HANCOCK JOHN SPECIAL EQUITIES FUND, 485BPOS, 1995-02-23

HANCOCK JOHN SPECIAL EQUITIES FUND
485BPOS, 1995-02-23

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<PAGE>

As filed with the Securities and Exchange Commission on February , 1995

File No. 2-92548
File No. 811-4079
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]

Pre-Effective Amendment No. __ [ ]

Post-Effective Amendment No. 11 [X]

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]

Amendment No. 11 [X]

JOHN HANCOCK SPECIAL EQUITIES FUND
----------------------------------
(Exact Name of Registrant as Specified in Charter)

101 HUNTINGTON AVENUE, BOSTON, MASSACHUSETTS 02199-7603
-------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number: 617-375-1700
------------

Name and Address of Agent for Service:
------------------
Thomas H. Drohan
John Hancock Advisers, Inc.
101 Huntington Avenue
Boston, MA 02199

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

It is proposed that this filing will become effective:

immediately upon filing pursuant to paragraph (b) of Rule 485

x on March 1, 1995 pursuant to paragraph (b) of Rule 485
60 days after filing pursuant to paragraph (a) of Rule 485

on (date) pursuant to paragraph (a) of Rule 485

Pursuant to Rule 24f-2 under the Investment Company Act of 1940, Registrant has
registered an indefinite number of securities under the Securities Act of 1933.
A Rule 24f-2 Notice for the Registrant's most recent fiscal year on December 23,
1994.

<PAGE>

<TABLE>
CROSS REFERENCE SHEET

Pursuant to Rule 495(a) under the Securities Act of 1933
<CAPTION>
Item Number Statement of Additional
Form N-1A Part A Prospectus Caption Information Caption
---------------- ------------------ -------------------
<S> <C> <C>
1 Front Cover Page *

2 Expense Information; *
The Fund's Expenses;
Shares Price;
Additional Services and
Programs

3 The Fund's Financial *
History Performance

4 Investment Objectives and *
Policies; Organization and
Management of the Fund

5 Organization and Management *
of the Fund; The Fund's
Expenses

6 Organization and Management of *
Fund; Distribution and Taxes;
How to Redeem Shares;
Additional Services and Programs

7 Who Can Buy Shares; *
How to Buy Shares;
Shares Price; Additional
Services and Programs

8 How to Redeem Shares *

9 Not Applicable *
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
Item Number Statement of Additional
Form N-1A Part A Prospectus Caption Information Caption
---------------- ------------------ -------------------
<S> <C> <C>
10 * Front Cover Page

11 * Table of Contents

12 * Organization of the Fund

13 * Investment Objective and
Policies; Investment
Restrictions

14 * Those Responsible for
Management

15 * Those Responsible for
Management

16 * Investment Advisory and
Other Services;
Distribution Contract;
Transfer Agent Services;
Custody of Portfolio;
Independent Auditors

17 * Brokerage Allocation

18 * Description of the Fund's
Shares

19 * Net Asset Value; Additional
Services and Programs

20 * Tax Status

21 * Distribution Contract

22 * Calculation of Performance

23 * Financial Statements
</TABLE>

<PAGE>
JOHN HANCOCK
SPECIAL
EQUITIES
FUND

CLASS A AND CLASS B
PROSPECTUS
MARCH 1, 1995

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

TABLE OF CONTENTS
Page
--
Expense Information .................................................... 2
The Fund's Financial Highlights ........................................ 3
Investment Objective and Policies ...................................... 5
Organization and Management of the Fund ................................ 8
Alternative Purchase Arrangements ...................................... 9
The Fund's Expenses .................................................... 10
Dividends and Taxes .................................................... 11
Performance ............................................................ 12
How to Buy Shares ...................................................... 13
Share Price ............................................................ 14
How to Redeem Shares ................................................... 20
Additional Services and Programs ....................................... 21
Institutional Investors ................................................ 25

This Prospectus sets forth information about John Hancock Special Equities
Fund (the "Fund"), a diversified fund, that you should know before investing.
Please read and retain it for future reference.

Additional information about the Fund has been filed with the Securities and
Exchange Commission (the "SEC"). You can obtain a copy of the Fund's Statement
of Additional Information, dated March 1, 1995 and incorporated by reference
into this Prospectus, free of charge by writing or telephoning: John Hancock
Investor Services Corporation, P.O. Box 9116, Boston, Massachusetts 02205-9116,
1-800-225-5291, (1-800-554-6713 TDD).

SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, ANY BANK, AND THE SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<PAGE>

EXPENSE INFORMATION
The purpose of the following information is to help you understand the
various fees and expenses that you will bear, directly or indirectly, when you
purchase shares of the Fund. The operating expenses included in the table and
hypothetical example below are based on fees and expenses for the Class A and
Class B shares of the Fund for the fiscal year ended October 31, 1994, adjusted
to reflect current fees and expenses. Actual fees and expenses of Class A shares
and Class B shares may be greater or less than those indicated.

<TABLE>
CLASS A CLASS B
SHARES<F1> SHARES<F1>
------------ ------------
<CAPTION>
<S> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum sales charge imposed on purchases (As a percentage of
offering price) ............................................... 5.00% None
Maximum sales charge imposed on reinvested dividends ............ None None
Maximum deferred sales charge ................................... None<F2> 5.00%
Redemption fee<F4> .............................................. None None
Exchange fee .................................................... None None

ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management fee<F5>............................................... 0.82% 0.82%
12b-1 fee<F3>.................................................... 0.30% 1.00%
Other expenses .................................................. 0.50% 0.57%

Total Fund operating expenses ................................... 1.62% 2.39%
<FN>
- ------------
<F1> The information set forth in the foregoing table relates only to the Class

A shares and Class B shares. As of the date of this Prospectus, the
Trustees have authorized the issuance of three classes of the Fund,
designated as Class A, Class B and Class C. Class B shares commenced
operations on March 1, 1993. See "Organization and Management of the Fund."
Class C shares are only offered to certain institutional investors and are
described in a separate prospectus. Some individual investors who are
currently eligible to purchase Class A and Class B shares may also be
participants in plans that are eligible to purchase Class C shares. See
"How to Buy Shares -- Institutional Investors." Class C shares are not
subject to a sales charge on purchases, redemptions, or reinvested
dividends, nor are they subject to deferred sales charges or an exchange
fee. Class C expenses are identical to those of Class A shares except that
the transfer agent fee may differ and there is no 12b-1 Fee on Class C
shares.
<F2> No sales charge is payable at the time of purchase on investments of $1
million or more, but for these investments a contingent deferred sales
charge may be imposed, as described below under the caption "Share Price,"
in the event of certain redemption transactions within one year of
purchase.
<F3> The amount of the 12b-1 fee used to cover service expenses will be up to
0.25% of the Fund's average net assets, and the remaining portion will be
used to cover distribution expenses. See "The Fund's Expenses."
<F4> Redemption by wire fee (currently $4.00) not included.
<F5> The calculation of the management fee is based on net assets at October 31,
1994. See "The Fund's Expenses."
</TABLE>

<PAGE>
<TABLE>
<CAPTION>
EXAMPLE: 1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
You would pay the following expenses for the indicated
period of years on a hypothetical $1,000 investment,
assuming a 5% annual return:

Class A Shares ....................................... $66 $ 99 $134 $233
Class B Shares
-- Assuming complete redemption at end of period ... $74 $105 $148 $254
-- Assuming no redemption .......................... $24 $ 75 $128 $254
</TABLE>
You would pay the following expenses for the indicated period of years on a
hypothetical $1,000 investment in Class C shares, assuming a 5% annual return; 1
year $11; 3 years $33; 5 years $57; and 10 years $126.

(This example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.)

The Fund's payment of a distribution fee may result in a long-term
shareholder indirectly paying more than the economic equivalent of the maximum
front-end sales charge permitted under the National Association of Securities
Dealers Rules of Fair Practice.

The management and 12b-1 fees referred to above are more fully explained in
this Prospectus under the caption "The Fund's Expenses" and in the Statement of
Additional Information under the captions "Investment Advisory and Other
Services" and "Distribution Contract."

<PAGE>

THE FUND'S FINANCIAL HIGHLIGHTS
The following table of Financial Highlights has been audited by Ernst &
Young LLP, the Fund's independent auditors whose unqualified report is included
in the Fund's 1994 Annual Report and is included in the Statement of Additional
Information. Further information about the performance of the Fund is contained
in the Fund's Annual Report to Shareholders, which may be obtained free of
charge by writing or telephoning John Hancock Investor Services Corporation
("Investor Services") at the address or telephone number listed on the front
page of this Prospectus.
Selected data for each class of shares outstanding throughout each period
indicated are as follows:
<TABLE>
<CAPTION>
PERIOD FROM
FEBRUARY 4,
YEAR ENDED OCTOBER 31, 1985 TO
------------------------------------------------------------------------------------------------ OCTOBER 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986 1985<F7>
----- ----- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
PER SHARE OPERATING PERFORMANCE
Net Asset Value,
Beginning of
Period $16.13 $10.99 $ 9.71 $ 4.97 $ 6.38 $ 4.89 $ 4.30 $ 6.08 $ 5.21 $ 5.00
------- ------- ------ ------ ----- ------ ------ ------ ------ ------
Net Investment
Income (Loss)<F1> (0.21)<F2> (0.20)<F2> (0.19)<F2> (0.10) (0.12) 0.01 0.04 (0.03) (0.03) 0.03
Net Realized and
Unrealized Gain
(Loss) on
Investments 0.19 5.43 2.14 4.84 (1.27) 1.53 0.55 (1.26) 0.93 0.18
Total from
Investment
Operations (0.02) 5.23 1.95 4.74 (1.39) 1.54 0.59 (1.29) 0.90 0.21
Less Distributions:
Dividends from Net
Investment
Income -- -- -- -- (0.02) (0.05) -- -- (0.02) --
Distributions from
Net Realized
Gain on
Investments Sold -- (0.09) (0.67) -- -- -- -- (0.45) (0.01) --
Distributions from
Capital Paid-In -- -- -- -- -- -- -- (0.04) -- --
Total
Distributions -- (0.09) (0.67) -- (0.02) (0.05) -- (0.49) (0.03) --
------- ------- ------ ------ ----- ------ ------ ------ ------ ------
Net Asset Value,
End of Period $16.11 $16.13 $10.99 $ 9.71 $ 4.97 $ 6.38 $ 4.89 $ 4.30 $ 6.08 $ 5.21
------- ------- ------ ------ ----- ------ ------ ------ ------ ------
Total
Investment
Return at
Net Asset
Value <F1> (0.12%) 47.83% 20.25% 95.37% (21.89%) 31.82% 13.72% (28.68%) 17.38% 4.20%
------- ------- ------ ------ ----- ------ ------ ------ ------ ------
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of
Period
(000's omitted) $310,625 $296,793 $44,665 $19,713 $8,166 $12,285 $11,714 $10,637 $13,780 $2,467
------- ------- ------ ------ ----- ------ ------ ------ ------ ------
Ratio of Expenses
to Average Net
Assets <F1> 1.62% 1.84% 2.24% 2.75% 2.63% 1.50% 1.50% 1.50% 1.50% 1.50%<F6>
Ratio of Net
Investment
Income (Loss) to
Average Net
Assets <F1> (1.40%) (1.49%) (1.91%) (2.12%) (1.58%) 0.47% 0.82% (0.57%) (0.57%) 1.42%<F6>
Portfolio Turnover
Rate 66% 33% 114% 163% 113% 115% 91% 93% 64% 15%

YEAR ENDED OCTOBER 31,
----------------------
1994 1993
---- ----
CLASS B <F3>
PER SHARE OPERATING PERFORMANCE
Net Asset Value,
Beginning of
Period $16.08 $12.30
----- -----
Net Investment
Income (Loss) (0.30)<F2> (0.18)<F2>
Net Realized and
Unrealized Gain
(Loss) on
Investments 0.19 3.96
----- -----
Total from
Investment
Operations (0.11) 3.78
----- -----
Net Asset Value,
End of Period $15.97 $16.08
----- -----
----- -----
Total
Investment
Return at
Net Asset
Value (0.68%) 30.73%<F4>
----- -----
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of
Period
(000's omitted) $191,979 $158,281
Ratio of Expenses
to Average Net
Assets 2.25% 2.34%<F6>
Ratio of Net
Investment
Income (Loss) to
Average Net
Assets (2.02%) (2.03%)<F6>
Portfolio Turnover
Rate 66% 33%
<PAGE>
THE FUND'S FINANCIAL HIGHLIGHTS -- CONTINUED
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------
1994 1993
----- -----
<S> <C> <C>
CLASS C <F5>
PER SHARE OPERATING PERFORMANCE
Net Asset Value,
Beginning of
Period $16.14 $14.90
------ ------
Net Investment
Income (Loss) (0.13)<F2> (0.03)<F2>
Net Realized and
Unrealized Gain
(Loss) on
Investments 0.19 1.27
------ ------
Total from
Investment
Operations 0.06 1.24
------ ------
Net Asset Value,
End of Period $16.20 $16.14
------ ------
------ ------
Total
Investment
Return at
Net Asset
Value 0.37% 8.32%<F4>
------ ------
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of
Period
(000's omitted) $ 7,123 $ 2,838
Ratio of Expenses
to Average Net
Assets 1.11% 1.45%<F6>
Ratio of Net
Investment
Income (Loss) to
Average Net
Assets (0.89%) (1.35%)<F6>
Portfolio Turnover
Rate 66% 33%
<FN>
- -----------
<F1> Reflects expense limitation in effect during the years ended October 31,
1985 through 1991 (see Note B to the financial statements in the Statement
of Additional Information). As a result of such limitations, expenses of
the Fund for the years ended October 31, 1991, 1990, 1989, 1988, 1987, 1986
and 1985 reflect reductions of $.002, $.02, $.03, $.07, $.04, $.09 and
$.18, respectively. Absent of such limitation, for the years ended October
31, 1991, 1990, 1989, 1988, 1987, 1986 and 1985 the ratio of net expenses
would have been 2.79%, 2.95%, 2.57%, 2.94%, 2.23%, 3.47% and 9.84%
respectively, and the ratio of net investment income (loss) to average net
assets would have been (2.16%), (1.90%), (0.60%), (0.62%), (1.30%), (2.55%)
and (6.91%), respectively. Without the limitation, total investment return
would be lower.
<F2> Net investment Loss per share has been calculated based on average monthly
shares outstanding.
<F3> Class B shares commenced operations on March 1, 1993.
<F4> Not annualized.
<F5> Class C shares commenced operations on September 1, 1993.
<F6> On an annualized basis.
<F7> For the period from December 17, 1984 (date of John Hancock Advisers,
Inc.'s initial investment) to February 4, 1985, the Fund had not commenced
investment operations.
</TABLE>

<PAGE>
INVESTMENT OBJECTIVE AND POLICIES

THE FUND SEEKS GROWTH OF CAPITAL BY INVESTING PRIMARILY IN THE EQUITY SECURITIES
OF EMERGING GROWTH AND SPECIAL SITUATION COMPANIES.

The investment objective of the Fund is to seek growth of capital by investing
in a diversified portfolio of equity securities consisting primarily of emerging
growth companies and of companies in "special situations," collectively referred
to as "Special Equities." In seeking to achieve this objective, the Fund will
invest at least 65% of its total assets in Special Equities. The potential for
growth of capital will be the basis for selection of portfolio securities.
Current income will not be a factor in this selection. The Fund's investments
will be subject to the market fluctuation and risks inherent in all securities.
There is no assurance that the Fund will achieve its investment objective.

THE FUND'S INVESTMENTS IN SPECIAL EQUITIES WILL BE PRIMARILY IN COMMON STOCK BUT
MAY ALSO INCLUDE PREFERRED STOCK, SECURITIES CONVERTIBLE INTO COMMON STOCK,
RIGHTS, WARRANTS, FOREIGN SECURITIES WITH THE SAME CHARACTERISTICS AS SPECIAL
EQUITIES AND AMERICAN DEPOSITARY RECEIPTS (ADRS).

The Fund may also invest in:

-- equity securities of established companies that John Hancock Advisers,
Inc. (the "Adviser") believes to offer growth potential.

-- cash or investment grade corporate debt securities (debt securities which
have, at the time of purchase, a rating within the four highest grades as
determined by Moody's Investors Services, Inc. -- Aaa, Aa, A or Baa or
Standard & Poor's Rating Group -- AAA, AA, A or BBB), money market
instruments or securities of the United States Government or its agencies or
instrumentalities ("government securities"), for temporary defensive
purposes or to provide for anticipated redemptions of the Fund's shares.
Debt securities rated Baa or BBB are considered medium grade obligations
with speculative characteristics, and adverse economic conditions or
changing circumstances may weaken capacity to pay interest and repay
principal. If the rating of a debt security is reduced below Baa or BBB, the
Adviser will consider whatever action is appropriate consistent with the
Fund's investment objectives and policies.

THE FUND SEEKS TO IDENTIFY EMERGING GROWTH COMPANIES WHICH CAN SHOW SUSTAINED
INCREASES IN EARNINGS.

The emerging growth companies whose securities are selected for the Fund's
portfolio will generally have annual gross sales of greater than $100 million,
although companies with smaller sales which, in the opinion of the Adviser, have
significant growth potential may also be selected. Thus, there is no requirement
that a company have annual sales of a pre-selected minimum amount before the
Fund will invest in its securities. In many cases, a company may not yet be
profitable when the Fund invests in its securities.

The Fund seeks emerging growth companies that either occupy a dominant position
in an emerging industry or have a significant and growing market share in a
large, fragmented industry. The Fund seeks to invest in those companies with
potential for high growth, stable earnings, ability to self- finance, a position
of industry leadership, and strong, visionary management. The Adviser believes
that, while these companies present above-average risks, properly selected
emerging growth companies have the potential to increase their earnings at rates
substantially in excess of the growth of earnings of other companies. This
increase in earnings is likely to enhance the value of an emerging growth
company's equity securities.
<PAGE>

The Fund may invest in equity securities of companies in special situations that
the Adviser believes present opportunities for capital growth. A company is in a
"special situation" when an unusual and possibly non-repetitive development is
anticipated or is taking place. Since every special situation involves, to some
extent, a break with past experience, the uncertainties in the appraisal of the
future value of the company's equity securities and risk of possible decline in
value of the Fund's investment are significant.

The Fund may effect portfolio transactions without regard to holding periods, if
the Adviser judges these transactions to be advisable in light of a change in
circumstances of a particular company or within a particular industry or in
general market, economic or financial conditions. The Fund does not generally
consider the length of time it has held a particular security in making its
investment decisions. Portfolio turnover rates of the Fund for recent years are
shown in the section "The Fund's Financial Highlights."

THE FUND IS DESIGNED FOR INVESTORS WHO ARE WILLING TO ASSUME GREATER THAN USUAL
RISKS IN THE HOPE OF REALIZING GREATER THAN USUAL RETURNS.

The Fund is not intended as a complete investment program. The Fund's shares are
suitable for investment by persons who can invest without concern for current
income, who are in a financial position to assume above-average investment risk,
and who are prepared to experience above-average fluctuations in net asset value
over the intermediate and long term. Emerging growth companies and companies in
special situations will usually not pay dividends.

Generally, emerging growth companies will have high price/earnings ratios in
relation to the market. A high price/earnings ratio generally indicates that the
market value of a security is especially sensitive to developments that could
affect the company's potential for future earnings. These companies may have
limited product lines, market or financial resources, or they may be dependent
upon a limited management group. Emerging growth companies may have operating
histories of fewer than three years.

Full development of the potential of emerging growth companies frequently takes
time. For this reason, the Fund should be considered a long-term investment and
not a vehicle for seeking short-term profits and income.

The securities in which the Fund invests will often be traded in the
over-the-counter market or on a regional securities exchange and may not be
traded every day or in the volume typical of trading on a national securities
exchange. They may be subject to wide fluctuations in market value. The trading
market for any given security may be sufficiently thin as to make it difficult
for the Fund to dispose of a substantial block of such securities. The
disposition by the Fund of portfolio securities to meet redemptions or otherwise
may require the Fund to sell these securities at a discount from market prices
or during periods when, in the Adviser's judgment, such disposition is not
desirable or to make many small sales over a lengthy period of time.

THE FUND MAY EMPLOY CERTAIN INVESTMENT STRATEGIES TO HELP ACHIEVE ITS INVESTMENT
OBJECTIVES.

FOREIGN SECURITIES. The Fund may invest in U.S. dollar-denominated securities of
foreign issuers which are traded in the United States. ADRs (sponsored and
unsponsored) are receipts typically issued by an American bank or trust company
which evidence ownership of underlying securities issued by a foreign
corporation, and are designed for trading in United States securities markets.
Issuers of unsponsored ADRs are not contractually obligated to disclose material
information in the United States and, therefore, there may not be a correlation
between that information and the market value of an unsponsored ADR. Investment
in foreign securities may involve risks not present in domestic investments.
Foreign companies may not be subject to accounting standards or government
supervision comparable to U.S. companies, and there is often less publicly
available information about their operations. They can also be affected by
political or financial instability abroad.

RESTRICTED SECURITIES. The Fund may invest in securities which are subject to
legal or contractual delays in or restrictions on resale ("restricted
securities"). These purchases are subject to an investment restriction limiting
all illiquid securities held by the Fund to not more than 15% of the Fund's net
assets. The registration of these securities under the Securities Act of 1933,
as amended (the "Securities Act"), may be required prior to sale, and the Fund
may have to bear all or a part of the expense of these registrations. The Fund's
investments in restricted securities, may include those eligible for resale to
"qualified institutional buyers" pursuant to Rule 144A under the Securities Act.
The Trustees will monitor the Fund's investments in Rule 144A securities,
focusing on certain factors, including valuation, liquidity and availability of
information.

LENDING OF SECURITIES. The Fund may lend portfolio securities to brokers,
dealers, and financial institutions if the loan is collateralized by cash or
U.S. government securities according to applicable regulatory requirements. The
Fund may reinvest any cash collateral in short-term securities. When the Fund
lends portfolio securities, there is a risk that the borrower may fail to return
the securities involved in the transaction. As a result, the Fund may incur a
loss or, in the event of the borrower's bankruptcy, the Fund may be delayed in
or prevented from liquidating the collateral. It is a fundamental policy of the
Fund not to lend portfolio securities having a total value exceeding 33 1/3% of
its total assets.

REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements. In a
repurchase agreement, the Fund buys a security subject to the right and
obligation to sell it back at a higher price. These transactions must be fully
collateralized at all times, but involve some credit risk to the Fund if the
other party defaults on its obligation and the Fund is delayed or prevented from
liquidating the collateral.

THE FUND FOLLOWS CERTAIN POLICIES WHICH MAY HELP REDUCE INVESTMENT RISK.

The Fund has adopted certain investment restrictions which are detailed in the
Statement of Additional Information, where they are classified as fundamental or
non-fundamental. The Fund's investment objective and those investment
restrictions designated as fundamental may not be changed without shareholder
approval. All other investment policies and restrictions are non-fundamental and
can be changed by a vote of the Trustees without shareholder approval.

Portfolio turnover rates of the Fund for recent years are shown in the section
"The Fund's Financial Highlights." A high rate of portfolio turnover (100% or
more) involves correspondingly greater brokerage transaction costs which must be
borne by the Fund, and its shareholders and may, under certain circumstances,
make it more difficult for the Fund to qualify as a regulated investment company
under the Internal Revenue Code of 1986. See "Tax Status" and "Brokerage
Allocation" in the Statement of Additional Information.

BROKERS ARE CHOSEN BASED ON BEST PRICE AND EXECUTION.

When choosing brokerage firms to carry out the Fund's transactions, the Adviser
gives primary consideration to execution at the most favorable prices, taking
into account the broker's professional ability and quality of service.
Consideration may also be given to the broker's sales of Fund shares. Pursuant
to procedures determined by the Trustees, the Adviser may place securities
transactions with brokers affiliated with the Adviser. These brokers include
Tucker Anthony Incorporated, John Hancock Distributors, Inc. and Sutro &
Company, Inc. They are indirectly owned by John Hancock Mutual Life Insurance
Company, which in turn indirectly owns the Adviser.

ORGANIZATION AND MANAGEMENT OF THE FUND

THE TRUSTEES ELECT OFFICERS AND RETAIN THE INVESTMENT ADVISER WHO IS RESPONSIBLE
FOR THE DAY-TO-DAY OPERATIONS OF THE FUND, SUBJECT TO THE TRUSTEES' POLICIES AND
SUPERVISION.

The Fund is a diversified open-end management investment company organized as a
Massachusetts business trust in 1984. The Fund has an unlimited number of
authorized shares of beneficial interest. The Fund's Declaration of Trust
permits the Trustees, without shareholder approval, to create and classify
shares of beneficial interest into separate series of the Fund. As of the date
of this Prospectus, the Trustees have not authorized the creation of any new
series of the Fund. Although additional series may be added in the future, the
Trustees have no current intention of creating additional series of the Fund.
The Fund's Declaration of Trust also permits the Trustees, to classify and
reclassify any series or portfolio of shares into one or more classes.
Accordingly, the Trustees have authorized the issuance of three classes of the
Fund, designated as Class A, Class B, and Class C. The shares of each class
represent an interest in the same portfolio of investments of the Fund and have
equal rights as to voting, redemption, dividends and liquidation. However, each
class of shares bears different distribution and transfer agent fees, and Class
A and Class B shareholders have exclusive voting rights with respect to their
distribution plans.

Shareholders have certain rights to remove Trustees. The Fund is not required
and does not intend to hold annual shareholder meetings, although special
meetings may be held for such purposes as electing or removing Trustees,
changing fundamental investment restrictions and policies or approving a
management contract. The Fund, under certain circumstances, will assist in
shareholder communications with other shareholders.

JOHN HANCOCK ADVISERS, INC. ADVISES INVESTMENT COMPANIES HAVING TOTAL ASSETS OF
MORE THAN $13 BILLION.

The Adviser was organized in 1968 and is a wholly-owned indirect subsidiary of
the John Hancock Mutual Life Insurance Company, a financial services company.
The Adviser provides the Fund, and other investment companies in the John
Hancock group of funds, with investment research and portfolio management
services. John Hancock Funds, Inc. ("John Hancock Funds") distributes shares for
all of the John Hancock mutual funds through selected broker-dealers ("Selling
Brokers"). Certain Fund officers are also officers of the Adviser and John
Hancock Funds. Pursuant to an order granted by the Securities and Exchange
Commission, the Fund has adopted a deferred compensation plan for its
independent Trustees which allows Trustees' fees to be invested by the Fund in
other John Hancock funds.

Day-to-day management of the Fund is carried out by Michael P. DiCarlo,
supported by an investment team of sector and global specialists from the
Adviser's equity group. Mr. DiCarlo also manages John Hancock Special
Opportunities Fund and oversees the Adviser's equity management operation. Mr.
DiCarlo is a Senior Vice President of the Adviser and has been associated with
the Adviser since 1984.

In order to avoid any conflict with portfolio trades for the Fund, the Adviser
and the Fund have adopted extensive restrictions on personal securities trading
by personnel of the Adviser and its affiliates. Some of these restrictions are:
pre-clearance for all personal trades and a ban on the purchase of initial
public offerings, as well as contributions to specified charities of profits on
securities held for less than 91 days. These restrictions are a continuation of
the basic principle that the interests of the Fund and its shareholders come
first.

ALTERNATIVE PURCHASE ARRANGEMENTS

AN ALTERNATIVE PURCHASE PLAN ALLOWS YOU TO CHOOSE THE METHOD OF PAYMENT THAT IS
BEST FOR YOU.

You can purchase shares of the Fund at a price equal to their net asset value
per share plus a sales charge. At your election, this charge may be imposed
either at the time of the purchase (see "Initial Sales Charge Alternative --
Class A shares") or on a contingent deferred basis (see "Contingent Deferred
Sales Charge Alternative -- Class B shares"). If you do not specify on your
account application which class of shares you are purchasing, it will be assumed
that you are investing in Class A shares.

INVESTMENTS IN CLASS A SHARES OF THE FUND ARE SUBJECT TO AN INITIAL SALES
CHARGE.

CLASS A SHARES. If you elect to purchase Class A shares, you will incur an
initial sales charge unless the amount you purchase is $1 million or more. If
you purchase $1 million or more of Class A shares, you will not be subject to an
initial sales charge, but you will incur a sales charge if you redeem your
shares within one year of purchase. Class A shares are subject to ongoing
distribution and service fees at a combined annual rate of up to .30% of the
Fund's average daily net assets attributable to the Class A shares. Certain
purchases of Class A shares qualify for reduced initial sales charges. See
"Share Price -- Qualifying for a Reduced Sales Charge."

INVESTMENTS IN CLASS B SHARES ARE SUBJECT TO A CONTINGENT DEFERRED SALES CHARGE.

CLASS B SHARES. You will not incur a sales charge when you purchase Class B
shares, but the shares are subject to a sales charge if you redeem them within
six years of purchase (the "contingent deferred sales charge" or the "CDSC").
Class B shares are subject to ongoing distribution and service fees at a
combined annual rate of up to 1.00% of the Fund's average daily net assets
attributable to the Class B shares. Investing in Class B shares permits all of
your dollars to work from the time you make your investment, but the higher
ongoing distribution fee will cause these shares to have a higher expense ratio
than that of Class A shares. To the extent that any dividends are paid by the
Fund, these higher expenses will result in lower dividends than those paid on
Class A shares.

Class B shares are not available to full service defined contribution plans
administered by Investors Services or John Hancock Mutual Life Insurance Company
that had more than 100 eligible employees at the inception of the Fund
account.

