*For the period from the start of business April 22, 1998, to October 31,
1998.

PRINCIPAL UNDERWRITER
The total sales charges paid in connection with sales of Class A shares of
Tax-Managed Emerging Growth during the fiscal year ended October 31, 1998 was
$ , of which $ was received by the principal underwriter. For the
period from the start of business, September 25, 1997, to October 31, 1997,
total sales charges were $118,058, of which $17,757 was received by the
principal underwriter.

The total sales charges paid in connection with sales of Class A shares of
Tax-Managed International Growth during the period from the start of business,
April 22, 1998, to October 31, 1998 was $ , of which $ was received by
the principal underwriter.

The Trust has authorized the principal underwriter to act as its agent in
repurchasing shares at the rate of $2.50 for each repurchase transaction
handled by the principal underwriter. For the fiscal year ended October 31,
1998, Class A paid the principal underwriter for repurchase transactions
handled by it $2.50 for each such transaction which aggregated as follows:
Tax-Managed Emerging Growth -- $ ; and Tax-Managed International Growth --
$ .

PERFORMANCE INFORMATION

The table below indicates the cumulative and average annual total return
on a hypothetical investment of $1,000 in Class A shares for the periods shown
in the table. The "Value of Initial Investment" reflects the deduction of the
maximum sales charge of 5.75%. Past performance is no guarantee of future
results. Investment return and principal value will fluctuate; shares, when
redeemed, may be worth more or less than their original cost.

VALUE OF A $1,000 INVESTMENT -- TAX-MANAGED EMERGING GROWTH FUND

<TABLE>
<CAPTION>
TOTAL RETURN TOTAL RETURN
EXCLUDING MAXIMUM INCLUDING MAXIMUM
VALUE OF VALUE OF SALES CHARGE SALES CHARGE
INVESTMENT INVESTMENT INITIAL INVESTMENT -------------------------- ---------------------------
PERIOD DATE INVESTMENT ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- ---------------------------- ------------- ------------- ------------- ------------ ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 9/25/97 $ $ % % % %
1 Year ended
10/31/98 10/31/97 $ $ % % % %
</TABLE>

The table below indicates the cumulative and average annual total return
on a hypothetical investment of $1,000 in Class A shares for the period shown
in the table. The "Value of Initial Investment" reflects the deduction of the
maximum sales charge of 5.75%. Past performance is no guarantee of future
results. Investment return and principal value will fluctuate; shares, when
redeemed, may be worth more or less than their original cost.

VALUE OF A $1,000 INVESTMENT -- TAX-MANAGED INTERNATIONAL GROWTH FUND

<TABLE>
<CAPTION>
TOTAL RETURN TOTAL RETURN
EXCLUDING MAXIMUM INCLUDING MAXIMUM
VALUE OF VALUE OF SALES CHARGE SALES CHARGE
INVESTMENT INVESTMENT INITIAL INVESTMENT -------------------------- --------------------------
PERIOD DATE INVESTMENT ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- ---------------------------- ------------- ------------- ------------- ------------ ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Life of the Fund 4/22/98 $ $ % % % %
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at December 1, 1998, the Trustees and officers of the Trust, as a
group, owned in the aggregate less than 1% of the outstanding shares of each
Class A and of each Fund. In addition, as of the same date, the following
record owners held the amounts of Class A shares indicated below, which were
held on behalf of customers who are the beneficial owners of such shares, and
as to which they have voting power under certain limited circumstances:

<TABLE>
<S> <C> <C>
TAX-MANAGED EMERGING GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 7.1%
TAX-MANAGED INTERNATIONAL GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 6.9%
Eaton Vance Management Boston, MA 5.6%
</TABLE>

To the knowledge of the Trust, no other person owned of record or
beneficially 5% or more of either Fund's outstanding Class A shares as of such
date.
<PAGE>

APPENDIX B

CLASS B FEES, PERFORMANCE AND OWNERSHIP

DISTRIBUTION AND SERVICE PLANS
The following table shows, for the fiscal year ended October 31, 1998, (1)
sales commissions paid by the Principal Underwriter to Authorized Firms on
sales of Class B shares, (2) distribution payments to the Principal
Underwriter allocated to Class B shares under the Plan, (3) CDSC payments to
the Principal Underwriter, (4) service fees on Class B shares paid under the
Plan, and (5) amount of service fees on Class B shares paid to Authorized
Firms (the balance of which being retained by the Principal Underwriter).

