EATON VANCE MUTUAL FUNDS TRUST, 485BPOS, 2000-02-25

EATON VANCE MUTUAL FUNDS TRUST
485BPOS, 2000-02-25

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<PAGE>

As filed with the Securities and Exchange Commission on February 25, 2000
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. 55 [x]
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940 [x]
AMENDMENT NO. 58 [x]

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

THE EATON VANCE BUILDING, 255 STATE STREET, BOSTON, MASSACHUSETTS 02109
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

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

ALAN R. DYNNER
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THE EATON VANCE BUILDING, 255 STATE STREET, BOSTON, MASSACHUSETTS 02109
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(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 March 1, 2000 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on (date) pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] 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 and Strategic Income Portfolio have also executed this
Registration Statement.
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<PAGE>

LOGO
Investing
for the
21st
Century(R)

Eaton Vance
Strategic Income
Fund

A mutual fund seeking high income and total return

Prospectus Dated
March 1, 2000

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
<S> <C> <C> <C>
Page Page
- ---------------------------------------------------------------------------------------------------
Fund Summary 2 Sales Charges 7
Investment Objective & Principal Policies and Risks 4 Redeeming Shares 9
Management and Organization 5 Shareholder Account Features 9
Valuing Shares 6 Tax Information 10
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 Fund's investment objective
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 also
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 Fund will invest principally (over 50% of net assets) in high grade debt
securities. The Fund may invest the remainder of its assets in lower-rated debt
securities (so-called "junk bonds") and other securities that are expected to
produce income. The Fund may invest in U.S. and foreign securities, such as U.S.
Government mortgage-backed debt obligations, high yield corporate bonds and
sovereign debt of foreign countries, including emerging market countries. The
Fund may engage in derivative transactions to protect against price decline, to
enhance returns or as a substitute for purchasing or selling securities. The use
of these techniques is subject to certain limitations and may expose the Fund to
increased risk of principal loss.

The Fund currently seeks its objective by investing in Strategic Income
Portfolio (the "Portfolio"), a separate registered investment company with the
same investment objective and policies as the Fund. In lieu of having the
Portfolio invest in lower-rated debt securities, the Fund may also invest in
High Income Portfolio, 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.

Changes in prevailing interest rates in the U.S. or abroad may affect the value
of Fund shares, depending upon the currency denomination of security holdings,
whether derivative transactions had magnified or reduced sensitivity to a
change, overall portfolio composition and other factors. The effect of economic
and other events on the interrelationships of portfolio holdings can be complex
and not entirely predictable.

As a non-diversified fund, the Fund may invest a larger portion of its assets in
the obligations of a limited number of issuers than may a diversified fund. This
makes the Fund more susceptible to adverse economic, business or other
developments affecting such issuers. 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 in the Fund. 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.

2
<PAGE>

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. The following returns are for Class B shares for
each calendar year through December 31, 1999 and do not reflect a sales charge.
If the sales charge was reflected, the returns would be lower.

8.23% -0.69% 10.82% -5.27% 14.44% 18.19% 8.52% 1.93% 5.41%
1991 1992 1993 1994 1995 1996 1997 1998 1999
</TABLE>

The highest quarterly total return for Class B was 7.36% for the quarter ended
June 30, 1995, and the lowest quarterly total return was -6.59% for the quarter
ended March 31, 1994. For the 30 days ended October 31, 1999, the yield and tax
equivalent yield (assuming a federal tax rate of 31%) for Class A shares were
7.52% and 10.90%, respectively, for Class B shares were 7.04% and 10.20%,
respectively, and for Class C shares were 6.97% and 10.10%, respectively. For
current yield information call 1-800-225-6265.
<TABLE>
<CAPTION>
One Five Life of
Average Annual Total Return as of December 31, 1999 Year Years Fund
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Class A Shares 1.30% 8.74% 6.09%
Class B Shares 0.56% 9.26% 6.52%
Class C Shares 4.36% 9.74% 6.64%
Lehman Aggregate Bond Index -0.82% 7.73% 7.67%
Composite of Lipper Fund Classification Averages 2.52% 5.06% 3.52%
</TABLE>

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). 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 effective
dollar weighted average maturity of not more than three years until March 1,
1997. The Composite of Lipper Fund Classification Averages reflects the average
of the total returns of mutual funds included in the same fund classification as
this Fund. The fund classifications are established by Lipper Inc., an
organization that compiles mutual fund performance. Funds within a
classification 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 effective dollar weighted
average maturity of not more than three years. In connection with this policy
change, the Fund's Lipper classification also changed. The Composite is based on
the average total returns of funds in the Lipper Short World Multi-Market Income
Funds classification 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. Investors cannot
invest directly in an Index or Lipper Classification. (Source: Lipper Inc.)

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 (Load) (as a percentage of offering price) 4.75% None None
Maximum Deferred Sales Charge (Load) (as a percentage of the
lower of net asset value at time of purchase or redemption) None 5.00% 1.00%
Maximum Sales Charge (Load)Imposed on Reinvested Distributions None None None
Exchange Fee None None None
</TABLE>

Annual Fund Operating Expenses
(expenses that are deducted from Fund assets) Class A Class B Class C
- --------------------------------------------------------------------------------
Management Fees 0.56% 0.56% 0.56%
Distribution and Service (12b-1) Fees* 0.00% 1.00% 1.00%
Other Expenses** 0.47% 0.47% 0.47%
---- ---- ----
Total Annual Fund Operating Expenses 1.28% 2.03% 2.03%

* Long-term shareholders of Class B and Class C shares may pay more than the
economic equivalent of the front-end shales charge permitted by the National
Association of Securities Dealers, Inc.
** Other Expenses for Class A includes a service fee of 0.25%.

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

Class A shares $599 $ 862 $1,144 $1,947
Class B shares $706 $1,037 $1,293 $2,358
Class C shares $306 $ 637 $1,093 $2,358

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

1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
Class A shares $599 $862 $1,144 $1,947
Class B shares $206 $637 $1,093 $2,358
Class C shares $206 $637 $1,093 $2,358

3
<PAGE>

INVESTMENT OBJECTIVE & PRINCIPAL POLICIES AND RISKS

The Fund's investment objective 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 currently seeks its objective by investing in
Strategic Income Portfolio, a separate investment company having the same
investment objective and policies as the Fund. The Fund's objective may be
changed by the Trustees without shareholder approval.

The investment adviser adjusts the Portfolio's investments (buys and sells
securities) 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. Investment strategy may change frequently. 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. This 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 securities 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 Ratings Group ("S&P"), Moody's
Investors Service, Inc. ("Moody's"), or Duff & Phelps, Inc. ("DCR"). 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 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, which may be rated in the C or D rating categories. 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 be required to retain legal counsel and/or a
financial adviser. This may increase the Portfolio's operating expenses and
adversely affect the Portfolio's net asset value. 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 not be compelled to dispose of such security
or other asset.

In lieu of having the Portfolio invest in lower-rated debt securities, the Fund
may invest up to 50% of its net 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 only invest in the HI Portfolio when it invests as
stated in this paragraph. 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. The portion of
the Fund's assets invested in the HI Portfolio will be subject to the HI
Portfolio's advisory fee, but will not be subject to Strategic Income
Portfolio's advisory or administration fee, or a Fund advisory fee.

4
<PAGE>

At January 31, 2000, HI Portfolio had 95.66% of its assets invested in high
yield, high risk securities, 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
indices, other indices, other financial instruments or currencies; options on
futures contracts; exchange-traded options on securities, indices or currencies;
warrants; forward foreign currency exchange contracts; interest rate, total
return, default and currency swaps; and short sales. Transactions in derivative
instruments involve a risk of loss due to unanticipated adverse changes in
securities prices, interest rates, indices, 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
investment adviser's use of derivative instruments will be advantageous. The
Portfolio may also engage in short sales of its securities.

The Portfolio may borrow amounts up to one-third of the value of its total
assets (including borrowings), but it will not borrow more than 5% of the value
of its total assets except to satisfy redemption requests or for other temporary
purposes. Such borrowings would result in increased expense to the Fund and,
while they are outstanding, would magnify increases or decreases in the value of
Fund shares. The Portfolio will not purchase additional investment securities
while outstanding borrowings exceed 5% of the value of its total assets. During
unusual market conditions, the Portfolio may temporarily invest up to 100% of
its assets in cash or cash equivalents. While temporarily invested, the
Portfolio may not achieve its investment objective. While at times the Portfolio
may use alternative investment strategies in an effort to limit losses, it may
choose not to do so.

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 the Portfolio's net asset value to fluctuate as well. Costs are incurred
in connection with conversions between various currencies. In addition, foreign
brokerage commissions, custody fees and other costs of investing in foreign
securities 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. 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.

MANAGEMENT AND ORGANIZATION

Management. The Portfolio's investment adviser is Boston Management and Research
("BMR"), a subsidiary of Eaton Vance Management ("Eaton Vance"), with offices at
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109. Eaton
Vance has been managing assets since 1924 and managing mutual funds since 1931.
Eaton Vance and its subsidiaries currently manage over $41 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.

5
<PAGE>

Annual Daily
Category Daily Net Assets Asset Rate Income Rate
- -------------------------------------------------------------------------------
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, 1999, the Portfolio paid BMR advisory fees
equivalent to 0.56% of the Portfolio's average net assets for such year.

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, 1999, the HI Portfolio paid BMR advisory fees equivalent to
0.61% 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 more than 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, 1999, the Portfolio paid BMR
adminstration fees equal to 0.15% of the Portfolio's average daily net assets.

The investment adviser and the Fund, Portfolio and HI 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 Portfolios) 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 offers multiple classes of shares. Each
class represents a pro rata interest in the Fund, but is subject to different
expenses and rights. 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 Portfolios (and may invest in the HI 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 a 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 purchase
price of shares is their net asset value (plus a sales charge for Class A),
which is derived from Portfolio holdings. Most debt securities are valued by an
independent pricing service.

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 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

6
<PAGE>

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 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 of
shares 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 and certain group
purchase plans.

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>

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 totaling $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. Class A shares purchased at net asset value in amounts of
$1 million or more 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:

Year of Redemption After Purchase CDSC
- --------------------------------------------
First or Second 5%
Third 4%
Fourth 3%
Fifth 2%
Sixth 1%
Seventh or following 0%

The CDSC is based on the lower of the net asset value at the time of purchase or
at 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.

7
<PAGE>

The sales commission on Class C shares equals 0.75% of the purchase price of the
shares. After the first year, investment dealers also receive 0.75% of the value
of Class C shares in annual distribution fees.

Reducing or Eliminating Sales Charges. Front-end sales charges on purchases of
Class A shares may be reduced under the right of accumulation or under a
statement of intention. Under the right of accumulation, the sales charges you
pay are reduced if the current market value of your current holdings (based on
the current offering price), plus your new purchases, total $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. Under a statement of intention, 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 you satisfy the statement or the 13-month period
expires.

Class A shares are offered at net asset value to clients of financial
intermediaries who charge a fee for their services; accounts affiliated with
those financial intermediaries; tax-deferred retirement plans; investment and
institutional clients of Eaton Vance; certain persons affiliated with Eaton
Vance; and certain Eaton Vance and fund service providers. Ask your investment
dealer for details. Class A shares are also sold at net asset value if the
amount invested represents redemption proceeds from a mutual fund not affiliated
with Eaton Vance, provided the redemption occurred within 60 days of the Fund
share purchase and the redeemed shares were subject to a sales charge. Class A
shares so acquired will be subject to a 0.50% CDSC if they are redeemed within
12 months of purchase. Investment dealers will be paid a commission on such
sales of 0.50% of the amount invested.

CDSCs are waived for certain redemptions pursuant to a Withdrawal Plan (see
"Shareholder Account Features") and, for Class B and Class C shares, 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 all or any portion 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. Under these circumstances your
account will be credited with any CDSC paid in connection with the redemption.
Any CDSC period applicable to the shares you acquire upon reinvestment will run
from the date of your original share purchase. 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 in effect plans
under Rule 12b-1 that allow 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 0.75% 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 equal to 0.25% of
average daily net assets annually.

Class B and Class C distribution fees are subject to termination when payments
under the Rule 12b-1 plans are sufficient to extinguish uncovered distribution
charges. As described more fully in the Statement of Additional Information,
uncovered distribution charges of a Class are increased by sales commissions
payable by the Class to the principal underwriter in connection with sales of
shares of that Class and by an interest factor tied to the U.S. Prime Rate.
Uncovered distribution charges are reduced by the distribution fees paid by the
Class and by CDSCs paid to the Fund by redeeming shareholders. The amount of the
sales commissions payable by Class B to the principal underwriter in connection
with sales of Class B shares is significantly less than the maximum permitted by
the sales charge rule of the National Association of Securities Dealers, Inc. To
date, neither Class B nor Class C uncovered distribution charges have been fully
covered.

8
<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 by 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 and shares that are
subject to fiduciary arrangements cannot be
redeemed by telephone.

Through an Investment Dealer Your investment dealer is responsible for
transmitting the order promptly. An
investment 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 purchase 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(R) 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.

Withdrawal Plan. You may redeem shares on a regular monthly or quarterly basis
by establishing a systematic withdrawal plan. Withdrawals will not be subject to
any applicable CDSC if they are, in the aggregate, less than or equal to 12%
annually of the greater of either the initial account balance or the current
account balance. A minimum account size of

9
<PAGE>

$5,000 is required to establish a systematic withdrawal plan. Because purchases
of Class A shares are generally subject to an initial sales charge, you should
not make withdrawals from your account while you are making purchases.