FACTORS TO CONSIDER IN CHOOSING AN ALTERNATIVE

YOU SHOULD CONSIDER WHICH CLASS OF SHARES WILL BE A MORE BENEFICIAL INVESTMENT
FOR YOU.

The alternative purchase arrangement allows you to choose the most beneficial
way to buy shares, given the amount of purchase, the length of time you expect
to hold your shares and other circumstances. You should consider whether, during
the anticipated life of your Fund investment, the CDSC and accumulated fees on
Class B shares would be less than the initial sales charge and accumulated fees
on Class A shares purchased at the same time, and to what extent this
differential would be offset by the Class A shares' lower expenses. To help you
make this determination, the table under the caption "Expense Information" on
page 2 of this Prospectus shows examples of the charges applicable to each class
of shares. Class A shares will normally be more beneficial if you qualify for a
reduced sales charge. See "Share Price -- Qualifying for a Reduced Sales
Charge".

Class A shares are subject to lower distribution and service fees and,
accordingly, pay correspondingly higher dividends per share, to the extent any
dividends are paid. However, because initial sales charges are deducted at the
time of purchase, you would not have all of your funds invested initially and,
therefore, would initially own fewer shares. If you do not qualify for reduced
initial sales charges and expect to maintain your investment for an extended
period of time, you might consider purchasing Class A shares because the
accumulated distribution and service charges on Class B shares may exceed the
initial sales charge and accumulated distribution and service charges on Class A
shares during the life of your investment.

Alternatively, you might determine that it would be more advantageous to
purchase Class B shares in order to have all of your funds invested initially.
However, you would be subject to higher distribution fees and, for a six-year
period, a CDSC.

In the case of Class A shares, the distribution expenses that John Hancock Funds
incurs in connection with the sale of the shares will be paid from the proceeds
of the initial sales charge and the ongoing distribution and service fees. In
the case of Class B shares, the expenses will be paid from the proceeds of the
ongoing distribution and service fees, as well as the CDSC incurred upon
redemption within six years of purchase. The purpose and function of the Class B
shares' CDSC and ongoing distribution and service fees are the same as those of
the Class A shares' initial sales charge and ongoing distribution and service
fees. Sales personnel distributing the Fund's shares may receive different
compensation for selling each class of shares.

Dividends, if any, on Class A and Class B shares will be calculated in the same
manner, at the same time and on the same day and will be in the same amount,
except for differences resulting from the fact that each class will bear only
its own distribution and service fees, shareholder meeting expenses and any
incremental transfer agency costs. See "Dividends and Taxes."

THE FUND'S EXPENSES
For managing its investment and business affairs, the Fund pays a fee to the
Adviser which for the 1994 year was 0.79% of the Fund's average daily net
assets. The investment management fee is higher than the fees paid to most
mutual funds but is believed to be comparable to fees paid by those funds with
investment objectives similar to that of the Fund.

THE FUND PAYS DISTRIBUTION AND SERVICE FEES FOR MARKETING AND SALES-RELATED
SHAREHOLDER SERVICING.

The Class A and Class B shareholders have adopted distribution plans (each a
"Plan") pursuant to Rule 12b-1 under the Investment Company Act of 1940 (the
"1940 Act"). Under these Plans, the Fund will pay distribution and service fees
at an aggregate annual rate of up to 0.30% of the Class A shares' average daily
net assets and an aggregate annual rate of up to 1.00% of the Class B shares'
average daily net assets. In each case, up to 0.25% is for service expenses and
the remaining amount is for distribution expenses. The distribution fees will be
used to reimburse John Hancock Funds for its distribution expenses including but
not limited to: (i) initial and ongoing sales compensation to Selling Brokers
and others (including affiliates of John Hancock Funds) engaged in the sale of
Fund shares; (ii) marketing, promotional and overhead expenses incurred in
connection with the distribution of Fund shares; and (iii) with respect to Class
B shares only, interest expenses on unreimbursed distribution expenses. The
service fees will be used to compensate Selling Brokers for providing personal
and account maintenance services to shareholders. In the event John Hancock
Funds is not fully reimbursed for payments made or expenses incurred by it under
the Class A Plan, these expenses will not be carried beyond twelve months from
the date they were incurred. These unreimbursed expenses under the Class B Plan
will be carried forward together with interest on the balance of these
unreimbursed expenses. For the fiscal year ended October 31, 1994 an aggregate
of $6,824,915 of distribution expenses or 4%, of the average net assets of the
Class B shares of the Fund, was not reimbursed or recovered by John Hancock
Funds through the receipt of deferred sales charges or 12b-1 fees in prior
periods.

The Fund's total expenses for the year ended October 31, 1994 for Class A and
Class B shares were 1.62% and 2.25%, respectively, of average daily net asset
value of each class.

DIVIDENDS AND TAXES
Dividends from the Fund's net investment income and capital gains are generally
declared and paid at least annually. Dividends are reinvested in additional
shares of your class unless you elect the option to receive them in cash. If you
elect the cash option and the U.S. Postal Service cannot deliver your checks,
your election will be converted to the reinvestment option. Because of the
higher expenses associated with Class B shares, any dividend on Class B shares
will be lower than that on Class A shares. See "Share Price."

TAXATION. Dividends from the Fund's net investment income and net short-term
capital gains are taxable to you as ordinary income. Dividends from the Fund's
net long-term capital gains are taxable as long-term capital gains. These
dividends are taxable whether received in cash or reinvested in additional
shares. Certain dividends may be paid in January of a given year, but they may
be taxable as if you received them the previous December. Corporate shareholders
may be entitled to take a corporate dividends received deduction for dividends
received by the Fund from U.S. domestic corporations, subject to certain
restrictions in the Internal Revenue Code of 1986, as amended (the "Code"). The
Fund will send you a statement by January 31 showing the tax status of the
dividends you received for the prior year.

The Fund has qualified and intends to continue to qualify as a regulated
investment company under Subchapter M of the Internal Revenue Code of 1986, as
amended (the "Code"). As a regulated investment company, the Fund will not be
subject to Federal income taxes on any net investment income and net realized
capital gains that are distributed to its shareholders within the time period
prescribed by the Code.

When you redeem (sell) or exchange shares, you may realize a taxable gain or
loss.

On the account application, you must certify that your social security or other
taxpayer identification number is correct and that you are not subject to backup
withholding of Federal income tax. If you do not provide this information, or
are otherwise subject to this withholding, the Fund may be required to withhold
31% of your dividends and the proceeds of redemptions and exchanges.

PERFORMANCE

THE FUND MAY ADVERTISE ITS TOTAL RETURN.

Total return is based on the overall change in value of a hypothetical
investment in the Fund. The Fund's total return shows the overall dollar or
percentage change in value, assuming the reinvestment of all dividends.
Cumulative total return shows the Fund's performance over a period of time.
Average annual total return shows the cumulative return divided over the number
of years included in the period. Because average annual total return tends to
smooth out variations in performance, you should recognize that it is not the
same as actual year-to-year results.

Total return calculations for Class A shares generally include the effect of
paying the maximum sales charge (except as shown in "The Fund's Financial
Highlights"). Investments at a lower sales charge would result in higher
performance figures. Total return for the Class B shares reflects the deduction
of the applicable CDSC imposed on a redemption of shares held for the applicable
period. All calculations assume that all dividends are reinvested at net asset
value on the reinvestment dates during the periods. Total return of Class A and
Class B shares will be calculated separately, and, because each class is subject
to different expenses, the total return may differ with respect to that class
for the same period. The relative performance of the Class A and Class B shares
will be affected by a variety of factors, including the higher operating
expenses attributable to the Class B shares, whether the Fund's investment
performance is better in the earlier or later portions of the period measured
and the level of net assets of the Classes during the period. The Fund will
include the total return of Class A, Class B and Class C in any advertisement or
promotional materials including Fund performance data. The value of Fund shares,
when redeemed, may be more or less than their original cost. Total return is a
historical calculation and is not an indication of future performance. See
"Factors to Consider in Choosing an Alternative."

HOW TO BUY SHARES

OPENING AN ACCOUNT.

- ------------------------------------------------------------------------------
The minimum initial investment in Class A and Class B shares is $1,000 ($250
for group $500 for retirement plans). Complete the Account Application
attached to this Prospectus. Indicate whether you are purchasing Class A or
Class B shares. If you do not specify which class of shares you are
purchasing, Investor Services will assume you are investing in Class A shares.
- ------------------------------------------------------------------------------
BY CHECK 1. Make your check payable to John Hancock Investor Services
Corporation ("Investor Services"). 2. Deliver the
completed application and check to your registered
representative, or Selling Broker, or mail it directly to
Investor Services.
- ------------------------------------------------------------------------------
BY WIRE 1. Obtain an account number by contacting your registered
representative or Selling Broker, or by calling
1-800-225-5291.
2. Instruct your bank to wire funds to:
First Signature Bank & Trust
John Hancock Deposit Account No. 900000260
ABA Routing No. 211475000
For Credit To: John Hancock Special Equities Fund
(Class A or Class B shares)
Your Account Number
Name(s) under which account is registered
3. Deliver the completed application to your registered
representative or Selling Broker or mail it directly to
Investor Services.
- ------------------------------------------------------------------------------

BUYING ADDITIONAL CLASS A AND CLASS B SHARES.

MONTHLY AUTOMATIC Complete the "Automatic Investing" and "Bank Information"
ACCUMULATION sections on the Account Privileges Application
PROGRAM (MAAP) designating a bank account from which your funds may be
drawn.

2. The amount you elect to invest will be automatically
withdrawn from your bank or credit union account.

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

BY TELEPHONE 1. Complete the "Invest-By-Phone" and "Bank Information"
sections on the Account Privileges Application
designating a bank account from which your funds may be
drawn. Note that in order to invest by phone, your
account must be in a bank or credit union that is a
member of the Automated Clearing House system (ACH).
2. After your authorization form has been processed, you may
purchase Class A or Class B shares by calling Investor
Services toll-free at 1-800-225-5291.
3. Give the Investor Services representative the name(s) in
which your account is registered, the Fund name, the
class of shares you own, account number, and the amount
you wish to invest.
4. Your investment normally will be credited to your account
the business day following your phone request.
- -------------------------------------------------------------------------------

BY CHECK 1. Either complete the detachable stub included on your
account statement or include a note with your investment
listing the name of the Fund, the class, your account
number and the name(s) in which the account is
registered.
2. Make your check payable to John Hancock Investor Services
Corporation.
3. Mail the account information and check to:
John Hancock Investor Services Corporation
P.O. Box 9115
Boston,MA 02205-9115
or deliver it to your registered representative or
Selling Broker.
- -------------------------------------------------------------------------------
BY WIRE Instruct your bank to wire funds to:
First Signature Bank & Trust
John Hancock Deposit Account No. 900000260
ABA Routing No. 211475000
For credit to: John Hancock Special Equities Fund
(Class A or Class B shares)
Your Account Number
Name(s) under which account is registered
- -------------------------------------------------------------------------------
Other Requirements: All purchases must be made in U.S. dollars. Checks written
on foreign banks will delay purchases until U.S. funds are received and a
collection charge may be imposed. Shares of the Fund are priced at the
offering price based on the net asset value computed after John Hancock Funds
receives notification of the dollar equivalent from the Fund's custodian bank.
Wire purchases normally take two or more hours to complete and, to be accepted
the same day, must be received by 4:00 p.m. New York time. Your bank may or
may not charge a fee to wire funds. Telephone transactions are recorded to
verify information. Share certificates are not issued unless a request is made
in writing to Investor Services.

- ------------------------------------------------------------------------------
Institutional Investors: Certain institutional investors may purchase Class C
shares of the Fund, which have no sales charge or 12b-1 fee. See
"Institutional Investors" for further information.
- ------------------------------------------------------------------------------

YOU WILL RECEIVE ACCOUNT STATEMENTS WHICH YOU SHOULD KEEP TO HELP WITH YOUR
PERSONAL RECORDKEEPING.

You will receive a statement of your account after any transaction that affects
your share balance or registration (statements related to reinvestment of
dividends and automatic investment/withdrawal plans will be sent to you
quarterly). A tax information statement will be mailed to you by January 31 of
each year.

SHARE PRICE
THE OFFERING PRICE OF YOUR SHARES IS THE NET ASSET VALUE PLUS A SALES CHARGE, IF
APPLICABLE, WHICH WILL VARY WITH THE PURCHASE ALTERNATIVE YOU CHOOSE.

The net asset value per share (the "NAV") is the value of one share. The NAV is
calculated by dividing the net assets of each class by the number of outstanding
shares of that class. The NAV of each class can differ in value. Securities in
the Fund's portfolio are valued on the basis of market quotations, valuations
provided by independent pricing sevices or, at a fair value as determined in
good faith in accordance with procedures approved by the Trustees. Short-Term
debt investments maturing within 60 days are valued at amortized cost which
approximates market value. Foreign securities are valued on the basis of
quotations from the primary market in which they are traded, and are translated
from the local currency into U.S. dollars using current exchange rates. If
quotations are not readily available or, the value has been materially affected
by events occurring after the closing of a foreign market, assets are valued by
a method that the Trustees believe accurately reflects fair value. The NAV is
calculated once daily as of the close of regular trading on the New York Stock
Exchange (generally at 4:00 p.m., New York time) on each day that the Exchange
is open.

Shares of the Fund are sold at the offering price based on the NAV computed
after your investment request is received in good order by John Hancock Funds.
If you buy shares of the Fund through a Selling Broker, the Selling Broker must
receive your investment before the close of regular trading on the New York
Stock Exchange and transmit it to John Hancock Funds before its close of
business to receive that day's offering price.

INITIAL SALES CHARGE ALTERNATIVE -- CLASS A SHARES. The offering price you pay
for Class A shares of the Fund equals the NAV plus a sales charge as follows:
<PAGE>
<TABLE>
<CAPTION>
COMBINED
SALES CHARGE REALLOWANCE REALLOWANCE TO
SALES CHARGE AS A PERCENTAGE AND SERVICE FEE SELLING BROKER AS
AMOUNT INVESTED AS A PERCENTAGE OF THE AS A PERCENTAGE A PERCENTAGE OF
(INCLUDING SALES CHARGE) OF OFFERING PRICE AMOUNT INVESTED OF OFFERING PRICE<F4> OFFERING PRICE<F1>
- ------------------------ ---------------- --------------- ----------------- ----------------
<S> <C> <C> <C> <C>
Less than $50,000 5.00% 5.26% 4.25% 4.01%
$50,000 to $99,999 4.50% 4.71% 3.75% 3.51%
$100,000 to $249,999 3.50% 3.63% 2.85% 2.61%
$250,000 to $499,999 2.50% 2.56% 2.10% 1.86%
$500,000 to $999,999 2.00% 2.04% 1.60% 1.36%
$1,000,000 and over 0.00%<F2> 0.00%<F2> <F3> 0.00%<F3>
<FN>
- ----------
<F1> Upon notice to Selling Brokers with whom it has sales agreements, John
Hancock Funds may reallow an amount up to the full applicable sales charge.
In addition to the reallowance allowed to all Selling Brokers, John Hancock
Funds will pay the following: round trip airfare to a resort will be
offered to each registered representative of a Selling Broker (if the
Selling Broker has agreed to participate) who sells certain amounts of
shares of John Hancock funds. John Hancock Funds will make these incentive
payments out of its own resources. Other than distribution fees, the Fund
does not bear distribution expenses. A Selling Broker to whom substantially
the entire sales charge is reallowed or who receives these incentives may
be deemed to be an underwriter under the Securities Act.
<F2> No sales charge is payable at the time of purchase of Class A shares of $1
million or more, but a contingent deferred sales charge may be imposed, in
the event of certain redemption transactions made within one year of
purchase.
<F3> John Hancock Funds may pay a commission and first year's service fee (as
described in (+ ) below) to Selling Brokers
who initiate and are responsible for purchases of $1 million or more in
the aggregate as follows: 1% on sales up to $4,999,999, 0.50% on the next
$5 million and 0.25% on $10 million and over.
<F4> At the time of sale, John Hancock Funds pays to Selling Brokers the first
year's service fee in advance, in an amount equal to 0.25% of the net
assets invested in the Fund. Thereafter, it pays the service fee
periodically in arrears in an amount up to 0.25% of the Fund's average
annual net assets. Selling Brokers receive the fee as compensation for
providing personal and account maintenance services to shareholders.
</TABLE>
Sales charges ARE NOT APPLIED to any dividends which are reinvested in
additional Class A shares of the Fund.

In addition, John Hancock Funds will pay certain affiliated Selling Brokers at
an annual rate of up to 0.05% of the daily net assets of the accounts
attributable to these brokers.

Under certain circumstances described below, investors in Class A shares may
be entitled to pay reduced sales charges. See "Qualifying for a Reduced Sales
Charge" below.

CONTINGENT DEFERRED SALES CHARGE -- INVESTMENTS OF $1 MILLION OR MORE IN CLASS A
SHARES. Purchases of $1 million or more of Class A shares will be made at net
asset value with no initial sales charge, but if the shares are redeemed within
12 months after the end of the calendar month in which the purchase was made
(the contingent deferred sales charge period), a contingent deferred sales
charge ("CDSC") will be imposed. The rate of the CDSC will depend on the amount
invested as follows:

AMOUNT INVESTED CDSC RATE
---------------- ---------
$1 million to $4,999,999 1.00%
Next $5 million to $9,999,999 0.50%
Amounts of $10 million and over 0.25%

Existing full service clients of John Hancock Mutual Life Insurance Company
group annuity contract holders as of September 1, 1994, may purchase Class A
shares with no initial sales charge, but if the shares are redeemed within 12
months after the end of the calendar year in which the purchase was made, a
contingent deferred sales charge will be imposed at the above rate.

The charge will be assessed on an amount equal to the lesser of the current
market value or the original purchase cost of the Class A shares redeemed.
Accordingly, no CDSC will be imposed on increases in account value above the
initial purchase price, including any dividends which have been reinvested in
additional Class A shares.

In determining whether a CDSC applies to a redemption, the calculation will be
determined in a manner that results in the lowest possible rate being charged.
Therefore, it will be assumed that the redemption is first made from any shares
in your account that are not subject to the CDSC. The CDSC is waived on
redemption in certain circumstances. See the discussion below under the caption
"Waiver of Contingent Deferred Sales Charge".

YOU MAY QUALIFY FOR A REDUCED SALES CHARGE ON YOUR INVESTMENTS IN CLASS A
SHARES.

QUALIFYING FOR A REDUCED SALES CHARGE. If you invest more than $50,000 in Class
A shares of the Fund or a combination of funds in the John Hancock family of
funds, (except money market funds) you may qualify for a reduced sales charge on
your investments through a LETTER OF INTENTION. You may also be able to use the
ACCUMULATION PRIVILEGE and COMBINATION PRIVILEGE to take advantage of the value
of your previous investments in Class A shares of the John Hancock funds when
meeting the breakpoints for a reduced sales charge. For the ACCUMULATION
PRIVILEGE and COMBINATION PRIVILEGE, the applicable sales charge will be based
on the total of:

1. Your current purchase of Class A shares of the Fund;

2. The net asset value (at the close of business on the previous day) of (a)
all Class A shares of the Fund you hold, and (b) all Class A shares of any
other John Hancock funds you hold; and

3. The net asset value of all shares held by another shareholder eligible to
combine his or her holdings with you into a single "purchase."

EXAMPLE:
If you hold Class A shares of a John Hancock fund with a net asset value of
$20,000 and, subsequently, invest $30,000 in Class A shares of the Fund, the
sales charge on this subsequent investment would be 4.50% and not 5.00% (the
rate that would otherwise be applicable to investments of less than $50,000. See
"Initial Sales Charge Alternative -- Class A Shares.")

CLASS A SHARES MAY BE AVAILABLE WITHOUT A SALES CHARGE TO CERTAIN INDIVIDUALS
AND ORGANIZATIONS.

If you are in one of the following categories, you may purchase Class A shares
of the Fund without paying a sales charge:

* A Trustee or officer of the Trust; a Director or officer of the Adviser and
its affiliates or Selling Brokers; employees or sales representatives of any
of the foregoing; retired officers, employees or Directors of any of the
foregoing; a member of the immediate family of any of the foregoing; or any
Fund, pension, profit sharing or other benefit plan for the individuals
described above.

* Any state, county, city or any instrumentality, department, authority, or
agency of these entities which is prohibited by applicable investment laws
from paying a sales charge or commission when it purchases shares of any
registered investment management company.+

* A bank, trust company, credit union, savings institution or other depository
institution, its trust departments or common trust funds if it is purchasing
$1 million or more for non-discretionary customers or accounts.*

* A broker, dealer or registered investment adviser that has entered into an
agreement with John Hancock Funds providing specifically for the use of Fund
shares in fee-based investment products made available to their clients.

* A former participant in an employee benefit plan with John Hancock funds,
when he/she withdraws from his/her plan and transfers any or all of his/her
plan distributions directly to the Fund.
- ---------
+ For investments made under these provisions, John Hancock Funds may make a
payment out of its own resources to the Selling Broker in an amount not to
exceed 0.25% of the amount invested.

Class A shares of the Fund may also be purchased without a sales charge in
connection with certain liquidation, merger or acquisition transactions
involving other investment companies or personal holding companies.

CONTINGENT DEFERRED SALES CHARGE ALTERNATIVE -- CLASS B SHARES. Class B shares
are offered at net asset value per share without a sales charge so that your
entire initial investment will go to work at the time of purchase. However,
Class B shares redeemed within six years of purchase will be subject to a CDSC
at the rates set forth below. This charge will be assessed on an amount equal to
the lesser of the current market value or the original purchase cost of the
shares being redeemed. Accordingly, you will not be assessed a CDSC on increases
in account value above the initial purchase price, including shares derived from
dividend reinvestments. In determining whether a CDSC applies to a redemption,
the calculation will be determined in a manner that results in the lowest
possible rate being charged. It will be assumed that your redemption comes first
from shares you have held beyond the six-year CDSC redemption period or those
you acquired through dividend reinvestment, and next from the shares you have
held the longest during the six-year period. The CDSC is waived on redemptions
in certain circumstances. See the discussion "Waiver of Contingent Deferred
Sales Charges" below.

EXAMPLE:
You have purchased 100 shares at $10 per share. The second year after your
purchase, your investment's net asset value per share has increased by $2 to
$12, and you have gained 10 additional shares through dividend reinvestment. If
you redeem 50 shares at this time, your CDSC will be calculated as follows:

* Proceeds of 50 shares redeemed at $12 per share $600
* Minus proceeds of 10 shares not subject to CDSC because
they were acquired through dividend reinvestment (10 x $12) -120
* Minus appreciation on remaining shares, also not subject to
CDSC (40 x $2) - 80
----
* Amount subject to CDSC $400

Proceeds from the CDSC are paid to John Hancock Funds. John Hancock Funds uses
all or part of them, to defray its expenses related to providing the Fund with
distribution services in connection with the sale of the Class B shares, such as
compensating Selling Brokers for selling these shares. The combination of the
CDSC and the distribution and service fees makes it possible for the Fund to
sell Class B shares without a sales charge being deducted at the time of the
purchase.

The amount of the CDSC, if any, will vary depending on the number of years from
the time you purchase your Class B shares until the time you redeem them. Solely
for purposes of determining the holding period, any payments you make during the
month will be aggregated and deemed to have been made on the last day of the
month.
CONTINGENT DEFERRED SALES
YEAR IN WHICH CLASS B SHARES CHARGE AS A PERCENTAGE OF
REDEEMED FOLLOWING PURCHASE DOLLAR AMOUNT SUBJECT TO CDSC
--------------------------- ------------------------------
First 5.0%
Second 4.0%
Third 3.0%
Fourth 3.0%
Fifth 2.0%
Sixth 1.0%
Seventh and thereafter None

A commission equal to 3.75% of the amount invested and a first year's service
fee equal to 0.25% of the amount invested are paid to Selling Brokers. The
initial service fee is paid in advance at the time of sale for the provision of
personal and account maintenance services to shareholders during the twelve
months following the sale, and thereafter the service fee is paid in arrears.

UNDER CERTAIN CIRCUMSTANCES, THE CDSC ON CLASS B AND CERTAIN CLASS A SHARE
REDEMPTIONS WILL BE WAIVED.

WAIVER OF CONTINGENT DEFERRED SALES CHARGE. The CDSC will be waived on
redemptions of Class B shares and of Class A shares that are subject to a CDSC,
unless indicated otherwise, in the circumstances defined below:

* Redemptions of Class B shares made under a Systematic Withdrawal Plan (see
"How to Redeem Shares"), as long as your annual redemptions do not exceed 10%
of your account value at the time you established your Systematic Withdrawal
Plan and 10% of the value of subsequent investments (less redemptions) in that
account at the time your notify Investor Services. This waiver does not apply
to Systematic Withdrawal Plan redemptions of Class A shares that are subject
to a CDSC.

* Redemptions made to effect distributions from an Individual Retirement Account
either before or after age 59 1/2, as long as the distributions are based on
your life expectancy or the joint-and-last survivor life expectancy of you and
your beneficiary. These distributions must be free from penalty under the
Code.

* Redemptions made to effect mandatory distributions under the Code after age 70
1/2 from a tax-deferred retirement plan.

* Redemptions made to effect distributions to participants or beneficiaries from
certain employer-sponsored retirement plans including those qualified under
Section 401(a) of the Code, custodial accounts under Section 403(b)(7) of the
Code and deferred compensation plans under Section 457 of the Code. The waiver
also applies to certain returns of excess contributions made to these plans.
In all cases, the distributions must be free from penalty under the Code.

* Redemptions due to death or disability.

* Redemptions made under the Reinvestment Privilege, as described in "Additional
Services and Programs" of this Prospectus.

* Redemptions made pursuant to the Fund's right to liquidate your account if you
own fewer than 50 shares.

* Redemptions made in connection with certain liquidation, merger or acquisition
transactions involving other investment companies or personal holding
companies.

* Redemptions from certain IRA and retirement plans which purchased shares prior
to October 1, 1992.

If you qualify for a CDSC waiver under one of these situations, you must notify
Investor Services either directly or through your Selling Broker at the time you
make your redemption. The waiver will be granted once Investor Services has
confirmed that you are entitled to the waiver.

CONVERSION OF CLASS B SHARES. Your Class B shares and an appropriate portion of
reinvested dividends on those shares will be converted into Class A shares
automatically at the end of the month eight years after the shares were
purchased, resulting in lower annual distribution fees. If you exchanged Class B
shares into the Fund from another John Hancock fund, the calculation will be
based on the time you purchased the shares in the original fund. The Fund has
obtained a ruling from the Internal Revenue Service to the effect that the
automatic conversion of Class B shares into Class A shares will be tax-free, the
tax holding period of the Class B shares will include the tax holding period of
the Class A shares converted into such Class B shares, and the tax basis of the
Class B shares will be the same as that of the Class A shares converted into
such Class B shares. There can be no assurance that such ruling will continue to
be in effect at the time any particular conversion occurs.

HOW TO REDEEM SHARES
You may redeem all or a portion of your shares on any business day. Your shares
will be redeemed at the next NAV calculated after your redemption request is
received in good order by Investor Services less any applicable CDSC. The Fund
may hold payment until reasonably satisfied that investments that were recently
made by check or Invest-by-Phone have been collected (which may take up to 10
calendar days).

Once your shares are redeemed, the Fund generally sends you payment on the next
business day. When you redeem your shares, you may realize a taxable gain or
loss depending usually on the difference between what you paid for them and what
you receive for them, subject to certain tax rules. Under unusual circumstances,
the Fund may suspend redemptions or postpone payment for up to seven days or
longer, as permitted by Federal securities laws.

TO ASSURE ACCEPTANCE OF YOUR REDEMPTION REQUEST, PLEASE FOLLOW THESE PROCEDURES.

- -------------------------------------------------------------------------------
BY TELEPHONE All Fund shareholders are automatically eligible for
privilege. Call 1-800-225-5291, from 8:00 A.M. to 4:00
P.M. (New York time), Monday through Friday, excluding
days on which the New York Stock Exchange is closed.
Investor Services employs the following procedures to
confirm that instructions received by telephone are
genuine. Your name, the account number, taxpayer
identification number applicable to the account and other
relevant information may be requested. In addition,
telephone instructions are recorded.
You may redeem up to $100,000 by telephone, but the
address on the account must not have changed for the last
30 days. A check will be mailed to the exact name(s) and
address shown on the account.
If reasonable procedures, such as those described above,
are not followed, the Fund may be liable for any loss due
to unauthorized or fraudulent telephone instructions. In
all other cases, neither the Fund nor Investor Services
will be liable for any loss or expense for acting upon
telephone instructions made in accordance with the
telephone transaction procedures mentioned above.
Telephone redemption is not available for IRAs or other
tax-qualified retirement plans or shares of the Fund that
are in certificate form.
During periods of extreme economic conditions or market
changes, telephone requests may be difficult to implement
due to a large volume of calls. During these times you
should consider placing redemption requests in writing or
using EASI-Line. EASI-Line's telephone number is
1-800-338-8080.
- ------------------------------------------------------------------------------
BY WIRE If you have a telephone redemption form on file with the
Fund, redemption proceeds of $1,000 or more can be wired
on the next business day to your designated bank account,
and a fee (currently $4.00) will be deducted. You may
also use electronic funds transfer to your assigned bank
account, and the funds are usually collectable after two
business days. Your bank may or may not charge for this
service. Redemptions of less than $1,000 will be sent by
check or electronic funds transfer.
This feature may be elected by completing the Telephone
Redemption section on the Account Privileges Application
that is included with this Prospectus.
- ------------------------------------------------------------------------------

IN WRITING Send a stock power or "letter of instruction" specifying
the name of the Fund, the dollar amount or the number of
shares to be redeemed, your name, class of shares, your
account number and the additional requirements listed
below that apply to your particular account.

- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
TYPE OF REGISTRATION REQUIREMENTS
-------------------- ------------

Individual, Joint Tenants, Sole A letter of instruction signed
Proprietorship, Custodial (with titles, where applicable)
(Uniform Gifts or Transfer to by all persons authorized to sign
Minors Act), General Partners. for the account, exactly as it is
registered, with the signature(s)
guaranteed.

Corporation, Association A letter of instruction and a
corporate resolution, signed by
person(s) authorized to act on
the account, with the
signature(s) guaranteed.

<PAGE>
TYPE OF REGISTRATION REQUIREMENTS
-------------------- ------------

Trusts A letter of instruction signed by
the Trustee(s) with the
signature(s) guaranteed. (If the
Trustee's name is not registered
on your account, also provide a
copy of the trust document,
certified within the last 60
days.)

If you do not fall into any of these registration categories please call
1-800-225-5291 for further instructions.

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

WHO MAY GUARANTEE YOUR SIGNATURE.

A signature guarantee is a widely accepted way to protect you and the Fund by
verifying the on your request. It may not be provided by a notary public. If
the net asset value of the shares redeemed is $100,000 or less, John Hancock
Funds may guarantee the signature. The following institutions may provide you
with a signature guarantee, provided that the institution meets credit
standards established by Investor Services: (i) a bank; (ii) a securities
broker or dealer, including a government or municipal securities broker or
dealer, that is a member of a clearing corporation or meets certain net
capital requirements; (iii) a credit union having authority to issue signature
guarantees; (iv) a savings and loan association, a building and loan
association, a cooperative bank, a federal savings bank or association; or (v)
a national securities exchange, a registered securities exchange or a clearing
agency.

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

ADDITIONAL INFORMATION ABOUT REDEMPTIONS.

THROUGH YOUR BROKER Your broker may be able to initiate the redemption.
Contact your broker for instructions.

- ------------------------------------------------------------------------------
If you have certificates for your shares, you must submit them with your stock
power or a letter of instruction. Unless you specify to the contrary, any
outstanding Class A shares will be redeemed before Class B shares. You may not
redeem certified shares by telephone.
Due to the proportionately high cost of maintaining smaller accounts, the Fund
reserves the right to redeem at net asset value all shares in an account which
holds fewer than 50 shares (except accounts under retirement plans) and to
mail the proceeds to the shareholder or the transfer agent may impose an
annual fee of $10.00. No account will be involuntarily redeemed or additional
fee imposed, if the value of the account is in excess of the Fund's minimum
initial investment. No CDSC will be imposed on involuntary redemptions of
shares.

Shareholders will be notified before these redemptions are to be made or this
fee is imposed and will have 30 days to purchase additional shares to bring
their account balance up to the required minimum. Unless the number of shares
acquired by further purchases and dividend reinvestments, if any, exceeds the
number of shares redeemed, repeated redemptions from a smaller account may
eventually trigger this policy.

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

ADDITIONAL SERVICES AND PROGRAMS
EXCHANGE PRIVILEGE

YOU MAY EXCHANGE SHARES OF THE FUND ONLY FOR SHARES OF THE SAME CLASS IN ANOTHER
JOHN HANCOCK FUND.

If your investment objective changes, or if you wish to achieve further
diversification, John Hancock offers other funds with a wide range of investment
goals. Contact your registered representative or Selling Broker and request a
prospectus for the John Hancock funds that interest you. Read the prospectus
carefully before exchanging your shares. You can exchange shares of each class
of the Fund only for shares of the same class of another John Hancock fund. For
this purpose, John Hancock funds with only one class of shares will be treated
as Class A whether or not they have been so designated.

Exchanges between funds which are not subject to a CDSC are based on their
respective net asset values. No sales charge or transaction charge is imposed.
Class B shares of the Fund which are subject to a CDSC may be exchanged into
Class B shares of another John Hancock fund without incurring the CDSC; however,
these shares will be subject to the CDSC schedule of the shares acquired (except
exchanges into John Hancock Short-Term Strategic Income Fund and John Hancock
Limited Term Government Fund will be subject to the initial fund's CDSC). For
purposes of computing the CDSC payable upon redemption of shares acquired in an
exchange, the holding period of the original shares is added to the holding
period of the shares acquired in an exchange.However, if you exchange Class B
shares purchased prior to January 1, 1994 for Class B shares of any other John
Hancock fund, you will continue to be subject to the CDSC schedule that was in
effect at your initial purchase date.

You may exchange Class B shares of the Fund into shares of John Hancock Cash
Management Fund at net asset value. However, you will continue to be subject to
a CDSC upon redemption. The rate of the CDSC will be the rate in effect for the
original fund at the time of the exchange.

The Fund reserves the right to require you to keep previously exchanged shares
(and reinvested dividends) in the Fund for 90 days before you are permitted to
execute a new exchange. The Fund may also terminate or alter the terms of the
exchange privilege upon 60 days' notice to shareholders.

An exchange of shares is treated as a redemption of shares of one fund and the
purchase of shares in another for Federal income tax purposes. An exchange may
result in a taxable gain or loss.

When you make an exchange, your account registration in both the existing and
new account must be identical. The exchange privilege is available only in
states where the exchange can be made legally.

Under exchange agreements with John Hancock Funds, certain dealers, brokers and
investment advisers may exchange their clients' Fund shares, subject to the
terms of those agreements and John Hancock Funds' right to reject or suspend
those exchanges at any time. Because of the restrictions and procedures under
those agreements, the exchanges may be subject to timing limitations and other
restrictions that do not apply to exchanges requested by shareholders directly,
as described above.

Because Fund performance and shareholders can be hurt by excessive trading, the
Fund reserves the right to terminate the exchange privilege for any person or
group that, in John Hancock Funds' judgment, is involved in a pattern of
exchanges that coincide with a "market timing" strategy that may disrupt the
Fund's ability to invest effectively according to its investment objective and
policies, or might otherwise affect the Fund and its shareholders adversely. The
Fund may also temporarily or permanently terminate the exchange privilege for
any person who makes seven or more exchanges out of the Fund per calendar year.
Accounts under common control or ownership will be aggregated for this purpose.
Although the Fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any time.

BY TELEPHONE
1. When you fill out the application for your purchase of Fund shares, you
automatically authorize exchanges by telephone unless you check the box
indicating that you do not wish to have the telephone exchange privilege.

2. Call 1-800-225-5291. Have the account number of your current fund and the
exact name in which it is registered available to give to the telephone
representative.

3. Investors Services employs the following procedures to confirm that
instructions received by telephone are genuine. Your name, the account
number, taxpayer identification number applicable to the account and other
relevant information may be requested. In addition, telephone instructions
are recorded.

IN WRITING
1. In a letter request an exchange and list the following: -- the name and class
of the fund whose shares you currently own -- your account number -- the
name(s) in which the account is registered -- the name of the fund in which
you wish your exchange to be invested -- the number of shares, all shares or
the dollar amount you wish to exchange
Sign your request exactly as the account is registered.

2. Mail the request and information to:
John Hancock Investor Services Corporation
P.O. Box 9116
Boston, Massachusetts 02205-9116

REINVESTMENT PRIVILEGE

IF YOU REDEEM SHARES OF THE FUND, YOU MAY BE ABLE TO REINVEST THE PROCEEDS IN
SHARES OF THIS FUND OR ANOTHER JOHN HANCOCK FUND WITHOUT PAYING AN ADDITIONAL
SALES CHARGE.

1. You will not be subject to a sales charge on Class A shares reinvested in any
John Hancock fund that is otherwise subject to a sales charge as long as you
reinvest within 120 days from the redemption date. If you paid a CDSC upon a
redemption, you may reinvest at net asset value in the same class of shares
from which you redeemed within 120 days. Your account will be credited with
the amount of the CDSC previously charged, and the reinvested shares will
continue to be subject to a CDSC. For purposes of computing the CDSC payable
upon a subsequent redemption, the holding period of the shares acquired
through reinvestment will include the holding period of the redeemed shares.

2. Any portion of your redemption may be reinvested in Fund shares or in shares
of any of the other John Hancock funds, subject to the minimum investment
limit of that fund.

3. To reinvest, you must notify Investor Services in writing. Include the Fund
(s) name, account number and class from which your shares were originally
redeemed.

SYSTEMATIC WITHDRAWAL PLAN

YOU CAN PAY ROUTINE BILLS FROM YOUR ACCOUNT OR MAKE PERIODIC DISBURSEMENTS FROM
YOUR RETIREMENT ACCOUNT TO COMPLY WITH IRS REGULATIONS.

1. You may elect the Systematic Withdrawal Plan at any time by completing the
Account Privilege Application which is attached to this Prospectus. You can
also obtain this application from your registered representative or by
calling 1-800-225-5291.

2. To be eligible, you must have at least $5,000 in your account.

3. Payments from your account can be made monthly, quarterly, semi-annually or
annually or on a selected monthly basis, to yourself or any other designated
payee.

4. There is no limit on the number of payees you may authorize, but all
payments must be made at the same time or intervals.

5. It is not advantageous to maintain a Systematic Withdrawal Plan concurrently
with purchases of additional Class A or Class B shares, because you may be
subject to initial sales charges on your purchases of Class A shares or a
CDSC on your redemptions of Class B shares. In addition, your redemptions are
taxable events.

6. Redemptions will be discontinued if the U.S. Postal Service cannot deliver
your checks, or if deposits to a bank account are returned for any reason,
your redemptions will be discontinued.

MONTHLY AUTOMATIC ACCUMULATION PROGRAM (MAAP)

YOU CAN MAKE AUTOMATIC INVESTMENTS AND SIMPLIFY YOUR INVESTING.

1. You may authorize an investment to be automatically drawn each month from
your bank for investment in Fund shares under the "Automatic Investing" and
"Bank Information" sections of the Account Privileges Application.

2. You may also authorize automatic investing through payroll deduction by
completing the "Direct Deposit Investing" section of the Account Privileges
Application.

3. You may terminate your Monthly Automatic Accumulation Program at any time.

4. There is no charge to you for this program, and there is no cost to the
Fund.

5. If you have payments being withdrawn from a bank account and we are notified
that the account has been closed, your withdrawals will be discontinued.

GROUP INVESTMENT PROGRAM

ORGANIZED GROUPS OF AT LEAST FOUR PERSONS MAY ESTABLISH ACCOUNTS.

1. An individual account will be established for each participant, but the
initial sales charge for Class A shares will be based on the aggregate dollar
amount of all participants' investments. To determine how to qualify for this
program, contact your registered representative or call 1-800-225- 5291.

2. The initial aggregate investment of all participants in the group must be
at least $250.

3. There is no additional charge for this program. There is no obligation to
make investments beyond the minimum, and you may terminate the program at
any time.

RETIREMENT PLANS
1. You may use the Fund as a funding medium for various types of qualified
retirement plans, including Individual Retirement Accounts, Keogh Plans (H.R.
10), Pension and Profit Sharing Plans (including 401(k) Plans), Tax-
Sheltered Annuity Retirement Plans (403(b) or TSA Plans), and 457 Plans.

2. The initial investment minimum or aggregate minimum for any of these plans is
$500. However, accounts being established as group IRA, SEP, SARSEP, TSA,
401(k) and 457 Plans will be accepted without an initial minimum investment.

INSTITUTIONAL INVESTORS
Class C shares of the Fund are available only to the following types of
institutional investors: (i) Benefit plans not affiliated with the Adviser which
have at least $25,000,000 in plan assets, and either have a separate trustee
vested with investment discretion and certain limitations on the ability of the
plan beneficiaries to access their plan investments without incurring adverse
tax consequences or allow their participants to select among one or more
investment options, including the Fund ("participant-directed plans"); (ii)
Banks and insurance companies which are not affiliated with the Adviser
purchasing shares for their own account; (iii) Investment companies not
affiliated with the Adviser; (iv) Tax-exempt retirement plans of the Adviser and
its affiliates, including affiliated brokers; (v) Unit investment trusts
sponsored by John Hancock Funds and certain other sponsors; and (vi) existing
full-service clients of John Hancock Mutual Life Insurance Company who were
group annuity contract holders as of September 1, 1994. Participant- directed
plans include, but are not limited to, 401(k), TSA and 457 plans.

Class C shares are available to eligible institutional investors at net asset
value without the imposition of a sales charge and are not subject to ongoing
distribution fees imposed under a plan adopted pursuant to Rule 12b-1 under the
Investment Company Act of 1940. The minimum initial investment in Class C shares
is $1,000,000, but this requirement may be waived at the discretion of the
Fund's officers. Some individuals who are currently eligible to purchase Class A
or Class B shares may also be participants in plans that are eligible to
purchase Class C shares of the Fund.

John Hancock Funds may pay a one-time payment of up to 0.15% of the amount
invested in Class C shares to a selling broker for its sales of Class C shares.
A person entitled to receive compensation for selling shares of the Fund may
receive different compensation with respect to sales of Class A, Class B or
Class C shares or any additional future class of shares.

Class C shares are also available to existing full-service clients of John
Hancock Mutual Life Insurance Company group annuity contract holders as of
September 1, 1994. John Hancock Funds, out of its own resources, may pay to a
Selling Broker an annual service fee of up to 0.20% of the amount invested in
Class C shares by these clients.

The Reinvestment Privilege, Systematic Withdrawal Plan, Monthly Automatic
Accumulation Program, Group Investment Program and Retirement Plans are not
available for Class C shares.

If you are considering a purchase of Class C shares of the Fund, please call
John Hancock Investor Services Corporation at 1-800-437-9312 to obtain
information about eligibility, instructions for purchase by check or wire and
an Institutional Account Application.

<PAGE>

JOHN HANCOCK SPECIAL EQUITIES FUND

INVESTMENT ADVISER
John Hancock Advisers, Inc.
101 Huntington Avenue
Boston, Massachusetts 02199-
7603

PRINCIPAL DISTRIBUTOR
John Hancock Funds, Inc.
101 Huntington Avenue
Boston, Massachusetts 02199-
7603

CUSTODIAN
Investors Bank & Trust
Company
24 Federal Street
Boston, Massachusetts 02110

TRANSFER AGENT
John Hancock Investor
Services Corporation
P.O. Box 9116
Boston, Massachusetts 02205-
9116

INDEPENDENT AUDITORS
Ernst & Young LLP
200 Clarendon Street
Boston, Massachusetts 02116

HOW TO OBTAIN INFORMATION
ABOUT THE FUND

For: Service Information
Telephone Exchange call 1-800-225-5291
Telephone Redemption
Investment-by-Phone
For: TDD call 1-800-554-6713

JHD-1800P 3-95

JOHN HANCOCK
SPECIAL
EQUITIES
FUND

CLASS A AND B SHARES
PROSPECTUS
MARCH 1, 1995

A MUTUAL FUND SEEKING TO
ACHIEVE GROWTH OF CAPITAL
BY INVESTING IN A
DIVERSIFIED PORTFOLIO OF
EQUITY SECURITIES
PRIMARILY OF EMERGING
GROWTH COMPANIES AND OF
COMPANIES IN SPECIAL
SITUATIONS.

101 HUNTINGTON AVENUE
BOSTON, MASSACHUSETTS
02199-7603
TELEPHONE 1-800-225-5291

Printed on Recycled Paper

<PAGE>
JOHN HANCOCK
SPECIAL
EQUITIES
FUND

CLASS C SHARES
PROSPECTUS
MARCH 1, 1995

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

TABLE OF CONTENTS
Page
---
Expense Information .................................................... 2
The Fund's Financial Highlights ........................................ 3
Investment Objective and Policies ...................................... 5
Organization and Management of the Fund ................................ 8
The Fund's Expenses .................................................... 9
Dividends and Taxes .................................................... 9
Performance ............................................................ 10
Who Can Buy Class C Shares ............................................. 10
How to Buy Class C Shares .............................................. 11
Class C Share Price .................................................... 12
How to Redeem Class C Shares ........................................... 13
Additional Services and Programs ....................................... 15

This Prospectus sets forth the information about John Hancock Special
Equities Fund (the "Fund") a diversified fund, that you should know before
investing. Please read and retain it for future reference.

Additional information about the Fund has been filed with the Securities and
Exchange Commission (the "SEC"). You can obtain a copy of the Fund's Statement
of Additional Information, dated March 1, 1995 and incorporated by reference
into this Prospectus, free of charge by writing or telephoning: John Hancock
Investor Services Corporation, Attn: Institutional Services P.O. Box 9277,
Boston, Massachusetts 02205-9277, 1-800-437-9312.

<PAGE>

EXPENSE INFORMATION
The purpose of the following information is to help you to understand the
various fees and expenses that you will bear, directly or indirectly, when you
purchase Class C shares of the Fund. The operating expenses included in the
table and hypothetical example below are based on fees and expenses for the
Class C shares of the Fund for the fiscal year ended October 31, 1994, adjusted
to reflect current fees and expenses. Actual fees and expenses of Class C shares
in the future may be greater or less than those indicated.

CLASS C
SHARES*
-------
SHAREHOLDER TRANSACTION EXPENSES
Maximum sales charge imposed on purchases (as a percentage
of offering price) ............................................. None
Maximum sales charge imposed on reinvested dividends ............. None
Maximum deferred sales charge .................................... None
Redemption fee+ .................................................. None
Exchange fee ..................................................... None

ANNUAL FUND OPERATING EXPENSES (as a percentage of average
net assets)
Management fee** ................................................. 0.82%
Other expenses ................................................... 0.21%
-----
Total Fund operating expenses .................................... 1.03%
-----
-----

- ---------
* The information set forth in the foregoing table relates only to Class C
shares. Class C shares commenced operations on September 1, 1993.
+ Redemption by wire fee (currently $4.00) not included.

** The calculation of the management fee is based on net assets at October 31,
1994. See "The Fund's Expenses."

EXAMPLE: CLASS C SHARES 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- ----------------------- ------ ------- ------- --------
You would pay the following
expenses for the indicated period
of years on a hypothetical $1,000
investment, assuming a 5% annual
return: ........................ $11 $33 $57 $126

(This example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.)

The management fee referred to above is more fully explained in this
Prospectus under the caption "The Fund's Expenses" and in the Statement of
Additional Information under the caption "Investment Advisory and Other
Services."

In addition to Class C shares, the Fund also offers Class A and Class B
shares. Class A and B shares are available to individual investors at net asset
value plus a maximum initial sales charge of 5.00% for A shares and a maximum
contingent deferred sales charge of 5.00% for B shares. Class A and B shares are
subject to ongoing distribution and service fees of 0.30% and 1.00%,
respectively, of the Fund's average daily net assets in accordance with plans
adopted pursuant to Rule 12b-1 under the Investment Company Act of 1940. The
minimum initial investment in Class A or B shares is $1,000 ($250 for group
investments or $500 for retirement plans). Generally, investors who are eligible
to purchase Class C shares are able to purchase A or B shares. If you are
considering a purchase of Class A or B shares, please call John Hancock Investor
Services, Corporation ("Investor Services") at 1-800-437-9312 for more
information about eligibility, instructions for purchase by check or wire and an
Account Application.

Class A and B shares generally have operating expenses similar to Class C
shares, except for the sales charge and distribution and transfer agent fees.
Class A and B shareholders are eligible for a reinvestment privilege, systematic
withdrawal plan, monthly automatic accumulation program, group investment
program and use of the Fund as a funding vehicle for a retirement plan.
Investors wishing information about any of these services and expenses should
contact Investor Services at 1-800-437-9312.

Selected data for each class of shares outstanding throughout each period
indicated are as follows:

PERIOD FROM
FEBRUARY 4,
YEAR ENDED OCTOBER 31, 1985 TO
----------------------------------------------------------------------------------------- OCTOBER 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986 1985<F7>
---- ---- ---- ---- ---- ---- ---- ---- ---- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
PER SHARE OPERATING PERFORMANCE
Net Asset Value,
Beginning of
Period $16.13 $10.99 $ 9.71 $ 4.97 $6.38 $4.89 $4.30 $6.08 $5.21 $5.00
------ ------ ------ ------ ----- ----- ----- ----- ----- -----
Net Investment
Income (Loss)<F1> (0.21)<F2> (0.20)<F2> (0.19)<F2> (0.10) (0.12) 0.01 0.04 (0.03) (0.03) 0.03
Net Realized and
Unrealized Gain
(Loss) on
Investments 0.19 5.43 2.14 4.84 (1.27) 1.53 .55 (1.262) 0.9347 0.18
------ ------ ------ ------ ----- ----- ----- ----- ----- -----
Total from
Investment
Operations (0.02) 5.23 1.95 4.74 (1.39) 1.54 .59 (1.292) 0.9047 0.21
------ ------ ------ ------ ----- ----- ----- ----- ----- -----
Less Distributions:
Dividends from Net
Investment
Income -- -- -- -- (0.02) (0.05) -- -- (0.02) --
Distributions from
Net Realized
Gain on
Investments Sold -- (0.09) (0.67) -- -- -- -- (0.45) (0.01) --
Distributions from
Capital Paid-In -- -- -- -- -- -- -- (0.04) -- --
------ ------ ------ ------ ----- ----- ----- ----- ----- -----
Total
Distributions -- (0.09) (0.67) -- (0.02) (0.05) -- (0.49) (0.0347) --
------ ------ ------ ------ ----- ----- ----- ----- ----- -----
Net Asset Value
End of Period $16.11 $16.13 $10.99 $ 9.71 $4.97 $ 6.38 $4.89 $4.30 $6.08 $5.21
------ ------ ------ ------ ----- ----- ----- ----- ----- -----
Total Investment
Return at Net
Asset Value<F1> (0.12%) 47.83% 20.25% 95.37% (21.89%) 31.82% 13.72% (28.68%) 17.38% 4.20%
------ ------ ------ ------ ----- ----- ----- ----- ----- -----
<PAGE>
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of
Period (000's
omitted) $310,625 $296,793 $44,665 $19,713 $8,166 $12,285 $11,714 $10,637 $13,780 $2,467
Ratio of Expenses
to Average Net
Assets<F1> 1.62% 1.84% 2.24% 2.75% 2.63% 1.50% 1.50% 1.50% 1.50% 1.50%<F6>
Ratio of Net
Investment
Income (Loss)
to Average Net
Assets<F1> (1.40%) (1.49%) (1.91%) (2.12%) (1.58%) 0.47% 0.82% (0.57%) (0.57%) 1.42%<F6>
Portfolio Turnover
Rate 66% 33% 114% 163% 113% 115% 91% 93% 64% 15%
CLASS B (c)
PER SHARE OPERATING PERFORMANCE
Net Asset Value,
Beginning of
Period $16.08 $12.30
------ ------
Net Investment
Income (Loss) (0.30)<F2> (0.18)<F2>
Net Realized and
Unrealized Gain
(Loss) on
Investments 0.19 3.96
------ ------
Total from
Investment
Operations (0.11) 3.78
------ ------
Net Asset Value,
End of Period $15.97 $16.08
------ ------
------ ------
Total
Investment
Return at
Net Asset
Value (0.68%) 30.73%<F2>
------ ------

RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of
Period (000's
omitted) $191,979 $158,281
Ratio of Expenses
to Average Net
Assets 2.25% 2.34%<F6>
Ratio of Net
Investment Income
(Loss) to Average
Net Assets (2.02%) (2.03%)<F6>
Portfolio Turnover
Rate 66% 33%
(Continued on next page)
<PAGE>
THE FUND'S FINANCIAL HIGHLIGHTS -- CONTINUED
<CAPTION>
YEAR ENDED OCTOBER 31,
---------------------------
1994 1993
------ ------
<S> <C> <C>
CLASS C<F5>
PER SHARE OPERATING PERFORMANCE
Net Asset Value,
Beginning of
Period $16.14 $14.90
------ ------
Net Investment
Income (Loss) (0.13)<F2> (0.03)<F2>
Net Realized and
Unrealized Gain
(Loss) on
Investments 0.19 1.27
------ ------
Total from
Investment
Operations 0.06 1.24
------ ------
Net Asset Value,
End of Period $16.20 $16.14
------ ------
------ ------
Total
Investment
Return at
Net Asset
Value 0.37% 8.32%<F4>
------ ------
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of
Period (000's
omitted) $ 7,123 $ 2,838
Ratio of Expenses
to Average Net
Assets 1.11% 1.45%
Ratio of Net
Investment
Income (Loss)
to Average Net
Assets (0.89%) (1.35%)
------ ------
Portfolio Turnover
Rate 66% 33%
<FN>
- ----------
<F1> Reflects expense limitation in effect during the years ended October 31,
1985 through 1991 (see Note B to the financial statements in the Statement
of Additional Information). As a result of such limitations, expenses of
the Fund for the years ended October 31, 1991, 1990, 1989, 1988, 1987, 1986
and 1985 reflect reductions of $.002, $.02, $.03, $.07, $.04, $.09 and
$.18, respectively. Absent of such limitation, for the years ended October
31, 1991, 1990, 1989, 1988, 1987, 1986 and 1985 the ratio of net expenses
would have been 2.79%, 2.95%, 2.57%, 2.94%, 2.23%, 3.47% and 9.84%
respectively, and the ratio of net investment income (loss) to average net
assets would have been (2.16%), (1.90%), (0.60%), (0.62%), (1.30%), (2.55%)
and (6.91%), respectively. Without the limitation, total investment return
would be lower.

<F2> Net investment Loss per share has been calculated based on average monthly
shares outstanding.
<F3> Class B shares commenced operations on March 1, 1993.
<F4> Not annualized.
<F5> Class C shares commenced operations on September 1, 1993.
<F6> On an annualized basis.
<F7> For the period from December 17, 1984 (date of John Hancock Advisers,
Inc.'s initial investment) to February 4, 1985, the Fund had not commenced
investment operations.
</TABLE>
<PAGE>

INVESTMENT OBJECTIVE AND POLICIES

THE FUND SEEKS GROWTH OF CAPITAL BY INVESTING PRIMARILY IN THE EQUITY SECURITIES
OF EMERGING GROWTH AND SPECIAL SITUATION COMPANIES.

The Fund may also invest in:

-- equity securities of established companies that by John Hancock
Advisers, Inc. (the "Adviser") believes to offer growth potential.

THE FUND SEEKS TO IDENTIFY EMERGING GROWTH COMPANIES WHICH CAN SHOW SUSTAINED
INCREASES IN EARNINGS.

The Fund may effect portfolio transactions without regard to holding periods, if
the Adviser's judges these transactions to be advisable in light of a change in
circumstances of a particular company or within a particular industry or in
general market, economic or financial conditions. The Fund does not generally
consider the length of time it has held a particular security in making its
investment decisions. Portfolio turnover rates of the Fund for recent years are
shown in the section "The Fund's Financial Highlights."

THE FUND IS DESIGNED FOR INVESTORS WHO ARE WILLING TO ASSUME GREATER THAN USUAL
RISKS IN THE HOPE OF REALIZING GREATER THAN USUAL RETURNS.

The securities in which the Fund invests will often be traded only in the
over-the-counter market or on a regional securities exchange and may not be
traded every day or in the volume typical of trading on a national securities
exchange. They may be subject to wide fluctuations in market value. The trading
for any given security may be sufficiently thin as to make it difficult for the
Fund to dispose of a substantial block of such securities. The disposition by
the Fund of portfolio securities to meet redemptions or otherwise may require
the Fund to sell these securities at a discount from market prices or during
periods when, in the Adviser's judgment, such disposition is not desirable or to
make many small sales over a lengthy period of time.

THE FUND MAY EMPLOY CERTAIN INVESTMENT STRATEGIES TO HELP ACHIEVE ITS INVESTMENT
OBJECTIVES.

RESTRICTED SECURITIES. The Fund may invest in securities which are subject to
legal or contractual delays in or restrictions on resale ("restricted
securities"). The registration of these securities under the Securities Act of
1933, as amended (the "Securities Act"). These purchases are subject to an
investment restriction limiting all illiquid securities held by the Fund to not
more than 15% of the Fund's net assets may be required prior to sale, and the
Fund may have to bear all or a part of the expense of these registrations. The
Fund's investment restricted securities, may include those eligible for resale
to "qualified institutional buyers" pursuant to Rule 144A under the Securities
Act. The Trustees will monitor the Fund's investments in these securities,
focusing on certain factors, including valuation, liquidity and availability of
information.

THE FUND FOLLOWS CERTAIN POLICIES WHICH MAY HELP REDUCE INVESTMENT RISK.

The Fund has adopted certain investment restrictions which are enumerated in
detail in the Statement of Additional Information, where they are classified as
fundamental or non-fundamental. The Fund's investment objective and those
investment restrictions designated as fundamental may not be changed without
shareholder approval. All other investment policies and restrictions are non-
fundamental and can be changed by a vote of the Trustees without shareholder
approval.

Portfolio turnover rates of the Fund for recent years are shown in the section
"The Fund's Financial Highlights." A high rate of portfolio turnover (100% or
more) involves correspondingly greater brokerage transaction costs which must be
borne by the Fund and its shareholders and may, under certain circumstances,
make it more difficult for the Fund to qualify as a regulated investment company
under the Internal Revenue Code of 1986. See "Tax Status" and "Brokerage
Allocation" in the Statement of Additional Information.

BROKERS ARE CHOSEN BASED ON BEST PRICE AND EXECUTION.

ORGANIZATION AND MANAGEMENT OF THE FUND

THE TRUSTEES ELECT OFFICERS AND RETAIN THE INVESTMENT ADVISER WHO IS RESPONSIBLE
FOR THE DAY-TO-DAY OPERATIONS OF THE FUND, SUBJECT TO THE TRUSTEES' POLICIES AND
SUPERVISION.