<TABLE>
<CAPTION>
DISTRIBUTION CDSC SERVICE
PAYMENTS TO PAYMENTS TO FEES TO
SALES THE PRINCIPAL THE PRINCIPAL SERVICE AUTHORIZED
CLASS B COMMISSIONS UNDERWRITER UNDERWRITER FEES** FIRMS

<S> <C> <C> <C> <C> <C>
Tax-Managed Emerging Growth .... $ $ $ $ $
Tax-Managed International Growth*

- ------------
* For the period from the start of business, April 22, 1998, to October 31, 1998.
** Tax-Managed International Growth expects to begin accruing for its service fees during the quarter ending
June 30, 1999.
</TABLE>

PRINCIPAL UNDERWRITER
The Trust has authorized the principal underwriter to act as its agent in
repurchasing shares at the rate of $2.50 for each repurchase transaction
handled by the principal underwriter. For the fiscal year ended October 31,
1998, Class B paid the principal underwriter for repurchase transactions
handled by it $2.50 for each such transaction which aggregated as follows:
Tax-Managed Emerging Growth -- $ ; and Tax-Managed International Growth
- -- $ .

PERFORMANCE INFORMATION

VALUE OF A $1,000 INVESTMENT -- TAX-MANAGED EMERGING GROWTH

<TABLE>
<CAPTION>
VALUE OF VALUE OF TOTAL RETURN BEFORE TOTAL RETURN AFTER
INVESTMENT INVESTMENT DEDUCTING DEDUCTING
BEFORE AFTER THE MAXIMUM CDSC THE MAXIMUM CDSC
DEDUCTING THE DEDUCTING THE
INVESTMENT INVESTMENT AMOUNT OF MAXIMUM CDSC MAXIMUM CDSC -------------------------- --------------------------
PERIOD DATE INVESTMENT ON 10/31/98 ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ------------ ----------- --------------- --------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 9/29/97 $1,000 $ $ % % % %
1 Year
Ended
10/31/98 10/31/97 $1,000 $ $ % % % %
</TABLE>

The table below indicates the cumulative and average annual total return
on a hypothetical investment of $1,000 in Class B shares for the period shown
in the table. Past performance is not indicative of future results. Investment
return and principal value will fluctuate; shares, when redeemed, may be worth
more or less than their original cost.

VALUE OF $1,000 INVESTMENT -- TAX-MANAGED INTERNATIONAL GROWTH

<TABLE>
<CAPTION>
VALUE OF VALUE OF TOTAL RETURN TOTAL RETURN
INVESTMENT INVESTMENT BEFORE DEDUCTING CDSC AFTER DEDUCTING CDSC
INVESTMENT INVESTMENT AMOUNT OF BEFORE CDSC AFTER CDSC -------------------------- --------------------------
PERIOD DATE INVESTMENT ON 10/31/98 ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ------------ ----------- --------------- --------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 4/22/98 $1,000 $ $ % % % %
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at December 1, 1998, the Trustees and officers of the Trust, as a
group, owned in the aggregate less than 1% of the outstanding shares of each
Class B and of each Fund. In addition, as of the same date, the following
record owners held the amounts of Class B shares indicated below, which were
held on behalf of their customers who are the beneficial owners of such
shares, and as to which they have voting power under certain limited
circumstances:

<TABLE>
<S> <C> <C>
TAX-MANAGED EMERGING GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 13.1%
TAX-MANAGED INTERNATIONAL GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 17.2%
</TABLE>

To the knowledge of the Trust, no other person owned of record or
beneficially 5% or more of either Fund's outstanding Class B shares as of such
date.
<PAGE>

APPENDIX C

CLASS C FEES, PERFORMANCE AND OWNERSHIP

DISTRIBUTION PLAN
During the fiscal year ended October 31, 1998 and during the period from
the start of business, April 22, 1998, to October 31, 1998, the Principal
Underwriter paid to Authorized Firms sales commissions of $ and
$ on sales of Class C shares of Tax-Managed Emerging Growth and Tax-
Managed International Growth, respectively. During the same period, each Class
C made distribution payments to the principal underwriter under the Plans
aggregating $ and $ , respectively, and the principal underwriter
received approximately $ and $ , respectively, in CDSCs imposed
on early redeeming shareholders. During the fiscal year ended October 31, 1998
and during the period from the start of business, April 22, 1998, to October
31, 1998, Tax-Managed Emerging Growth Fund and Tax-Managed International
Growth Fund Class C made service fee payments aggregating $ and
$ , respectively, all of which were paid to the Principal Underwriter.