Tax-Sheltered Retirement Plans. Class A 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 hold Class A shares for less than six months and exchange them for
shares subject to a higher sales charge, you will be charged the difference
between the two sales charges. 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, 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 12 months, it will be deemed to be market
timing. The exchange privilege may be terminated for market timing accounts.

Telephone and Electronic Transactions. You can redeem or exchange shares by
telephone as described in this prospectus. In addition, certain transactions may
be conducted through the Internet. The transfer agent and the principal
underwriter have procedures in place to authenticate telephone and electronic
instructions (such as using security codes or verifying personal account
information). As long as the transfer agent and principal underwriter follow
these procedures, they will not be responsible for unauthorized telephone or
electronic transactions and you bear the risk of possible loss resulting from
these 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. You will not be able to
utilize a number of shareholder features, such as telephone transactions,
directly with the Fund. 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. Different classes will distribute different dividend
amounts. A portion of the Fund's distributions may be eligible for the corporate
dividends-received deduction. Distributions of income and net gains from
investments that the Portfolio or HI Portfolio held for one year or less will be
taxable as ordinary income. Distributions of any net gains from investments held
by the Portfolio or HI Portfolio for more than one year are taxable as long-term
gains (generally at a 20% rate for noncorporate shareholders). The Fund expects
that its distributions will consist primarily of ordinary income.

The Portfolios' investments in foreign securities may be subject to foreign
withholding taxes, which may decrease the Portfolios' yield on those securities.
In addition, the Portfolios' investments in foreign securities or foreign
currencies may increase or accelerate the Fund's recognition of ordinary income
and may affect the timing or amount of the Fund's distributions.

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. A
redemption of Fund shares, including an exchange for shares of another fund, is
a taxable transaction.

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
PricewaterhouseCoopers LLP, independent accountants. The report of
PricewaterhouseCoopers LLP 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 two classes of shares on November 1, 1997.
Prior to that date, the Fund offered only Class B shares and Class C existed as
a separate fund. The Fund began offering Class A shares on January 23, 1998.

<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
-------------------------------------------------------------
1999
-------------------------------------------------------------
CLASS A(1) CLASS B(1) CLASS C(1)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value - Beginning of year $ 9.220 $ 8.720 $11.010
------- -------- -------
Income (loss) from operations
Net investment income $ 0.852 $ 0.731 $ 0.912
Net realized and unrealized gain (loss) (0.095) (0.105) (0.132)
------- ------- -------
Total income (loss) from operations $ 0.757 $ 0.626 $ 0.780
------- ----- -------
Less distributions
From net investment income $(0.819) $ (0.688) $(0.872)
In excess of net investment income -- -- --
Tax return of capital (0.048) (0.048) (0.048)
------- ------- -------
Total distributions $(0.867) $ (0.736) $(0.920)
------- -------- --------
Net asset value - End of year $ 9.110 $ 8.610 $10.870
======= ========= ========
Total return(3) 8.40% 7.32% 7.23%
Ratios/Supplemental Data:
Net assets, end of year (000's omitted) $ 6,050 $155,768 $30,882
Ratios (as a percentage of average daily net assets):
Expenses(4) 1.08% 1.96% 2.03%
Net investment income 9.20% 8.31% 8.22%
Portfolio Turnover of the Portfolio 47% 47% 47%
<CAPTION>

1998 1997 1996
---------------------------------------------------------------
CLASS A(2) CLASS B CLASS C CLASS B CLASS B
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value - Beginning of year $10.000 $ 9.470 $11.950 $ 9.310 $ 8.500
------- -------- ------- -------- --------
Income (loss) from operations
Net investment income $ 0.668 $ 0.684 $ 0.869 $ 0.657 $ 0.655
Net realized and unrealized gain (loss) (0.767) (0.686) (0.872) 0.288 0.858
------- -------- ------- -------- --------
Total income (loss) from operations $(0.099) $ (0.002) $(0.003) $ 0.945 $ 1.513
------- -------- ------- -------- --------
Less distributions
From net investment income $(0.654) $ (0.748) $(0.884) $ (0.657) $ (0.655)
In excess of net investment income (0.027) -- (0.053) (0.128) (0.048)
Tax return of capital -- -- -- -- --
------- -------- ------- -------- --------
Total distributions $(0.681) $ (0.748) $(0.937) $ (0.785) $ (0.703)
------- -------- ------- -------- --------
Net asset value - End of year $ 9.220 $ 8.720 $11.010 $ 9.470 $ 9.310
======= ======== ======= ======== ========
Total return(3) (1.29)% (0.20)% (0.15)% 10.44% 18.48%
Ratios/Supplemental Data:
Net assets, end of year (000's omitted) $ 2,009 $138,495 $19,518 $130,596 $129,671
Ratios (as a percentage of average daily net assets):
Expenses(4) 1.03%(5) 1.96% 2.03% 2.08% 2.17%
Net investment income 8.44%(5) 7.40% 7.37% 6.91% 7.38%
Portfolio Turnover of the Portfolio 71% 71% 71% 77% 71%
<CAPTION>

1995
-----------
CLASS B
- ----------------------------------------------------------------------
<S> <C>
Net asset value - Beginning of year $ 8.290
--------
Income (loss) from operations
Net investment income $ 0.726
Net realized and unrealized gain (loss) 0.167
--------
Total income (loss) from operations $ 0.893
--------
Less distributions
From net investment income $ (0.361)
In excess of net investment income --
Tax return of capital (0.322)
--------
Total distributions $ (0.683)
--------
Net asset value - End of year $ 8.500
========
Total return(3) 11.34%
Ratios/Supplemental Data:
Net assets, end of year (000's omitted) $150,767
Ratios (as a percentage of average daily net assets):
Expenses(4) 2.18%
Net investment income 7.85%
Portfolio Turnover of the Portfolio 78%
</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) 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 reinvestment date. Total return is not computed on
an annualized basis.
(4) I ncludes the Fund's share of the Portfolios' allocated expenses for the
period the Fund was investing in the Portfolios.
(5) Annualized.

<PAGE>

LOGO
Investing
for the
21st
Century(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.
The Eaton Vance Building
255 State Street
Boston, MA 02109
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
operation of the public reference room); 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
20549-0102 or by electronic mail at [email protected].

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

PFPC Global Fund Services
P.O. Box 9653
Providence, RI 02904-9653
1-800-262-1122

The Fund's SEC File No. is 811-4015 SIP

<PAGE>

{LOGO} Mutual Funds
EATON VANCE for People
Mutual Funds Who Pay
Taxes(R)

Eaton Vance Tax-Managed
Emerging Growth Fund

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

Eaton Vance Tax-Managed
International Growth Fund

A diversified fund seeking long-term, after tax returns
by investing in foreign companies

Prospectus Dated
March 1, 2000

Information in this prospectus
Page Page
- --------------------------------------------------------------------------------
Fund Summaries 2 Sales Charges 8
Investment Objectives & Principal Redeeming Shares 9
Policies 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 page summarizes the investment objective, 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 through 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. Although it invests primarily in domestic companies, the Fund may invest
up to 25% of its total assets in foreign companies.

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. The Fund invests primarily in common stocks of companies included in
the Morgan Stanley Capital International Europe, Australasia, Far East ("EAFE")
Index. The EAFE Index is an unmanaged index of approximately 1,000 companies
located in twenty countries.

Each Fund may engage in derivative transactions to protect against price
declines, to enhance returns or as a substitute for purchasing or selling
securities. Some of the securities owned by a Fund may have restrictions on
resale.

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
(which is not subject to current tax). 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 approach to investing;
*attempting to avoid net realized short-term gains;
*when appropriate, selling stocks trading below their tax cost to
realize 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 smaller 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

Each Fund's shares are 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-specific risk by diversifying its holdings among many companies
and industries.

In addition to stock market risk, shares of Tax-Managed Emerging Growth Fund are
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.

Because the Funds invest in foreign securities, the value of Fund shares may be
affected by changes in currency exchange rates and other developments abroad.
The use of derivative transactions is subject to certain limitations and may
expose a Fund to increased risk of principal loss. Securities subject to
restrictions on resale are often less liquid and more difficult to value.

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.
Shareholders may realize substantial losses and should invest for the long-term.

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 pre-tax performance, including a
comparison of the Fund's performance to the performance of a broad-based,
unmanaged market index of 600 small capitalization stocks. 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, 1999 and do not reflect sales charges. If the sales charge was reflected,
the returns would be lower.

11.02% 45.22%
- --------------------------------------------------------------------------------
1998 1999

The highest quarterly total return for Class B was 32.32% for the quarter
ended December 31, 1999, and the lowest quarterly return was -17.52% for
the quarter ended September 30, 1998.

Average Annual Total Return
as of December 31, 1999 One Year Life of Fund
- --------------------------------------------------------------------------------
Class A Shares 38.03% 20.95%
Class B Shares 40.22% 21.78%
Class C Shares 43.94% 22.95%
Standard & Poor's 600 Small Cap Index 12.41% 3.27%

These returns reflect the maximum sales charge for Class A (5.75%) and any
applicable CDSC for Class B and Class C. Class A commenced operations on
September 25, 1997 and Class B and Class C commenced operations on September 29,
1997. Life of Fund returns are calculated from September 30, 1997. The Standard
& Poor's 600 Index is a broad-based unmanaged market index of 600 small
capitalization stocks. Investors cannot invest directly in an Index. (Source for
Standard & Poor's 600 Small Cap Index: Lipper Inc.)

Fund Fees and Expenses. These tables describe the fees and expenses that you may
pay if you buy and hold shares.

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

Annual Fund Operating Expenses
(expenses that are deducted
from Fund assets Class A Class B Class C
- --------------------------------------------------------------------------------
Management Fees 0.63% 0.63% 0.63%
Distribution and Service
(12b-1) Fees* 0.00% 1.00% 1.00%
Other Expenses** 0.57% 0.32% 0.32%
----- ----- -----
Total Annual Fund Operating Expenses 1.20% 1.95% 1.95%

* 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.

** Other Expenses for Class A shares includes a service fee of 0.25%.

<PAGE>
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
- -------------------------------------------------------------------------------
Class A shares $ 690 $ 934 $ 1,197 $ 1,946
Class B shares $ 698 $ 1,012 $ 1,252 $ 2,275
Class C shares $ 298 $ 612 $ 1,052 $ 2,275

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

1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
Class A shares $ 690 $ 934 $ 1,197 $ 1,946
Class B shares $ 198 $ 612 $ 1,052 $ 2,275
Class C shares $ 198 $ 612 $ 1,052 $ 2,275

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

Performance Information. The following bar chart and table provide information
about Tax-Managed International Growth Fund's pre-tax performance, including a
comparison of the Fund's performance to the performance of a broad-based,
unmanaged market index of international stocks. 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 the calendar year ending December 31, 1999 and do not reflect
sales charges. If the sales charge was reflected, the returns would be lower.

44.01% The highest quarterly total return for Class B was 19.82% for the
- ------ quarter ended December 31, 1999, and the lowest quarterly return
1999 was 1.15% for the quarter ended March 31, 1999.

Average Annual Return
as of December 31, 1999 One Year Life of Fund
- --------------------------------------------------------------------------------
Class A Shares 36.83% 18.99%
Class B Shares 39.01% 19.71%
Class C Shares 42.89% 22.13%
Morgan Stanley Capital
International Europe,
Australasia,
and Far East Index 26.96% 16.29%

These returns reflect the maximum sales charge for Class A (5.75%) and any
applicable CDSC for Class B and Class C. Class A, Class B and Class C commenced
operations on April 22, 1998. Life of Fund returns are calculated from April 30,
1998. The Morgan Stanley Capital International Europe, Australasia, and Far East
(EAFE) Index is a broad-based, unmanaged index of international stocks.
Investors cannot invest directly in an Index. (Source for the EAFE Index: Lipper
Inc.)

Fund Fees and Expenses. These tables describe the fees and expenses that you may
pay if you buy and hold shares.

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

Annual Fund Operating Expenses
(expenses that are deducted
from Fund assets) Class A Class B Class C
- --------------------------------------------------------------------------------
Management Fees 1.00% 1.00% 1.00%
Distribution and Service
(12b-1) Fees* 0.00% 1.00% 1.00%
Other Expenses** 0.94% 0.72% 0.72%
----- ----- -----
Total Annual Fund Operating Expenses 1.94% 2.72% 2.72%

* 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.
** Other Expenses for Class A shares includes a service fee of 0.25%.

<PAGE>
Example

1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
Class A shares $ 761 $1,149 $ 1,562 $2,709
Class B shares $ 775 $1,244 $ 1,640 $3,051
Class C shares $ 374 $ 841 $ 1,435 $3,041

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

1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
Class A shares $ 761 $1,149 $ 1,562 $2,709
Class B shares $ 275 $ 844 $ 1,440 $3,051
Class C shares $ 274 $ 841 $ 1,435 $3,041

4
<PAGE>
INVESTMENT OBJECTIVES & PRINCIPAL 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
through 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 many emerging growth
companies will have annual revenues of $1 billion or less at the time they are
acquired by the Fund, but the Fund may also invest in larger and smaller
companies having emerging growth characteristics.

Under normal market conditions, Tax-Managed Emerging Growth Fund will invest at
least 65% of its total assets in equity securities of emerging growth companies.
Many emerging growth companies are in the early stages of their development, are
more dependent on fewer products, services, markets or financial resources or
may depend upon a more limited management group than more established companies,
may lack substantial capital reserves and do not have established performance
records. Emerging growth stocks frequently have less trading volume than stocks
of more established companies making them more volatile and difficult to value.