The Fund is a diversified open-end investment management company organized as a
Massachusetts business trust in 1984. The Fund has an unlimited number of
authorized shares of beneficial interest. The Fund's Declaration of Trust
permits the Trustees, without shareholder approval, to create and classify
shares of beneficial interest in separate series of the Fund. As of the date of
this Prospectus, the Trustees have not authorized the creation of any new series
of the Fund. Although additional series may be added in the future, the Trustees
have no current intention of creating additional series of the Fund. The Fund's
Declaration of Trust also permits the Trustees to classify and reclassify any
series or portfolio of shares into one or more classes. Accordingly, the
Trustees have authorized the issuance of three classes of the Fund, designated
as Class A, Class B and Class C. The shares of each class represent an interest
in the same portfolio of investments of the Fund and have equal rights as to
voting, redemption, dividends and liquidation. However, each class of shares
bears different distribution and transfer agent fees and Class A and Class B
shareholders have exclusive voting rights with respect to their distribution
plans.

JOHN HANCOCK ADVISERS, INC. ADVISES INVESTMENT COMPANIES HAVING TOTAL ASSETS OF
MORE THAN $13 BILLION.

The Adviser was organized in 1968 and is a wholly-owned indirect subsidiary of
the John Hancock Mutual Life Insurance Company, a financial services company.
The Adviser provides the Fund, and other investment companies in the John
Hancock group of funds, with investment research and portfolio management
services. John Hancock Funds, Inc. ("John Hancock Funds") distributes shares for
all of the John Hancock mutual funds through selected broker-dealers ("Selling
Brokers"). Certain Fund officers are also officers or the Adviser and John
Hancock Funds. Pursuant to an order granted by the Securities and Exchange
Commission, the Fund has adopted a deferred compensation plan for its
independent Trustees which allows Trustees' fees to be invested by the Fund in
other John Hancock funds.

In order to avoid any conflict with portfolio trades for the Fund, the Adviser
and the Fund have adopted extensive restrictions on personal securities trading
by personnel of the Adviser and its affiliates. Some of these restictions are:
pre-clearance for all personal trades and a ban on the purchase of initial
public offerings, as well as contributions to specified charities of profits on
securities held for less than 91 days. These restrictions are a continuation of
the basic principle that the interests of the Fund and its shareholders come
first.

THE FUND'S EXPENSES

For managing its investment and business affairs, the Fund pays a fee to the
Adviser which for the 1994 fiscal year was 0.79% of the Fund's average daily net
asset value. The investment management fee is higher than the fees paid to most
mutual funds but is believed to be comparable to fees paid by those funds with
investment objectives similar to that of the Fund.

The total expenses for the Fund's Class C shares for the period ended October
31, 1994 was 1.11% of average daily net asset value on an annualized basis.

DIVIDENDS AND TAXES

Dividends from the Fund's net investment income and capital gains are generally
declared at least annually. Dividends are reinvested in additional Class C
shares unless you elect the option to receive them in cash. If you elect the
cash option and the U.S. Postal Service cannot deliver your checks, your
election will be converted to the reinvestment option.

TAXATION. For investors who are not exempt from federal income taxes, dividends
from the Fund's net investment income and net short-term capital gains are
taxable to you as ordinary income. Dividends from the Fund's net long-term
capital gains are taxable as long-term capital gains. These dividends are
taxable whether received in cash or reinvested in additional Class C shares.
Certain dividends may be paid in January of a given year, but they may be
taxable as if you received them the previous December. Corporate shareholders
may be entitled to take a corporate dividends received deduction for dividends
received by the Fund from U.S. domestic corporations, subject to certain
restrictions in the Internal Revenue Code of 1986, as amended (the "Code"). The
Fund will send you a statement by January 31 showing the tax status of the
dividends you received for the prior year.

The Fund has qualified and intends to continue to qualify as a regulated
investment company under Subchapter M of the Code. As a regulated investment
company, the Fund will not be subject to Federal income taxes on any net
investment income and net realized capital gains that are distributed to its
shareholders within the time period prescribed by the code.

When you redeem (sell) or exchange Class C shares, you may realize a taxable
gain or loss.

The Fund anticipates that it will be subject to foreign withholding taxes or
other foreign taxes on income (possibly including capital gains) on certain
foreign investments which will reduce the yield on those investments. However,
if more than 50% of the Fund's total assets at the close of its taxable year
consists of securities of foreign corporations and if the Fund so elects,
shareholders will include in their gross incomes their pro-rata shares of
qualified foreign taxes paid by the Fund and may be entitled subject to certain
conditions and limitations under the Code, to claim a Federal income tax credit
or deduction for their share of these taxes. On the account application, you
must certify that your social security or other taxpayer identification number
is correct and that you are not subject to back-up withholding of Federal income
tax. If you do not provide this information, or are otherwise subject to this
withholding, the Fund may be required to withhold 31% of your dividends and the
proceeds of redemptions and exchanges.

In addition to Federal taxes, you may be subject to state, local or foreign
taxes with respect to your investment in and distributions from the Fund. A
state income (and possibly local income and/or intangible property) tax
exemption is generally available to the extent the Fund's distributions are
derived from interest on (or, in the case of intangibles taxes, the value of its
assets is attributable to) certain U.S. Government obligations, provided in some
states that certain thresholds for holdings of such obligations and/or reporting
requirements are satisfied. The foregoing discussion relates to U.S. investors
that are not exempt from U.S. Federal income tax. Different tax consequences
will apply to plan participants, tax-exempt investors and investors that are
subject to tax deferral. Non-U.S. shareholders are also subject to different tax
treatment not described above. You should consult your tax adviser for specific
advice. Under the Code, a tax-exempt investor in the Fund will not generally
recognize unrelated business taxable income from its investment in the Fund
unless the tax-exempt investor incurred indebtedness to acquire or continue to
hold Fund shares and such indebtedness remains unpaid.

PERFORMANCE

THE FUND MAY ADVERTISE ITS TOTAL RETURN ON CLASS C SHARES.

Total return is based on the overall change in value of a hypothetical
investment in Class C shares of the Fund. The Fund's total return on Class C
shares shows the overall dollar or percentage change in value, assuming the
reinvestment of all dividends and distributions in Class C shares. Cumulative
total return shows the performance on Class C shares over a period of time.
Average annual total return shows the cumulative return of the Class C shares of
the Fund divided over the number of years included in the period. Because
average annual total return tends to smooth out variations in the performance of
Class C shares of the Fund, you should recognize that it is not the same as
actual year-to-year results.

Total return calculations with respect to Class C shares do not reflect the
imposition of a sales charge. The value of Class C shares of the Fund, when
redeemed, may be more or less than their original cost. Total return is a
historical calculation and is not an indication of future performance.

WHO CAN BUY CLASS C SHARES

CLASS C SHARES ARE AVAILABLE TO CERTAIN INSTITUTIONAL INVESTORS.

In order to qualify to buy Class C shares of the Fund, you must qualify as one
of the following types of institutional investors: (i) Benefit plans not
affiliated with the Adviser which have at least $25,000,000 in plan assets, and
either have a separate trustee vested with investment discretion and certain
limitations on the ability of the plan beneficiaries to access their plan
investments without incurring adverse tax consequences or allow their
participants to select among one or more investment options, including the Fund
("participant-directed plans"); (ii) Banks and insurance companies which are not
affiliated with the Adviser purchasing shares for their own account; (iii)
Investment companies not affiliated with the Adviser; (iv) Tax exempt retirement
plans of the Adviser and its affiliates, including affiliated brokers; (v) Unit
investment trusts sponsored by Broker Services and certain other sponsors; and
(vi) existing full-service clients of John Hancock Mutual Life Insurance Company
who were group annuity contract holders as of September 1, 1994.
Participant-directed plans include but are not limited to 401(k), TSA and 457
Plans.

HOW TO BUY CLASS C SHARES

OPENING AN ACCOUNT.

- ------------------------------------------------------------------------------
The minimum initial investment is $1,000,000, except that this requirement may
be waived at discretion of the Fund's officers. You may qualify for the
minimum investment if you invest more than $1,000,000 in Class C shares of the
Fund and Class C shares of funds in the John Hancock family. This is discussed
in greater detail in the Statement of Additional Information.

Complete the application attached to this Prospectus.
- ------------------------------------------------------------------------------

BY CHECK 1. Make your check payable to John Hancock Investor
Services, Corporation ("Investor Services").
2. Deliver the completed application and check to your
registered representative or Selling Broker, or mail it
directly to Investor Services.

- ------------------------------------------------------------------------------
BY WIRE 1. Obtain an account number by contacting your registered
representative or Selling Broker or by calling
1-800-437-9312.
2. Instruct your bank to wire funds to:
First Signature Bank & Trust
John Hancock Deposit Account No. 900000260
ABA Routing No. 211475000
For credit to: John Hancock Special Equities Fund
(Class C Shares)
Your Account Number
Name(s) under which account is registered.

3. Deliver the completed application to your registered
representative or Selling Broker, or mail it directly to
Investor Services.

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

BUYING ADDITIONAL CLASS C SHARES.

BY TELEPHONE 1. Complete the "Invest-By-Phone" and "Bank Information"
sections on Account Privileges Application designating a
bank account from which your funds may be drawn. Note
that in order to invest by phone, your account must be in
a bank or credit union that is a member of the Automated
Clearing House system (ACH).
2. After your authorization form has been processed, you may
purchase additional Class C shares by calling Investor
Services toll free at 1-800-437-9312.
3. Give the Investor Services representative the name(s) in
which your account is registered, the Fund name and your
account number, and the amount you wish to invest in
Class C shares.
4. Your investment normally will be credited to your account
the business day following your phone request.

<PAGE>
- ------------------------------------------------------------------------------
BY CHECK 1. Either complete the detachable stub included on your
account statement or include a note with your investment
listing the name of the Fund and class of shares, your
account number and the name(s) in which the account is
registered.

2. Make your check payable to John Hancock Investor
Services, Corporation.

3. Mail the account information and check to:
John Hancock Investor Services Corporation
P.O. Box 9115
Boston, MA 02205-9115

or deliver it to your registered representative or Selling
Broker.

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

BY WIRE Instruct your bank to wire funds to:

First Signature Bank & Trust
John Hancock Deposit Account No. 900000260
ABA Routing No. 211475000
For credit to: John Hancock Special Equities Fund
(Class C Shares)
Your Account Number
Name(s) under which account is registered
- ------------------------------------------------------------------------------

Other Requirements: All purchases must be made in U.S. dollars. Checks written
on foreign banks will delay purchases until U.S. funds are received, and a
collection charge may be imposed. Shares of the Fund are priced at the
offering price based on the net asset value computed after John Hancock Funds
receives notification of the dollar equivalent from the Fund's custodian bank.
Wire purchases normally take two or more hours to complete and, to be accepted
the same day, must be received by 4:00 p.m., New York time. Your bank may
charge a fee to wire funds. Telephone transactions are recorded to verify
information. Class C share certificates are not issued unless a request is
made in writing to Investor Services.

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

YOU WILL RECEIVE ACCOUNT STATEMENTS WHICH YOU SHOULD KEEP TO HELP WITH YOUR
PERSONAL RECORDKEEPING.

You will receive a statement of your account after any transaction that affects
your share balance or registration (statements related to reinvestment of
dividends will be sent to you quarterly). A tax information statement will be
mailed to you by January 31 of each year.

CLASS C SHARE PRICE

THE OFFERING PRICE OF YOUR CLASS C SHARES IS THEIR NET ASSET VALUE.

The net asset value per share ("NAV") of a Class C share is the value of one
Class C share. The NAV per share is calculated by dividing the net assets of
each class by the number of outstanding shares of that class. The NAV of each
class can differ in value. Securities in the Fund's portfolio are valued on the
basis of market quotations, valuations provided by independent pricing services
or, at fair value as determined in good faith in accordance with procedures
approved by the Trustees. Short-term debt investments maturing within 60 days
are valued at amortized cost which approximates market value. Foreign securities
are valued on the basis of quotations from the primary market in which they are
traded, and are translated from the local currency into U.S. dollars using
current exchange rates. If quotations are not readily available or, the value
has been materially affected by events occurring after the closing of a foreign
market, assets are valued by a method that the Trustees believe accurately
reflects fair value. The NAV of Class C shares is calculated once daily as of
the close of regular trading on the New York Stock Exchange (generally at 4:00
p.m., New York time) on each day that the Exchange is open.

Class C shares of the Fund are sold at the offering price based on the NAV
computed after your investment request is received in good order by John Hancock
Funds. If you buy shares of the Fund through a Selling Broker, the Selling
Broker must receive your investment before the close of regular trading on the
New York Stock Exchange and transmit it to John Hancock Funds prior to its close
of business to receive that day's offering price. There is no sales charge
imposed on the purchase of Class C shares.

A one-time payment of up to 0.15% of the amount invested in Class C shares may
be made by John Hancock Funds to a Selling Broker for sales of Class C shares
made by that Selling Broker. A person entitled to receive compensation for
selling shares of the Fund may receive different compensation with respect to
sales of Class A shares, Class B shares and Class C shares of the Fund. John
Hancock Funds, out of its own resources, may pay to a selling broker an annual
service fee up to 0.20% of the amount invested in Class C shares by these
clients.

HOW TO REDEEM CLASS C SHARES

You may redeem all or a portion of your Class C shares on any business day. Your
Class C shares will be redeemed at the next NAV for Class C shares calculated
after your redemption request is received in good order by Investor Services.
The Fund may hold payment until reasonably satisfied that investments that were
recently made by check or Invest-by-Phone have been collected (which may take up
to 10 calendar days).

Once your Class C shares are redeemed, the Fund generally sends you payment on
the next business day. When you redeem your Class C shares, if you are subject
to tax, you may realize a taxable gain or loss depending usually on the
difference between what you paid for them and what you receive for them,
subject to certain tax rules. Under unusual circumstances, the Fund may
suspend redemptions or postpone payment for up to seven days or longer, as
permitted by Federal securities laws.

- ------------------------------------------------------------------------------
TO ASSURE ACCEPTANCE OF YOUR REDEMPTION REQUEST, PLEASE FOLLOW THESE PROCEDURES.

BY TELEPHONE All Fund shareholders are automatically eligible for
privilege. Call 1-800-437-9312, from 8:00 A.M. to 4:00
P.M. (New York time), Monday through Friday, excluding
days on which the New York Stock Exchange is closed.
Investor Services employs the following procedures to
confirm that instructions received by telephone are
genuine. Your name, the account number, taxpayer
identification number applicable to the account and other
relevant information may be requested. In addition,
telephone instructions are recorded.

You may redeem up to $100,000 by telephone, but the
address on the account must not have changed for the last
thirty days. A check will be mailed to the exact name(s)
and address on the account.

If reasonable procedures such as those described above
are not followed, the Fund may be liable for any loss due
to unauthorized or fraudulent telephone instructions. In
all other cases, neither the Fund nor Investor Services
will be liable for any loss or expense for acting upon
telephone instructions made in accordance with the
telephone transaction procedures mentioned above.

Telephone redemption is not available for tax-qualified
retirement plans or Class C shares of the Fund that are
in certificated form.

During periods of extreme economic conditions or market
changes, telephone requests may be difficult to implement
due to a large volume of calls. During such times you
should consider placing redemption requests in writing or
using EASI-Line. EASI-Line's telephone number is
1-800-338-8080.
- ------------------------------------------------------------------------------
BY WIRE If you have a telephone redemption form on file with the
Fund, redemption proceeds of $1,000 or more can be wired
on the next business day to your designated bank account,
and a fee (currently $4.00) will be deducted. You may
also use electronic funds transfer to your assigned bank
account, and the funds are usually collectable after two
business days. Your bank may or may not charge a fee for
this service. Redemptions of less than $1,000 will be
sent by check or electronic funds transfer.

This feature may be elected by completing the "Telephone
Redemption" section on the Account Privileges Application
that is included with this Prospectus.
- ------------------------------------------------------------------------------
IN WRITING Send a stock power or "letter of instruction" specifying
the name of the Fund, the dollar amount or the number of
Class C shares to be redeemed, your name, class of
shares, your account number and the additional
requirements listed below that apply to your particular
account.

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

TYPE OF REGISTRATION REQUIREMENTS
-------------------- ------------
Corporation, Association A letter of instruction and a corporate
resolution, signed by person(s) authorized to
act on the account, with the signature(s)
guaranteed.

Trusts A letter of instruction signed by the
Trustee(s) with signature(s) guaranteed. (If
the Trustee's name is not registered on your
account, also provide a copy of the trust
document, certified within the last 60 days.)

If you do not fall into any of these registration categories please call
1-800-437-9312 for further instructions.
- ------------------------------------------------------------------------------

WHO MAY GUARANTEE YOUR SIGNATURE.

A signature guarantee is a widely accepted way to protect you and the Fund by
verifying the on your request. It may not be provided by a notary public. If
the net asset value of the Class C shares redeemed is $100,000 or less, John
Hancock Funds may guarantee the signature. The following institutions may
provide you with a signature guarantee, provided that the institution meets
credit standards established by Investor Services: (i) a bank; (ii) a
securities broker or dealer, including a government or municipal securities
broker or dealer, that is a member of a clearing corporation or meets certain
net capital requirements; (iii) a credit union having authority to issue
signature guarantees; (iv) a savings and loan association, a building and loan
association, a cooperative bank, a federal savings bank or association; or (v)
a national securities exchange, a registered securities exchange or a clearing
agency.

- ------------------------------------------------------------------------------
ADDITIONAL INFORMATION ABOUT REDEMPTIONS.

THROUGH YOUR BROKER Your broker may be able to initiate the redemption.
Contact him or instructions.
- ------------------------------------------------------------------------------
IF YOU HAVE CERTIFICATES FOR YOUR SHARES, YOU MUST SUBMIT THEM WITH YOUR STOCK
POWER OR A LETTER OF INSTRUCTION. YOU MAY NOT REDEEM CERTIFICATED SHARES BY
TELEPHONE.

DUE TO THE PROPORTIONATELY HIGH COST OF MAINTAINING SMALLER ACCOUNTS, THE FUND
RESERVES THE RIGHT TO REDEEM AT NET ASSET VALUE ALL CLASS C SHARES IN AN
ACCOUNT WHICH HOLDS FEWER THAN 50 SHARES (EXCEPT ACCOUNTS UNDER RETIREMENT
PLANS) AND TO MAIL THE PROCEEDS TO THE SHAREHOLDER, OR THE TRANSFER AGENT MAY
IMPOSE AN ANNUAL FEE OF $10.00. NO ACCOUNT WILL BE INVOLUNTARILY REDEEMED OR
ADDITIONAL FEE IMPOSED, IF THE VALUE OF THE ACCOUNT IS IN EXCESS OF THE FUND'S
MINIMUM INITIAL INVESTMENT. SHAREHOLDERS WILL BE NOTIFIED BEFORE THESE
REDEMPTIONS ARE TO BE MADE OR THIS CHARGE IS IMPOSED AND WILL HAVE 30 DAYS TO
PURCHASE ADDITIONAL CLASS C SHARES TO BRING THEIR ACCOUNT UP TO THE REQUIRED
MINIMUM. UNLESS THE NUMBER OF CLASS C SHARES ACQUIRED BY FURTHER PURCHASES AND
DIVIDEND REINVESTMENTS, IF ANY, EXCEEDS THE NUMBER OF CLASS C SHARES REDEEMED,
REPEATED REDEMPTIONS FROM A SMALLER ACCOUNT MAY EVENTUALLY TRIGGER THIS
POLICY.
- ------------------------------------------------------------------------------
ADDITIONAL SERVICES AND PROGRAMS
EXCHANGE PRIVILEGE

YOU MAY EXCHANGE CLASS C SHARES OF THE FUND ONLY FOR CLASS C SHARES IN ANOTHER
JOHN HANCOCK MUTUAL FUND.

If your investment objective changes, or if you wish to achieve further
diversification, John Hancock offers other funds with a wide range of investment
goals. Not all John Hancock funds offer Class C shares. Contact your registered
representative or Selling Broker and request a prospectus for the John Hancock
funds that interest you. Read the prospectus carefully before exchanging your
Class C shares. Exchanges may be made only into Class C shares of other John
Hancock funds or into John Hancock Cash Management Fund.

Exchanges between funds are based on their respective net asset values. No sales
charge or transaction charge is imposed.

The Fund reserves the right to require you to keep previously exchanged Class C
shares (and reinvested dividends) in the Fund for 90 days before you are
permitted to execute a new exchange. The Fund may also terminate or alter the
terms of the exchange privilege upon 60 days' notice to shareholders.

An exchange of shares is treated as a redemption of shares of one fund and the
purchase of shares of another for Federal income tax purposes. An exchange may
result in a taxable gain or loss.

When you make an exchange, your account registration in both the old and new
account must be identical. The exchange privilege is available only in states
where the exchange can be made legally.

BY TELEPHONE
1. When you fill out the application for your purchase of Class C shares of the
Fund, you automatically authorize exchanges by telephone unless you check the
box indicating that you do not wish to have the authorized telephone exchange
privilege.

2. Call 1-800-437-9312. Have the account number of your current fund and the
exact name in which it is registered available to give to the telephone
representative.

IN WRITING
1. In a letter request an exchange and list the following:

-- the name of the fund whose Class C shares you currently own

-- your account number

-- the name(s) in which the account is registered

-- the name of the fund in which you wish your exchange to be invested

-- the number of Class C shares, all Class C shares or the dollar amount you
wish to exchange

Sign your request exactly as the account is registered.

2. Mail the request and information to:
John Hancock Investor Services Corporation
Attn: Institutional Services
P.O. Box 9277
Boston, Massachusetts 02205-9277

<PAGE>
JOHN HANCOCK SPECIAL EQUITIES FUND

INVESTMENT ADVISER
John Hancock Advisers, Inc.
101 Huntington Avenue
Boston, Massachusetts 02199-
7603

PRINCIPAL DISTRIBUTOR
John Hancock Funds, Inc.
101 Huntington Avenue
Boston, Massachusetts 02199- 7603

CUSTODIAN
Investors Bank & Trust
Company
24 Federal Street
Boston, Massachusetts 02110

TRANSFER AGENT
John Hancock Investor
Services Corporation
P.O. Box 9116
Boston, Massachusetts 02205-9116

INDEPENDENT AUDITORS
Ernst & Young LLP
200 Clarendon Street
Boston, Massachusetts 02116

HOW TO OBTAIN INFORMATION
ABOUT THE FUND

For: Service Information
Telephone Exchange call 1-800-437-9312
Telephone Redemption
Invest-by-Phone

JHD-180PC 3/95

JOHN HANCOCK
SPECIAL
EQUITIES
FUND

CLASS C SHARES
PROSPECTUS
MARCH 1, 1995

A MUTUAL FUND SEEKING TO
ACHIEVE GROWTH OF CAPITAL
BY INVESTING IN A
DIVERSIFIED PORTFOLIO OF
EQUITY SECURITIES
PRIMARILY OF EMERGING
GROWTH COMPANIES AND OF
COMPANIES IN SPECIAL
SITUATIONS.

101 HUNTINGTON AVENUE
BOSTON, MASSACHUSETTS
02199-7603
TELEPHONE 1-800-437-9312

Printed on recycled paper using soybean ink

<PAGE>
JOHN HANCOCK SPECIAL EQUITIES FUND

CLASS A, CLASS B and CLASS C SHARES

Statement of Additional Information

March 1, 1995

This Statement of Additional Information provides information about
John Hancock Special Equities Fund (the "Fund") in addition to the information
that is contained in the Fund's Class A and Class B Shares Prospectus and Class
C Shares Prospectus (together, the "Prospectuses"), both dated March 1, 1995.

This Statement of Additional Information is not a prospectus. It should
be read in conjunction with the Fund's Prospectuses, copies of which can be
obtained free of charge by writing or telephoning:

John Hancock Investor Services Corporation
P.O. Box 9116
Boston, Massachusetts 02205-9116
1-800-225-5291

<TABLE>
TABLE OF CONTENTS
<CAPTION>
Cross-Referenced
Statement of to Class A Cross-Referenced
Additional and Class B to Class C
Information Prospectus Prospectus
Page Page Page

<S> <C> <C> <C>
Organization of the Fund 2 7 7
Investment Objective and Policies 2 4 4
Investment Restrictions 5 4 4
Ratings 8 4 4
Those Responsible for Management 10 7 7
Investment Advisory and Other Services 15 7 7
Distribution Contracts 18 9 8
Net Asset Value 20 3 11
Initial Sales Charge on Class A Shares 20 7 --
Deferred Sales Charge on Class B Shares 22 8 --
Special Redemptions 22 -- --
Additional Services and Programs 23 20 --
Description of the Fund's Shares 24 12 11
Tax Status 25 9 8
Calculation of Performance 28 10 9
Brokerage Allocation 29 6 6
Transfer Agent Services 31 Back Cover --
Custody of Portfolio 31 Back Cover --
Independent Auditors 31 Back Cover --
Financial Statements -- 3 --
</TABLE>

ORGANIZATION OF THE FUND

John Hancock Special Equities Fund (the "Fund") is a diversified
open-end management investment company organized as a Massachusetts business
trust under the laws of The Commonwealth of Massachusetts. The Fund was
organized in 1984 by John Hancock Advisers, Inc. (the "Adviser"). The Adviser is
an indirect wholly-owned subsidiary of John Hancock Mutual Life Insurance
Company (the "Life Insurance Company"), a Massachusetts life insurance company
chartered in 1862, with national headquarters at John Hancock Place, Boston,
Massachusetts. On March 1, 1991, the Fund changed its name from "John Hancock
Special Equities Trust."

INVESTMENT OBJECTIVE AND POLICIES

The Fund's investment objective is to seek growth of capital by
investing in a diversified portfolio of equity securities consisting primarily
of emerging growth companies and of companies in "special situations,"
collectively referred to as "Special Equities." For a discussion of the Fund's
investment objective and policies, investors should refer to the description in
the Fund's Prospectuses under the caption "Investment Objective and Policies."
There is no assurance that the Fund will achieve its investment objective.
Although the Fund may receive current income from dividends, interest and other
sources, income is an incidental consideration to seeking capital growth.

The Fund will invest at least 65% of its total assets in Special
Equities. The balance of the Fund's portfolio may be invested in:

- equity securities of established companies believed by the Adviser to
offer growth potential.

- cash or high-quality corporate debt securities, money market
instruments or securities of the United States Government or its agencies or
instrumentalities ("government securities"), if, in the opinion of the Adviser,
prevailing economic or market conditions require a temporary defensive posture.

- cash, money market instruments and government securities, in such
proportions as the Trustees and the officers of the Fund deem appropriate to
provide for anticipated redemptions of the Fund's shares.

Special Equities, particularly equity securities of emerging growth
companies, may have limited marketability due to thin markets in which the
volume of trading for such securities is low or due to the fact that there are
only a few market makers for such securities. Such limited marketability may
make it difficult for the Fund to dispose of a large block of such securities.
To satisfy redemption requests or other needs for cash, the Fund may have to
sell these securities prematurely or at a discount from market prices or to make
many small and more costly sales over a lengthy period of time. Investments by
the Fund may be in existing as well as new issues of securities and may be
subject to wide fluctuations in market value. The Fund will not concentrate its
investments in any particular industry.

The Fund anticipates that its investments generally will be in
securities of companies which it considers to reflect the following
characteristics:

- Share prices which do not appear to take into account adequately the
underlying value of the company's assets or which appear to reflect substantial
undervaluation due to factors such as prospective reversal of an unfavorable
industry trend, lack of investor recognition or disappointing earnings believed
to be temporary in comparison with previous earnings trends;

- Growth potential due to technological advances or discoveries, new
methods in marketing or production, the offering of new or unique products or
services, changes in demand for products or services or other significant new
developments; or

- Existing, contemplated or possible changes in management or
management policies, corporate structure or control, capitalization or the
existence or possibility of some other circumstances which could be expected to
have a favorable impact on earnings or market price of such company's shares.

The Fund is intended to provide an opportunity for investors who are
not ordinarily in a position to perform the specialized type of research or
analysis involved in investing in Special Equities and who may not be able to
invest sufficient assets in such companies to provide wide diversification.

The following is a description of the non-equity securities in which
the Fund may invest for defensive purposes or to provide for anticipated
redemptions of Fund shares:

Corporate debt securities are those corporate debt securities issued by
United States corporations payable in United States dollars. The Fund will only
invest in corporate debt securities which have, at the time of purchase, a
rating within the four highest grades as determined by Moody's Investors
Service, Inc. ("Moody's") (AAA, AA, A OR BAA) or Standard & Poor's Rating Group
("S&P") (AAA, AA, A or BBB).

Money market instruments are either commercial paper (which refers to
promissory notes issued by corporations to finance their short-term credit
needs) or certificates of deposit (which are certificates issued against funds
deposited in a bank). The Fund will invest in commercial paper rated Prime-1 by
Moody's or A-1 by S&P. These commercial paper ratings are the highest assigned
by the two rating agencies. It will also invest in certificates of deposit which
are issued by U.S. banks having assets of $1 billion or more and which mature in
one year or less from the date of acquisition.

Government securities include Treasury Notes, Bonds and Bills which are
direct obligations of the U.S. Government backed by the full faith and credit of
the United States, and securities issued by agencies and instrumentalities of
the U.S. Government, which may be guaranteed by the United States Treasury or
supported by the issuer's right to borrow from the Treasury and may be backed by
the credit of the federal agency or instrumentality itself.