PRINCIPAL UNDERWRITER
The Trust has authorized the principal underwriter to act as its agent in
repurchasing shares at the rate of $2.50 for each repurchase transaction
handled by the principal underwriter. For the fiscal year ended October 31,
1998, Class C paid the principal underwriter for repurchase transactions
handled by it $2.50 for each such transaction which aggregated as follows:
Tax-Managed Emerging Growth -- $ ; and Tax-Managed International Growth --
$ .

PERFORMANCE INFORMATION

The table below indicates the cumulative and average annual total return
on a hypothetical investment of $1,000 in Class C shares for the periods shown
in the table. Past performance is not indicative of future results. Investment
return and principal value will fluctuate; shares, when redeemed, may be worth
more or less than their original cost.

VALUE OF A $1,000 INVESTMENT -- TAX-MANAGED EMERGING GROWTH

<TABLE>
<CAPTION>
VALUE OF VALUE OF
INVESTMENT INVESTMENT TOTAL RETURN BEFORE TOTAL RETURN AFTE
BEFORE AFTER DEDUCTING DEDUCTING
DEDUCTING DEDUCTING THE MAXIMUM CDSC THE MAXIMUM CDSC
INVESTMENT INVESTMENT AMOUNT OF THE CDSC THE CDSC -------------------------- --------------------------
PERIOD DATE INVESTMENT ON 10/31/98 ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ------------ ------------ --------------- -------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of
the Fund 9/29/97 $1,000 $ $ % % % %
1 Year
Ended
10/31/98 10/31/97 $1,000 $ $ % % % %
</TABLE>

VALUE OF A $1,000 INVESTMENT -- TAX-MANAGED INTERNATIONAL GROWTH

<TABLE>
<CAPTION>
VALUE OF VALUE OF
INVESTMENT INVESTMENT TOTAL RETURN BEFORE TOTAL RETURN AFTER
BEFORE AFTER DEDUCTING DEDUCTING
DEDUCTING DEDUCTING THE CDSC THE CDSC
INVESTMENT INVESTMENT AMOUNT OF THE CDSC THE CDSC -------------------------- --------------------------
PERIOD DATE INVESTMENT ON 10/31/98 ON 10/31/98 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ------------ ------------ --------------- -------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 4/22/98 $1,000 $ $ % % % %
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at December 1, 1998, the Trustees and officers of the Trust, as a
group, owned in the aggregate less than 1% of the outstanding shares of each
Class C and of each Fund. In addition, as of the same date, the following
record owners held the amounts of Class C shares indicated below, which were
held either individually or on behalf of their customers who are the
beneficial owners of such shares, and as to which they have voting power under
certain limited circumstances:

<TABLE>
<S> <C> <C>
TAX-MANAGED EMERGING GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 24.8%
TAX-MANAGED INTERNATIONAL GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 26.8%
</TABLE>

To the knowledge of the Trust, no other person owned of record or
beneficially 5% or more of either Fund's outstanding Class C shares as of such
date.

<PAGE>
PART C - OTHER INFORMATION

ITEM 23. EXHIBITS

(a)(1) Amended and Restated Declaration of Trust of Eaton Vance Mutual
Funds Trust dated August 17, 1993, filed as Exhibit (1)(a) to
Post-Effective Amendment No. 23 and incorporated herein by
reference.

(2) Amendment dated July 10, 1995 to the Declaration of Trust filed
as Exhibit (1)(b) to Post-Effective Amendment No. 23 and
incorporated herein by reference.

(3) Amendment dated June 23, 1997 to the Declaration of Trust filed
as Exhibit (1)(c) to Post-Effective Amendment No. 38 and
incorporated herein by reference.

(4) Amendment and Restatement of Establishment and Designation of
Shares dated January 6, 1998 filed as Exhibit (1)(d) to
Post-Effective Amendment No. 41 and incorporated herein by
reference.