The portfolio manager seeks to purchase securities that are favorably priced in
relation to their fundamental value. In making investment decisions, the
portfolio manager relies on the investment adviser's research staff. As noted
below, the portfolio manager may sell securities to realize capital losses that
can be used to offset capital gains. Use of this tax management strategy may
increase the Fund's portfolio turnover rate. A fund with a high turnover rate
(100% or more) pays more commissions, which may reduce return.

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, Tax-Managed International Growth Fund will
invest at least 65% of its total 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. The Fund maintains investments in not less than five different
countries and will not invest more than 25% of total assets in any one industry.

The portfolio manager uses both a quantitative method and fundamental research
in managing the Fund. The Fund generally acquires securities with the
expectation of holding them for at least five years.

COMMON INVESTMENT PRACTICES

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. Fund distributions that are taxed as ordinary
income are minimized by emphasizing, where appropriate, investments in
lower-yielding stocks and by generally avoiding net realized short-term capital
gains. Fund distributions taxed as long-term capital gains are minimized by
avoiding or minimizing the sale of securities with large accumulated 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 purchase or 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. These derivative instruments may also be used by the Fund to enhance
returns or as a substitute for the purchase or sale of securities. The use of
derivatives is highly specialized. The built-in leverage inherent to many
derivative instruments can result in losses that substantially exceed the
initial amount paid or received by the Fund. Equity swaps and over-the-counter
options are private contracts in which there is a risk of loss in the event of a
counterparty's default. Derivative instruments may be difficult to value, may be

5
<PAGE>
illiquid, and may be subject to wide swings in valuation caused by changes in
the value of the underlying security. Derivative hedging transactions may not be
effective because of imperfect correlation and other factors.

Each Fund may invest 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), relations between nations
and trading, settlement, custodial and other operational risks. 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 markets in the United States. Foreign investments
also 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.
These risks can be more significant for companies in less developed countries.
As an alternative to holding foreign stocks directly, each Fund may invest in
dollar-denominated securities of foreign companies that trade on U.S. exchanges
or in the over-the-counter market (including depositary receipts which evidence
ownership in underlying foreign stocks). Such investments are not subject to
Tax-Managed Emerging Growth Fund's 25% limitation on investing in foreign
securities.

Each 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 than
liquid securities. 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. Even if determined to be liquid, holdings of these securities may
increase the level of Fund illiquidity if eligible buyers become uninterested in
purchasing them.

Each Fund may borrow amounts up to one-third of the value of its total assets
(including borrowings), but it will not borrow more than 5% of the value of its
total assets except to satisfy redemption requests or for other temporary
purposes. Such borrowings would result in increased expense to a Fund and, while
they are outstanding, would magnify increases or decreases in the value of Fund
shares. A Fund will not purchase additional investment securities while
outstanding borrowings exceed 5% of the value of its total assets. During
unusual market conditions, each Fund may temporarily invest up to 100% of its
assets in cash or cash equivalents. While temporarily invested, a Fund may not
achieve its investment objective. While at times a Fund may use alternative
investment strategies in an effort to limit losses, it may choose not to do so.

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. Any such company or companies would be advised by the
Fund's investment adviser (or an affiliate) and the Fund would not pay directly
any advisory fee with respect to the assets so invested. The Fund may initiate
investments in one or more investment companies without shareholder approval at
any time.

MANAGEMENT AND ORGANIZATION

Management. Each Fund's investment adviser is Eaton Vance Management ("Eaton
Vance"), with offices at The Eaton Vance Building, 255 State Street, Boston,
Massachusetts 02109. Eaton Vance has been managing assets since 1924 and
managing mutual funds since 1931. Eaton Vance and its subsidiaries currently
manage over $41 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 Tax-Managed Emerging Growth Fund's
investment advisory agreement, 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, 1999, the Fund
paid Eaton Vance advisory fees equivalent to 0.625% of its average daily net
assets.

Under Tax-Managed International Growth Fund's investment advisory agreement,
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, 1999, 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 since joining Eaton Vance in 1996. Prior to joining Eaton Vance,
he was Senior Product Manager, Equity Management for TradeStreet Investment
Associates, Inc., a wholly-owned subsidiary of NationsBank.

6
<PAGE>
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 since joining Eaton Vance in 1998. Prior to joining
Eaton Vance, he was an international equity portfolio 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. Each Fund offers multiple classes of shares. Each
class represents a pro rata interest in a Fund, but is subject to different
expenses and rights. 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 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 purchase
price of Fund shares is their net asset value (plus a sales charge for Class A
shares). Exchange-listed securities are generally valued at closing sale prices;
however, the investment adviser may use the fair value of a foreign security if
events occurring after the close of a foreign exchange would materially affect
net asset value. Because foreign securities trade on days when Fund shares are
not priced, net asset value can change at times when Fund shares cannot be
redeemed.

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 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 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>
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>
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 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 totalling $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 made at net asset value to certain tax-deferred
retirement plans.

Year of Redemption After Purchase CDSC
- --------------------------------------------------------------------------------
First or Second 5%
Third 4%
Fourth 3%
Fifth 2%
Sixth 1%
Seventh or following 0%

The principal underwriter pays commissions to investment dealers on sales of
Class B and Class C shares (except exchange transactions and reinvestments). The
sales commission on Class B shares equals 4% of the purchase price of the
shares. The sales commission on Class C shares equals .75% of the purchase price
of the shares. After the first year, investment dealers also receive 0.75% of
the value of Class C shares in annual distribution fees.

Reducing or Eliminating Sales Charges. Front-end sales charges on purchases of
Class A shares may be reduced under the right of accumulation or under a
statement of intention. Under the right of accumulation, the sales charges you
pay are reduced if the current market value of your current holdings (based on
the current offering price), plus your new purchases, total $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. Under a statement of intention, 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 you satisfy the statement or the 13-month period
expires.

8
<PAGE>
shares so acquired will be subject to a 0.50% CDSC if they are redeemed within
12 months of purchase. Investment dealers will be paid a commission on such
sales of 0.50% of the amount invested.

Distribution and Service Fees. Class B and Class C shares have in effect plans
under Rule 12b-1 that allow each 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 0.75% 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 equal to 0.25% of
average daily net assets annually.

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 by 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 and shares that are subject to fiduciary
arrangements cannot be redeemed by telephone.

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

9
<PAGE>
If you recently purchased shares, the proceeds of a redemption will not be sent
until the purchase 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
pays shareholder 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. 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 without transaction
costs 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 redemption. Such
shareholders could incur brokerage charges and other costs and may be exposed to
market risk in selling the distributed securities.

If the Fund adopts a policy of distributing securities to meet redemptions, it
may continue to meet redemptions in whole or in part with cash. During periods
of volatile market conditions, the Fund could be expected to meet redemptions
primarily with cash.

SHAREHOLDER ACCOUNT FEATURES

Once you purchase shares, the transfer agent establishes a Lifetime Investing
Account(R) 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.

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 of the greater of either the initial account balance
or the current account balance. These 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 generally subject to an
initial sales charge, you should not make withdrawals from your account while
you are making purchases.

10
<PAGE>
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 hold Class A shares for less than six months and exchange them for
shares subject to a higher sales charge, you will be charged the difference
between the two sales charges. 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.

TAX INFORMATION

While the Fund attempts to minimize taxable distributions, there can be no
assurance that taxable distributions can be avoided. Distributions of investment
income and net realized short-term capital gains will be taxable as ordinary
income. Distributions of net realized long-term capital gains are taxable as
long-term gains. The Fund expects to pay any distributions 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
purchase price back as a taxable distribution. Certain distributions paid in
January (if any) will be taxable to shareholders as if received on December 31
of the prior year. A redemption of Fund shares, including an exchange for shares
of another fund, is a taxable transaction.

Tax-Managed International Growth Fund anticipates that it will be subject to
foreign withholding taxes on a portion of its dividend income from foreign
securities. The Fund intends to file an election each year which would require
Fund shareholders to include in ordinary gross income their pro rata share of
qualified foreign income taxes paid by the Fund (even though such amounts are
not received by the shareholders) and would allow Fund shareholders to use their
pro rata portion of such foreign income taxes as a foreign tax credit against
their federal income taxes or, alternatively, for shareholders who itemize their
tax deductions to deduct their portion of the Fund's foreign taxes paid in
computing taxable federal income. The Tax-Managed Emerging Growth Fund also may
be subject to foreign withholding taxes on dividend income from certain of its
foreign investments, but does not expect to be able to pass through a deduction
or credit to its shareholders for such taxes paid.

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 Deloitte & Touche LLP,
independent accountants. The report of Deloitte & Touche LLP and each Fund's
financial statements are incorporated herein by reference and included in the
annual report, which is available on request.

<TABLE>

<CAPTION>
TAX-MANAGED EMERGING GROWTH FUND
------------------------------------------------------------------------------------------------------------
YEAR ENDED OCTOBER 31,
------------------------------------------------------------------------------------------------------------
1999 1998 1997(2)
------------------------------------------------------------------------------------------------------------
CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value -
Beginning of year $ 9.460 $ 9.390 $ 9.370 $ 9.740 $ 9.740 $ 9.720 $10.000 $10.000 $10.000
------- -------- ------- ------- ------- ------- ------- ------- -------
Income (loss) from
operations
Net investment
income (loss) $(0.053) $ (0.128) $(0.135) $(0.040) $(0.090) $(0.092) $ 0.008 $ 0.005 $ 0.003
Net realized and
unrealized gain
(loss) 3.703 3.648 3.625 (0.240) (0.260) (0.258) (0.268) (0.265) (0.283)
------- -------- ------- ------- ------- ------- ------- ------- -------
Net income (loss)
from operations $ 3.650 $ 3.520 $ 3.490 $(0.280) $(0.350) $(0.350) $(0.260) $(0.260) $(0.280)
------- -------- ------- ------- ------- ------- ------- ------- -------
Net asset value -
End of year $13.110 $ 12.910 $12.860 $ 9.460 $ 9.390 $ 9.370 $ 9.740 $ 9.740 $ 9.720
======= ======== ======= ======= ======= ======= ======= ======= =======
Total Return(3) 38.58% 37.49% 37.25% (2.87)% (3.59)% (3.60)% (2.60)% (2.60)% (2.80)%

Ratios/Supplemental
Data
Net assets, end of
year (000's omitted) $57,518 $105,949 $39,487 $28,035 $52,641 $18,455 $ 3,925 $ 8,613 $ 2,051
Ratios (as a
percentage of
average daily net
assets):
Expenses 1.04% 1.81% 1.95% 1.21% 2.04% 2.21% 0.63%(4) 1.37%(4) 1.56%(4)
Net investment
income (loss) (0.55)% (1.33)% (1.47)% (0.57)% (1.41)% (1.58)% 1.83%(4) 1.13%(4) 0.90%(4)
Portfolio turnover
of the Fund 80% 80% 80% 110% 110% 110% 7.00% 7.00% 7.00%
</TABLE>

(See footnotes on last page.)

12
<PAGE>
FINANCIAL HIGHLIGHTS (continued)

<TABLE>

<CAPTION>
TAX-MANAGED INTERNATIONAL GROWTH FUND
----------------------------------------------------------------------------------
YEAR ENDED OCTOBER 31,
----------------------------------------------------------------------------------
1999(1) 1998(1)(2)
----------------------------------------------------------------------------------
CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value - Beginning of period $ 8.840 $ 8.810 $ 8.800 $10.000 $10.000 $10.000
------- ------- -------
Income (loss) from operations
Net investment income (loss) $ 0.016 $(0.055) $(0.080) $ 0.012 $(0.039) $(0.055)
Net realized and unrealized gain (loss) 3.304 3.275 3.280 (1.172) (1.151) (1.145)
------- ------- -------
Total income (loss) from operations $ 3.320 $ 3.220 $ 3.200 $(1.160) $(1.190) $(1.200)
------- ------- -------
Net asset value - End of period $12.160 $12.030 $12.000 $ 8.840 $ 8.810 $ 8.800
======= ======= =======
Total return (3) 37.56% 36.55% 36.36% (11.60)% (11.90)% (12.00)%
Ratios/Supplemental Data+
Net assets, end of year (000's omitted) $27,833 $26,498 $14,470 $ 6,659 $ 9,808 $ 4,416
Ratios (as a percentage of average daily net
assets):*
Net expenses 1.73% 2.53% 2.71% 1.97%(4) 2.72%(4) 2.97%(4)
Net expenses after custodian fee reduction 1.73% 2.53% 2.71% 1.95%(4) 2.70%(4) 2.95%(4)
Net investment income (loss) 0.15% (0.53)% (0.78)% 0.25%(4) (0.80)%(4) (1.15)%(4)
Portfolio turnover of the Fund 60% 60% 60% 14% 14% 14%
</TABLE>
+ The operating expenses of the Fund reflect a waiver of the investment
adviser fee. Had such action not been taken, the ratios and investment
income (loss) per share would have been as follows:
<TABLE>
<S> <C> <C> <C>
Ratios (as a percentage of average net assets)
Expenses 2.20%(4) 2.95%(4) 3.20%(4)
Expenses after custodian fee reduction 2.18%(4) 2.93%(4) 3.18%(4)
Net investment loss 0.02%(4) (1.03)%(4) (1.38)%(4)
Net investment loss per share $0.001 $(0.050) $(0.066)
</TABLE>
(1) Net investment income (loss) per share was computed using average shares
outstanding.
(2) For the Tax-Managed Emerging Growth Fund for Class A for the period from
the start of business, September 25, 1997, to October 31, 1997 and for
Class B and Class C for the period from the start of business September 29,
1997, to October 31, 1997 and for the Tax-Managed International Growth Fund
for the period from the start of business, April 22, 1998, to October 31,
1998.
(3) 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.
(4) Computed on an annualized basis.