Repurchase Agreement Transactions. The Fund may enter into repurchase agreements
with respect to its portfolio securities. The Fund has established a procedure
providing that the securities serving as collateral for each repurchase
agreement must be delivered to the Fund's custodian either physically or in
book-entry form and that the collateral must be marked to market daily to ensure
that each repurchase agreement is fully collateralized at all times. In the
event of bankruptcy or other default by a seller of a repurchase agreement, the
Fund could experience delays in liquidating the underlying securities and could
experience losses, including a possible decline in the value of the underlying
securities during the period in which the Fund seeks to enforce its rights
thereto, possible subnormal levels of income and lack of access to income during
this period, and the expense of enforcing its rights.

There may be additional risks inherent in the Fund's investment
objective and policies. Some of these risks are described in the Prospectuses
under the caption "Investment Objective and Policies." For example, if the Fund
were to assume substantial positions in particular securities with limited
trading markets, such positions could have an adverse effect upon the liquidity
and marketability of such securities and the Fund may not be able to dispose of
its holdings in these securities at then current market prices. Circumstances
could also exist (to satisfy redemption requests, for example) when portfolio
securities could have to be sold by the Fund at times which otherwise would be
considered disadvantageous so that the Fund would receive lower proceeds from
such sales than it might otherwise have expected to realize. Investment in
securities which are "restricted" in the hands of the Fund (see the discussion
below under the caption "Investment Restrictions") could involve added expense
to the Fund should the Fund be required to bear registration costs and could
involve delays in disposing of such securities. Such delays could have an
adverse effect upon the price and timing of sales of such securities and the
liquidity of the Fund with respect to redemptions.

The Fund may effect portfolio transactions without regard to holding
periods if, in the Adviser's judgment, such transactions are advisable in light
of a change in circumstances of a particular company or within a particular
industry or in general market, economic or financial conditions. Thus, the Fund
may at times make investments which result in recognition of short-term capital
gains. However, the Fund intends to qualify as a regulated investment company
under Subchapter M of the Internal Revenue Code and, accordingly, intends to
limit its short-term trading so that less than 30% of its gross income each
taxable year will be derived from gains realized on the sale or other
disposition of securities held for less than three months. Fund to be treated as
a regulated investment company, may at certain times prevent the Fund from
realizing capital gains on securities held for less than three months. See "Tax
Status."

The rate of portfolio turnover cannot be predicted with assurance and
may vary from year to year. Future turnover rates will be governed by the
availability of investment opportunities, the desirability of continuing to hold
a portfolio security and cash requirements for redemptions of Fund shares. The
portfolio turnover rate for the years ended October 31, 1994, 1993, and 1992 was
66%, 33%, and 114%, respectively.

Debt Securities and Money Market Instruments. The Fund may purchase or sell debt
securities (including U.S. corporate bonds and notes, and obligations issued or
guaranteed by the U.S. or foreign governments or their agencies or
instrumentalities) and money market instruments (including short-term debt
obligations payable in U.S. dollars issued by certain banks, savings and loan
associations and corporations) without regard to the length of time the security
has been held to take advantage of short-term differentials in yields. The Fund
will only purchase securities meeting the requirements, including rating
qualifications, stated in the Prospectuses. See the discussion under "Ratings"
below. General changes in prevailing interest rates will affect the value of the
debt securities and money market instruments held by the Fund, the value of
which will vary inversely to the changes in such rates. For example, if interest
rates rise after a security is purchased, the value of the security would
decline.

INVESTMENT RESTRICTIONS

Fundamental Investment Restrictions. The following investment restrictions (as
well as the Fund's investment objective) will not be changed without approval of
a majority of the outstanding voting securities which, as used in the
Prospectuses and this Statement of Additional Information, means approval of the
lesser of (1) the holders of 67% or more of the shares represented at a meeting
if the holders of more than 50% of outstanding shares are present in person or
by proxy or (2) the holders of more than 50% of the outstanding shares.

The Fund observes the following fundamental restrictions:

The Fund may not:

(1) Issue senior securities, except as permitted by paragraphs (2), (6)
and (7) below. For purposes of this restriction, the issuance of shares
of beneficial interest in multiple classes or series, the purchase or
sale of options, futures contracts and options on futures contracts,
and forward foreign exchange contracts, forward commitments and
repurchase agreements entered into in accordance with the Fund's
investment policy, and the pledge, mortgage or hypothecation of the
Fund's assets within the meaning of paragraph (3) below, are not deemed
to be senior securities.

(2) Borrow money, except from banks as a temporary measure for
extraordinary emergency purposes in amounts not to exceed 33 1/3% of
the Fund's total assets (including the amount borrowed) taken at market
value. The Fund will not use leverage to attempt to increase income.
The Fund will not purchase securities while outstanding borrowings
exceed 5% of the Fund's total assets.

(3) Pledge, mortgage or hypothecate its assets, except to secure
indebtedness permitted by paragraph (2) above and then only if such
pledging, mortgaging or hypothecating does not exceed 33 1/3% of the
Fund's total assets taken at market value.

(4) Act as an underwriter, except to the extent that in connection with
the disposition of portfolio securities, the Fund may be deemed to be
an underwriter for purposes of the Securities Act of 1933.

(5) Purchase or sell real estate or any interest therein, except that
the Fund may invest in securities of corporate or governmental entities
secured by real estate or marketable interests therein or securities
issued by companies that invest in real estate or interests therein.

(6) Make loans, except that the Fund may lend portfolio securities in
accordance with the Fund's investment policies. The Fund does not, for
this purpose, consider repurchase agreements, the purchase of all or a
portion of an issue of publicly distributed bonds, bank loan
participation agreements, bank certificates of deposit, bankers'
acceptances, debentures or other securities, whether or not the
purchase is made upon the original issuance of the securities, to be
the making of a loan.

(7) Invest in commodities or in commodity contracts or in puts, calls,
or combinations of both, except options on securities and securities
indices, futures contracts on securities and securities indices and
options on such futures, forward foreign exchange contracts, forward
commitments, securities index put or call warrants and repurchase
agreements entered into in accordance with the Fund's investment
policies.

(8) Purchase the securities of issuers conducting their principal
business activity in the same industry if, immediately after such
purchase, the value of its investments in such industry would exceed
25% of its total assets taken at market value at the time of each
investment. This limitation does not apply to investments in
obligations of the U.S. Government or any of its agencies or
instrumentalities.

(9) Purchase securities of an issuer (other than the U.S. Government,
its agencies or instrumentalities), if

(i) such purchase would cause more than 5% of the
Fund's total assets taken at market value to be invested in
the securities of such issuer, or

(ii) such purchase would at the time result in more
than 10% of the outstanding voting securities of such issuer
being held by the Fund.

In connection with the lending of portfolio securities under item (6)
above, such loans must at all times be fully collateralized and the Fund's
custodian must take possession of the collateral either physically or in book
entry form. Securities used as collateral must be marked to market daily.

Nonfundamental Investment Restrictions. The following restrictions are
designated as nonfundamental and may be changed by the Board of Trustees without
shareholder approval.

The Fund may not:

(a) Participate on a joint or joint-and-several basis in any securities
trading account. The "bunching" of orders for the sale or purchase of
marketable portfolio securities with other accounts under the
management of the Adviser to save commissions or to average prices
among them is not deemed to result in a joint securities trading
account.

<PAGE>

(b) Purchase securities on margin or make short sales, except in
connection with arbitrage transactions, or unless by virtue of its
ownership of other securities, the Fund has the right to obtain
securities equivalent in kind and amount to the securities sold and, if
the right is conditional, the sale is made upon the same conditions,
except that the Fund may obtain such short-term credits as may be
necessary for the clearance of purchases and sales of securities and in
connection with transactions involving forward foreign currency
exchange contracts.

(c) Knowingly purchase or retain securities of an issuer if one or more
of the Trustees or officers of the Fund or directors or officers of the
Adviser or any investment management subsidiary of the Adviser
individually owns beneficially more than 0.5%, and together own
beneficially more than 5%, of the securities of such issuer.

(d) Purchase a security if, as a result, (i) more than 10% of the
Fund's assets would be invested in securities of other investment
companies, (ii) such purchase would result in more than 3% of the total
outstanding voting securities of any one such investment company being
held by the Fund, or (iii) more than 5% of the Fund's assets would be
invested in any one such investment company.

(e) Purchase securities of any issuer which, together with any
predecessor, has a record of less than three years' continuous
operations prior to the purchase if such purchase would cause
investments of the Fund in all such issuers to exceed 5% of the value
of the total assets of the Fund.

(f) Invest for the purpose of exercising control over or management of
any company.

(g) Purchase warrants of any issuer, if, as a result of such purchases,
more than 2% of the value of the Fund's total assets would be invested
in warrants which are not listed on the New York Stock Exchange or the
American Stock Exchange or more than 5% of the value of the total
assets of the Fund would be invested in warrants generally, whether or
not so listed. For these purposes, warrants are to be valued at the
lesser of cost or market, but warrants acquired by the Fund in units
with or attached to debt securities shall be deemed to be without
value.

(h) Purchase interests in oil, gas or other mineral leases or
exploration programs; however, this policy will not prohibit the
acquisition of securities of companies engaged in the production or
transmission of oil, gas, or other minerals.

(i) Invest more than (1) 10% of its total assets in securities which
are restricted under the Securities Act of 1933 (the "1933 Act")
(excluding securities eligible for resale pursuant to Rule 144A under
the 1933 Act) or (2) 15% of its total assets in such restricted
securities (including securities eligible for resale pursuant to Rule
144A).

(j) Purchase interests in real estate limited partnerships.

(k) Purchase any security, including any repurchase agreement maturing
in more than seven days, which is not readily marketable, if more than
15% of the net assets of the Fund, taken at market value, would be
invested in such securities. (The staff of the Securities and Exchange
Commission considers over-the-counter options to be illiquid securities
subject to the 15% limit.)

(l) The Fund may not purchase securities of any open-end investment
company except when such purchase is part of a plan of merger,
consolidation, reorganization or purchase of substantially all of the
assets of any other investment company.

(m) Notwithstanding any investment restriction to the contrary, the
Fund may, in connection with the John Hancock Group of Funds Deferred
Compensation Plan for Independent Trustees/Directors, purchase
securities of other investment companies within the John Hancock Group
of Funds provided that, as a result, (i) no more than 10% of the Fund's
assets would be invested in securities of all other investment
companies, (ii) such purchase would not result in more than 3% of the
total outstanding voting securities of any one such investment company
being held by the Fund and (iii) no more than 5% of the Fund's assets
would be invested in any one such investment company.

In order to permit the sale of shares of the Fund in certain states,
the Trustees may, in their sole discretion, adopt restrictions or investment
policies more restrictive than those described above. Should the Trustees
determine that any such more restrictive policy is no longer in the best
interests of the Fund and its shareholders, the Fund may cease offering shares
in the state involved and the Trustees may revoke such restrictive policy.
Moreover, if the states involved no longer require any such restrictive policy,
the Trustees may, at their sole discretion, revoke such policy. The Fund has
agreed with a state securities administrator that it will not purchase
securities of any open-end investment company except when such purchase is part
of a plan of merger, consolidation, reorganization or purchase of substantially
all of the assets of any other investment company.

If a percentage restriction on investment or utilization of assets as
set forth above is adhered to at the time an investment is made, a later change
in percentage resulting from changes in the values or the total costs of the
Fund's assets will not be considered a violation of the restriction.

RATINGS

Bonds. As described in the Prospectuses, the Fund's investments in corporate
debt must be rated Baa or better by Moody's or BBB or better by S&P.

Moody's describes its ratings for corporate bonds as follows:

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 edge." 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.

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 fluctuation of protective
elements may be of greater amplitude or there may be other elements present
which make the long term risks appear somewhat larger than in Aaa securities.

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 at some time in the future.

Bonds which are rated Baa are considered 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.

S&P describes its ratings for corporate bonds as follows:

AAA. Debt rated "AAA" has the highest rating by S&P. 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 debt in higher rated
categories.

BBB. Debt rated "BBB" is regarded as having 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.

Commercial Paper. As described in the Fund's Prospectuses, the Fund may invest
in commercial paper which is rated A-1 by S&P or P-1 by Moody's.

Moody's ratings for commercial paper are opinions of the ability of issuers to
repay punctually promissory obligations not having an original maturity in
excess of nine months. Moody's highest commercial paper rating category is as
follows:

P-1. "Prime-1" indicates the highest quality repayment capacity of the
rated issues.

S&P commercial paper ratings are current assessments of the likelihood of timely
payment of debts having an original maturity of no more than 365 days. S&P's
highest commercial paper rating category is as follows:

A-1. This designation indicates that the degree of safety regarding
timely payment is very strong. Those issues determined to possess overwhelming
safety characteristics will be denoted with a plus (+) sign designation.

THOSE RESPONSIBLE FOR MANAGEMENT

The business of the Fund is managed by its Trustees, who elect officers who are
responsible for the day-to-day operations of the Fund and who execute policies
formulated by the Trustees. Several of the officers and Trustees of the Fund are
also officers and directors of the Adviser or directors of the Fund's principal
distributor, John Hancock Funds, Inc. ("John Hancock Funds").

The following table sets forth the principal occupation or employment of the
Trustees and principal officers of the Fund during the past five years:

<PAGE>

<TABLE>
<CAPTION>
POSITIONS HELD PRINCIPAL OCCUPATION(S)
NAME AND ADDRESS WITH THE FUND DURING THE PAST FIVE YEARS

Edward J. Boudreau, Jr.<F1> Chairman<F1><F2> Chairman and Chief Executive Officer, the
101 Huntington Avenue Adviser and The Berkeley Financial Group
Boston, Massachusetts ("The Berkeley Group"); Chairman, NM Capital
Management, Inc. ("NM Capital"); John Hancock
Advisers International Limited; ("Advisers
International"); John Hancock Funds, Inc.,
("John Hancock Funds"); John Hancock Investor
Services Corporation ("Investor Services")
and Sovereign Asset Management Corporation
("SAMCorp"); (herein after the Adviser, the
Berkeley Group, NM Capital, Advisers
International, John Hancock Funds, Investor
Services and SAMCorp are collectively
referred to as the "Affiliated Companies");
Chairman, First Signature Bank & Trust;
Director, John Hancock Freedom Securities
Corp., John Hancock Capital Corp., New
England/Canada Business Council; Member,
Investment Company Institute Board of
Governors; Director, Asia Strategic Growth
Fund, Inc.; Trustee, Museum of Science;
President, the Adviser (until July 1992).
Chairman John Hancock Distributors, Inc.
(until April, 1994).

Dennis S. Aronowitz Trustee<F5> Professor of Law, Boston University School
Boston University of Law; Trustee, Brookline Savings Bank;
Boston, Massachusetts Director, Boston University Center for
Banking Law Studies (until 1990).

Richard P. Chapman, Jr. Trustee<F5> President, Brookline Savings Bank.
160 Washington Street
Brookline, Massachusetts

William J. Cosgrove Trustee<F5> Vice President, Senior Banker and Senior
20 Buttonwood Place Credit Officer, Citibank, N.A. (retired
Saddle River, New Jersey September 1991); Executive Vice President,
Citadel Group Representative, Inc.

Gail D. Fosler Trustee<F5> Vice President and Chief Economist, The
4104 Woodbine Street Conference Board (non-profit economic and
Chevy Chase, MD business research).

Bayard Henry Trustee<F5> Corporate Advisor; Director, Fiduciary Trust
121 High Street Company (a trust company); Director,
Boston, Massachusetts Groundwater Technology, Inc. (remediation);
Samuel Cabot, Inc.; Advisor, Corning Capital
Corp.

<FN>
- -------------------
<F1> An "interested person" of the Fund, as such term is defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act").
<F1> A Member of the Executive Committee.
<F3> A Member of Investment Committee of the Adviser.
<F4> An Alternate Member of the Executive Committee.
<F5> A Member of the Audit and Administration Committees.

<PAGE>

<CAPTION>
POSITIONS HELD PRINCIPAL OCCUPATION(S)
NAME AND ADDRESS WITH THE FUND DURING THE PAST FIVE YEARS

<S> <C> <C>
Richard S. Scipione<F1> Trustee<F4> General Counsel, the Life Insurance Company;
John Hancock Place Director, the Adviser, the Affiliated
P.O. Box 111 Companies, John Hancock Distributors, Inc., JH
Boston, Massachusetts Networking Insurance Agency, Inc., John
Hancock Subsidiaries, Inc., SAMCorp, NM
Capital and John Hancock Property and Casualty
Insurance and its affiliates (until November,
1993); Trustee; The Berkeley Group; Director,
John Hancock Home Mortgages Corp. and John
Hancock Financial Access, Inc. (until July
1990).

Edward J. Spellman Trustee<F5> Partner, KPMG Peat Marwick (retired June 1990).
259C Commercial Bld.
Suite 200
Lauderdale by the Sea, FL

Robert G. Freedman<F1> Vice Chairman and Chief Vice Chairman and Chief Investment Officer,
101 Huntington Avenue Investment Officer<F3> the Adviser; President, the Adviser (until
Boston, Massachusetts December 1994).

Anne C. Hodsdon<F1> President<F3> President and Chief Operations Officer, the
101 Huntington Avenue Adviser; Executive Vice President, the Adviser
Boston, Massachusetts (until December 1994).

Thomas H. Drohan<F1> Senior Vice President and Senior Vice President and Secretary, the
101 Huntington Avenue Secretary Adviser.
Boston, Massachusetts

James K. Ho<F1> Senior Vice President<F3> Senior Vice President, the Adviser.
101 Huntington Avenue
Boston, Massachusetts

James B. Little<F1> Senior Vice President and Senior Vice President the Adviser.
101 Huntington Avenue Chief Financial Officer<F3>
Boston, Massachusetts

Michael P. DiCarlo<F1> Senior Vice President<F3> Senior Vice President, the Adviser.
101 Huntington Avenue
Boston, Massachusetts

John A. Morin<F1> Vice President Vice President, the Adviser.
101 Huntington Avenue
Boston, Massachusetts

Susan S. Newton<F1> Vice President, Assistant Vice President and Assistant Secretary,
101 Huntington Avenue Secretary and Compliance the Adviser.
Boston, Massachusetts Officer

James J. Stokowski<F1> Vice President and Treasurer Vice President, the Adviser.
101 Huntington Avenue
Boston, Massachusetts

<FN>
- ------------------
<F1> An "interested person" of the Fund, as such term is defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act").
<F1> A Member of the Executive Committee.
<F3> A Member of Investment Committee of the Adviser.
<F4> An Alternate Member of the Executive Committee.
<F5> A Member of the Audit and Administration Committees.
</TABLE>
<PAGE>

As of the date of this Statement of Additional Information, the
officers and Trustees of the Fund as a group owned less than 1% of the
outstanding shares of the Fund and to the knowledge of the registrant, no
persons owned of record or beneficially 5% or more of any class of registrant's
outstanding securities.

All of the officers listed are officers or employees of the Adviser or
the Affiliated Companies. Some of the Trustees and officers may also be officers
and/or directors and/or trustees of one or more other funds for which the
Adviser serves as investment adviser.

The following table provides information regarding the compensation
paid by the Fund and the other investment companies in the John Hancock Fund
Complex to the Independent Trustees for their services for each Fund's 1994
fiscal year. The two non-Independent Trustees, Messrs. Boudreau and Scipione,
and each of the officers of the Funds are interested persons of the Adviser, are
compensated by the Adviser and receive no compensation from the Fund for their
services.
<TABLE>
<CAPTION>
Pension or Total Compensation
Aggregate Retirement Benefits Estimated Annual From the Fund and John
Compensation From Accrued as Part of Benefits Upon Hancock Fund Complex
Independent Trustees the Fund the Fund's Expenses Retirement to Trustees<F1>

(Total of 18 Funds)

<S> <C> <C> <C> <C>
Dennis S. Aronowitz $ 7,694 - - $ 60,950
Richard P. Chapman, Jr. 7,878 - - 62,950
William J. Cosgrove 7,694 - - 60,950
Gail D. Fosler 5,553 - - 62,950
Bayard Henry 7,878 - - 60,950
Edward J. Spellman 7,694 - - 60,950
--------- ----------- ----------- ---------
$ 44,391 $ 369,700
<FN>
<F1> The total compensation paid by the John Hancock Fund Complex to the
Independent Trustees is as of the calendar year ended December 31, 1994.

</TABLE>

INVESTMENT ADVISORY AND OTHER SERVICES

As described in the Fund's Prospectuses, the Fund receives its
investment advice from the Adviser. Investors should refer to the Prospectuses
for a description of certain information concerning the investment management
contract.

Each of the Trustees and principal officers of the Fund who is also an
affiliated person of the Adviser is named above, together with the capacity in
which such person is affiliated with the Fund and the Adviser.

As described in the Fund's Prospectuses under the caption "Organization
and Management of the Fund," the Fund has entered into an investment management
contract with the Adviser. Under the investment management contract, the Adviser
provides the Fund with (i) a continuous investment program, consistent with the
Fund's stated investment objective and policies, (ii) supervision of all aspects
of the Fund's operations except those delegated to a custodian, transfer agent
or other agent and (iii) such executive, administrative and clerical personnel,
officers and equipment as are necessary for the conduct of its business. The
Adviser is responsible for the management of the Fund's portfolio assets.

Securities of the type held by the Fund may also be held by other funds
or investment advisory clients for which the Adviser or its affiliates provide
investment advice. Because of different investment objectives or other factors,
a particular security may be bought for one or more funds or clients when one or
more are selling the same security. If opportunities for purchase or sale of
securities by the Adviser for the Fund or for other funds or clients to which
the Adviser renders investment advice arise for consideration at or about the
same time, transactions in such securities will be made, insofar as feasible,
for the respective funds or clients in a manner deemed equitable to all of them.
To the extent that transactions on behalf of more than one client of the Adviser
or its affiliates may increase the demand for securities being purchased or the
supply of securities being sold, there may be an adverse effect on price.

No person other than the Adviser and its directors and employees
regularly furnishes advice to the Fund with respect to the desirability of the
Fund's investing in, purchasing or selling securities. The Adviser may from time
to time receive statistical or other similar factual information and information
regarding general economic factors and trends from the Life Insurance Company
and its affiliates.

Under the terms of the investment management contract with the Fund,
the Adviser provides the Fund with office space, supplies and other facilities
required for the business of the Fund. The Adviser pays the compensation of all
other officers and employees of the Fund and pays for clerical services relating
to the administration of the Fund.

All expenses which are not specifically paid by the Adviser and which
are incurred in the operation of the Fund (including fees of Trustees of the
Fund who are not "interested persons," as such term is defined in the Investment
Company Act, but excluding certain distribution related activities required to
be paid by the Adviser or John Hancock Funds), and the continuous public
offering of the shares of the Fund are borne by the Fund. Subject to conditions
set forth in a private letter ruling that the Fund has received from the
Internal Revenue Service relating to its multiple-class structure, class
expenses properly allocable to either Class A shares, Class B shares, or Class C
shares will be borne exclusively by such class of shares. There is no assurance
that this ruling, which favorably resolves certain tax issues, will continue in
effect indefinitely, but the Fund has no reason to believe that the ruling will
be limited in any respect or revoked.

As discussed in the Prospectuses and as provided by the investment
management contract, the Fund pays the Adviser monthly an investment management
fee, which is accrued daily, based on a stated percentage of the average of the
daily net assets of the Fund as follows:

Net Asset Value Annual Rate
First $250,000,000 0.85%
Amount Over $250,000,000 0.80%

From time to time, the Adviser may reduce its fee or make other
arrangements to limit the Fund's expenses to a specified percentage of average
daily net assets. The Adviser retains the right to re-impose a fee and recover
any other payments to the extent that, at the end of any fiscal year, the Fund's
annual expenses fall below this limit.

On October 31, 1994, the net assets of the Fund were $509,726,882. For
the years ended October 31, 1992, 1993 and 1994 the Adviser received a fee of
$239,050 and $1,345,474 and $3,458,972, respectively. These advisory fee figures
reflect the different advisory fee schedule that was in effect before January 1,
1994.

If the total of all ordinary business expenses of the Fund for any
fiscal year exceeds the limitations prescribed in any state in which shares of
the Fund are qualified for sale, the fee payable to the Adviser will be reduced
to the extent required by these limitations. At this time, the most restrictive
limits on expenses imposed by a state requires that expenses charged to the Fund
in any fiscal year not exceed 2 1/2% of the first $30,000,000 of the Fund's
average net assets, 2% of the next $70,000,000 of such net assets, and 1 1/2% of
the remaining average net assets. When calculating the above limit, the Fund may
exclude interest, brokerage commissions and extraordinary expenses.

Pursuant to its investment management contract, the Adviser is not
liable to the Fund or its shareholders for any error of judgment or mistake of
law or for any loss suffered by the Fund in connection with the matters to which
the investment management contract relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on the part of the Adviser in the
performance of its duties or from reckless disregard by the Adviser of its
obligations and duties under the investment management contract.

The Adviser, located at 101 Huntington Avenue, Boston, Massachusetts
02199-7603, was organized in 1968 and presently has approximately $13 billion in
assets under management in its capacity as investment adviser to the Fund and
the other mutual funds and publicly traded investment companies in the John
Hancock group of funds which have a combined total of over 1,060,900
shareholders. The Adviser is an affiliate of the Life Insurance Company, one of
the most recognized and respected financial institutions in the nation. With
total assets under management of $80 billion, the Life Insurance Company is one
of the ten largest life insurance companies in the United States, and carries
S&P's and A.M. Best's highest ratings. Founded in 1862, the Life Insurance
Company has been serving clients for over 130 years.

Under the investment management contract, the Fund may use the name
"John Hancock" or any name derived from or similar to it only for so long as the
contract or any extension, renewal or amendment thereof remains in effect. If
the contract is no longer in effect, the Fund (to the extent permitted by law)
will cease to use such a name or any other name indicating that it is advised by
or otherwise connected with the Adviser. In addition, the Adviser or the Life
Insurance Company may grant the non-exclusive right to use the name "John
Hancock" or any similar name to any other corporation or entity, including but
not limited to any investment company of which the Life Insurance Company or any
subsidiary or affiliate thereof or any successor to the business of any
subsidiary or affiliate thereof shall be the investment adviser.

The investment management contract and the distribution contract
discussed below continue in effect from year to year if approved annually by
vote of a majority of the Fund's Trustees who are not interested persons of one
of the parties to the contract, cast in person at a meeting called for the
purpose of voting on such approval, and by either the Fund's Trustees or the
holders of a majority of the Fund's outstanding voting securities. Each of these
contracts automatically terminates upon assignment. Each contract may be
terminated without penalty on 60 days' notice at the option of either party to
the respective contract or by vote of a majority of the outstanding voting
securities of the Fund.

DISTRIBUTION CONTRACT

The Fund has entered into a distribution contract pertaining to each
class of shares with John Hancock Funds. Under the contract, John Hancock Funds
is obligated to use its best efforts to sell shares of each class on behalf of
the Fund. Shares of the Fund are also sold by selected broker-dealers (the
"Selling Brokers") which have entered into selling agency agreements with John
Hancock Funds. John Hancock Funds accepts orders for the purchase of the shares
of the Fund which are continually offered at net asset value next determined,
plus any applicable sales charge. In connection with the sale of Class A or
Class B shares of the Fund, John Hancock Funds and Selling Brokers receive
compensation in the form of a sales charge imposed, in the case of Class A
shares, at the time of sale or, in the case of Class B shares, on a deferred
basis. The sales charges are discussed further in the Class A and Class B
Prospectus.

Effective January 3, 1994 and July 1, 1993, the Fund amended and
restated the Distribution Plans with respect to Class A and Class B shares (the
"Plans"), respectively, pursuant to Rule 12b-1 under the Investment Company Act.
Under the Class A Plan and the Class B Plan, the Fund pays distribution and
service fees at an aggregate annual rate of 0.30% and 1.00% respectively, of the
Fund's average daily net assets. However, the service fee will not exceed 0.25%
of the Fund's average daily net assets attributable to each class of shares. The
distribution fees reimburse John Hancock Funds for its distribution costs
incurred in the promotion of sales of shares of the Fund, and the service fees
compensate Selling Brokers for providing personal and account maintenance
services to shareholders. The Plans were approved by a majority of the voting
securities of the applicable class of the Fund. The Plans and all amendments
were approved by a majority of the Trustees, including a majority of the
Trustees who are not interested persons of the Fund and who have no direct or
indirect financial interest in the operation of the Plans (the "Independent
Trustees"), by votes cast in person at meetings called for the purpose of voting
on these Plans.

Pursuant to the Plans, at least quarterly, John Hancock Funds provides
the Fund with a written report of the amounts expended under the Plans and the
purpose for which such expenditures were made. The Trustees review such reports
on a quarterly basis.

During the fiscal year ended October 31, 1994 the Funds paid Investor
Services the following amounts of expenses with respect to the Class A shares
and Class B shares of each of the Funds:

<TABLE>
<CAPTION>
Expense Items
Printing and
Mailing of Interest Carrying
Prospectus to New Compensation to Expenses of John or Other Finance
Shareholders Selling Brokers Hancock Funds Charges Other
Advertising
<S> <C> <C> <C> <C> <C>
Special Equities
Class A shares $ 155,247 $ 23,653 $ 357,160 $ 390,984 $ 0
Class B shares 83,612 11,719 1,079,366 206,580 72,202
</TABLE>

Each of the Plans provides that it will continue in effect only as long
as its continuance is approved at least annually by a majority of both the
Trustees and the Independent Trustees. Each of the Plans provides that it may be
terminated without penalty (a) by vote of a majority of the Independent
Trustees, (b) by a vote of a majority of the Fund's outstanding shares of the
applicable class in each upon 60 days' written notice to John Hancock Funds and
(c) automatically in the event of assignment. Each of the Plans further provides
that it may not be amended to increase the maximum amount of the fees for the
services described therein without the approval of a majority of the outstanding
shares of the class of the Fund which has voting rights with respect to the
Plan. And finally, each of the Plans provides that no material amendment to the
Plan will, in any event, be effective unless it is approved by a majority vote
of both the Trustees and the Independent Trustees of the Fund. The holders of
Class A shares and Class B shares have exclusive voting rights with respect to
the Plan applicable to their respective class of shares. In adopting the Plans,
the Trustees concluded that, in their judgment, there is a reasonable likelihood
that each of the Plans will benefit the holders of the applicable class of
shares of the Fund.