(b)(1) By-Laws as amended November 3, 1986 filed as Exhibit (2)(a) to
Post-Effective Amendment No. 23 and incorporated herein by
reference.

(2) Amendment to By-Laws of Eaton Vance Mutual Funds Trust dated
December 13, 1993 filed as Exhibit (2)(b) to Post-Effective
Amendment No. 23 and incorporated herein by reference.

(d)(1) Investment Advisory Agreement with Eaton Vance Management for
Eaton Vance Short-Term Treasury Fund dated February 4, 1991 filed
as Exhibit (5)(a) to Post-Effective Amendment No. 23 and
incorporated herein by reference.

(2) Investment Advisory Agreement with Eaton Vance Management for
Eaton Vance Tax Free Reserves dated August 15, 1995 filed as
Exhibit (5)(b) to Post-Effective Amendment No. 25 and
incorporated herein by reference.

(3) Investment Advisory Agreement with Eaton Vance Management for
Eaton Vance Tax-Managed Emerging Growth Fund dated September 16,
1997 filed as Exhibit (5)(c) to Post-Effective Amendment No. 37
and incorporated herein by reference.

(4) Investment Advisory Agreement with Eaton Vance Management for
Eaton Vance Municipal Bond Fund dated October 17, 1997 filed as
Exhibit (5)(d) to Post-Effective Amendment No. 37 and
incorporated herein by reference.

(5) Investment Advisory Agreement with Eaton Vance Management for
Eaton Vance Tax-Managed International Growth Fund dated March 4,
1998 filed as Exhibit (5)(e) to Post-Effective Amendment No. 42
and incorporated herein by reference.

(e)(1) Distribution Agreement between Eaton Vance Mutual Funds Trust, on
behalf of Eaton Vance Cash Management Fund, and Eaton Vance
Distributors, Inc. effective November 1, 1996 filed as Exhibit
(6)(a)(4) to Post-Effective Amendment No. 34 and incorporated
herein by reference.

(2) Distribution Agreement Between Eaton Vance Mutual Funds Trust, on
behalf of Eaton Vance Liquid Assets Fund, and Eaton Vance
Distributors, Inc. effective November 1, 1996 filed as Exhibit
(6)(a)(5) to Post-Effective Amendment No. 34 and incorporated
herein by reference.

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<PAGE>
(3) Distribution Agreement between Eaton Vance Mutual Funds Trust, on
behalf of Eaton Vance Money Market Fund, and Eaton Vance
Distributors, Inc. effective November 1, 1996 filed as Exhibit
(6)(a)(6) to Post-Effective Amendment No. 34 and incorporated
herein by reference.

(4) Distribution Agreement between Eaton Vance Mutual Funds Trust, on
behalf of Eaton Vance Tax Free Reserves, and Eaton Vance
Distributors, Inc. effective November 1, 1996 filed as Exhibit
(6)(a)(7) to Post-Effective Amendment No. 34 and incorporated
herein by reference.

(5) Distribution Agreement between Eaton Vance Mutual Funds Trust (on
behalf of certain of its series), and Eaton Vance Distributors,
Inc. effective June 23, 1997 with attached Schedules filed as
Exhibit (6)(a)(8) to Post-Effective Amendment No. 38 and
incorporated herein by reference.

(i) Amendment to Distribution Agreement dated October 17, 1997 filed
as Exhibit (6)(a)(9) to Post-Effective Amendment No. 38 and
incorporated herein by reference.

(ii) Schedule A-2 to Distribution Agreement dated March 4, 1998, filed
as Exhibit (6)(a)(5)(ii) to Post-Effective Amendment No. 42 and
incorporated herein by reference.

(6) Selling Group Agreement between Eaton Vance Distributors, Inc.
and Authorized Dealers filed as Exhibit (6)(b) to the
Post-Effective Amendment No. 61 to the Registration Statement of
Eaton Vance Growth Trust (File Nos. 2-22019, 811-1241) and
incorporated herein by reference.

(f) The Securities and Exchange Commission has granted the Registrant
an exemptive order that permits the Registrant to enter into
deferred compensation arrangements with its independent Trustees.
See in the Matter of Capital Exchange Fund, Inc., Release No.
IC-20671 (November 1, 1994).