13
<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 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.
The Eaton Vance Building
255 State Street
Boston, MA 02109
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 operation of the public reference
room); 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 20549-0102 or by electronic mail at [email protected].

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:
- --------------------------------------------------------------------------------

PFPC Global Fund Services
P.O. Box 9653
Providence, RI 02904-9653
1-800-262-1122

The Fund's SEC File No. is 811-4015 MGIGP

<PAGE>

STATEMENT OF
ADDITIONAL INFORMATION
March 1, 2000

EATON VANCE STRATEGIC INCOME FUND

The Eaton Vance Building
255 State Street
Boston, Massachusetts 02109
(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"). 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 them in
the 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 ................................................................ 20
Portfolio Security Transactions ...................................... 21
Financial Statements ................................................. 23

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
D: Description of Securities Ratings ................................. d-1
E: Asset Composition Information ..................................... e-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, 2000, 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

MORTGAGE BACKED SECURITIES. While it is not possible to accurately predict the
life of a particular issue of a mortgage-backed "pass-through" security held by
the Portfolio, the actual life of any such security is likely to be
substantially less than the average maturity of the mortgage pool underlying the
security. This is because unscheduled early prepayments of principal on the
security owned by the Portfolio will result from the prepayment, refinancing or
foreclosure of the underlying mortgage loans in the mortgage pool. The
Portfolio, when the monthly payments (which may include unscheduled prepayments)
on such a security are passed through to it, may be able to reinvest them only
at a lower rate of interest. Because of the regular scheduled payments of
principal and the early unscheduled prepayments of principal, the
mortgage-backed "pass-through" security is less effective than other types of
obligations as a means of "locking-in" attractive long-term interest rates. As a
result, this type of security may have less potential for capital appreciation
during periods of declining interest rates than other U.S. Government securities
of comparable maturities, although many issues of mortgage-backed "pass-through"
securities may have a comparable risk of decline in market value during periods
of rising interest rates. If such a security has been purchased by the Portfolio
at a premium above its par value, both a scheduled payment of principal and an
unscheduled prepayment of principal, which would be made at par, will accelerate
the realization of a loss equal to that portion of the premium applicable to the
payment or prepayment and will reduce the Fund's total return. If such a
security has been purchased by the Portfolio at a discount from its par value,
both a scheduled payment of principal and an unscheduled prepayment of principal
will increase current and total returns and will accelerate the recognition of
income, which, when distributed to Fund shareholders, will be taxable as
ordinary income.

INCOME PRODUCING SECURITIES. The income producing securities in which the
Portfolio may invest include, but are not limited to, 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 and common stock expected to produce income. 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. 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 purchase floating or variable rate obligations. A
Portfolio may also purchase warrants.

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.

WHEN-ISSUED SECURITIES AND FORWARD COMMITMENTS A Portfolio may purchase and sell
securities on a "forward commitment" or "when-issued" basis. Forward commitment
or when-issued transactions arise when securities are purchased or sold by a
Portfolio with payment and delivery taking place in the future in order to
secure what is considered to be an advantageous price and yield to a Portfolio
at the time of entering into the transaction. However, the yield on a comparable
security when the transaction is consummated may vary from the yield on the
security at the time that the forward commitment or when-issued transaction was
made. From the time of entering into the transaction until delivery and payment
is made at a later date, the securities that are the subject of the transaction
are subject to market fluctuations. When the Portfolio engages in forward
commitment or when-issued transactions, a Portfolio relies on the seller or
buyer, as the case may be, to consummate the sale. Failure to do so may result
in a Portfolio missing the opportunity of obtaining a price or yield considered
to be advantageous. Forward commitment or when-issued transactions may be
expected to occur a month or more before delivery is due. However, no payment or
delivery is made by a Portfolio until it receives payment or delivery from the
other party to the transaction. To the extent a Portfolio engages in forward
commitment or when-issued transactions, it will do so for the purpose of
acquiring or disposing of securities held by a Portfolio consistent with a
Portfolio's investment objective and policies and not for the purpose of
investment leverage.

RESTRICTED SECURITIES. Each Portfolio may invest up to 15% of net assets in
illiquid securities. Illiquid securities include securities legally restricted
as to resale, such as commercial paper issued pursuant to Section 4(2) of the
Securities Act of 1933, as amended, and securities eligible for resale pursuant
to Rule 144A thereunder. Section 4(2) and Rule 144A securities may, however, be
treated as liquid by the investment adviser pursuant to procedures adopted by
the Trustees, which require consideration of factors such as trading activity,
availability of market quotations and number of dealers willing to purchase the
security. If a 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.

It may be difficult to sell such securities at a price representing their
fair value until such time as such securities may by sold publicly. Where
registration is required, a considerable period may elapse between a decision to
sell the securities and the time when a Portfolio would be permitted to sell.
Thus, a Portfolio may not be able to obtain as favorable a price as that
prevailing at the time of the decision to sell. Each Portfolio may also acquire
securities through private placements under which it may agree to contractual
restrictions on the resale of such securities. Such restrictions might prevent
their sale at a time when such sale would otherwise be desirable.

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 loaned if the borrower fails financially. However, the loans
will be made only to organizations deemed 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. 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.

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.

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").

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 Securities and Exchange
Commission ("SEC") guidelines regarding cover for these instruments and, if the
guidelines so require, set aside cash, U.S. Government securities or other
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
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.

TEMPORARY INVESTMENTS. Under unusual market conditions, the Portfolio may invest
temporarily in cash or cash equivalents. Cash equivalents are highly liquid,
short-term securities such as commercial paper, certificates of deposit,
short-term notes and short-term U.S. Government obligations.

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. Any such determination by a delegate
will be made pursuant to procedures adopted by the Board. 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. 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 The Eaton Vance Building, 255 State Street, Boston,
Massachusetts 02109. 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 (40), Trustee*
President and Chief Executive Officer of National Financial Partners (a
financial services company) (since April 1999). President and Chief Operating
Officer of John A. Levin & Co. (a registered investment advisor) (July 1997 to
April 1999) and a Director of Baker, Fentress & Company which owns John A.
Levin & Co. (July 1997 to April 1999). 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: 1301 Avenue of the Americas, New York, New York 10019

DONALD R. DWIGHT (68), Trustee
President of Dwight Partners, Inc. (a corporate relations and communications
company). Trustee/Director of the Royce Funds (mutual funds). Trustee of
various investment companies managed by Eaton Vance or BMR.
Address: Clover Mill Lane, Lyme, New Hampshire 03768

JAMES B. HAWKES (58), 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.

SAMUEL L. HAYES, III (65), Trustee
Jacob H. Schiff Professor of Investment Banking Emeritus, Harvard University
Graduate School of Business Administration. Trustee of the Kobrick 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 (64), 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 (42), 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

JACK L. TREYNOR (70), 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. (40), 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 (56), Vice President of the Trust
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

ARMIN J. LANG (35), Vice President
Vice President of Eaton Vance and BMR since March 1998. Previously he was a Vice
President at Standish, Ayer & Wood.

MICHAEL R. MACH (52), Vice President
Vice President of Eaton Vance and BMR since December 15, 1999. Previously, he
was a Managing Director and Senior Analyst for Robertson Stephens (1998-1999);
Managing Director and Senior Analyst for Piper Jaffray (1996-1998); and Senior
Vice President and Senior Analyst for Putnam Investments (1989-1996). Officer
of various investment companies managed by Eaton Vance or BMR.

ROBERT B. MACINTOSH (43), Vice President of the Trust
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

EDWARD E. SMILEY, JR. (55), Vice President
Vice President of Eaton Vance and BMR since November 1996. Previously he was a
Senior Vice President at Nationsbank. Officer of various investment companies
managed by Eaton Vance or BMR.

MARK VENEZIA (50), Vice President of the Portfolio
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

JAMES L. O'CONNOR (54), Treasurer
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

ALAN R. DYNNER (59), Secretary
Vice President, Secretary and Chief Legal Officer of BMR, Eaton Vance and EVC.
Prior to joining Eaton Vance on November 1, 1996, he 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.

JANET E. SANDERS (64), 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 (37), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

ERIC G. WOODBURY (42), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

The Nominating Committee of the Board of Trustees of the Trust and the
Portfolio is comprised of Trustees who are not "interested persons" as that term
is defined under the 1940 Act ("noninterested Trustees"). 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. Hayes (Chairman), Dwight and Reamer and Ms. Stout 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.

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, 1999, the
noninterested Trustees of the Trust and the Portfolio earned the following
compensation in their capacities as Trustees from the Trust and the Portfolio,
and for the year ended December 31, 1999, earned the following compensation in
their capacities as Trustees of the funds in the Eaton Vance fund complex(1):

AGGREGATE AGGREGATE TOTAL COMPENSATION
COMPENSATION COMPENSATION FROM TRUST AND
NAME FROM TRUST(2) FROM PORTFOLIO FUND COMPLEX
- ---- ------------- -------------- ------------------
Jessica M. Bibliowicz ... $1,656 $ 993 $160,000
Donald R. Dwight ........ $7,026 $2,322(3) $160,000(6)
Samuel L. Hayes, III .... $7,450 $2,539(4) $170,000
Norton H. Reamer ........ $6,996 $2,379 $160,000
Lynn A Stout ............ $1,399 $1,088(5) $160,000(7)
Jack L. Treynor ......... $7,371 $2,616 $170,000

(1) As of March 1, 2000, 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, 1999.
(3) Includes $1,218 of deferred compensation.
(4) Includes $428 of deferred compensation.
(5) Includes $236 of deferred compensation.
(6) Includes $60,000 of deferred compensation.
(7) Includes $16,000 of deferred compensation.

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 two classes of
shares on November 1, 1997 -- Class B shares and Class C shares (formerly EV
Classic Strategic Income Fund) of Eaton Vance Strategic Income Fund. The Fund
began offering Class A shares on January 23, 1998. 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 Trust's By-laws 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 By-laws 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.

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, 1999, the
Portfolio had net assets of $150,282,075. For the fiscal years ended October 31,
1999, 1998 and 1997, the Portfolio paid BMR advisory fees of $768,111, $713,908
and $679,210, respectively, (equivalent to 0.56%, 0.52% and 0.52%, respectively,
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:

ANNUAL DAILY
CATEGORY DAILY NET ASSETS ASSET RATE INCOME RATE
- -------------------------------------------------------------------------------
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%

For the fiscal years ended March 31, 1999, 1998 and 1997, HI Portfolio advisory
fees equaled 0.61%, 0.58% and 0.61%, 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.

The Portfolio has also engaged BMR to act as its Administrator under an
Administration Agreement. The Administration Agreement with BMR continues in
effect from year to year so long as such continuance is approved at least
annually (i) by the Trustees of the Portfolio and (ii) by the vote of a majority
of those Trustees of the Portfolio who are not interested persons of the
Portfolio or of the Administrator. Under the Administration Agreement, BMR is
obligated to (a) review and supervise the provision of all domestic and foreign
custodial services to the Portfolio, and to make such reports and
recommendations to the Board of Trustees of the Portfolio concerning the
provision of such services as the Board deems appropriate; (b) provide to the
Portfolio certain valuation, legal, accounting and tax assistance and services
in connection with the Portfolio's (i) investments in (A) securities,
obligations and commercial paper that are denominated in foreign currencies or
the European Currency Unit ("ECU"), or that are issued or guaranteed by foreign
entities, (B) certificates of deposit and bankers' acceptances issued or
guaranteed by, or time deposits maintained at, foreign banks or foreign branches
of U.S. banks, and (C) participation interests in loans by U.S. or foreign banks
that are made to foreign borrowers or that are denominated in foreign currencies
or the ECU; and (ii) transactions in derivative instruments, including
instruments indexed to foreign exchange rates, forward foreign currency exchange
contracts, put and call options on foreign currencies, futures contracts and
options on such contracts, and interest rate and currency swaps; and (c) provide
to the Portfolio such other special administrative services as the Board from
time to time shall instruct BMR to furnish under the Administration Agreement.
In return for these special services, the Portfolio pays BMR as compensation
under the Administration Agreement a monthly fee in the amount of .0125%
(equivalent to .15% annually) of the average daily net assets of the Portfolio.
For the fiscal years ended October 31, 1999, 1998 and 1997, the Portfolio paid
BMR administration fees of $208,472, $204,036 and $195,786, respectively.

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, John G.L. Cabot, Leo I. Higdon, Jr.,
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 Mr. Hawkes, Jeffrey P. Beale, Alan R. Dynner,
Thomas E. Faust, Jr., Thomas J. Fetter, Scott H. Page, Duncan W. Richardson,
William M. Steul, Payson F. Swaffield, Michael W. Weilheimer, and Wharton P.
Whitaker (all of whom are officers of Eaton Vance). 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 the fee paid to the principal
underwriter for handling share repurchases.

OTHER SERVICE PROVIDERS

PRINCIPAL UNDERWRITER. Eaton Vance Distributors, Inc. ("EVD"), The Eaton Vance
Building, 255 State Street, Boston, MA 02109, 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. 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 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, 160 Federal Street, Boston,
Massachusetts 02110, 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. PFPC Global Fund Services, P.O. Box 9653, Providence, RI
02904-9653, 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.