Class C shares of the Fund are not subject to any distribution plan.
Expenses associated with the obligation of John Hancock Funds to use its best
efforts to sell Class C shares will be paid by the Adviser or by John Hancock
Funds and will not be paid from the fees paid under Class A or Class B Plans.

When the Fund seeks an Independent Trustee to fill a vacancy or as a
nominee for election by shareholders, the selection or nomination of the
Independent Trustee is, under resolutions adopted by the Trustees
contemporaneously with their adoption of the Plans, committed to the discretion
of the Committee on Administration of the Trustees. The members of the Committee
on Administration are all Independent Trustees and are identified in this
Statement of Additional Information under the caption "Those Responsible for
Management."

<PAGE>

NET ASSET VALUE

For purposes of calculating the net asset value ("NAV") of a Fund's
shares, the following procedures are utilized wherever applicable.

Debt investment securities are valued on the basis of valuations
furnished by a principal market maker or a pricing service, both of which
generally utilize electronic data processing techniques to determine valuations
for normal institutional size trading units of debt securities without exclusive
reliance upon quoted prices.

Equity securities traded on a principal exchange or NASDAQ National
Market Issues are generally valued at last sale price on the day of valuation.
Securities in the aforementioned category for which no sales are reported and
other securities traded over-the-counter are generally valued at the last
available bid price.

Short-term debt investments which have a remaining maturity of 60 days
or less are generally valued at amortized cost which approximates market value.

If market quotations are not readily available or if in the opinion of
the Adviser any quotation or price is not representative of true market value,
the fair value of the security may be determined in good faith in accordance
with procedures approved by the Trustees.

Any assets or liabilities expressed in terms of foreign currencies are
translated into U.S. dollars by the custodian bank based on London currency
exchange quotations as of 5:00 p.m., London time (12:00 noon, New York time) on
the date of any determination of a Fund's NAV.

A Fund will not price its securities on the following national holidays: New
Year's Day; Presidents' Day; Good Friday; Memorial Day; Independence Day; Labor
Day; Thanksgiving Day; and Christmas Day. On any day an international market is
closed and the New York Stock Exchange is open, any foreign securities will be
valued at the prior day's close with the current day's exchange rate. Trading of
foreign securities may take place on Saturdays and U.S. business holidays on
which a Fund's NAV is not calculated. Consequently, a Fund's portfolio
securities may trade and the NAV of the Fund's redeemable securities may be
significantly affected on days when a shareholder has no access to the Fund.

INITIAL SALES CHARGE ON CLASS A SHARES

The sales charges applicable to purchases of Class A shares of the Fund
are described in the Class A and Class B Prospectus. Methods of obtaining
reduced sales charges referred to generally in the Class A and Class B
Prospectus are described in detail below. In calculating the sales charge
applicable to current purchases of Class A shares, the investor is entitled to
cumulate current purchases with the greater of the current value (at offering
price) of the Class A shares of the Fund or, if Investor Services is notified by
the investor's dealer or the investor at the time of the purchase, the cost of
the Class A shares owned.

Combined Purchases. In calculating the sales charge applicable to purchases of
Class A shares made at one time, the purchases will be combined if made by (a)
an individual, his or her spouse and their children under the age of 21
purchasing securities for his or their own account, (b) a trustee or other
fiduciary purchasing for a single trust, estate or fiduciary account and (c)
certain groups of four or more individuals making use of salary deductions or
similar group methods of payment whose funds are combined for the purchase of
mutual fund shares. Further information about combined purchases, including
certain restrictions on combined group purchases, is available from Fund
Services or a Selling Broker's representative.

Without Sales Charge. As described in the Class A and Class B Prospectus, Class
A shares of the Fund may be sold without a sales charge to certain persons
described in the Prospectus.

Accumulation Privilege. Investors (including investors combining purchases) who
are already Class A shareholders may also obtain the benefit of a reduced sales
charge by taking into account not only the amount then being invested but also
the purchase price or value of the Class A shares already held by such person.

Combination Privilege. Reduced sales charges (according to the schedule set
forth in the Class A and Class B Prospectus) also are available to an investor
based on the aggregate amount of his concurrent and prior investments in Class A
shares of the Fund and shares of all other John Hancock funds which carry a
sales charge.

Letter of Intention. The reduced sales charges are also applicable to
investments made over a specified period pursuant to a Letter of Intention (the
"LOI"), which should be read carefully prior to its execution by an investor.
The Fund offers two options regarding the specified period for making
investments under the LOI. All investors have the option of making their
investments over a specified period of thirteen (13) months. Investors who are
using the Fund as a funding medium for a qualified retirement plan, however, may
opt to make the necessary investments called for by the LOI over a forty-eight
(48) month period. These qualified retirement plans include group IRA, SEP,
SARSEP, TSA, 401(k), TSA and 457 plans. Such an investment (including
accumulations and combinations) must aggregate $25,000 or more invested during
the specified period from the date of the LOI or from a date within ninety (90)
days prior thereto, upon written request to Investor Services. The sales charge
applicable to all amounts invested under the LOI is computed as if the aggregate
amount intended to be invested had been invested immediately. If such aggregate
amount is not actually invested, the difference in the sales charge actually
paid and the sales charge payable had the LOI not been in effect is due from the
investor. However, for the purchases actually made within the specified period
(either 13 or 48 months) the sales charge applicable will not be higher than
that which would have applied (including accumulations and combinations) had the
LOI been for the amount actually invested.

The LOI authorizes Investor Services to hold in escrow a number of Class A
shares (approximately 5% of the aggregate) sufficient to make up any difference
in sales charges on the amount intended to be invested and the amount actually
invested, until such investment is completed within the specified period, at
which time the escrowed Class A shares will be released. If the total investment
specified in the LOI is not completed, the Class A shares held in escrow may be
redeemed and the proceeds used as required to pay such sales charge as may be
due. By signing the LOI, the investor authorizes Investor Services to act as his
or her attorney-in-fact to redeem any escrowed Class A shares and adjust the
sales charge, if necessary. A LOI does not constitute a binding commitment by an
investor to purchase, or by the Fund to sell, any additional Class A shares and
may be terminated at any time.

Because Class C shares are sold at net asset value without the
imposition of any sales charge, none of the privileges described under these
captions is available to Class C investors, with the following exception:

Combination Privilege. As is explained in the Prospectus for Class C shares, a
Class C investor may qualify for the minimum $1,000,000 investment (or such
other amount as may be determined by the Fund's officers) if the aggregate
amount of his or her current and prior investments in Class C shares of the Fund
and Class C shares of any other John Hancock fund exceeds $1,000,000.

DEFERRED SALES CHARGE ON CLASS B SHARES

Investments in Class B shares are purchased at net asset value per
share without the imposition of an initial sales charge so that the Fund will
receive the full amount of the purchase payment.

Contingent Deferred Sales Charge. Class B shares which are redeemed within six
years of purchase will be subject to a contingent deferred sales charge ("CDSC")
at the rates set forth in the Class A and Class B Prospectus as a percentage of
the dollar amount subject to the CDSC. The charge will be assessed on an amount
equal to the lesser of the current market value or the original purchase cost of
the Class B shares being redeemed. Accordingly, no CDSC will be imposed on
increases in account value above the initial purchase prices, including increase
in account value shares derived from reinvestment of dividends or capital gains
distributions.

The amount of the CDSC, if any, will vary depending on the number of
years from the time of payment for the purchase of Class B shares until the time
of redemption of such shares. Solely for purposes of determining this number of
years, all payments during a month will be aggregated and deemed to have been
made on the last day of the month.

Proceeds from the CDSC are paid to John Hancock Funds and are used in
whole or in part by John Hancock Funds to defray its expenses related to
providing distribution-related services to the Fund in connection with the sale
of the Class B shares, such as the payment of compensation to select Selling
Brokers for selling Class B shares. The combination of the CDSC and the
distribution and service fees facilitates the ability of the Fund to sell the
Class B shares without a sales charge being deducted at the time of the
purchase. See the Class A and Class B Prospectus for additional information
regarding the CDSC.

SPECIAL REDEMPTIONS

Although it would not normally do so, the Fund has the right to pay the
redemption price of shares of the Fund in whole or in part in portfolio
securities as prescribed by the Trustees. If the shareholder were to sell
portfolio securities received in this fashion, he or she would incur a brokerage
charge. Any such securities would be valued for the purposes of making such
payment at the same value as used in determining net asset value. The Fund has,
however, elected to be governed by Rule 18f-1 under the Investment Company Act.
Under that rule, the Fund must redeem its shares for cash except to the extent
that the redemption payments to any shareholder during any 90-day period would
exceed the lesser of $250,000 or 1% of the Fund's net asset value at the
beginning of such period.

ADDITIONAL SERVICES AND PROGRAMS

Exchange Privilege. As described more fully in the Prospectuses, the Fund
permits exchanges of shares of any class of the Fund for shares of the same
class in any other John Hancock fund offering that class.

Systematic Withdrawal Plan. As described briefly in the Fund's Class A and Class
B Prospectus, the Fund permits the establishment of a Systematic Withdrawal
Plan. Payments under this plan represent proceeds arising from the redemption of
Fund shares. Since the redemption price of Fund shares may be more or less than
the shareholder's cost, depending upon the market value of the securities owned
by the Fund at the time of redemption, the distribution of cash pursuant to this
plan may result in realization of gain or loss for purposes of Federal, state
and local income taxes. The maintenance of a Systematic Withdrawal Plan
concurrently with purchases of additional Class A or Class B shares of the Fund
could be disadvantageous to a shareholder because of the initial sales charge
payable on purchases of Class A shares and the CDSC imposed on redemptions of
Class B shares and because redemptions are taxable events. Therefore, a
shareholder should not purchase Class A or Class B shares at the same time as a
Systematic Withdrawal Plan is in effect. The Fund reserves the right to modify
or discontinue the Systematic Withdrawal Plan of any shareholder on 30 days'
prior written notice to such shareholder or to discontinue the availability of
such plan in the future. The shareholder may terminate the plan at any time by
giving proper notice to Investor Services.

Monthly Automatic Accumulation Program ("MAAP"). This program applies solely to
Class A shares of the Fund and is explained more fully in the Class A and Class
B Prospectus and the Account Privileges Application. The program, as it relates
to automatic investment checks, is subject to the following conditions:

The investments will be drawn on or about the day of the month
indicated.

The privilege of making investments through the Monthly Automatic
Accumulation Program may be revoked by Investor Fund Services without
prior notice if any investment is not honored by the shareholder's
bank. The bank shall be under no obligation to notify the shareholder
as to the nonpayment of any check.

The program may be discontinued by the shareholder either by calling
Investor Services or upon written notice to Investor Services which is
received at least five (5) business days prior to the processing date
of any investment.

Reinvestment Privilege. A shareholder who has redeemed shares of the Fund may,
within 120 days after the date of redemption, reinvest without payment of a
sales charge any part of the redemption proceeds in shares of the same class of
the Fund or in any of the other John Hancock mutual funds, subject to the
minimum investment limit in that fund. The proceeds from the redemption of Class
A shares may be reinvested at net asset value without paying a sales charge in
Class A shares of the Fund or in Class A shares of any of the other John Hancock
mutual funds. If a CDSC was paid upon a redemption, a shareholder may reinvest
the proceeds from such redemption at net asset value in additional shares of the
class from which the redemption was made. The shareholder's account will be
credited with the amount of any CDSC charge upon the prior redemption and the
new shares will continue to be subject to the CDSC. The holding period of the
shares acquired through reinvestment will, for purposes of computing the CDSC
payable upon a subsequent redemption, include the holding period of the redeemed
shares. The Fund may modify or terminate the reinvestment privilege at any time.

A redemption or exchange of shares is a taxable transaction for Federal
income tax purposes even if the reinvestment privilege is exercised, and any
gain or loss realized by a shareholder on the redemption or other disposition of
shares will be treated for tax purposes as described under the caption "Tax
Status."

DESCRIPTION OF THE FUND'S SHARES

The Trustees of the Fund are responsible for the management and
supervision of the Fund. The Declaration of Trust permits the Trustees to issue
an unlimited number of full and fractional shares of beneficial interest of the
Fund without par value. Under the Declaration of Trust, the Trustees have the
authority to create and classify shares of beneficial interest in separate
series, without further action by shareholders. As of the date of this Statement
of Additional Information, the Trustees have not authorized any additional
series other than the Fund, although they may do so in the future. The
Declaration of Trust also authorizes the Trustees to classify and reclassify the
shares of the Fund, or any new series of the Fund, into one or more classes. As
of the date of this Statement of Additional Information, the Trustees have
authorized the issuance of three classes of shares of the Fund, designated as
Class A, Class B, and Class C.

The shares of each class of the Fund represent an equal proportionate
interest in the aggregate net assets attributable to that class of the Fund.
Class A shares and Class B shares of the Fund will be sold exclusively to
members of the public (other than the institutional investors described in the
Class A and Class B Prospectus) at net asset value. A sales charge will be
imposed either at the time of the purchase, for Class A shares, or on a
contingent deferred basis, for Class B shares. For Class A shares, no sales
charge is payable at the time of purchase on investments of $1 million or more,
but for such investments a contingent deferred sales charge may be imposed in
the event of certain redemption transactions within one year of purchase.

Class C shares of the Fund are offered only to certain institutional
investors as described in the Fund's Prospectuses. Some individual investors who
are currently eligible to purchase Class A and Class B shares may also be
participants in "participant-directed plans" (as defined in the Prospectuses)
that are eligible to purchase Class C shares. Investors eligible to purchase
Class C shares of the Fund after the date of this Statement of Additional
Information will not be eligible to purchase Class A shares or Class B shares of
the Fund.

Holders of Class A shares and Class B shares have certain exclusive
voting rights on matters relating to their respective distribution plans.
Holders of Class C shares have no voting rights with respect to the Class A or
Class B distribution plans. The different classes of the Fund may bear different
expenses relating to the cost of holding shareholder meetings necessitated by
the exclusive voting rights of any class of shares.

Dividends paid by the Fund, if any, with respect to each class of
shares will be calculated in the same manner, at the same time and will be in
the same amount, except that (i) the distribution and service fees relating to
Class A and Class B shares will be borne exclusively by that class, (ii) Class B
shares will pay higher distribution and service fees than Class A shares and
(iii) each of Class A shares, Class B shares and Class C shares will bear any
other class expenses properly allocable to such class of shares, subject to the
conditions set forth in a private letter ruling that the Fund has received from
the Internal Revenue Service relating to its multiple-class structure.
Accordingly, it is expected that the net asset value per share of the Fund's
Class C shares will be higher than the net asset value per share of the Fund's
Class A shares and Class B shares, each of which has a Rule 12b-1 distribution
plan and sales load. Similarly, the net asset value per share may vary depending
on whether Class A shares or Class B shares are purchased.

In the event of liquidation, shareholders are entitled to share pro
rata in the net assets of the Fund available for distribution to such
shareholders. Shares entitle their holders to one vote per share, are freely
transferable and have no preemptive, subscription or conversion rights. When
issued, shares are fully paid and non-assessable except as set forth in the
Prospectuses.

Unless otherwise required by the Investment Company Act or the
Declaration of Trust, the Fund has no intention of holding annual meetings of
shareholders. Fund shareholders may remove a Trustee by the affirmative vote of
at least two-thirds of the Fund's outstanding shares and the Trustees shall
promptly call a meeting for such purpose when requested to do so in writing by
the record holders of not less than 10% of the outstanding shares of the Fund.
Shareholders may, under certain circumstances, communicate with other
shareholders in connection with a request for a special meeting of shareholders.
However, at any time that less than a majority of the Trustees holding office
were elected by the shareholders, the Trustees will call a special meeting of
shareholders for the purpose of electing Trustees.

Under Massachusetts law, shareholders of a Massachusetts business trust
could, under certain circumstances, be held personally liable for acts or
obligations of the trust. However, the Fund's Declaration of Trust contains an
express disclaimer of shareholder liability for acts, obligations and affairs of
the Fund. The Declaration of Trust also provides for indemnification out of the
Fund's assets for all losses and expenses of any shareholder held personally
liable by reason of being or having been a shareholder. Liability is therefore
limited to circumstances in which the Fund itself would be unable to meet its
obligations, and the possibility of this occurrence is remote.

TAX STATUS

The Fund has qualified and has elected to be treated as a "regulated
investment company" under Subchapter M of the Internal Revenue Code of 1986, as
amended (the "Code") and intends to continue to so qualify in the future. As
such and by complying with the applicable provisions of the Code regarding the
sources of its income, the timing of its distributions, and the diversification
of its assets, the Fund will not be subject to Federal income tax on taxable
income (including net realized capital gains, if any) which is distributed to
shareholders at least annually.

The Fund will be subject to a 4% nondeductible Federal excise tax on
certain amounts not distributed (and not treated as having been distributed) on
a timely basis in accordance with annual minimum distribution requirements. The
Fund intends under normal circumstances to avoid liability for such tax by
satisfying such distribution requirements.

Distributions from the Fund's current or accumulated earnings and
profits ("E & P") as computed for Federal income tax purposes, will be taxable
as described in the Prospectuses whether taken in shares or in cash.
Distributions, if any, in excess of E & P will constitute a return of capital,
which will first reduce an investor's tax basis in Fund shares and thereafter
(after such basis is reduced to zero) will generally give rise to capital gains.
Shareholders electing to receive distributions in the form of additional shares
will have a cost basis for Federal income tax purposes in each share so received
equal to the amount of cash they would have received had they elected to receive
the distribution in cash, divided by the number of shares received.

The amount of net short-term and long-term capital gains, if any, in
any given year will vary depending upon the Adviser's current investment
strategy and whether the Adviser believes it to be in the best interest of the
Fund to dispose of portfolio securities that will generate capital gains. At the
time of an investor's purchase of shares of the Fund, a portion of the purchase
price is often attributable to realized or unrealized appreciation in the Fund's
portfolio or undistributed taxable income of the Fund. Consequently subsequent
distributions from such appreciation or income may be taxable to such investor
even if the net asset value of the investor's shares is, as a result of the
distributions, reduced below the investor's cost for such shares, and the
distributions in reality represent a portion of the purchase price.

Upon a redemption of shares (including by exercise of the exchange
privilege) a shareholder may realize a taxable gain or loss depending upon his
basis in his shares. Such gain or loss will be treated as capital gain or loss
if the shares are capital assets in the shareholder's hands and will be
long-term or short-term, depending upon the shareholder's holding period for the
shares. A sales charge paid in purchasing Class A shares of the Fund cannot be
taken into account for purposes of determining gain or loss on the redemption or
exchange of such shares within 90 days after their purchase to the extent Class
A shares of the Fund or another John Hancock fund are subsequently acquired
without payment of a sales charge pursuant to the reinvestment or exchange
privilege. Such disregarded charge will result in an increase in the
shareholder's tax basis in the Class A shares subsequently acquired. Also, any
loss realized on a redemption or exchange will be disallowed to the extent the
shares disposed of are replaced within a period of 61 days beginning 30 days
before and ending 30 days after the shares are disposed of, such as pursuant to
the Dividend Reinvestment Plan. In such a case, the basis of the shares acquired
will be adjusted to reflect the disallowed loss. Any loss realized upon the
redemption of shares with a tax holding period at the time of redemption of six
months or less will be treated as a long-term capital loss to the extent of any
amounts treated as distributions of long-term capital gain with respect to such
shares.

Although its present intention is to distribute all net short-term and
long-term capital gain, if any, the Fund reserves the right to retain and
reinvest all or any portion of its "net capital gain", which is the excess, as
computed for Federal income tax purposes, of net long-term capital gain over net
short-term capital loss in any year. The Fund will not in any event distribute
net long-term capital gains realized in any year to the extent that a capital
loss is carried forward from prior years against such gain. To the extent such
excess was retained and not exhausted by the carryforward of prior years'
capital losses, it would be subject to Federal income tax in the hands of the
Fund. Each shareholder would be treated for Federal income tax purposes as if
the Fund had distributed to him on the last day of its taxable year his pro rata
share of such excess, and he had paid his pro rata share of the taxes paid by
the Fund and reinvested the remainder in the Fund. Accordingly, each shareholder
would (a) include his pro rata share of such excess as long-term capital gain
income in his return for his taxable year in which the last day of the Fund's
taxable year falls, (b) be entitled either to a tax credit on his return for, or
to a refund of, his pro rata share of the taxes paid by the Fund, and (c) be
entitled to increase the adjusted tax basis for his shares in the Fund by the
difference between his pro rata share of such excess and his pro rata share of
such taxes.

For Federal income tax purposes, the Fund is permitted to carry forward
a net realized capital loss in any year to offset net realized capital gains, if
any, during the eight years following the year of the loss. To the extent
subsequent net realized capital gains are offset by such losses, they would not
result in Federal income tax liability to the Fund and, as noted above, would
not be distributed as such to shareholders. The Fund has $26,020,140 of capital
loss carryforwards available, to the extent provided by regulation, to offset
future net capital gains. The carry- forwards expire as follows: October 31,
2001 - $5,311,412 and October 21, 2002 - $20,708,728.

Different tax treatment, including penalties on certain excess
contributions and deferrals, certain pre-retirement and post-retirement
distributions and certain prohibited transactions, is accorded to accounts
maintained as qualified retirement plans. Shareholders should consult their tax
advisers for more information.

For purposes of the dividends received deduction available to
corporations, dividends received by the Fund, if any, from U.S. domestic
corporations in respect of the stock of such corporations held by the Fund, for
U.S. Federal income tax purposes, for at least 46 days (91 days in the case of
certain preferred stock) and distributed and designated by the Fund may be
treated as qualifying dividends. Corporate shareholders must meet the minimum
holding period requirement stated above (46 or 91 days) with respect to their
shares of the Fund in order to qualify for the deduction and, if they borrow to
acquire such shares, may be denied a portion of the dividends received
deduction. The entire qualifying dividend, including the otherwise-deductible
amount, will be included in determining the excess (if any) of a corporate
shareholder's adjusted current earnings over its alternative minimum taxable
income, which may increase its alternative minimum tax liability. Additionally,
any corporate shareholder should consult its tax adviser regarding the
possibility that its basis in its shares may be reduced, for Federal income tax
purposes, by reason of "extraordinary dividends" received with respect to the
shares, for the purpose of computing its gain or loss on redemption or other
disposition of the shares.

The foregoing discussion relates solely to U.S. Federal income tax law
as applicable to U.S. persons (i.e., U.S. citizens or residents and U.S.
domestic corporations, partnerships, trusts or estates) subject to tax under
such law. The discussion does not address special tax rules applicable to
certain classes of investors, such as tax-exempt entities, insurance companies
and financial institutions. Dividends, capital gain distributions, and ownership
of or gains realized on the redemption (including an exchange) of shares of the
Fund may also be subject to state and local taxes. Shareholders should consult
their own tax advisers as to the Federal, state or local tax consequences of
ownership of shares of the Fund in particular circumstances.

Non-U.S. investors not engaged in a U.S. trade or business with which
their Fund investment is effectively connected will be subject to U.S. Federal
income tax treatment that is different from that described above. These
investors may be subject to non-resident alien withholding at the rate of 30%
(or a lower rate under an applicable tax treaty) on amounts treated as ordinary
dividends from the Fund and, unless an affective IRS Form W-8 or authorized
substitute is on file, 31% backup withholding on certain other payments from the
Fund. Non-U.S. investors should consult their tax advisers regarding such
treatment and the application of foreign taxes to an investment in the Fund.

The Fund is not subject to Massachusetts corporate excise or franchise
taxes. Provided that the Fund qualifies as a regulated investment company under
the Code, it will also not be required to pay Massachusetts income tax.

CALCULATION OF PERFORMANCE

The average annual total return on Class A shares of the Fund for the 1
year, 5 year and life-of-fund periods ended October 31, 1994 was (7.96) %,
18.51%, and 13.91%, respectively, and reflect payment of the maximum sales
charge of 5.00%.

The average annual total return on Class B shares of the Fund for the 1
year ended October 31, 1994 and shares inception on March 1, 1993 was (8.45)%
and 11.66%, respectively and reflects the applicable contingent deferred sales
charge. The average annual total return on Class C shares of the Fund for the 1
year and since inception on September 1, 1993 was 0.37% and 7.41%, respectively.

The Fund's total return is computed by finding the average
annual compounded rate of return over the 1 year, 5 year and life-of-fund
periods that would equate the initial amount invested to the ending redeemable
value according to the following formula:

[GRAPHIC OMITTED]

Where:

P = a hypothetical initial investment of $1,000.

T = average annual total return.

n = number of years.

ERV = ending redeemable value of a hypothetical $1,000 investment made at the
beginning of the 1 year and life-of-fund periods.

This calculation assumes that all dividends and distributions are
reinvested at net asset value on the reinvestment dates during the period.

In the case of Class A shares or Class B shares, this calculation
assumes the maximum sales charge is included in the initial investment or the
CDSC applied at the end of the period. This calculation also assumes that all
dividends and distributions are reinvested at net asset value on the
reinvestment dates during the period.

The "distribution rate" is determined by annualizing the result of
dividing the declared dividends of the Fund during the period stated by the
maximum offering price or net asset value at the end of the period. Excluding
the Fund's sales load from the distribution rate produces a higher rate.

In addition to average annual total returns, the Fund may quote
unaveraged or cumulative total returns reflecting the simple change in value of
an investment over a stated period. Cumulative total returns may be quoted as a
percentage or as a dollar amount, and may be calculated for a single investment,
a series of investments, and/or a series of redemptions, over any time period.
Total returns may be quoted with or without taking the Fund's 5.0% sales charge
on Class A shares or the CDSC on Class B shares into account. Excluding the
Fund's sales charge on Class A shares and the CDSC on Class B shares from a
total return calculation produces a higher total return figure.

From time to time, in reports and promotional literature, the Fund's
total return will be ranked or compared to indices of mutual funds such as
Lipper Analytical Services, Inc.'s "Lipper -Mutual Performance Analysis," a
monthly publication which tracks net assets, total return, and yield on more
than 1,000 equity mutual funds in the United States. Ibottson and Associates,
CDA Weisenberger and F.C. Towers are also used for comparison purposes, as well
as the Russell and Wilshire Indices.

Performance rankings and ratings reported periodically in national
financial publications such as Money Magazine, Forbes, Business Week, The Wall
Street Journal, Micropal, Inc. Morningstar, Barron's, and Stanger's and may also
be utilized.

The performance of the Fund is not fixed or guaranteed. Performance
quotations should not be considered to be representations of performance of the
Fund for any period in the future. The performance of the Fund is a function of
many factors including its earnings, expenses and number of outstanding shares.
Fluctuating market conditions; purchases, sales and maturities of portfolio
securities; sales and redemptions of shares of beneficial interest; and changes
in operating expenses are all examples of items that can increase or decrease
the Fund's performance.

BROKERAGE ALLOCATION

Decisions concerning the purchase and sale of portfolio securities of
the Fund are made by officers of the Fund pursuant to recommendations made by an
investment committee of the Adviser, which consists of officers and directors of
the Adviser and officers and Trustees who are interested persons of the Fund.
Orders for purchases and sales of securities are placed in a manner, which, in
the opinion of the officers of the Fund, will offer the best price and market
for the execution of each such transaction. Purchases from underwriters of
portfolio securities may include a commission or commissions paid by the issuer,
and transactions with dealers serving as market maker reflect a "spread." Debt
securities are generally traded on a net basis through dealers acting for their
own account as principals and not as brokers; no brokerage commissions are
payable on such transactions.

The Fund's primary policy is to execute all purchases and sales of
portfolio instruments at the most favorable prices consistent with best
execution, considering all of the costs of the transaction including brokerage
commissions. This policy governs the selection of brokers and dealers and the
market in which a transaction is executed. Consistent with the foregoing primary
policy, the Rules of Fair Practice of the National Association of Securities
Dealers, Inc. and such other policies as the Trustees may determine, the Adviser
may consider sales of shares of the Fund as a factor in the selection of
broker-dealers to execute the Fund's portfolio transactions.

To the extent consistent with the foregoing, the Fund will be governed
in the selection of brokers and dealers and the negotiation of brokerage
commission rates and dealer spreads by the reliability and quality of the
services, including primarily the availability and value of research information
and, to a lesser extent, statistical assistance furnished to the Adviser of the
Fund and their value and expected contribution to the performance of the Fund.
It is not possible to place a dollar value on information and services to be
received from brokers and dealers, since it is only supplementary to the
research efforts of the Adviser. The receipt of research information is not
expected to reduce significantly the expenses of the Adviser. The research
information and statistical assistance furnished by brokers and dealers may
benefit the Life Insurance Company or other advisory clients of the Adviser,
and, conversely, brokerage commissions and spreads paid by other advisory
clients of the Adviser may result in research information and statistical
assistance beneficial to the Fund. The Fund will make no commitment to allocate
portfolio transactions upon any prescribed basis. While the Adviser will be
primarily responsible for the allocation of the Fund's brokerage business, the
policies and practices of the Adviser in this regard must be consistent with the
foregoing and will at all times be subject to review by the Trustees. For the
years ended on October 31, 1994, 1993, and 1992 the Fund paid negotiated
brokerage commissions of 305.789, $273,700 and $72,562, respectively.