(g)(1) Custodian Agreement with Investors Bank & Trust Company dated
October 15, 1992 filed as Exhibit (8) to Post-Effective Amendment
No. 23 and incorporated herein by reference.

(2) Amendment to Custodian Agreement with Investors Bank & Trust
Company dated October 23, 1995 filed as Exhibit (8)(b) to
Post-Effective Amendment No. 27 and incorporated herein by
reference.

(h)(1)(a) Amended Administrative Services Agreement between Eaton Vance
Mutual Funds Trust (on behalf of certain of its series) and Eaton
Vance Management dated July 31, 1995 with attached schedules
(including Amended Schedule A dated May 7, 1996) filed as Exhibit
(9)(a) to Post-Effective Amendment No. 24 and incorporated herein
by reference.

(b) Amendment to Schedule A dated June 23, 1997 to the Amended
Administrative Services Agreement dated July 31, 1995 filed as
Exhibit (9)(a)(1) to Post-Effective Amendment No. 38 and
incorporated herein by reference.

(2) Transfer Agency Agreement dated January 1, 1998 filed as Exhibit
(k)(b) to the Registration Statement on Form N-2 of Eaton Vance
Advisers Senior Floating-Rate Fund (File Nos. 333-46853,
811-08671) (Accession No. 0000950156-98-000172) and incorporated
herein by reference.

C-2
<PAGE>
(i) Opinion of Internal Counsel filed herewith.

(j) Not applicable

(k) Not applicable

(l) Not applicable

(m)(1)(a) Distribution Plan pursuant to Rule 12b-1 under the Investment
Company Act of 1940 for Eaton Vance Short-Term Treasury Fund
dated February 4, 1991 as Amended and Restated February 25, 1991
filed as Exhibit (15)(b) to Post-Effective Amendment No. 23 and
incorporated herein by reference.

(b) Amendment to Distribution Plan for Eaton Vance Mutual Funds Trust
on behalf of Eaton Vance Short-Term Treasury Fund adopted June
24, 1996 filed as Exhibit (15)(b)(1) to Post-Effective Amendment
No. 34 and incorporated herein by reference.

(2)(a) Distribution Plan for Eaton Vance Liquid Assets Fund pursuant to
Rule 12b-1 under the Investment Company Act of 1940 dated June
19, 1995 filed as Exhibit (15)(g) to Post-Effective Amendment No.
25 and incorporated herein by reference.

(b) Amendment to Distribution Plan for Eaton Vance Mutual Funds Trust
on behalf of Eaton Vance Liquid Assets Fund adopted june 24, 1996
filed as Exhibit (15)(g)(1) to Post-Effective Amendment No. 34
and incorporated herein by reference.

(3)(a) Distribution Plan for Eaton Vance Money Market Fund pursuant to
Rule 12b-1 under the Investment Company Act of 1940 dated June
19, 1995 filed as Exhibit (15)(h) to Post-Effective Amendment No.
25 and incorporated herein by reference.

(b) Amendment to Distribution Plan for Eaton Vance Mutual Funds Trust
on behalf of Eaton Vance Money Market Fund adopted June 24, 1996
filed as Exhibit (15)(h)(1) to Post-Effective Amendment No. 34
and incorporated herein by reference.

(4)(a) Eaton Vance Mutual Funds Trust Class A Service Plan adopted June
23, 1997 with attached Schedules filed as Exhibit (15)(i) to
Post-Effective Amendment No. 38 and incorporated herein by
reference.

(b) Schedule A-2 to Class A Service Plan dated March 4, 1998, filed
as Exhibit (15)(d)(1) to Post-Effective Amendment No. 42 and
incorporated herein by reference.

(5)(a) Eaton Vance Mutual Funds Trust Class B Distribution Plan adopted
June 23, 1997 with attached Schedules filed as Exhibit (15)(j) to
Post-Effective Amendment No. 38 and incorporated herein by
reference.

(b) Schedule A-2 to Class B Distribution Plan dated March 4, 1998,
filed as Exhibit (15)(e)(1) to Post-Effective Amendment No. 42
and incorporated herein by reference.

(6)(a) Eaton Vance Mutual Funds Trust Class C Distribution Plan adopted
June 23, 1997 with attached Schedules filed as Exhibit (15)(k) to
Post-Effective Amendment No. 38 and incorporated herein by
reference.