Debt securities (other than mortgage-backed, "pass-through" securities and
short-term obligations maturing in sixty days or less), including listed
securities and securities for which price quotations are available and forward
contracts, will normally be valued on the basis of market valuations furnished
by pricing services. Mortgage-backed "pass-through" securities are valued using
an independent matrix pricing system applied by the Advisor which takes into
account closing bond valuations, yield differentials, anticipated prepayments
and interest rates provided by dealers. Financial futures contracts listed on
commodity exchanges and exchange-traded options are valued at closing settlement
prices. Over-the-counter options are valued at the mean between the bid and
asked prices provided by dealers. Short-term obligations and money market
securities maturing in sixty days or less are valued at amortized cost which
approximates value. Non-U.S. dollar denominated short-term obligations maturing
in sixty days or less are valued at amortized cost as calculated in the base
currency and translated into U.S. dollars at the current exchange rate.
Investments for which market quotations are unavailable are valued at fair value
using methods determined in good faith by or at the direction of the Trustees of
the Portfolio.

The value of all assets and liabilities expressed in foreign currencies will
be converted into U.S. dollar values at the mean between the buying and selling
rates of such currencies against U.S. dollars on one of the principal markets
for such currencies. Generally, trading in foreign securities, derivative
instruments and currencies is substantially completed each day at various times
prior to the time a Portfolio calculates its net asset value. If an event
materially affecting the values of such securities, instruments or currencies
occurs between the time such values are determined and the time net asset value
is calculated, such securities, instruments or currencies may be valued at fair
value.

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 the 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".

In connection with employee benefit or other continuous group purchase
plans, the Fund may accept initial investments of less than $1,000 on the part
of an individual participant. In the event a shareholder who is a participant of
such a plan terminates participation in the plan, his or her shares will be
transferred to a regular individual account. However, such account will be
subject to the right of redemption by the Fund as decribed below.

SUSPENSION OF SALES. 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.

Due to the high cost of maintaining small accounts, the Trust reserves the
right to redeem accounts with balances of less than $750. Prior to such a
redemption, shareholders will be given 60 days' written notice to make an
additional purchase. However, no such redemption would be required by the Trust
if the cause of the low account balance was a reduction in the net asset value
of shares. No CDSC will be imposed with respect to such involuntary redemptions.

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 officers and employees of IBT and the transfer agent; to persons
associated with law firms, consulting firms and others providing services to
Eaton Vance and the Eaton Vance funds; and to such persons' spouses, parents,
siblings and children and their beneficial accounts. Such shares may also be
issued at net asset value (1) in connection with the merger of an investment
company (or series or class thereof) with the Fund (or class thereof), (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. Class A shares may also be sold at net asset value to
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".
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.
All CDSC waivers are prospective only.

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, the Statement of
Intention section of the account application should be completed 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. If you make a Statement of Intention, the transfer agent is
authorized 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. A Statement of Intention does not obligate the shareholder to purchase
or the Fund to sell the full amount indicated in the Statement.

If the amount actually purchased during the 13-month period is less than
that indicated in the Statement, the shareholder will be requested to pay the
difference between the sales charge applicable to the shares purchased and the
sales charge paid under the Statement of Intention. If the payment is not
received in 20 days, the appropriate number of escrowed shares will be redeemed
in order to realize such difference. If the total purchases during the 13-month
period are large enough to qualify for a lower sales charge than that applicable
to the amount specified in the Statement, all transactions will be computed at
the expiration date of the Statement to give effect to the lower sales charge.
Any difference will be refunded to the shareholder in cash or applied to the
purchase of additional shares, as specified by the shareholder. This refund will
be made by the investment dealer and the principal underwriter. If at the time
of the recomputation, the investment dealer for the account has changed, the
adjustment will be made only on those shares purchased through the current
investment dealer for the account.

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.

EXCHANGE PRIVILEGE. In addition to exchanges into the same class of another
Eaton Vance fund, Class B shares may be exchanged for shares of a money market
fund sponsored by an investment dealer and approved by the principal underwriter
(an "investment dealer fund"). For purposes of calculating the CDSC applicable
to investment dealer fund shares acquired in an exchange, the CDSC schedule
applicable to the exchanged shares will apply and the purchase of investment
dealer fund shares is deemed to have occurred at the time of the original
purchase of the exchanged shares, except that the time during which a
shareholder holds such investment dealer fund shares will not be credited toward
completion of the CDSC period.

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 in effect 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. For the service fees paid
by Class A shares, see Appendix A.

The Trust also has in effect 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.
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, 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 who are "interested" persons of the
Fund have an indirect financial interest in the Plans because their employers
(or affiliates thereof) receive distribution and/or service fees under the Plans
or agreements related thereto.

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. The Fund may also publish total
return figures for each class based on reduced sales charges or at net asset
value. These returns would be lower if the full sales charge was imposed. 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 the 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 various domestic, international
and global securities indices, such as the Commodity Research Bureau Futures
Price Index. The Fund's yield may also be compared to the yields of other
fixed-income securities, such as U.S. Treasuries, mortgage-backed securities,
and corporate bonds or other securities comparable to the securities held by a
Portfolio as reported by various independent sources (such as Bloomberg L.P.).
In making such comparisons, the Fund may provide information concerning the
nature of such indices or securities. This information 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 other investment companies.

Evaluations of the Fund's performance (including ratings and rankings) made
by independent sources, may be used in advertisements and in information
furnished to present or prospective shareholders. In addition, information
showing the effects of compounding interest may be included in advertisements
and other material furnished to present and prospective shareholders.
Compounding is the process of earning interest on principal plus interest that
was earned earlier. Interest can be compounded annually, semi-annually,
quarterly or daily. Examples of compounding will be used for illustration
purposes only.

Information used in advertisements and in materials provided to present and
prospective shareholders may include descriptions of Eaton Vance and other Fund
service providers, their investment styles, other investment products, personnel
and Fund didstribution channels.

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, 1999. 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 (generally at a 20% rate for
noncorporate shareholders), whether received in cash or in additional shares and
regardless of the length of time their shares have been held. Distributions of
net income and net short-term capital gains are taxable to shareholders as
ordinary income. 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.

Redemptions and exchanges of the Fund's shares are taxable events and,
accordingly, shareholders may realize gain or loss on these transactions. In
general, any gain realized upon a taxable disposition of shares will be treated
as long-term capital gain if the shares have been held for more than one year.
Otherwise, the gain on the sale, exchange or redemption of Fund shares will be
treated as short-term capital gain.

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
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
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 Portfolio 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, 1999, 1998 and 1997, the Portfolio
paid brokerage commissions of $9,534, $11,678 and $14,023, respectively, on
portfolio transactions aggregating approximately $201,512,390, $239,984,156 and
$182,150,347, 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).

FINANCIAL STATEMENTS

The audited financial statements of and independent accountants reports for
the Fund and the Portfolio appear in the Fund's most recent annual report to
shareholders and are 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.

Registrant incorporates by reference the audited financial information for
the Fund and the Portfolio for the fiscal year ended October 31, 1999 (Accession
No. 0000912057-00-000276) as previously filed electronically with the SEC.

<PAGE>
APPENDIX A

CLASS A FEES, PERFORMANCE AND OWNERSHIP
SERVICE FEES

For the fiscal year ended October 31, 1999, Class A made service fee
payments under the Plan aggregating $2,074, of which $1,880 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, 1999, and for the period from the start
of business, January 23, 1998, to October 31, 1998, were $109,624 and $62,717,
respectively, of which $4,544 and $3,458, respectively, was received by the
principal underwriter. For the fiscal year ended October 31, 1999, and for the
period from the start of business, January 23, 1998, to October 31, 1998,
investment dealers received $105,080 and $59,259, respectively, from the total
sales charges.

PERFORMANCE INFORMATION

The table below indicates the cumulative and average total return on a
hypothetical investment of $1,000 in Class A shares for the periods shown in the
table. Total return for Class A prior to January 23, 1998 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.

<TABLE>
<CAPTION>
VALUE OF A $1,000 INVESTMENT
TOTAL RETURN TOTAL RETURN
EXCLUDING MAXIMUM INCLUDING MAXIMUM
VALUE OF VALUE OF SALES CHARGE SALES CHARGE
INVESTMENT INVESTMENT INITIAL INVESTMENT --------------------------- ---------------------------
PERIOD DATE INVESTMENT ON 10/31/99 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- ------------------------- ------------- -------------- -------------- ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Life of the Fund 11/26/90 $952.33 $1,673.06 75.68% 6.51% 67.31% 5.93%
5 Years Ended 10/31/99 10/31/94 $952.53 $1,503.21 57.81% 9.55% 50.32% 8.49%
1 Year Ended 10/31/99 10/31/98 $952.48 $1,032.50 8.40% 8.40% 3.25% 3.25%

</TABLE>
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As of January 31, 2000, 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 January 31, 2000, Wexford Clearing Services Corp., FBO Johnson &
Wales University, Providence, RI 02903-2807, owned beneficially and of record
18.8% of the outstanding Class A shares of the Fund. As of the same date, NFSC
FEBO #C1B-506397, Roger S. Coolidge Irrevocable Trust, Charles Moizeau,
Millington, NJ 07946 owned beneficially and of record 6.4% of the outstanding
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, 1999, the principal underwriter
paid to investment dealers sales commissions of $1,333,243 on sales of Class B
shares. During the same period, the Fund made payments under the Distribution
Plan to the principal underwriter aggregating $1,124,927 and the principal
underwriter received approximately $218,000 in CDSCs imposed on early redeeming
shareholders. These distribution payments and CDSC payments reduced uncovered
distribution charges under the Plan. As at October 31, 1999, the outstanding
uncovered distribution charges of the principal underwriter calculated under the
Plan amounted to approximately $24,025,000 (which amount was equivalent to
approximately 15.4% of the net assets attributable to Class B on such day).
During the fiscal year ended October 31, 1999, Class B made service fee payments
to the principal underwriter and investment dealers aggregating $275,194, of
which $273,359 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, 1999, Class
B paid the principal underwriter $3,605 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 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.

<TABLE>
<CAPTION>
VALUE OF A $1,000 INVESTMENT
VALUE OF VALUE OF
INVESTMENT INVESTMENT
BEFORE AFTER TOTAL RETURN BEFORE TOTAL RETURN AFTER
DEDUCTING DEDUCTING DEDUCTING THE CDSC DEDUCTING THE CDSC
INVESTMENT INVESTMENT AMOUNT OF THE CDSC THE CDSC ------------------------- ------------------------
PERIOD DATE INVESTMENT ON 10/31/99 ON 10/31/99 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- ------------- ---------- ---------- ----------- ----------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of the Fund 11/26/90 $1,000 $1,736.82 $1,736.82 73.68% 6.38% 73.68% 6.38%
5 Years Ended 10/31/99 10/31/94 $1,000 $1,560.24 $1,540.24 56.02% 9.30% 54.02% 9.02%
1 Year Ended 10/31/99 10/31/98 $1,000 $1,073.16 $1,023.79 7.32% 7.32% 2.38% 2.38%

</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at January 31, 2000, 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 January 31, 2000, Merrill Lynch, Pierce, Fenner & Smith, Inc.,
Jacksonville, FL 32246 was the record owner of approximately 27.7% 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, 1999, the principal underwriter
paid to investment dealers sales commissions of $114,368 on sales of Class C
shares. During the same period, the Fund made payments under the Distribution
Plan to the principal underwriter aggregating $188,098 and the principal
underwriter received approximately $6,000 in CDSCs imposed on early redeeming
shareholders. These distribution payments and CDSC payments reduced uncovered
distribution charges under the Plan. As at October 31, 1999, the outstanding
uncovered distribution charges of the principal underwriter calculated under the
Plan amounted to approximately $2,553,000 (which amount was equivalent to
approximately 8.3% of the net assets attributable to Class C on such day).
During the fiscal year ended October 31, 1999, Class C made service fee payments
to the principal underwriter and investment dealers aggregating $64,326 of which
$28,551 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, 1999, Class
C paid the principal underwriter $767.50 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 C shares for the periods shown in
the table. 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.

<TABLE>
<CAPTION>
VALUE OF A $1,000 INVESTMENT

VALUE OF VALUE OF
INVESTMENT INVESTMENT
BEFORE AFTER TOTAL RETURN BEFORE TOTAL RETURN AFTER
DEDUCTING DEDUCTING DEDUCTING THE CDSC DEDUCTING THE CDSC
INVESTMENT INVESTMENT AMOUNT OF THE CDSC THE CDSC ------------------------- ------------------------
PERIOD* DATE INVESTMENT ON 10/31/99 ON 10/31/99 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- ------------- ---------- ---------- ----------- ----------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 11/26/90 $1,000 $1,755.56 $1,755.56 75.56% 6.51% 75.56% 6.51%
5 Years Ended 10/31/99 10/31/94 $1,000 $1,576.95 $1,576.95 57.70% 9.54% 57.70% 9.54%
1 Year Ended 10/31/99 10/31/98 $1,000 $1,072.26 $1,062.39 7.23% 7.23% 6.24% 6.24%

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

*Predecessor Fund commenced operations on May 25, 1994.
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As of January 31, 2000, 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 January 31, 2000, Merrill Lynch, Pierce, Fenner & Smith, Inc.,
Jacksonville, FL 32246 was the record owner of approximately 9.9% 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 IBCA

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>

APPENDIX E

EATON VANCE STRATEGIC INCOME FUND

ASSET COMPOSITION INFORMATION
FOR THE FISCAL YEAR ENDED OCTOBER 31, 1999

PERCENT OF
NET ASSETS
- --------------------------------------------------------------------------
Debt Securities -- Moody's or S&P Rating
AAA 43.56%
AA 1.61%
A 8.25%
BBB 2.11%
BB 10.11%
B 29.66%
CCC 2.39%
Unrated 2.31%
------
Total 100.00%

The chart above indicates the weighted average composition of the securities
owned indirectly by the Fund as the result of its investment in both the
Strategic Income Portfolio and the High Income Portfolio for the fiscal year
ended October 31, 1999, with the debt securities rated by Moody's or S&P
separated into the indicated categories. The weighted average indicated above
was calculated on a dollar weighted basis and was computed as at the end of each
month during the fiscal year. Securities are categorized based on the higher of
the Moody's or S&P rating. The chart does not necessarily indicate what the
composition will be in the current and subsequent fiscal years.