As permitted by Section 28(e) of the Securities Exchange Act of 1934,
the Fund may pay a broker which provides brokerage and research services to the
Fund an amount of disclosed commission in excess of the commission which another
broker would have charged for effecting that transaction. This practice is
subject to a good faith determination by the Trustees that such price is
reasonable in light of the services provided and to such policies as the
Trustees may adopt from time to time. During the fiscal year ended October 31,
1994, the Fund paid no commissions to compensate brokers for research services
such as industry and company reviews and evaluations of the securities.

The Adviser's indirect parent, the Life Insurance Company, is the
indirect sole shareholder of John Hancock Freedom Securities Corporation and its
subsidiaries, three of which, Tucker Anthony Incorporated, John Hancock
Distributors, Inc. and Sutro & Company, Inc. are broker-dealers ("Affiliated
Brokers"). Pursuant to procedures determined by the Trustees and consistent with
the above policy of obtaining best net results, the Fund may execute portfolio
transactions with or through Affiliated Brokers. During the year ended October
31, 1994, the Fund did not execute any portfolio transactions with Affiliated
Brokers.

Any of the Affiliated Brokers may act as broker for the Fund on
exchange transactions, subject, however, to the general policy of the Fund set
forth above and the procedures adopted by the Trustees pursuant to the
Investment Company Act. Commissions paid to an Affiliated Broker must be at
least as favorable as those which the Trustees believe to be contemporaneously
charged by other brokers in connection with comparable transactions involving
similar securities being purchased or sold. A transaction would not be placed
with an Affiliated Broker if the Fund would have to pay a commission rate less
favorable than the Affiliated Broker's contemporaneous charges for comparable
transactions for its other most favored, but unaffiliated, customers, except for
accounts for which the Affiliated Broker acts as clearing broker for another
brokerage firm, and any customers of the Affiliated Broker not comparable to the
Fund as determined by a majority of the Trustees who are not interested persons
(as defined in the Investment Company Act) of the Fund, the Adviser or the
Affiliated Broker. Because the Adviser, which is affiliated with the Affiliated
Brokers, has, as an investment adviser to the Fund, the obligation to provide
investment management services, which includes elements of research and related
investment skills, such research and related skills will not be used by the
Affiliated Broker as a basis for negotiating commissions at a rate higher than
that determined in accordance with the above criteria. The Fund will not effect
principal transactions with Affiliated Brokers.

TRANSFER AGENT SERVICES

Investor Services, P.O. Box 9116, Boston, MA 02205-9116, a wholly-owned
indirect subsidiary of the Life Insurance Company, is the transfer and dividend
paying agent for the Fund. The Fund pays Investor Services an annual fee for
Class A of $16.00 per shareholder account and for Class B shares of $18.50 and
the 0.10% of the average daily net assets attributable to the Class C shares,
plus certain out-of-pocket expenses.

CUSTODY OF PORTFOLIO

Portfolio securities of the Fund are held pursuant to a custodian
agreement between the Fund and Investors Bank & Trust Company, 24 Federal
Street, Boston, Massachusetts 02110. Under the custodian agreement, Investors
Bank & Trust Company performs custody, portfolio and Fund accounting services.

INDEPENDENT AUDITORS

The independent auditors of the Fund are Ernst & Young LLP, 200
Clarendon Street, Boston, Massachusetts 02116. Ernst & Young LLP audits and
renders an opinion of the Fund's annual financial statements and prepares the
Fund's annual Federal income tax return.
<PAGE>

FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

THE STATEMENT OF ASSETS AND LIABILITIES IS THE FUND'S BALANCE SHEET AND SHOWS
THE VALUE OF WHAT THE FUND OWNS, IS DUE AND OWES ON OCTOBER 31, 1994. YOU'LL
ALSO FIND THE NET ASSET VALUE AND THE MAXIMUM OFFERING PRICE PER SHARE AS OF
THAT DATE.

STATEMENT OF ASSETS AND LIABILITIES
October 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments at value - Note C:
Common stocks (cost - $357,304,227)...................................... $478,435,165
Short-term notes - (cost - $25,996,542).................................. 25,996,542
Joint repurchase agreement (cost - $18,513,000).......................... 18,513,000
Corporate savings account................................................ 24,514
------------
522,969,221
Receivable for shares sold................................................. 294,704
Receivable for investments sold............................................ 8,703,352
Interest receivable........................................................ 2,488
Dividends receivable....................................................... 12,937
------------
Total Assets........................................ 531,982,702
--------------------------------------------------------------------
LIABILITIES:
Payable for shares repurchased............................................. 287,224
Payable for investments purchased.......................................... 21,382,487
Payable to John Hancock Advisers, Inc. and affiliates - Note B............. 507,937
Accounts payable and accrued expenses...................................... 78,172
------------
Total Liabilities................................... 22,255,820
--------------------------------------------------------------------
NET ASSETS:
Capital paid-in............................................................ 414,616,084
Accumulated net realized loss on investments............................... ( 26,020,140)
Net unrealized appreciation of investments................................. 121,130,938
------------
Net Assets.......................................... $509,726,882
====================================================================

NET ASSET VALUE PER SHARE:
(Based on net asset values and shares of beneficial interest outstanding
- unlimited number of shares authorized with no par value)
Class A - $310,625,109/19,287,318.......................................... $ 16.11
===========================================================================================
Class B - $191,979,121/12,021,618.......................................... $ 15.97
===========================================================================================
Class C - $7,122,652/439,601............................................... $ 16.20
===========================================================================================
MAXIMUM OFFERING PRICE PER SHARE*
Class A - ($16.11 x 105.26%)............................................... $ 16.96
===========================================================================================
</TABLE>

* On single retail sales of less than $50,000. On sales of $50,000 or more and
on group sales the offering price is reduced.

THE STATEMENT OF OPERATIONS SUMMARIZES THE FUND'S INVESTMENT INCOME EARNED AND
EXPENSES INCURRED IN OPERATING THE FUND. IT ALSO SHOWS NET GAINS (LOSSES) FOR
THE PERIOD STATED.

STATEMENT OF OPERATIONS
Year ended October 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest................................................................... $ 672,928
Dividends.................................................................. 288,263
-----------
961,191
-----------
EXPENSES:
Investment management fee - Note B......................................... 3,458,972
Distribution/service fee - Note B
Class A.................................................................. 927,044
Class B.................................................................. 1,453,478
Transfer agent fee - Note B
Class A.................................................................. 1,109,779
Class B.................................................................. 649,884
Class C.................................................................. 10,679
Registration and filing fees............................................... 122,288
Custodian fee.............................................................. 98,349
Printing................................................................... 57,452
Trustees' fees............................................................. 40,744
Auditing fee............................................................... 40,700
Legal fees................................................................. 26,711
Miscellaneous.............................................................. 21,957
Administration fee - Note B................................................ 16,614
-----------
Total Expenses...................................... 8,034,651
-------------------------------------------------------------------
Net Investment Loss................................. ( 7,073,460)
-------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on investments sold...................................... ( 20,708,728)
Change in net unrealized appreciation/depreciation
of investments........................................................... 29,140,783
-----------
Net Realized and Unrealized
Gain on Investments................................. 8,432,055
-------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations........................... $ 1,358,595
===================================================================
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>
FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------
1994 1993
------------ ------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment loss............................................................................. ($ 7,073,460) ($ 3,063,309)
Net realized loss on investments sold........................................................... ( 20,708,728) ( 5,311,803)
Change in net unrealized appreciation/depreciation of investments............................... 29,140,783 81,983,208
------------ ------------
Net Increase in Net Assets Resulting from Operations.......................................... 1,358,595 73,608,096
------------ ------------

DISTRIBUTIONS TO SHAREHOLDERS:
Distributions from net realized gain on investments sold Class A -
(none and $0.0904 per share, respectively)................................................... -- ( 439,749)
------------ ------------
FROM FUND SHARE TRANSACTIONS - NET*............................................................... 50,457,201 340,077,476
------------ ------------

NET ASSETS:
Beginning of period............................................................................. 457,911,086 44,665,263
------------ ------------
End of period................................................................................... $509,726,882 $457,911,086
============ ============
</TABLE>

* ANALYSIS OF FUND SHARE TRANSACTIONS:

<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------------------------------
1994 1993
-------------------------- ----------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------ ------------ ------------
<S> <C> <C> <C> <C>

CLASS A
Shares sold....................................................... 15,399,407 $233,394,230 21,646,464 $301,131,885
Shares issued to shareholders in reinvestment of distributions.... -- -- 33,860 424,609
---------- ------------ ------------ ------------
15,399,407 233,394,230 21,680,324 301,556,494
Less shares repurchased........................................... (14,507,334) ( 219,847,278) ( 7,348,574) ( 104,184,010)
---------- ------------ ------------ ------------
Net increase...................................................... 892,073 $ 13,546,952 14,331,750 $197,372,484
========== ============ ============ ============

CLASS B**
Shares sold....................................................... 4,220,733 $ 63,417,649 10,375,087 $147,612,441
Less shares repurchased........................................... ( 2,043,273) ( 30,587,828) ( 530,929) ( 7,666,497)
---------- ------------ ------------ ------------
Net increase...................................................... 2,177,460 $ 32,829,821 9,844,158 $139,945,944
========== ============ ============ ============
CLASS C***
Shares sold....................................................... 318,075 $ 4,881,336 175,931 $ 2,759,048
Less shares repurchased........................................... ( 54,405) ( 800,908) -- --
---------- ------------ ------------ ------------
Net increase...................................................... 263,670 $ 4,080,428 175,931 $ 2,759,048
========== ============ ============ ============
</TABLE>
** Class B shares commenced operations on March 1, 1993.
*** Class C shares commenced operations on September 1, 1993.

THE STATEMENT OF CHANGES IN NET ASSETS SHOWS HOW THE VALUE OF THE FUND'S NET
ASSETS HAS CHANGED SINCE THE END OF THE PREVIOUS YEAR. THE DIFFERENCE REFLECTS
EARNINGS LESS EXPENSES, ANY INVESTMENT GAINS AND LOSSES, DISTRIBUTIONS PAID TO
SHAREHOLDERS, AND ANY INCREASE OR DECREASE IN MONEY SHAREHOLDERS INVESTED IN THE
FUND. THE FOOTNOTE ILLUSTRATES THE NUMBER OF FUND SHARES SOLD, REINVESTED AND
REDEEMED DURING THE LAST TWO PERIODS, ALONG WITH THE CORRESPONDING DOLLAR VALUE.

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>
FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated, investment returns, key ratios and supplemental data are
listed as follows:
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
------------------------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
CLASS A
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Period...................... $ 16.13 $ 10.99 $ 9.71 $ 4.97 $ 6.38
-------- -------- ------- ------- -------
Net Investment Loss (a)................................... (0.21)(b) ( 0.20)(b) ( 0.19)(b) ( 0.10) ( 0.12)
Net Realized and Unrealized Gain (Loss) on Investments.... 0.19 5.43 2.14 4.84 ( 1.27)
-------- -------- ------- ------- -------
Total from Investment Operations........................ ( 0.02) 5.23 1.95 4.74 ( 1.39)
-------- -------- ------- ------- -------
Less Distributions:
Dividends from Net Investment Income...................... -- -- -- -- ( 0.02)
Distributions from Net Realized Gain on Investments Sold.. -- ( 0.09) ( 0.67) -- --
-------- -------- ------- ------- -------
Total Distributions..................................... -- ( 0.09) ( 0.67) -- ( 0.02)
-------- -------- ------- ------- -------
Net Asset Value, End of Period............................ $ 16.11 $ 16.13 $ 10.99 $ 9.71 $ 4.97
======== ======== ======= ======= =======
Total Investment Return at Net Asset Value (a)............ ( 0.12%) 47.83% 20.25% 95.37% ( 21.89%)

RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (000's omitted)................. $310,625 $296,793 $44,665 $19,713 $ 8,166
Ratio of Expenses to Average Net Assets (a)............... 1.62% 1.84% 2.24% 2.75% 2.63%
Ratio of Net Investment Loss to Average Net Assets (a).... ( 1.40%) ( 1.49%) ( 1.91%) ( 2.12%) ( 1.58%)
Portfolio Turnover Rate................................... 66% 33% 114% 163% 113%

CLASS B (c)
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Period...................... $ 16.08 $ 12.30
-------- --------
Net Investment Loss....................................... ( 0.30)(b) ( 0.18)(b)
Net Realized and Unrealized Gain (Loss) on Investments.... 0.19 3.96
-------- --------
Total from Investment Operations........................ ( 0.11) 3.78
-------- --------
Net Asset Value, End of Period............................ $ 15.97 $ 16.08
======== ========
Total Investment Return at Net Asset Value................ ( 0.68%) 30.73%(d)

RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (000's omitted)................. $191,979 $158,281
Ratio of Expenses to Average Net Assets................... 2.25% 2.34%*
Ratio of Net Investment Loss to Average Net Assets........ ( 2.02%) ( 2.03%)*
Portfolio Turnover Rate................................... 66% 33%
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>
FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
------------------------
1994 1993
------ ------
<S> <C> <C>
CLASS C (e)
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Period.......................... $16.14 $14.90
------ ------
Net Investment Loss........................................... ( 0.13)(b) ( 0.03)(b)
Net Realized and Unrealized Gain (Loss) on Investments........ 0.19 1.27
------ ------
Total from Investment Operations............................ 0.06 1.24
------ ------
Net Asset Value, End of Period................................ $16.20 $16.14
====== ======
Total Investment Return at Net Asset Value.................. 0.37% 8.32%(d)

RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (000's omitted)..................... $7,123 $2,838
Ratio of Expenses to Average Net Assets....................... 1.11% 1.45%*
Ratio of Net Investment Loss to Average Net Assets............ ( 0.89%) ( 1.35%)*
Portfolio Turnover Rate....................................... 66% 33%
</TABLE>

* On an annualized basis.

(a) Reflects expense limitation in effect during the years ended October 31,
1990 through 1991 (see Note B). As a result of such limitations, expenses of
the Fund for the years ended October 31, 1991 and 1990 reflect reductions of
$.002 and $.02, respectively. Absent of such limitations, for the years
ended October 31, 1991 and 1990 the ratio of net expenses would have been
2.79% and 2.95%, respectively, and the ratio of net investment loss to
average net assets would have been (2.16%) and (1.90%), respectively.
Without the limitation, total investment return would be lower.
(b) On average month end shares outstanding.
(c) Class B shares commenced operations on March 1, 1993.
(d) Not annualized.
(e) Class C shares commenced operations on September 1, 1993.

THE FINANCIAL HIGHLIGHTS SUMMARIZES THE IMPACT OF THE FOLLOWING FACTORS ON A
SINGLE SHARE FOR THE PERIOD INDICATED: INCOME, EXPENSES, DISTRIBUTIONS AND GAINS
(LOSSES) OF THE FUND. IT SHOWS HOW THE FUND'S NET ASSET VALUE FOR A SHARE HAS
CHANGED SINCE THE END OF THE PREVIOUS PERIOD. ADDITIONALLY, IMPORTANT
RELATIONSHIPS BETWEEN SOME ITEMS PRESENTED IN THE FINANCIAL STATEMENTS ARE
EXPRESSED IN RATIO FORM.

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>
FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

SCHEDULE OF INVESTMENTS
October 31, 1994
- -------------------------------------------------------------------------------

THE SCHEDULE OF INVESTMENTS IS A COMPLETE LIST OF ALL SECURITIES OWNED BY THE
SPECIAL EQUITIES FUND ON OCTOBER 31, 1994. IT'S DIVIDED INTO TWO MAIN
CATEGORIES: COMMON STOCKS AND SHORT-TERM INVESTMENTS. COMMON STOCKS ARE FURTHER
BROKEN DOWN BY INDUSTRY GROUP. SHORT-TERM INVESTMENTS, WHICH REPRESENT THE
FUND'S "CASH" POSITION, ARE LISTED LAST.

<TABLE>
<CAPTION>
MARKET
ISSUER, DESCRIPTION NUMBER OF SHARES VALUE
- ------------------- ---------------- ------------
<S> <C> <C>
COMMON STOCKS
APPLIANCES - HOUSEHOLD (0.77%)
Fedders Corp. **.......................... 475,000* $ 2,850,000
Fedders Corp. (Class A) **................ 237,500* 1,068,750
------------
3,918,750
------------
BROADCASTING (2.50%)
Infinity Broadcasting Corp. (Class A) **.. 425,000 12,750,000
------------
COMPUTERS (17.51%)
Adaptec, Inc. **.......................... 600,000 13,950,000
America Online, Inc. **................... 250,000 17,687,500
Avid Technology, Inc. **.................. 70,000* 2,625,000
BMC Software, Inc. **..................... 200,000* 9,050,000
C-Cube Microsystems, Inc. **.............. 250,000* 5,312,500
Digidesign Inc. **........................ 275,000* 7,700,000
Electronics for Imaging, Inc. **.......... 200,000* 5,200,000
In Focus Systems, Inc. **................. 280,000* 7,280,000
Microtouch Systems, Inc. **............... 70,000* 3,920,000
Seagate Technology, Inc. **............... 300,000 7,612,500
Softkey International, Inc. **............ 420,000* 7,822,500
Wonderware Corp. **....................... 45,000* 1,125,000
------------
89,285,000
------------
DRUGS (1.44%)
Elan Corp. , PLC, American Depository
Receipt (ADR) **.......................... 200,000* 7,375,000
------------
ELECTRONICS (10.97%)
Altera Corp. **........................... 150,000* 5,906,250
Atmel Corp. **............................ 200,000* 7,375,000
Cypress Semiconductor Corp. **............ 350,000* 7,306,250
Electroglas, Inc. **...................... 230,000* 9,142,500
Fusion Systems Corp. **................... 210,000* 7,192,500
Home Theater Products International,
Inc. **................................. 200,000* 1,181,240
Linear Technology Corp.................... 100,000* 4,800,000
Novellus Systems, Inc. ** ................ 150,000* 8,175,000
X-Rite, Inc............................... 45,000* 1,631,250
Xilinx, Inc. **........................... 55,000* 3,190,000
------------
55,899,990
------------
FINANCE (0.47%)
First USA, Inc............................ 68,600 2,418,150
------------
FINANCIAL/BUSINESS SERVICES (1.64%)
Franklin Quest Co. **..................... 236,400* 8,362,650
------------
HEALTHCARE (12.59%)
Conventry Corp. **........................ 400,000 9,900,000
Gencare Health Systems, Inc. **........... 162,500 7,515,625
Health Management Systems, Inc. **........ 150,000* 4,162,500
Healthsource, Inc. **..................... 381,200 14,771,500
Lincare Holdings, Inc. **................. 250,000* 6,687,500
Mid Atlantic Medical Services **.......... 600,000* 13,875,000
Quantum Health Resources, Inc............. 200,000* 7,250,000
------------
64,162,125
------------
HOTELS & MOTELS (0.68%)
Rio Hotel and Casino, Inc. **............. 270,000 3,476,250
------------
LEISURE & RECREATION (6.01%)
Cobra Golf, Inc. **....................... 640,000 23,680,000
Scientific Games Holdings Corp. **........ 157,500 6,930,000
------------
30,610,000
------------
MEDICAL/DENTAL (1.72%)
Acuson Corp. **........................... 350,000* 6,431,250
Hologic, Inc. **.......................... 150,000* 2,343,750
------------
8,775,000
------------
OFFICE EQUIPMENT & SUPPLIES (6.74%)
Office Depot, Inc. **..................... 525,000 12,993,750
Viking Office Products, Inc. **........... 700,000 21,350,000
------------
34,343,750
------------
PROTECTION (1.20%)
Safety 1st, Inc. **....................... 205,000 6,098,750
------------
RETAIL (18.50%)
AnnTaylor Stores, Inc. **................. 300,000 12,450,000
Autozone, Inc. **......................... 462,000 11,088,000
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>
FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

<TABLE>
<CAPTION>
MARKET
ISSUER, DESCRIPTION NUMBER OF SHARES VALUE
- ------------------- ---------------- ------------
<S> <C> <C>

RETAIL (CONTINUED)
CUC International, Inc. **............. 200,000 $ 6,425,000
Cygne Designs, Inc. **................. 425,000* 5,312,500
Gymboree Corp. **...................... 300,000* 9,750,000
Petsmart, Inc.**....................... 280,000 10,290,000
Starbucks Corp. **..................... 400,000* 10,800,000
Sunglass Hut International, Inc. ** 283,500 11,694,375
Urban Outfitters, Inc. **.............. 204,700* 6,141,000
Williams-Sonoma, Inc. **............... 300,000* 10,350,000
------------
94,300,875
------------
TELECOMMUNICATIONS (8.09%)
ALC Communications Corp. **............ 360,000 13,635,000
Brite Voice Systems, Inc. **........... 188,000* 3,431,000
Cidco, Inc. **......................... 320,000* 9,600,000
Colonial Data Technologies Corp. **.... 100,000* 925,000
LDDS Communications, Inc. **........... 579,750 13,624,125
------------
41,215,125
------------
TEXTILES (3.03%)
Tommy Hilfiger Corp. **................ 350,000 15,443,750
------------
TOTAL COMMON STOCKS
(Cost $357,304,227) ( 93.86%) 478,435,165
------- ------------
</TABLE>

INTEREST PAR VALUE MARKET
ISSUER, DESCRIPTION RATE (000'S OMITTED) VALUE
- ------------------- -------- --------------- ------------
<S> <C> <C> <C>

SHORT-TERM INVESTMENTS
JOINT REPURCHASE AGREEMENT (3.63%)
Investment in a joint repurchase
agreement transaction with
Kidder Peabody & Co., Inc. -
Dated 10-31-94, Due 11-01-94
(secured by US Treasury Bond,
9.00% Due 11-15-18, and by
US Treasury Notes, 6.75%
Due 02-28-97 and
5.625% Due 01-31-98)
- Note A............................... 4.77% $18,513 $ 18,513,000
------------

SHORT-TERM NOTES (5.10%)
Countrywide Funding Corp., due
11-03-94............................. 4.80 10,000 9,997,334
Merrill Lynch & Co., Inc., due
11-01-94............................. 4.80 10,000 10,000,000
Pacific Gas & Electric Co., due
11-02-94............................. 4.75 6,000 5,999,208
------------
25,996,542
------------
CORPORATE SAVINGS ACCOUNT (0.01%)
Investors Bank & Trust Company
Daily Interest Savings Account
Current Rate 2.15%................... 24,514
------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $ 44,476,792) ( 8.74%) 44,534,056
-------- ------------
TOTAL INVESTMENTS (102.60%) $522,969,221
======== ============
</TABLE>

* Securities, other than short-term investments, newly added to the portfolio
during the year ended October 31, 1994.
** Non-income producing security.

The percentage shown for each investment category is the total value of that
category as a percentage of the net assets of the Fund.

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>

NOTES TO FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

NOTE A -
ACCOUNTING POLICIES

John Hancock Special Equities Fund (the "Fund") is a diversified open-end
management investment company, registered under the Investment Company Act of
1940.

The Trustees have authorized the issuance of three classes of the
Fund, designated as Class A, Class B, and Class C. The shares of each class
represent an interest in the same portfolio of investments of the Fund and
have equal rights to voting, redemption, dividends, and liquidation, except
that certain expenses, subject to the approval of the Trustees, may be
applied differently to each class of shares in accordance with current
regulations of the Securities and Exchange Commission and the Internal Revenue
Service. Shareholders of a class which bears distribution/service expenses
under the terms of a distribution plan, have exclusive voting rights
regarding such distribution plan. After the close of business on September 3,
1993, the Fund was closed to new shareholders. The Fund was temporarily
reopened to new shareholders between the opening of business on August 29,
1994 and the close of business on September 30, 1994. Significant accounting
policies of the Fund are as follows:

VALUATION OF INVESTMENTS Investments in equity securities traded on national
securities exchanges are normally valued at the last quoted sales price on
the day of valuation. Securities traded in the over-the-counter market and
listed securities for which no sale was reported on valuation date are valued
at the last available bid price. Short-term debt investments which have a
remaining maturity of 60 days or less are valued at amortized cost, which
generally approximates market value. Investment securities for which no
current market quotations are available are valued at fair value based on
procedures approved by the Trustees.

JOINT REPURCHASE AGREEMENT Pursuant to an exemptive order issued by the
Securities and Exchange Commission, the Fund, along with other registered
investment companies having a management contract with John Hancock Advisers,
Inc. (the "Adviser"), a wholly-owned subsidiary of The Berkeley Financial Group,
may participate in a joint repurchase agreement transaction. Aggregate cash
balances are invested in one or more large repurchase agreements, whose
underlying securities are obligations of the U.S. government and/or its
agencies. The Fund's custodian bank receives delivery of the underlying
securities for the joint account on the Fund's behalf. The Adviser is
responsible for ensuring that the agreement is fully collateralized at all
times.

INVESTMENT TRANSACTIONS Investment transactions are recorded as of the date
of purchase, sale or maturity. Net realized gains and losses on sales of
investments are determined on the identified cost basis.

FEDERAL INCOME TAXES The Fund's policy is to comply with the requirements of
the Internal Revenue Code that are applicable to regulated investment companies
and to distribute all of its taxable income, including any net realized gain
on investment, to its shareholders. Therefore, no federal income tax provision
is required. For federal income tax purposes, the Fund has $26,020,140 of
capital loss carryforwards available, to the extent provided by regulations,
to offset future net realized capital gains. If such carryforwards are used by
the Fund, no capital gain distributions will be made. The carryforwards expire
as follows:October 31, 2001 - $5,311,412, and October 31, 2002 - $20,708,728.

DIVIDENDS, DISTRIBUTIONS AND INTEREST Dividend income on investment
securities is recorded on the ex-dividend date. Interest income on investment
securities is recorded on the accrual basis. The Fund records all
distributions payable to shareholders from net investment income and realized
gains on the ex-dividend date. Such distributions are determined in
conformity with income tax regulations. Dividends paid by the Fund, if any,
with respect to each class of shares will be calculated in the same manner,
at the same time and will be in the same amount, except for the effect of
expenses that may be applied differently to each class as explained
previously.

CLASS ALLOCATIONS Income, common expenses and realized and unrealized gains
(losses) are determined at the Fund level and allocated daily to each class
of shares based on the appropriate net assets of the respective classes.
Transfer agent expenses and distribution/service fees if any,

<PAGE>
NOTES TO FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

are calculated daily at the class level based on the appropriate net assets of
each class and the specific expense rate(s) applicable to each class.

NOTE B -
MANAGEMENT FEE AND
TRANSACTIONS WITH AFFILIATES
AND OTHERS

Under the present investment management contract, the Fund pays a monthly
management fee to the Adviser, for a continuous investment program equivalent,
on an annual basis, to the sum of: (a) 0.85% of the first $250,000,000 of the
Fund's average daily net assets and (b) 0.80% of the Fund's average daily net
asset value in excess of $250,000,000. Prior to January 1, 1994 the Fund paid
a quarterly management fee to the Adviser equivalent, on an annual basis, to
the sum of (a) 0.75% of the first $150,000,000 of the Fund's average daily net
asset value, (b) 0.55% of the next $150,000,000, (c) 0.50% of the next
$150,000,000, and (d) 0.40% of the Fund's average daily net asset value in
excess of $450,000,000. Effective January 1, 1994, the former administration
fee was eliminated.

In the event normal operating expenses of the Fund, exclusive of
certain expenses prescribed by state law, are in excess of the most restrictive
state limit where the Fund is registered to sell shares of beneficial
interest, the fee payable to the Adviser will be reduced to the extent of such
excess, and the Adviser will make additional arrangements necessary to
eliminate any remaining excess expenses. The current limits are 2.5% of the
first $30,000,000 of the Fund's average daily net asset value, 2.0% of the
next $70,000,000 and 1.5% of the remaining average daily net asset value.

The Fund has a distribution agreement with John Hancock Broker
Distribution Services, Inc. ("Broker Services"), a wholly-owned subsidiary of
the Adviser. For the year ended October 31, 1994, Broker Services received net
sales charges of $1,900,554 with regard to sales of Class A shares. Out of this
amount, $302,164 was retained and used for printing prospectuses, advertising,
sales literature and other purposes, $1,097,661 was paid as sales commissions to
unrelated broker-dealers and $500,729 was paid as sales commissions to sales
personnel of John Hancock Distributors, Inc. ("Distributors"), Tucker Anthony,
Incorporated ("Tucker Anthony") and Sutro & Co., Inc. ("Sutro"). The Adviser's
indirect parent, John Hancock Mutual Life Insurance Company, is the indirect
sole shareholder of Distributors and John Hancock Freedom Securities Corporation
and its subsidiaries, which include Tucker Anthony and Sutro, which are
broker-dealers.

Class B shares which are redeemed within six years of purchase will
be subject to a contingent deferred sales charge ("CDSC") at declining rates
beginning at 5.0% (4.0% on purchases made prior to January 1, 1994) of the
lesser of the current market value at the time of redemption or the original
purchase cost of the shares being redeemed. Proceeds from the CDSC are paid
to Broker Services and are used in whole or in part to defray its expenses
related to providing distribution related services to the Fund in connection
with the sale of Class B shares. For the year ended October 31, 1994
contingent deferred sales charges received by Broker Services amounted to
$45,198.