C-3
<PAGE>
(b) Schedule A-2 to Class C Distribution Plan dated March 4, 1998,
filed as Exhibit (15)(f)(1) to Post-Effective Amendment No. 42
and incorporated herein by reference.

(n) Not applicable

(o)(1) (a) Multiple Class Plan for Eaton Vance Funds dated June 23, 1997
filed as Exhibit (18) to Post-Effective Amendment No. 37 and
incorporated herein by reference.

(b) Schedule A-4 to Multiple Class Plan dated January 6, 1998 filed
as Exhibit (18)(a)(1) to Post-Effective Amendment No. 42 and
incorporated herein by reference.

(p)(1) Power of Attorney for Eaton Vance Mutual Funds Trust dated
November 16, 1998 filed herewith.

(2) Power of Attorney for Government Obligations Portfolio dated
April 22, 1997 filed as Exhibit (17)(b) to Post-Effective
Amendment No. 36 and incorporated herein by reference.

(3) Power of Attorney for High Income Portfolio dated November 16,
1998 filed herewith.

(4) Power of Attorney for Strategic Income Portfolio dated November
16, 1998 filed herewith.

(5) Power of Attorney for Cash Management Portfolio dated April 22,
1997 filed as Exhibit (17)(e) to Post-Effective Amendment No. 36
and incorporated herein by reference.

(6) Power of Attorney for Tax-Managed Growth Portfolio dated November
16, 1998 filed herewith.

ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL

Not applicable

ITEM 25. INDEMNIFICATION

Article IV of the Registrant's Amended and Restated Declaration of Trust
permits Trustee and officer indemnification by By-law, contract and vote.
Article XI of the By-Laws contains indemnification provisions. Registrant's
Trustees and officers are insured under a standard mutual fund errors and
omissions insurance policy covering loss incurred by reason of negligent errors
and omissions committed in their capacities as such.

The distribution agreements of the Registrant also provide for reciprocal
indemnity of the principal underwriter, on the one hand, and the Trustees and
officers, on the other.

ITEM 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

Reference is made to: (i) the information set forth under the caption
"Management and Organization" in the Statement of Additional Information; (ii)
the Eaton Vance Corp. 10-K filed under the Securities Exchange Act of 1934 (File
No. 1-8100); and (iii) the Form ADV of Eaton Vance Management (File No.
801-15930) and Boston Management and Research (File No. 801-43127) filed with
the Commission, all of which are incorporated herein by reference.

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<PAGE>
ITEM 27. PRINCIPAL UNDERWRITERS

(a) Registrant's principal underwriter, Eaton Vance Distributors, Inc., a
wholly-owned subsidiary of Eaton Vance Management, is the principal
underwriter for each of the investment companies named below:

Eaton Vance Advisers Senior Eaton Vance Municipals Trust II
Floating-Rate Fund Eaton Vance Mutual Funds Trust
Eaton Vance Growth Trust Eaton Vance Prime Rate Reserves
Eaton Vance Income Fund of Boston Eaton Vance Special Investment Trust
Eaton Vance Investment Trust EV Classic Senior Floating-Rate
Eaton Vance Municipals Trust Fund

(b)
<TABLE>
<S> <C> <C>
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address* with Principal Underwiter with Registrant
-----------------