For a description of Moody's and S&P's ratings of fixed-income securities,
see Appendix D to this SAI.

<PAGE>

STATEMENT OF
ADDITIONAL INFORMATION
March 1, 2000

EATON VANCE TAX-MANAGED EMERGING GROWTH FUND
EATON VANCE TAX-MANAGED INTERNATIONAL
GROWTH FUND

The Eaton Vance Building
255 State Street
Boston, Massachusetts 02109
(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 ............................................... 5
Management and Organization ........................................... 7
Investment Advisory and Administrative Services ....................... 9
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

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, 2000, 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 investment 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.

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 investment 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
investment 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.

TAX-MANAGED INVESTING. Taxes are a major influence on the net returns that
investors receive on their taxable investments. There are four components of
the returns of an equity mutual fund -- price appreciation, distributions of
income and distributions of realized short-term and long-term capital gains --
which are treated differently for federal income tax purposes. Distributions
of net investment income and net realized short-term gains (on stocks held
less than 12 months) are taxed as ordinary income, at rates as high as 39.6%.
Distributions of realized long-term gains (on stocks held at least 12 months)
are taxed at rates up to 20%. Returns derived from price appreciation are
untaxed until the shareholder redeems. Upon redemption, a capital gain equal
to the difference between the net proceeds of the redemption and the
shareholder's adjusted tax basis is realized.

The Funds are similar to retirement planning products such as variable
annuities and IRAs in that they are vehicles for long-term, tax-deferred
investing. As a mutual fund, however, the Funds avoid a number of structural
disadvantages inherent in a variable annuity--including the limitations and
penalties on early withdrawals, the taxing of all income and gain upon
withdrawal at ordinary income rates, and the inability to gain a step up in
basis at death. Variable annuities offer tax-free exchanges and a death
benefit, which are not offered by the Funds. Eligibility to invest in IRAs and
annual contributions to IRAs are limited. Contributions to deductible IRAs can
be made from pre-tax dollars and distributions from Roth IRAs are not taxed if
certain requirements are met.

An analysis of long-term hypothetical returns achievable from a tax-
managed equity fund that achieves returns predominantly from unrealized gains
compared to a conventional equity mutual fund and a variable annuity can
illustrate the fundamental soundness of a tax-managed equity fund investment.
Assuming identical annual pre-tax returns, over a holding period of several
years a tax-managed fund can generate liquidation proceeds higher than a
conventional managed equity mutual fund and a variable annuity. If the
investments are passed into an estate (thereby triggering a step-up in basis),
the relative performance advantage of a tax-managed fund compared to a
conventional fund or to a variable annuity can be substantial, again assuming
equivalent annual returns before taxes. Of course, actual returns achieved by
long-term investors in a Fund cannot be predicted.

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.

Each Fund may also invest in American Depositary Receipts (ADRs), European
Depositary Receipts (EDRs) and Global Depositary Receipts (GDRs). ADRs, EDRs
and GDRs are certificates evidencing ownership of shares of a foreign issuer
and are alternatives to directly purchasing the underlying foreign securities
in their national markets and currencies. However, they continue to be subject
to many of the risks associated with investing directly in foreign securities.
These risks include foreign exchange risk as well as the political and
economic risks of the underlying issuer's country. ADRs, EDRs and GDRs may be
sponsored or unsponsored. Unsponsored receipts are established without the
participation of the issuer. Unsponsored receipts may involve higher expenses,
they may not pass-through voting and other shareholder rights, and they may be
less liquid.

DERIVATIVE INVESTMENTS. Each Fund may purchase or sell derivative instruments
to hedge against securities price declines and currency movements, to enhance
returns and as a substitute for the purchase and sale of securities.
Transactions in derivative instruments (which derive their value by reference
to other securities, indices, instruments, or currencies) may be conducted in
the U.S. and abroad. Such transactions may include the purchase and sale of
stock index futures contracts and options on stock index futures; the purchase
of put options and the sale of call options on securities held; equity swaps;
and the purchase and sale of forward currency exchange contracts and currency
futures. Derivative transactions may be more advantageous in a given
circumstance than transactions involving securities due to more favorable
current tax treatment, lower transaction costs, or greater liquidity. While
many derivative instruments have built-in leveraging characteristics, the
Funds will not use them for the purpose of leverage. The purchase and sale of
derivative instruments is a highly specialized activity that can expose a Fund
to a significant risk of loss. The use of futures for nonhedging purposes is
limited by regulations of the Commodity Futures Trading Commission ("CFTC").
There can be no assurance that the use of derivative instruments will be
advantageous.

EQUITY SWAPS AND OTC OPTIONS. Equity swaps and over-the-counter options
contracts will only be entered into with counterparties whose credit quality
or claims paying ability are considered to be investment grade by the
investment adviser. In addition, at the time of entering into a transaction, a
Fund's credit exposure to any one counterparty will be limited to 5% or less
of net assets. As described below, the Fund's investment in illiquid assets,
which may include certain equity swaps and over-the-counter options, may not
represent more than 15% of net assets at the time any such illiquid assets are
acquired.

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 investment 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 investment 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 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
Securities and Exchange 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.

LIMITATIONS ON FUTURES CONTRACTS AND OPTIONS. 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,
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). 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. These transactions may
also require the current recognition of taxable gain under certain tax rules
applicable to constructive sales. The investment 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.

The ability to use short sales against-the-box, certain equity swaps and
certain equity collar strategies as a tax-efficient management technique with
respect to holdings of appreciated securities is limited to circumstances in
which the hedging transaction is closed out within thirty days after the end
of the taxable year and the underlying appreciated securities position is held
unhedged for at least the next sixty days after the hedging transaction is
closed.

ASSET COVERAGE REQUIREMENTS. Transactions involving swaps, short sales,
forward contracts, futures contracts and options (other than options that a
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.

LENDING PORTFOLIO SECURITIES. Each Fund may seek to earn income by lending
portfolio securities to broker-dealers or other institutional borrowers. As
with other extensions of credit, there are risks of delay in recovery or even
loss of rights in the securities loaned if the borrower of the securities
fails financially. However, the loans will be made only to organizations
deemed by the investment adviser to be sufficiently creditworthy and when, in
the judgment of the investment adviser, the consideration which can be earned
from securities loans of this type, net of administrative expenses and
finders' fees, justifies the attendant risk. 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 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.

TEMPORARY INVESTMENTS. Under unusual market conditions, a Fund may invest
temporarily in cash or cash equivalents. Cash equivalents are highly liquid,
short-term securities such as commercial paper, certificates of deposit,
short-term notes and short-term U.S. Government 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 emerging growth funds (in the case of Tax-
Managed Emerging Growth Fund) or international growth funds (in the case of
Tax-Managed International Growth Fund), except to the extent a Fund sells
securities in order to generate capital losses. Selling securities to generate
capital losses will increase a Fund's turnover rate, resulting in more
commission. For the portfolio turnover rate of each Fund, see "Financial
Highlights" 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;

(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;

(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 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. Any such determination by a delegate will be made
pursuant to procedures adopted by the Board. 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; 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 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, each Fund must always be in
compliance with the limitation on investing in illiquid securities and the
borrowing policies set forth above.

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 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
The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109. Those
Trustees who are "interested persons" of the Trust, as defined in the 1940
Act, are indicated by an asterisk(*).

JAMES B. HAWKES (58), President and Trustee*
Chairman, President and Chief Executive Officer of Eaton Vance, Boston
Management and Research ("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 (40), Trustee*
Chief Executive Officer of National Financial Partners (a financial services
company) (since April, 1999). President and Chief Operating Officer of John
A. Levin & Co. (a registered investment advisor) (July, 1997 to April, 1999)
and a Director of Baker, Fentress & Company which owns John A. Levin & Co.
(July, 1997 to April, 1999). 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: 1301 Avenue of the Americas, New York, NY 10019

SAMUEL L. HAYES, III (65), Trustee
Jacob H. Schiff Professor of Investment Banking Emeritus, Harvard University
Graduate School of Business Administration. Trustee of the Kobrick
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 (64), 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

JACK L. TREYNOR (70), 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. (40), Vice President
Assistant Vice President of BMR and Eaton Vance. Officer of various investment
companies managed by Eaton Vance or BMR.

THOMAS J. FETTER (56), Vice President
Vice President of BMR, Eaton Vance and EV. Officer of various investment
companies managed by Eaton Vance or BMR.

ARMIN J. LANG (35), Vice President
Vice President of Eaton Vance and BMR. Prior to joining Eaton Vance in 1998,
he was an international equity portfolio manager and quantitative strategist
at Standish, Ayre & Wood.

MICHAEL R. MACH (52), Vice President
Vice President of Eaton Vance and BMR. Prior to joining Eaton Vance in December
1999, he was a Managing Director and Senior Analyst for Robertson Stephens
(1998-1999), Managing Director and Senior Analyst for Piper Jaffray
(1996-1998), and Senior Vice President and Senior Analyst for Putnam
Investments (1989-1996). Officer of various investment companies managed by
Eaton Vance or BMR.

ROBERT B. MACINTOSH (43), Vice President
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

EDWARD E. SMILEY, JR. (55), Vice President
Vice President of Eaton Vance and BMR. Prior to joining Eaton Vance in 1996, he
was a Senior Product Manager, equity management for TradeStreet Investment
Associates, Inc., a wholly-owned subsidiary of NationsBank. Officer of various
investment companies managed by Eaton Vance or BMR.

JAMES L. O'CONNOR (54), Treasurer
Vice President of Eaton Vance and BMR. Officer of various investment companies
managed by Eaton Vance or BMR.

ALAN R. DYNNER (59), Secretary
Vice President, Secretary and Chief Legal Officer of Eaton Vance, BMR and EVC.
Prior to joining Eaton Vance on November 1, 1996, 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 (64), 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 (37), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

ERIC G. WOODBURY (42), Assistant Secretary
Vice President of BMR and Eaton Vance. Officer of various investment companies
managed by Eaton Vance or BMR.

The Nominating Committee of the Board of Trustees of the Trust is
comprised of the Trustees who are not "interested persons" as that term is
defined under the 1940 Act ("noninterested Trustees"). 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. Hayes (Chairman), Dwight, Reamer and Ms. Stout 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.

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 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 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, 1999, the noninterested
Trustees of the Trust earned the following compensation in their capacities as
Trustees of the Trust and for the year ended December 31, 1999, earned the
following compensation in their capacities as Trustees of all of the funds in
the Eaton Vance fund complex(1):

<TABLE>
SOURCE OF JESSICA M. DONALD R. SAMUEL L. NORTON H. LYNN A. JACK L.
COMPENSATION BIBLIOWICZ(5) DWIGHT HAYES, III REAMER STOUT(5) TREYNOR
------------ ------------- ------ ---------- ------ -------- -------
<S> <C> <C> <C> <C> <C> <C>
Trust(2) $ 1,656 $ 7,026 $ 7,450 $ 6,996 $ 1,399 $ 7,371
Trust and Fund Complex $160,000 $160,000(3) $170,000 $160,000 $160,000(4) $170,000

- ----------
(1) As of March 1, 2000, the Eaton Vance complex consists of 143 registered investment companies or series thereof.
(2) The Trust consisted of 16 Funds as of October 31, 1999.
(3) Includes $60,000 of deferred compensation.
(4) Includes $16,000 of deferred compensation.
(5) Ms. Bibliowicz and Ms. Stout were elected as Trustees on October 30, 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.

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 Trust's By-laws 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 By-laws
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 communicating 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 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 under the Investment Advisory Agreement on average daily net
assets up to $500 million, see the prospectus. On net assets of $500 million and
over the annual fee is reduced and the advisory fee is computed as follows:

ANNUALIZED FEE RATE
AVERAGE DAILY NET ASSETS FOR THE MONTH (FOR EACH LEVEL)
- --------------------------------------------------------------------------------
$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%

As of October 31, 1999, Tax-Managed Emerging Growth Fund had net assets of
$202,953,525. For the fiscal years ended October 31, 1999 and 1998 and for the
period from the start of business, September 25, 1997, to October 31, 1997,
Eaton Vance earned advisory fees of $932,128, $390,191 and $3,602,
respectively (equivalent to 0.63%, 0.63% and 0.625% (annualized),
respectively, of the Fund's average daily net assets for each such period).

For a description of the compensation that Tax-Managed International
Growth Fund pays Eaton Vance under the Investment Advisory Agreement on
average daily net assets up to $500 million, see the prospectus. On net assets
of $500 million and over the annual fee is reduced and the advisory fee is
computed as follows:

ANNUALIZED FEE RATE
AVERAGE DAILY NET ASSETS FOR THE MONTH (FOR EACH LEVEL)
- --------------------------------------------------------------------------------
$500 million but less than $1 billion 0.9375%
$1 billion but less than $2.5 billion 0.8750%
$2.5 billion but less than $5 billion 0.8125%
$5 billion and over 0.7500%

As of October 31, 1999, the Tax-Managed International Growth Fund had net
assets of $68,800,959. For the fiscal year ended October 31, 1999 and for the
period from the start of business April 22, 1998 to October 31, 1998, Eaton
Vance earned advisory fees of $384,881 and $58,834, respectively (equivalent
to 1.00% and 0.77% (annualized), respectively, of the Fund's average daily net
assets for each such period).