Albert F. Barbaro Vice President None
Chris Berg Vice President None
Kate B. Bradshaw Vice President None
David B. Carle Vice President None
Mark Carlson Vice President None
Daniel C. Cataldo Vice President None
Raymond Cox Vice President None
Peter Crowley Vice President None
Mark P. Doman Vice President None
Alan R. Dynner Vice President Secretary
Richard A. Finelli Vice President None
Kelly Flynn Vice President None
James Foley Vice President None
Michael A. Foster Vice President None
William M. Gillen Senior Vice President None
Hugh S. Gilmartin Vice President None
James B. Hawkes Vice President and Director President and Trustee
Perry D. Hooker Vice President None
Brian Jacobs Senior Vice President None
Thomas P. Luka Vice President None
John Macejka Vice President None
Stephen Marks Vice President None
Joseph T. McMenamin Vice President None
Morgan C. Mohrman Senior Vice President None
James A. Naughton Vice President None
Joseph Nelson Vice President None
Mark D. Nelson Vice President None
Linda D. Newkirk Vice President None
James L. O'Connor Vice President Treasurer
Andrew Ogren Vice President None
Thomas Otis Secretary and Clerk None
George D. Owen, II Vice President None
Enrique M. Pineda Vice President None
F. Anthony Robinson Vice President None
Frances Rogell Vice President None
Jay S. Rosoff Vice President None
Benjamin A. Rowland, Jr. Vice President, Treasurer and Director None
Stephen M. Rudman Vice President None
John P. Rynne Vice President None
Kevin Schrader Vice President None
George V.F. Schwab, Jr. Vice President None
Teresa A. Sheehan Vice President None
William M. Steul Vice President and Director None
Cornelius J. Sullivan Senior Vice President None
Peter Sykes Vice President None
David M. Thill Vice President None
John M. Trotsky Vice President None
Jerry Vainisi Vice President None
Chris Volf Vice President None
Wharton P. Whitaker President and Director None
Sue Wilder Vice President None
</TABLE>

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<PAGE>
- ------------------------------------------
* Address is 24 Federal Street, Boston, MA 02110

ITEM 28. LOCATION OF ACCOUNTS AND RECORDS

All applicable accounts, books and documents required to be maintained by
the Registrant by Section 31(a) of the Investment Company Act of 1940 and the
Rules promulgated thereunder are in the possession and custody of the
Registrant's custodian, Investors Bank & Trust Company, 200 Clarendon Street,
16th Floor, Mail Code ADM27, Boston, MA 02116, and its transfer agent, First
Data Investor Services Group, 4400 Computer Drive, Westborough, MA 01581-5120,
with the exception of certain corporate documents and portfolio trading
documents which are in the possession and custody, Eaton Vance Management, 24
Federal Street, Boston, MA 02110. Registrant is informed that all applicable
accounts, books and documents required to be maintained by registered investment
advisers are in the custody and possession of Eaton Vance Management and Boston
Management and Research.

ITEM 29. MANAGEMENT SERVICES

Not applicable

ITEM 30. UNDERTAKINGS

Not applicable

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<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, and the
Investment Company Act of 1940, the Registrant has duly caused this Amendment to
its Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Boston, and the Commonwealth of
Massachusetts, on December 28, 1998.

EATON VANCE MUTUAL FUNDS TRUST

By: /s/ JAMES B. HAWKES
------------------------------------
James B. Hawkes, President

Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to the Registration Statement has been signed below by
the following persons in the capacities on December 28, 1998.

Signature Title
- --------- -----

/s/ James B. Hawkes President (Chief Executive Officer)
- ---------------------------------- and Trustee
James B. Hawkes

/s/ James L. O'Connor Treasurer (Principal Financial and
- ---------------------------------- Accounting Officer)
James L. O'Connor

Jessica M. Bibliowicz* Trustee
- ----------------------------------
Jessica M. Bibliowicz

Donald R. Dwight* Trustee
- ----------------------------------
Donald R. Dwight

Samuel L. Hayes, III* Trustee
- ----------------------------------
Samuel L. Hayes, III

Norton H. Reamer* Trustee
- ----------------------------------
Norton H. Reamer

Lynn A. Stout* Trustee
- ----------------------------------
Lynn A. Stout

John L. Thorndike* Trustee
- ----------------------------------
John L. Thorndike

Jack L. Treynor* Trustee
- ----------------------------------
Jack L. Treynor

*By: /s/ Alan R. Dynner
-----------------------------
Alan R. Dynner (As attorney-in-fact)

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<PAGE>
SIGNATURES

High Income Portfolio has duly caused this Amendment to the Registration
Statement on Form N-1A of Eaton Vance Mutual Funds Trust (File No. 02-90946) to
be signed on its behalf by the undersigned, thereunto duly authorized in the
City of Boston and the Commonwealth of Massachusetts on December 28, 1998.

HIGH INCOME PORTFOLIO

By: /s/ JAMES B. HAWKES
--------------------------------------
James B. Hawkes, President

This Amendment to the Registration Statement on Form N-1A of Eaton Vance
Mutual Funds Trust (File No. 02-90946) has been signed below by the following
persons in the capacities on December 28, 1998.