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 investment adviser
may render services to others. Each Agreement also provides that the
investment 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. Eaton Vance and EV are wholly-owned
subsidiaries of EVC. Eaton Vance is a Massachusetts business trust, and EV is
the trustee of Eaton Vance. EVC through its subsidiaries and affiliates
engages primarily in investment management, administration and marketing
activities. The Directors of EVC are James B. Hawkes, John G.L. Cabot, Leo I.
Higdon, Jr., 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 shares
of the outstanding Voting Common Stock of EVC are deposited in a Voting Trust,
the Voting Trustees of which are Messrs. Hawkes, Jeffrey P. Beale, Alan R.
Dynner, Thomas E. Faust, Jr., Thomas J. Fetter, Scott H. Page, Duncan W.
Richardson, William M. Steul, Payson F. Swaffield, Michael W. Weilheimer, and
Wharton P. Whitaker (all of whom are officers of Eaton Vance). 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. 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"), The Eaton Vance
Building, 255 State Street, Boston, MA 02109, 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, 200 Berkeley Street, Boston,
MA 02116, 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. PFPC Global Fund Services, P.O. Box 9653, Providence, RI
02904-9653, 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.

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."

In connection with employee benefit or other continuous group purchase
plans, a Fund may accept initial investments of less than $1,000 on the part
of an individual participant. In the event a shareholder who is a participant
of such a plan terminates participation in the plan, his or her shares will be
transferred to a regular individual account. However, such account will be
subject to the right of redemption by a Fund as described below.

SUSPENSION OF SALES. 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.

Due to the high cost of maintaining small accounts, the Trust reserves the
right to redeem accounts with balances of less than $750. Prior to such a
redemption, shareholders will be given 60 days' written notice to make an
additional purchase. However, no such redemption would be required by the
Trust if the cause of the low account balance was a reduction in the net asset
value of shares. No CDSC will be imposed with respect to such involuntary
redemptions.

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; to clients
and current and retired officers and employees of Eaton Vance, its affiliates
and other investment advisers of Eaton Vance sponsored funds; to officers and
employees of IBT and the transfer agent; to persons associated with law firms,
consulting firms, and others providing services to Eaton Vance and the Eaton
Vance funds; and to such persons' spouses, parents, siblings and children and
their beneficial accounts. Such shares may also be issued at net asset value
(1) in connection with the merger of an investment company (or series or class
thereof) with a Fund (or class thereof), (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. Class A
shares may also be sold at net asset value to 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". 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. All CDSC waivers are prospective only.

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, the Statement of
Intention section of the account application should be completed 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. If you make a Statement the transfer
agent is authorized 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. A Statement of Intention does not obligate the
shareholder to purchase or the Fund to sell the full amount indicated in the
Statement.

If the amount actually purchased during the 13-month period is less than
that indicated in the Statement, the shareholder will be requested to pay the
difference between the sales charge applicable to the shares purchased and the
sales charge paid under the Statement of Intention. If the payment is not
received in 20 days, the appropriate number of escrowed shares will be
redeemed in order to realize such difference. If the total purchases during
the 13-month period are large enough to qualify for a lower sales charge than
that applicable to the amount specified in the Statement, all transactions
will be computed at the expiration date of the Statement to give effect to the
lower sales charge. Any difference will be refunded to the shareholder in cash
or applied to the purchase of additional shares, as specified by the
shareholder. This refund will be made by the investment dealer and the
principal underwriter. If at the time of the recomputation, the investment
dealer for the account has changed, the adjustment will be made only on those
shares purchased through the current investment dealer for the account.

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.

EXCHANGE PRIVILEGE. In addition to exchanges into the same class of another
Eaton Vance fund, Class B shares may be exchanged for shares of a money market
fund sponsored by an investment dealer and approved by the principal
underwriter (an "investment dealer fund"). For purposes of calculating the
CDSC applicable to investment dealer fund shares acquired in an exchange, the
CDSC schedule applicable to the exchanged shares will apply and the purchase
of investment dealer fund shares is deemed to have occurred at the time of the
original purchase of the exchanged shares, except that the time during which a
shareholder holds such investment dealer fund shares will not be credited
toward completion of the CDSC period.

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 in effect 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 also has in effect 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.

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
Eaton Vance by a Fund) 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 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.
The Trustees of the Trust who are "interested" persons of the Funds have an
indirect financial interest in the Plans because their employers (or
affiliates thereof) receive distribution and/or service fees under the Plans
or agreements related thereto.

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 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. Each
Fund may also publish total return figures for each class based on reduced
sales charges or at net asset value. These returns would be lower if the full
sales charge was imposed. 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. The Fund's
total return and companies with these indices may be used in advertisements
and in information furnished to present or prospective shareholders. In
addition, evaluations of a Fund's performance, ratings 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 used in advertisements and in materials provided to present
and prospective shareholders may include descriptions of Eaton Vance and other
Fund service providers, their investment styles, other investment products,
personnel and Fund distribution channels.

Information about portfolio allocation, turnover and holdings of a Fund at
a particular date 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).

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 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.

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. Each Fund has elected to be treated and to qualify each
year as a regulated investment company ("RIC") under the Code. 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 any investment company taxable income so as to effect such qualification.
Each Fund may also distribute part or all of any 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.

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 capital 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. Distributions of short-term
capital gains and investment income are taxed as ordinary income. 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.

If either Fund does not qualify for taxation as a RIC for any taxable
year, such Fund's income will be subject to corporate income taxes, and all
distributions from earnings and profits, including distributions of net
capital gain (if any), will be taxable to shareholders as ordinary income. In
addition, in order to requalify for taxation as a RIC, such Fund may be
required to recognize unrealized gains, pay substantial taxes and interest,
and make certain distributions.

Each Fund's transactions in foreign currencies, foreign currency-
denominated debt securities and certain foreign currency options, futures
contracts, and forward contracts (and similar instruments) may give rise to
ordinary income or loss to the extent such income or loss results from
fluctuations in the value of the foreign currency concerned.

If more than 50% of a Fund's assets at year end consists of the debt and
equity securities of a foreign corporation, the Fund may elect to permit
shareholders to claim a credit or deduction on their income tax returns for
their pro rata portion of qualified taxes paid by such Fund to foreign
countries. The Tax-Managed International Growth Fund expects to make this
election; the Tax-Managed Emerging Growth Fund does not. If the election is
made, shareholders will include in gross income from foreign sources their pro
rata share of such taxes. A shareholder's ability to claim a foreign tax
credit or deduction in respect of foreign taxes paid by a Fund may be subject
to certain limitations imposed by the Code (including a holding period
requirement applied at both the Fund and shareholder level), as a result of
which a shareholder may not get a full credit or deduction for the amount of
such taxes. Shareholders who do not itemize deductions on their federal income
tax returns may claim a credit (but no deduction) for such taxes.

Investment by a Fund in "passive foreign investment companies" could subject
the Fund to U.S. federal income tax or other charge on the proceeds from the
sale of its investment in such a company; however, this tax can be avoided by
making an election to mark such investments to market annually or to treat the
passive foreign investment company as a "qualified electing fund."

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.

Sales charges paid upon a purchase of Class A shares of a Fund cannot be
taken into account for purposes of determining gain or loss on a redemption or
exchange of the shares before the 91st day after their purchase to the extent
a sales charge is reduced or eliminated in a subsequent acquisition of shares
of the Fund (or of another fund) pursuant to the reinvestment or exchange
privilege. Any disregarded amounts will result in an adjustment to the
shareholder's tax basis in some or all of any 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.

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, foreign investors, 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
Eaton Vance. Eaton Vance is also responsible for the execution of transactions
for all other accounts managed by it.

Eaton Vance places the portfolio security transactions of a Fund and of
certain other accounts managed by it for execution with many broker-dealer
firms. Eaton Vance 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, Eaton Vance 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 Eaton Vance, 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 Eaton Vance's
other clients in part for providing brokerage and research services to Eaton
Vance.

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 Eaton Vance 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 Eaton Vance and its affiliates have for accounts over
which it exercises investment discretion. In making any such determination,
Eaton Vance 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, Eaton Vance may receive Research
Services from broker-dealer firms with which Eaton Vance 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 Eaton Vance 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 Eaton Vance 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 Eaton Vance receives such Research Services. Eaton Vance 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 Eaton Vance 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 Eaton Vance shall use its best efforts to
seek to execute portfolio security transactions at advantageous prices and at
reasonably competitive commission rates or spreads, Eaton Vance 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 Eaton Vance or its affiliates.
Whenever decisions are made to buy or sell securities for a Fund and one or
more of such other accounts simultaneously, Eaton Vance 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
Eaton Vance 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 Eaton Vance's organization outweigh any disadvantage that
may arise from exposure to simultaneous transactions.

For the fiscal years ended October 31, 1999 and 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 $154,791, $145,074 and
$9,058, respectively, with respect to portfolio transactions. Of these
amounts, approximately $117,164, $117,379 and $8,926, respectively, were paid
in respect of portfolio security transactions aggregating approximately
$83,900,198, $70,427,759 and $5,484,898, 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).

For the fiscal year ended October 31, 1999 and for the period from the
start of business, April 22, 1998, to October 31, 1998, Tax-Managed
International Growth paid brokerage commissions of $144,062 and $36,899,
respectively, with respect to portfolio transactions. Of these amounts,
approximately $131,384 and $28,697, respectively, were paid in respect of
portfolio security transactions aggregating approximately $55,220,842 and
$17,900,080, 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 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.

Registrant incorporates by reference the audited financial information for
Tax-Managed Emerging Growth and Tax-Managed International Growth for the
fiscal year ended October 31, 1999, as previously filed electronically with
the SEC (Accession Nos. 0000912057-99-009268 and 0000912057-00-000200,
respectively).

<PAGE>

APPENDIX A

CLASS A FEES, PERFORMANCE AND OWNERSHIP

SERVICE FEES
For the fiscal year ended October 31, 1999, the following table shows (1)
service fees paid under the Service Plan, and (2) service fees 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
- ------- ------------ ------------------
<S> <C> <C>
Tax-Managed Emerging Growth ............................ $30,285 $29,717
Tax-Managed International Growth ....................... $ 4,671 $ 3,734
</TABLE>

PRINCIPAL UNDERWRITER
The total sales charges paid in connection with sales of Class A shares of
Tax-Managed Emerging Growth during the fiscal years ended October 31, 1999 and
1998 were $636,575 and $819,795, respectively, of which $89,138 and $113,598,
respectively, was received by the principal underwriter. For the fiscal years
ended October 31, 1999 and 1998, investment dealers received $547,437 and
$706,197, respectively, from the total sales charges.

The total sales charges paid in connection with sales of Class A shares of
Tax-Managed International Growth during the fiscal year ended October 31, 1999
and the period from the start of business, April 22, 1998, to October 31, 1998
was $298,403 and $178,113, respectively, of which $46,269 and $25,777,
respectively, was received by the principal underwriter. For the fiscal year
ended October 31, 1999 and for the period from the start of business, April
22, 1998 to October 31, 1998, investment dealers received $252,134 and
$152,336, respectively, from the total sales charges.

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,
1999, 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 -- $1,345; and Tax-Managed International Growth --
$352.50.

PERFORMANCE INFORMATION

The tables below indicate 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.

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

TOTAL RETURN TOTAL RETURN
EXCLUDING MAXIMUM INCLUDING MAXIMUM
VALUE OF VALUE OF SALES CHARGE SALES CHARGE
INVESTMENT INVESTMENT INITIAL INVESTMENT --------------------------- ---------------------------
PERIOD DATE INVESTMENT ON 10/31/99 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- ---------------------- ---------- ---------- ----------- ------------- ------------- -------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 9/25/97 $942.51 $1,235.63 31.10% 13.76% 23.56% 10.60%
1 Year ended
10/31/99 10/31/98 $942.23 $1,305.78 38.58% 38.58% 30.58% 30.58%

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

TOTAL RETURN TOTAL RETURN
EXCLUDING MAXIMUM INCLUDING MAXIMUM
VALUE OF VALUE OF SALES CHARGE SALES CHARGE
INVESTMENT INVESTMENT INITIAL INVESTMENT --------------------------- ---------------------------
PERIOD DATE INVESTMENT ON 10/31/99 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- ---------------------- ---------- ---------- ----------- ------------- ------------- -------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 4/22/98 $942.51 $1,146.09 21.60% 13.64% 14.61% 9.32%
1 Year Ended
10/31/99 10/31/98 $942.43 $1,296.38 37.56% 37.56% 29.64% 29.64%
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at February 1, 2000, 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 5% or more of the outstanding shares of Class A, 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> <C>
TAX-MANAGED EMERGING GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 10.9%
TAX-MANAGED INTERNATIONAL GROWTH -- Centurion Trust Company Phoenix, AZ 15.5%
</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
For the fiscal year ended October 31, 1999, the following table shows (1)
sales commissions paid by the principal underwriter to investment dealers on
sales of Class B shares, (2) distribution fees to the principal underwriter
under the Distribution Plan, (3) CDSC payments to the principal underwriter,
(4) uncovered distribution charges under the Plan (dollar amount and as a
percentage of net assets attributable to Class B), (5) service fees paid under
the Distribution Plan, and (6) the service fees paid to investment dealers.
The service fees paid by the Funds that were not paid to investment dealers
were retained by the principal underwriter. Distribution and CDSC payments
reduce uncovered distribution charges under the Plan.

<TABLE>
<CAPTION>
UNCOVERED
DISTRIBUTION CDSCS DISTRIBUTION SERVICE
FEES PAID TO PAID TO CHARGES (AS FEES TO
SALES THE PRINCIPAL THE PRINCIPAL A % OF NET SERVICE INVESTMENT
COMMISSIONS UNDERWRITER UNDERWRITER ASSETS) FEES DEALERS
CLASS B --------------- --------------- -------------- -------- ------------ -------------
- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Tax-Managed
Emerging Growth $1,364,609 $593,458 $258,000 $3,904,000 (3.7%) $82,141 $81,784
Tax-Managed
International
Growth ....... 496,746 121,193 32,000 1,050,000 (8.2%) 7,807 7,807
</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,
1999, 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 -- $2,025; and Tax-Managed International Growth --
$372.50.

PERFORMANCE INFORMATION

The tables below indicate 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 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.

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

VALUE OF VALUE OF
INVESTMENT INVESTMENT TOTAL RETURN BEFORE TOTAL RETURN AFTER
BEFORE AFTER DEDUCTING DEDUCTING
DEDUCTING THE DEDUCTING THE THE MAXIMUM CDSC THE MAXIMUM CDSC
INVESTMENT INVESTMENT AMOUNT OF MAXIMUM CDSC MAXIMUM CDSC ------------------------- -------------------------
PERIOD DATE INVESTMENT ON 10/31/99 ON 10/31/99 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ---------- ---------- -------------- -------------- ----------- ------------ ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 9/29/97 $1,000 $1,291.00 $1,251.00 29.10% 13.00% 25.10% 11.31%
1 Year
Ended
10/31/99 10/31/98 $1,000 $1,374.86 $1,324.86 37.49% 37.49% 32.49% 32.49%
</TABLE>

<PAGE>

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

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 10/31/99 ON 10/31/99 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ---------- ---------- ----------- ----------- ---------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 4/22/98 $1,000 $1,203.00 $1,153.00 20.30% 12.84% 15.30% 9.75%
1 Year Ended
10/31/99 10/31/98 $1,000 $1,365.49 $1,315.49 36.55% 36.55% 31.55% 31.55%
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at February 1, 2000, 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 5% or more of the outstanding shares of Class B, 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> <C>
TAX-MANAGED EMERGING GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 14.0%
TAX-MANAGED INTERNATIONAL GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 13.7%
</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
For the fiscal year ended October 31, 1999, the following table shows,
(1) sales commissions paid by the principal underwriter to investment dealers
on sales of Class C shares, (2) distribution fees to the principal underwriter
under the Distribution Plan, (3) CDSC payments to the principal underwriter,
(4) uncovered distribution charges under the Plan (dollar amount and as a
percentage of net assets attributable to Class C), (5) service fees paid under
the Distribution Plan, and (6) the service fees paid to investment dealers.
The service fees paid by the Funds that were not paid to investment dealers
were retained by the principal underwriter. Distribution and CDSC payments
reduce uncovered distribution charges under the Plan.

<TABLE>
<CAPTION>
UNCOVERED
DISTRIBUTION CDSCS DISTRIBUTION SERVICE
FEES PAID TO PAID TO CHARGES (AS FEES TO
SALES THE PRINCIPAL THE PRINCIPAL A % OF NET SERVICE INVESTMENT
COMMISSIONS UNDERWRITER UNDERWRITER ASSETS) FEES DEALERS
CLASS C --------------- --------------- -------------- -------- ------------ ---------------
- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Tax-Managed
Emerging Growth $91,848 $209,151 $14,000 $2,183,000 (5.5%) $69,717 $22,945
Tax-Managed
International
Growth ....... 8,741 56,352 5,000 830,000 (5.7%) 18,746 2,185
</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,
1999, 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 -- $847.50; and Tax-Managed International Growth
- -- $200.

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 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.

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

VALUE OF VALUE OF
INVESTMENT INVESTMENT TOTAL RETURN BEFORE TOTAL RETURN AFTER
BEFORE AFTER DEDUCTING DEDUCTING
DEDUCTING DEDUCTING THE MAXIMUM CDSC THE MAXIMUM CDSC
INVESTMENT INVESTMENT AMOUNT OF THE CDSC THE CDSC ------------------------- -------------------------
PERIOD DATE INVESTMENT ON 10/31/99 ON 10/31/99 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ---------- ---------- ------------ ----------- ------------ ------------ ------------ ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of
Fund 9/29/97 $1,000 $1,286.00 $1,286.00 28.60% 12.79% 28.60% 12.79%
1 Year
Ended
10/31/99 10/31/98 $1,000 $1,372.47 $1,362.47 37.25% 37.25% 36.25% 36.25%
</TABLE>

<PAGE>

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

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 10/31/99 ON 10/31/99 CUMULATIVE ANNUALIZED CUMULATIVE ANNUALIZED
- -------------- ---------- ---------- ----------- ----------- ------------ ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Life of Fund 04/22/98 $1,000 $1,200.00 $1,200.00 20.00% 12.66% 20.00% 12.66%
1 Year
Ended
10/31/99 10/31/98 $1,000 $1,363.63 $1,353.63 36.36% 36.36% 35.36% 35.36%
</TABLE>

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As at February 1, 2000, 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 5% or more of the outstanding shares of Class C shares,
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> <C>
TAX-MANAGED EMERGING GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 23.1%
TAX-MANAGED INTERNATIONAL GROWTH -- Merrill Lynch, Pierce, Fenner & Smith, Inc. Jacksonville, FL 24.5%
</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
Series of Shares dated August 16, 1999 filed as Exhibit (a)(4) to
Post-Effective Amendment No. 54 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 Tax Free Reserves dated August 15, 1995 filed as
Exhibit (5)(b) to Post-Effective Amendment No. 25 and
incorporated herein by reference.

(2) 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.

(3) 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.

(4) 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.

(5) Investment Advisory Agreement with Eaton Vance Management for
Eaton Vance Tax-Managed Value Fund dated August 16, 1999 filed as
Exhibit (d)(5) to Post-Effective Amendment No. 54 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.

C-1
<PAGE>
(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.

(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 (A, A-1 and
A-2) 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) Schedules A-3, A-4 and A-5 to Distribution Agreement filed as
Exhibit (e)(5)(ii) to Post-Effective Amendment No. 54 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.

(3) Amendment to Master Custodian Agreement with Investors Bank &
Trust Company dated December 21, 1998 filed as Exhibit (g)(3) to
the Registration Statement of Eaton Vance Municipals Trust (File
Nos. 33-572, 811-4409)(Accession No. 0000950156-99-000050) 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.

C-2
<PAGE>
(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) Administrative Services Agreement between Eaton Vance Mutual
Funds Trust (on behalf of certain of its series) and Eaton Vance
Management dated August 16, 1999 with attached Schedule A dated
August 16, 1999 filed as Exhibit (h)(2) to Post-Effective
Amendment No. 54 and incorporated herein by reference.

(3) 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.

(i)(1) Opinion of Internal Counsel dated August 25, 1999 filed as
Exhibit (i)(1) to Post-Effective Amendment No. 54 and
incorporated herein by reference.

(2) Consent of Counsel filed herewith.

(j)(1) Consent of Independent Accountants for Eaton Vance Strategic
Income Fund filed herewith.

(2) Independent Auditors' Consent for Eaton Vance Tax-Managed
Emerging Growth Fund filed herewith.

(3) Independent Auditors' Consent for Eaton Vance Tax-Managed
International Growth Fund filed herewith.

(k) Not applicable

(l) Not applicable

(m)(1)(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.

(2)(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.

(3)(a) Eaton Vance Mutual Funds Trust Class A Service Plan adopted June
23, 1997 with attached Schedules (A, A-1 and A-2) filed as
Exhibit (15)(i) to Post-Effective Amendment No. 38 and
incorporated herein by reference.

C-3
<PAGE>
(b) Schedules A-3, A-4 and A-5 to Class A Service Plan filed as
Exhibit (m)(3)(b) to Post-Effective Amendment No. 54 and
incorporated herein by reference.

(c) Eaton Vance Mutual Funds Trust Class S Service Plan adopted
February 22, 1999 filed as Exhibit (m)(3)(c) to Post-Effective
Amendment No. 53 and incorporated herein by reference.

(4)(a) Eaton Vance Mutual Funds Trust Class B Distribution Plan adopted
June 23, 1997 with attached Schedules (A, A-1 and A-2) filed as
Exhibit (15)(j) to Post-Effective Amendment No. 38 and
incorporated herein by reference.

(b) Schedules A-3, A-4 and A-5 to Class B Distribution Plan filed as
Exhibit (m)(4)(b) to Post-Effective Amendment No. 54 and
incorporated herein by reference.

(5)(a) Eaton Vance Mutual Funds Trust Class C Distribution Plan adopted
June 23, 1997 with attached Schedules (A and A-1) filed as
Exhibit (15)(k) to Post-Effective Amendment No. 38 and
incorporated herein by reference.

(b) Schedules A-2, A-3, A-4 and A-5 to Class C Distribution Plan
filed as Exhibit (m)(5)(b) to Post-Effective Amendment No. 54 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.

(c) Amendment to Multiple Class Plan for Eaton Vance Mutual Funds
Trust dated February 22, 1999 filed as Exhibit (o)(1)(c) to
Post-Effective Amendment No. 53 and incorporated herein by
reference.

(d) Schedule A-6 to Multiple Class Plan dated August 16, 1999 filed
as Exhibit (o)(d) to Post-Effective Amendment No. 54 and
incorporated herein by reference.

(p)(1) Power of Attorney for Eaton Vance Mutual Funds Trust dated June
23, 1997 filed as Exhibit No. (17)(a) to Post-Effective Amendment
No. 35 and incorporated herein by reference.

(a) Power of Attorney for Eaton Vance Mutual Funds Trust dated
November 16, 1998 filed as Exhibit (p)(1) to Post-Effective
Amendment No. 47 and incorporated herein by reference.

(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.

(a) Power of Attorney for Government Obligations Portfolio dated
November 16, 1998 filed as Exhibit (p)(2)(a) to Post-Effective
Amendment No. 48 and incorporated herein by reference.

(3) Power of Attorney for High Income Portfolio dated February 14,
1997 filed as Exhibit No. (17)(c) to Post-Effective Amendment No.
36 and incorporated herein by reference.

(a) Power of Attorney for High Income Portfolio dated November 16,
1998 filed as Exhibit (p)(3) to Post-Effective Amendment No. 47
and incorporated herein by reference.

C-4
<PAGE>
(4) Power of Attorney for Strategic Income Portfolio dated April 22,
1997 filed as Exhibit No. (17)(d) to Post-Effective Amendment No.
36 and incorporated herein by reference.

(a) Power of Attorney for Strategic Income Portfolio dated November
16, 1998 filed as Exhibit (p)(4) to Post-Effective Amendment No.
47 and incorporated herein by reference.

(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.

(a) Power of Attorney for Cash Management Portfolio dated November
16, 1998 filed as Exhibit (p)(5)(a) to Post-Effective Amendment
No. 48 and incorporated herein by reference.

(6) Power of Attorney for Tax-Managed Growth Portfolio dated February
20, 1998 filed as Exhibit No. (17)(f) to Post-Effective Amendment
No. 41 and incorporated herein by reference.

(a) Power of Attorney for Tax-Managed Growth Portfolio dated November
16, 1998 filed as Exhibit (p)(6) to Post-Effective Amendment No.
47 and incorporated herein by reference.

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.

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 Floating-Rate Fund
Eaton Vance Growth Trust
Eaton Vance Income Fund of Boston
Eaton Vance Institutional Senior Floating-Rate Fund
Eaton Vance Investment Trust
Eaton Vance Municipals Trust
Eaton Vance Municipals Trust II
Eaton Vance Mutual Funds Trust
Eaton Vance Prime Rate Reserves
Eaton Vance Special Investment Trust
EV Classic Senior Floating-Rate Fund

C-5
<PAGE>
(1) (2) (3)
Name and Principal Positions and Offices Positions and Offices
Business Address* with Principal Underwriter with Registrant
----------------- -------------------------- --------------------

Albert F. Barbaro Vice President None
Chris Berg Vice President None
Kate B. Bradshaw Vice President None
Mark Carlson Vice President None
Daniel C. Cataldo Vice President None
and Treasurer
Raymond Cox Vice President None
Peter Crowley Vice President None
Anthony DeVille Vice President None
Ellen Duffy Vice President None
Alan R. Dynner Vice President, Secretary Secretary
and Clerk
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
Kara Lawler Vice President None
Thomas P. Luka Vice President None
John Macejka Vice President None
Stephen Marks Vice President None
Geoff Marshall 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
George D. Owen, II Vice President None
Margaret Pier 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
Stephen M. Rudman Vice President None
Kevin Schrader 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
Debra Wekstein Vice President None
Wharton P. Whitaker President and Director None
Sue Wilder Vice President None

- ------------------------------------------
* Address is The Eaton Vance Building, 255 State Street, Boston, MA 02109

C-6
<PAGE>
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, PFPC
Global Fund Services, 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 of the administrator and investment adviser.
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

The Registrant undertakes to include the information required by Item 5 of
Form N-1A in its annual reports to shareholders under Rule 30d-1.

C-7
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Amendment to the Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and 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 February 23, 2000.

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 February 23, 2000.

Signature Title
- --------- -----

/s/ James B. Hawkes President (Chief Executive Officer) and Trustee
- --------------------------
James B. Hawkes

/s/ James L. O'Connor Treasurer (and 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

Jack L. Treynor* Trustee
- --------------------------
Jack L. Treynor

*By: /s/ Alan R. Dynner
-------------------------------
Alan R. Dynner (As attorney-in-fact)

C-8
<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 February 23, 2000.

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 their capacities on February 23, 2000.