In addition, to compensate Broker Services for the services it provides
as distributor of shares of the Fund, the Fund has adopted a Distribution Plan
with respect to Class A and Class B pursuant to Rule 12b-1 under the Investment
Company Act of 1940. Accordingly, the Fund will make payments to Broker Services
for distribution and service expenses which, in total, will not exceed on an
annual basis 0.30% of the Fund's average daily net assets attributable to Class
A shares (0.50% prior to January 1, 1994) and 1.00% of the Fund's average daily
net assets attributable to Class B shares, to reimburse Broker Services for its
distribution/service costs. Up to a maximum of 0.25% of such payments may be
service fees as defined by the amended Rules of Fair Practice of the National
Association of Securities Dealers, which became effective July 7, 1993. Under
the amended Rules of Fair Practice, curtailment of a portion of the Fund's 12b-1
payments could occur under certain circumstances. In order to comply wit h this
rule, the 12b-1 fee was decreased on Class B shares to 0.90% and 0.80% effective
June 1, 1994 and

<PAGE>

NOTES TO FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

September 1, 1994 respectively, and increased to 1.00% effective
November 1, 1994.

The Fund has a transfer agent agreement with John Hancock Fund
Services, Inc. ("Fund Services"), a wholly-owned subsidiary of The Berkeley
Financial Group. The Fund pays Fund Services a monthly transfer agent fee
equivalent, on an annual basis, to 0.40%, 0.42% and 0.10% (0.40% prior to
April 1, 1994) of the average daily net asset value, attributable to Class
A,Class B and Class C shares of the Fund, respectively, plus out of pocket
expenses incurred by Fund Services on behalf of the Fund for proxy mailings.

Messrs. Edward J. Boudreau, Jr., Francis C. Cleary, Jr., and Richard
S. Scipione are directors and/or officers of the Adviser, and/or its
affiliates as well as Trustees of the Fund. The compensation of unaffiliated
Trustees is borne by the Fund.

NOTE C -
INVESTMENT TRANSACTIONS

Purchases and proceeds from sales of securities, other than obligations of
the U.S. government and its agencies and short-term securities, during the
year ended October 31, 1994 aggregated $296,421,013 and $279,878,363,
respectively. There were no long term purchases or sales of obligations of
the U.S. government and its agencies during the year ended October 31, 1994.

The cost of investments owned at October 31, 1994 for Federal income
tax purposes was $401,813,769. Gross unrealized appreciation and depreciation
of investments aggregated $130,355,842, and $9,224,904, respectively,
resulting in net unrealized appreciation of $121,130,938.

NOTE D -
RECLASSIFICATION OF CAPITAL ACCOUNTS

During the year ended October 31, 1994, the Fund has reclassified the
accumulated net investment loss in the amount of $7,073,460 to capital
paid-in. This represents the cumulative amount necessary to report these
balances on a tax basis, as of October 31, 1994. Additional adjustments may
be needed in subsequent reporting periods. These reclassifications, which
have no impact on the net asset value of the Fund, are primarily attributable
to certain differences in the computation of distributable income and capital
gains under federal tax rules versus generally accepted accounting
principles.

<PAGE>

NOTES TO FINANCIAL STATEMENTS

John Hancock Funds - Special Equities Fund

REPORT of ERNST &YOUNG LLP,
INDEPENDENT AUDITORS

To the Trustees and Shareholders
John Hancock Special Equities Fund

We have audited the accompanying statement of assets and liabilities of John
Hancock Special Equities Fund (the "Fund"), including the schedule of
investments, as of October 31, 1994, and the related statement of operations
for the year then ended, the statement of changes in net assets for each of
two years in the period then ended, and financial highlights for each of the
five years in the period then ended. These financial statements and financial
highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.

We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements
and financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of October 31, 1994, by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial posi
tion of John Hancock Special Equities Fund at October 31, 1994, the results
of its operations for the year then ended, the changes in its net assets for
each of the two years in the period then ended, and financial highlights for
each of the five years in the period then ended, in conformity with generally
accepted accounting principles.

/s/ Ernst & Young LLP
---------------------
Boston, Massachusetts
December 14, 1994

TAX INFORMATION NOTICE (UNAUDITED)

For Federal Income Tax purposes, the following information is
furnished with respect to the taxable distribution of the Fund during its
fiscal year ended October 31, 1994.

The Fund has not paid any distributions of ordinary income dividends or
net long-term capital gains during the fiscal year.

<PAGE>
PART C.

OTHER INFORMATION

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial Statements included in the Registration Statement:

John Hancock Special Equities Fund

Statement of Assets and Liabilities as of October 31, 1994. Statement
of Operations for the year ended October 31, 1994 Statement of
Changes in Net Assets for each of the two years in the period ended
October 31, 1994. Financial Highlights for each of the 10 years ended
October 31, 1994. Schedule of Investments as of October 31, 1994.
Notes to Financial Statements.

(b) Exhibits:

Exhibits previously filed are incorporated herein by reference to the
filing containing such exhibit identified in the description to the
exhibit.

ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT

No person is directly or indirectly controlled by or under common
control with Registrant.

ITEM 26. NUMBER OF HOLDERS OF SECURITIES

As of February 3, 1995 the number of record holders of shares of
Registrant was as follows:

TITLE NUMBER OF RECORD HOLDERS

Class A Class B Class C
John Hancock Special Equities Fund 39,971 22,539 2

ITEM 27. INDEMNIFICATION

(a) Under Registrant's Declaration of Trust. Section 4.3 of Registrant's
Declaration of Trust provides as follows:

"Indemnification of Trustees, Officers, Etc." The Trust shall indemnify each of
its Trustees, officers, employees and agents (including any individual who
serves at its request as director, officer, partner, trustee or the like of
another organization in which it has any interest as a shareholder, creditor or
otherwise) against all liabilities and expenses, including but not limited to
amounts paid in satisfaction of judgments, in compromise or as fines and
penalties, and counsel fees reasonably incurred by him or her in connection with
the defense or disposition of any action, suit or other proceeding, whether
civil or criminal, before any court or administrative or legislative body in
which he or she may be or may have been involved as a party or otherwise or with
which he or she may be or may have been threatened. While acting as Trustee or
as an officer, employee or agent of the Trust or the Trustees, as the case may
be, or thereafter, by reason of his or her being or having been such a Trustee,
officer, employee or agent, except with respect to any matter as to which he or
she shall have been adjudicated not to have acted in good faith in the
reasonable belief that his or her action was in the best interests of the Trust,
provided that no individual shall be indemnified hereunder against any liability
to the Trust or the Shareholders by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
his or her office, and provided further that as to any matter disposed of by
settlement or a compromise payment by such Trustee, officer, employee or agent,
pursuant to a consent decree or otherwise, no indemnification either for said
payment or for any other expenses shall be provided unless there has been a
determination that such compromise is in the best interests of the Trust and
that such person appears to have acted in good faith in the reasonable belief
that his or her action was in the best interests of the Trust and did not engage
in willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his or her office. All determinations that the
applicable standards of conduct have been met for indemnification hereunder
shall be made by (a) a majority vote of a quorum consisting of disinterested
Trustees who are not parties to the proceeding relating to indemnification, or
(b) if such quorum is not obtainable or, even if obtainable, if a majority vote
of such quorum so directs, by independent legal counsel in a written opinion, or
(c) a Majority Shareholder Vote (excluding Shares owned of record or
beneficially by such individual). The rights accruing to any Trustee, officer,
employee or agent under these provisions shall not exclude any other right to
which he may be lawfully entitled. The Trustees may make advance payments in
connection with the expense of defending any action with respect to which
indemnification might be sought under this Section 4.3, provided that the
indemnified Trustee, officer, employee or agent shall have given a written
undertaking to reimburse the Trust in the event it is subsequently determined
that he is not entitled to such indemnification.

(b) Under the Distribution Agreement. Under Section 12 of the Distribution
Agreement, John Hancock Funds, Inc. ("John Hancock Funds") has agreed
to indemnify the Registrant and its Trustees, officers and controlling
persons against claims arising out of certain acts and statements of
John Hancock Funds.

(c) Under the By-Laws of the John Hancock Mutual Life Insurance Company
(the "Insurance Company"), John Hancock Funds and John Hancock
Advisers, Inc. (the "Adviser").

Section 9a of the By-Laws of the Insurance Company provides, in effect,
that the Insurance Company will, subject to limitations of law,
indemnify each present and former director, officer and employee of the
Insurance Company who serves as a Trustee or officer of the Registrant
at the direction or request of the Insurance company against litigation
expenses and liabilities incurred while acting as such, except that
such indemnification does not cover any expense or liability incurred
or imposed in connection with any matter as to which such person shall
be finally adjudicated not to have acted in good faith in the
reasonable belief that his action was in the best interests of the
Insurance Company. In addition, no such person will be indemnified by
the Insurance Company in respect of any liability or expense incurred
in connection with any matter settled without final adjudication unless
such settlement shall have been approved as in the best interests of
the Insurance Company either by vote of the Board of Directors at a
meeting composed of directors who have no interest in the outcome of
such vote or by vote of the policyholders. The Insurance Company may
pay expenses incurred in defending an action or claim in advance of its
final disposition, but only upon receipt of an undertaking by the
person indemnified to repay such payment if he should be determined to
be entitled to indemnification.

Article IX of the respective By-Laws of John Hancock Funds and the
Adviser provide as follows:

"Section 9.01. Indemnity: Any person made or threatened to be made a
party to any action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he is or
was at any time since the inception of the Corporation a director,
officer, employee or agent of the Corporation, or is or was at any time
since the inception of the Corporation serving at the request of the
Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise,
shall be indemnified by the Corporation against expenses (including
attorney's fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action,
suit or proceeding if he acted in good faith and the liability was not
incurred by reason of gross negligence or reckless disregard of the
duties involved in the conduct of his office, and expenses in
connection therewith may be advanced by the Corporation, all to the
full extent authorized by law."

"Section 9.02. Not Exclusive; Survival of Rights: The indemnification
provided by Section 9.01 shall not be deemed exclusive of any other
right to which those indemnified may be entitled, and shall continue as
to a person who has ceased to be a director, officer, employee or agent
and shall inure to the benefit of the heirs, executors and
administrators of such a person."

Insofar as indemnification for liabilities under the Securities Act of
1933, as amended (the "Act") may be permitted to Trustees, officers and
controlling persons of Registrant pursuant to Section 10.1 of the Registrant's
By-Laws, Section 13 of the Underwriting Agreement filed as Exhibit 6 to the
original Registration Statement, the By-Laws of the Registrant, the By-laws of
the Distributors, the Adviser, or the Insurance Company or otherwise. Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such Trustee, officer
or controlling person in connection with the securities being registered,
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether indemnification by it is against public policy as expressed
in the Act and will be governed by the final adjudication of such issue.

ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

For information as to the business, profession, vocation or employment
of a substantial nature of each of the officers and Directors of the Investment
Adviser, reference is made to Forms ADV (801-8124) filed under the Investment
Advisers Act of 1940, herein incorporated by reference.

ITEM 29. PRINCIPAL UNDERWRITERS

(a) John Hancock Funds acts as principal underwriter for the Registrant and
also serves as principal underwriter or distributor of shares for John
Hancock Cash Reserve, Inc., John Hancock Bond Fund, John Hancock
Capital Growth Fund, John Hancock Current Interest, John Hancock
Series, Inc., John Hancock Tax-Free Bond Fund, John Hancock California
Tax-Free Income Fund, John Hancock Capital Series, John Hancock Limited
Term Government Fund, John Hancock Tax-Exempt Fund, John Hancock
Sovereign Investors Fund, Inc., John Hancock Cash Management Fund, John
Hancock Special Equities Fund, John Hancock Sovereign Bond Fund, John
Hancock Tax-Exempt Series Fund, John Hancock Strategic Series, John
Hancock Technology Series, Inc. and John Hancock World Fund, John
Hancock Freedom Investment Trust, John Hancock Freedom Investment Trust
II and John Hancock Freedom Investment Trust III.

(b) The following table lists, for each director and officer of John
Hancock Funds, the information indicated.
POSITIONS AND
NAME AND PRINCIPAL POSITIONS AND OFFICES WITH OFFICES WITH
BUSINESS ADDRESS UNDERWRITER REGISTRANT

Edward J. Boudreau, Jr. Chairman Chairman
101 Huntington Avenue
Boston, Massachusetts

Robert H. Watts Director and Senior Vice None
101 Huntington Avenue President
Boston, Massachusetts

C. Troy Shaver, Jr. President, Chief Executive None
101 Huntington Avenue Officer and Director
Boston, Massachusetts

Foster Aborn Director None
John Hancock Place
P.O. Box 111
Boston, Massachusetts

Robert G. Freedman Director Vice Chairman and
101 Huntington Avenue Chief Investment
Boston, Massachusetts Officer

Stephen M. Blair Senior Vice President-Sales None
101 Huntington Avenue
Boston, Massachusetts

Thomas H. Drohan Senior Vice President Senior Vice
101 Huntington Avenue President and
Boston, Massachusetts Secretary

David A. King Senior Vice President None
101 Huntington Avenue
Boston, Massachusetts

James B. Little Senior Vice President Senior Vice
101 Huntington Avenue President and Chief
Boston, Massachusetts Financial Officer

John A. Morin Vice President Vice President
101 Huntington Avenue
Boston, Massachusetts

Susan S. Newton Secretary Vice President,
101 Huntington Avenue Assistant Secretary
Boston, Massachusetts and Compliance
Officer

Christopher M. Meyer Treasurer None
101 Huntington Avenue
Boston, Massachusetts

Stephen L. Brown Director None
John Hancock Place
P.O. Box 111
Boston, Massachusetts

Thomas E. Moloney Director None
John Hancock Place
P.O. Box 111
Boston, Massachusetts

Jeanne M. Livermore Director None
John Hancock Place
P.O. Box 111
Boston, Massachusetts

Richard S. Scipione Director Trustee
John Hancock Place
P.O. Box 111
Boston, Massachusetts

John Goldsmith Director None
John Hancock Place
P.O. Box 111
Boston, Massachusetts

Richard O. Hansen Director None
John Hancock Place
P.O. Box 111
Boston, Massachusetts

John M. DeCiccio Director None
John Hancock Place
P.O. Box 111
Boston, Massachusetts

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS

Registrant maintains the records required to be maintained by it under
Rules 31a-1 (a), 31a-a(b), and 31a-2(a) under the Investment Company
Act of 1940 as its principal executive offices at 101 Huntington
Avenue, Boston Massachusetts 02199-7603. Certain records, including
records relating to Registrant's shareholders and the physical
possession of its securities, may be maintained pursuant to Rule 31a-3
at the main office of Registrant's Transfer Agent and Custodian.

ITEM 31. MANAGEMENT SERVICES

Not applicable.

ITEM 32. UNDERTAKINGS

(a) Not applicable.

(b) Not applicable.

(c) Registrant hereby undertakes to furnish each person to whom a
prospectus with respect to a series of the Registrant is
delivered with a copy of the latest annual report to
shareholders with respect to that series upon request and
without charge.
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereto duly authorized, in the City of Boston, and the
Commonwealth of Massachusetts on the 22nd day of February 1995.

JOHN HANCOCK SPECIAL EQUITIES FUND

By: *
-------------------------------
Edward J. Boudreau, Jr.
Chairman

Pursuant to the requirements of the Securities Act of 1933, the
Registration has been signed below by the following persons in the capacities
and on the dates indicated.

Signature Title Date

* Chairman (Principal
______________________ Executive Officer)
Edward J. Boudreau, Jr.
Senior Vice President
and Chief Financial
Officer (Principal February 22, 1995
Financial and
James B. Little Accounting Officer)
James B. Little

*
______________________ Trustee
Dennis S. Aronowitz

*
______________________ Trustee
Richard P. Chapman

*
______________________ Trustee
William J. Cosgrove

*
______________________ Trustee
Gail D. Fosler

*
______________________ Trustee
Bayard Henry

*
______________________ Trustee
Richard S. Scipione

*
______________________ Trustee
Edward J. Spellman

February 22, 1995
Thomas H. Drohan
*By: Thomas H. Drohan
(Attorney-in-Fact)

<PAGE>

EXHIBIT INDEX

The exhibits listed below which are marked by an asterisk (*) have previously
been filed with the Commission and are incorporated by reference.

Exhibit No. Description Page Number

99.B1 Declaration of Trust of Registrant as amended
and restated February 28, 1992.

99.B2 By-Laws as adopted on December 8, 1993.

99.B2.1 Amendment to By-Laws dated December 13, 1994.

99.B3 None

99.B4 Specimen share certificate for the John
Hancock Special
Equities Fund Classes A & B and C.

99.B5 Investment Management Contract between
Registrant and John Hancock Advisers, Inc.
dated January 1, 1994

99.B6 Distribution Agreement with Registrant and
John Hancock BrokerDistribution Services, Inc.
dated August 1, 1991.

99.B6.1 Form of Soliciting Dealer Agreement between
John Hancock Broker Distribution Services,
Inc. and Selected Dealers.

99.B6.2 Form of Financial Institution Sales and
Service Agreement

99.B7 None

99.B8 Master Custodian Agreement between Registrant
and Investors Bank & Trust Company dated
December 15, 1992.

99.B9 Transfer Agency and Service Agreement between
Registrant and John Hancock Fund Services,
Inc. dated January 1, 1991.

99.B10 Opinion and Consent of Ropes and Gray

99.B11 Consent of Ernst & Young.

99.B12 Financial Statement of the John Hancock
Special Equities Fund for the fiscal year
ended October 31, 1994 included in Parts A
and B.

99.B13 Subscription Agreement between Registrant and
John Hancock Advisers, Inc. dated December 17,
1984.

<PAGE>

Exhibit No. Description Page Number

99.B14 None

99.B15 Class A Distribution Plan between John
Hancock Special Equities Fund and John
Hancock Broker Services, Inc.;

99.B15.1 Class B Distribution Plan between John
Hancock Special Equities Fund and John
Hancock Broker Services, Inc.

99.B16* Schedule for Computation of Total Return
incorporated by reference.

99.B17 Powers of Attorney dated November 20, 1984,
dated July 22, 1985, dated May 17, 1988, dated
November 15, 1988, dated May 17, 1991, May 21,
1984, June dated October 15, 1991, dated
January 1, 1994 and June 22, 1994

99.27 Class A Financial Data Schedules -Class A

99.27 Class B Financial Data Schedules -Class B

99.27 Class C Financial Data Schedules-Class C

<PAGE>
Exhibit 99.1

AMENDED AND RESTATED
DECLARATION OF TRUST

John Hancock Special Equities Fund

101 HUNTINGTON AVENUE
MASSACHUSETTS
02199-7603

DATED FEBRUARY 28, 1992

<PAGE>

TABLE OF CONTENTS

ARTICLE I - NAME AND DEFINITIONS 1
SECTION 1.1. NAME 1
SECTION 1.2. DEFINITIONS 1

ARTICLE II - TRUSTEES 2
SECTION 2.1. GENERAL POWERS 2
SECTION 2.2. INVESTMENTS 3
SECTION 2.3. LEGAL TITLE 4
SECTION 2.4. ISSUANCE AND REPURCHASE OF SHARES 4
SECTION 2.5. DELEGATION; COMMITTEES 4
SECTION 2.6. COLLECTION AND PAYMENT 4
SECTION 2.7. EXPENSES 4
SECTION 2.8. MANNER OF ACTING; BY-LAWS 5
SECTION 2.9. MISCELLANEOUS POWERS 5
SECTION 2.10. PRINCIPAL TRANSACTIONS 5
SECTION 2.11. LITIGATION 5
SECTION 2.12. NUMBER OF TRUSTEES 6
SECTION 2.13. ELECTION AND TERM 6
SECTION 2.14. RESIGNATION AND REMOVAL 6
SECTION 2.15. VACANCIES 6
SECTION 2.16. DELEGATION OF POWER TO OTHER TRUSTEES 6

ARTICLE III - CONTRACTS 7
SECTION 3.1. DISTRIBUTION CONTRACT 7
SECTION 3.2. ADVISORY OR MANAGEMENT CONTRACT 7
SECTION 3.3. ADMINISTRATION AGREEMENT 7
SECTION 3.4. SERVICE AGREEMENT 7
SECTION 3.5. TRANSFER AGENT 7
SECTION 3.6. CUSTODIAN 7
SECTION 3.7. AFFILIATIONS OF TRUSTEES OR OFFICERS, ETC. 8
SECTION 3.8. COMPLIANCE WITH 1940 ACT 8

ARTICLE IV - LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
TRUSTEES AND OTHERS 8
SECTION 4.1. NO PERSONAL LIABILITY OF SHAREHOLDERS, TRUSTEES, ETC. 8
SECTION 4.2. NON-LIABILITY OF TRUSTEES, ETC. 9

<PAGE>

SECTION 4.3. MANDATORY INDEMNIFICATION 9
SECTION 4.4. NO BOND REQUIRED OF TRUSTEES 10
SECTION 4.5. NO DUTY OF INVESTIGATION; NOTICE IN TRUST
INSTRUMENTS, ETC. 10
SECTION 4.6. RELIANCE ON EXPERTS, ETC. 10

ARTICLE V - SHARES OF BENEFICIAL INTEREST 11
SECTION 5.1. BENEFICIAL INTEREST 11
SECTION 5.2. RIGHTS OF SHAREHOLDERS 11
SECTION 5.3. TRUST ONLY 11
SECTION 5.4. ISSUANCE OF SHARES 11
SECTION 5.5. REGISTER OF SHARES 11
SECTION 5.6. TRANSFER OF SHARES 12
SECTION 5.7. NOTICES 12
SECTION 5.8. TREASURY SHARES 12
SECTION 5.9. VOTING POWERS 12
SECTION 5.10. MEETINGS OF SHAREHOLDERS 12
SECTION 5.11. SERIES OR CLASS DESIGNATION 13
SECTION 5.12. ASSENT TO DECLARATION OF TRUST 15

ARTICLE VI - REDEMPTION AND REPURCHASE OF SHARES 15
SECTION 6.1. REDEMPTION OF SHARES 15
SECTION 6.2. PRICE 15
SECTION 6.3. PAYMENT 16
SECTION 6.4. EFFECT OF SUSPENSION OF DETERMINATION OF NET
ASSET VALUE 16
SECTION 6.5. REPURCHASE BY AGREEMENT 16
SECTION 6.6. REDEMPTION OF SHAREHOLDER'S INTEREST 16
SECTION 6.7. REDEMPTION OF SHARES IN ORDER TO QUALIFY AS
REGULATED INVESTMENT COMPANY; DISCLOSURE OF HOLDING 16
SECTION 6.8. REDUCTIONS IN NUMBER OF OUTSTANDING SHARES
PURSUANT TO NET ASSET VALUE FORMULA 17
SECTION 6.9. SUSPENSION OF RIGHT OF REDEMPTION 17

ARTICLE VII- DETERMINATION OF NET ASSET VALUE, NET INCOME AND
DISTRIBUTIONS 17
SECTION 7.1. NET ASSET VALUE 17
SECTION 7.2. DISTRIBUTIONS TO SHAREHOLDERS 17
SECTION 7.3. DETERMINATION OF NET INCOME; CONSTANT NET
ASSET VALUE; REDUCTION OF OUTSTANDING SHARES 18
SECTION 7.4. POWER TO MODIFY FOREGOING PROCEDURES 18

ii.

<PAGE>

ARTICLE VIII - DURATION; TERMINATION OF TRUST OR A SERIES OR
CLASS; AMENDMENT; MERGERS, ETC. 19
SECTION 8.1. DURATION 19
SECTION 8.2. TERMINATION OF THE TRUST OR A SERIES OR A CLASS 19
SECTION 8.3. AMENDMENT PROCEDURE 20
SECTION 8.4. MERGER, CONSOLIDATION AND SALE OF ASSETS 20
SECTION 8.5. INCORPORATION 20

ARTICLE IX - REPORTS TO SHAREHOLDERS 21

ARTICLE X - MISCELLANEOUS 21
SECTION 10.3. COUNTERPARTS 21
SECTION 10.4. RELIANCE BY THIRD PARTIES 21
SECTION 10.5. PROVISIONS IN CONFLICT WITH LAW OR REGULATIONS 21

iii.

<PAGE>

AMENDED AND RESTATED
DECLARATION OF TRUST
OF
JOHN HANCOCK SPECIAL EQUITIES FUND
DATED FEBRUARY 28, 1992

DECLARATION OF TRUST made this 28th day of February, 1992 by ___________________
(together with all other persons from time to time duly elected, qualified and
serving as Trustees in accordance with the provisions of Article II hereof, the
"Trustees");

WHEREAS, pursuant to a Declaration of Trust dated November 21, 1984 the Trustees
established a trust for the investment and reinvestment of funds contributed
thereto;

WHEREAS, said Declaration of Trust provides that the beneficial interest in the
trust assets be divided into transferable shares of beneficial interest;

WHEREAS, said Declaration of Trust provides that all money and property
contributed to the trust established thereunder shall be held and managed in
trust for the benefit of the holders, from time to time, of the shares of
beneficial interest issued thereunder and subject to the provisions thereof; and

WHEREAS, the Trustees desire to amend and restate said Declaration of Trust in
its entirety, as hereinafter provided;

NOW, THEREFORE, the undersigned, being a majority of the Trustees of the Trust,
hereby amend and restate the Declaration of Trust in its entirety, as follows:

ARTICLE I
NAME AND DEFINITIONS

SECTION 1.1. NAME. The name of the trust created hereby is "John Hancock
Special Equities Fund" (the "Trust").

SECTION 1.2. DEFINITIONS. Wherever they are used herein, the following terms
have the following respective meanings:

(a) "Administrator" means the party, other than the Trust, to the
contract described in Section 3.3 hereof.

(b) "By-laws" means the By-laws referred to in Section 2.8 hereof, as
from time to time amended.

(c) "Class" means any division of shares within a Series, which Class
is or has been established within such Series in accordance with the
provisions of Article V. The three initial Classes of Shares
established and designated in Section 5.11 hereof are: "Class A";
"Class B"; and "Class C."

(d) The terms "Commission" and "Interested Person" have the meanings
given them in the 1940 Act. Except as such term may be otherwise
defined by the Trustees in conjunction with the establishment of any
Series of Shares, the term "vote of a majority of the Shares
outstanding and entitled to vote" shall have the same meaning as is
assigned to the term "vote of a majority of the outstanding voting
securities" in the 1940 Act.

(e) "Custodian" means any Person other than the Trust who has custody
of any Trust Property as required by Section 17(f) of the 1940 Act, but
does not include a system for the central handling of securities
described in said Section 17(f).

(f) "Declaration" means this Declaration of Trust as amended from time
to time. Reference in this Declaration of Trust to "Declaration,"
"hereof," "herein," and "hereunder" shall be deemed to refer to this
Declaration rather than exclusively to the article or section in which
such words appear.

(g) "Distributor" means the party, other than the Trust, to the
contract described in Section 3.1 hereof.

(h) "Fund" or "Funds", individually or collectively, means the separate
Series of Shares of the Trust, together with the assets and liabilities
assigned thereto.

(i) "Fundamental Restrictions" means the investment restrictions set
forth in the Prospectus and Statement of Additional Information and
designated as fundamental restrictions therein.

(j) "His" shall include the feminine and neuter, as well as the
masculine, genders.

(k) "Investment Adviser" means the party, other than the Trust, to the
contract described in Section 3.2 hereof.

(l) The "1940 Act" means the Investment Company Act of 1940, as amended
from time to time.

(m) "Person" means and includes individuals, corporations,
partnerships, trusts, associations, joint ventures and other entities,
whether or not legal entities, and governments and agencies and
political subdivisions thereof.

(n) "Prospectus" means the Prospectus and Statement of Additional
Information included in the Registration Statement of the Trust under
the Securities Act of 1933 as such Prospectus and Statement of
Additional Information may be amended or supplemented and filed with
the Commission from time to time.

(o) "Series" individually or collectively means the separately managed
component(s) of the Trust (or, if the Trust shall have only one such
component, then that one) as may be established and designated from
time to time by the Trustees pursuant to Section 5.11 hereof.

(p) "Shareholder" means a record owner of Outstanding Shares.

(q) "Shares" means the equal proportionate units of interest into which
the beneficial interest in the Trust shall be divided from time to
time, including the Shares of any and all Series or of any Class within
any Series (as the context may require) which may be established by the
Trustees, and includes fractions of Shares as well as whole Shares.
"Outstanding" Shares means those Shares shown from time to time on the
books of the Trust or its Transfer Agent as then issued and
outstanding, but shall not include Shares which have been redeemed or
repurchased by the Trust and which are at the time held in the treasury
of the Trust.

(r) "Transfer Agent" means any Person other than the Trust who
maintains the Shareholder records of the Trust, such as the list of
Shareholders, the number of Shares credited to each account, and the
like.

(s) "Trust" means John Hancock Special Equities Fund.

(t) The "Trustees" means the persons who have signed this Declaration,
so long as they shall continue in office in accordance with the terms
hereof, and all other persons who now serve or may from time to time be
duly elected, qualified and serving as Trustees in accordance with the
provisions of Article II hereof, and reference herein to a Trustee or
the Trustees shall refer to such person or persons in this capacity or
their capacities as trustees hereunder.

(u) "Trust Property" means any and all property, real or personal,
tangible or intangible, which is owned or held by or for the account of
the Trust or the Trustees, including any and all assets of or allocated
to any Series or Class, as the context may require.

ARTICLE II
TRUSTEES

SECTION 2.1. GENERAL POWERS. The Trustees shall have exclusive and absolute
control over the Trust Property and over the business of the Trust to
the same extent as if the Trustees were the sole owners of the Trust
Property and business in their own right, but with such powers of
delegation as may be permitted by this Declaration. The Trustees shall
have power to conduct the business of the Trust and carry on its
operations in any and all of its branches and maintain offices both
within and without the Commonwealth of Massachusetts, in any and all
states of the United States of America, in the District of Columbia,
and in any and all commonwealths, territories, dependencies, colonies,
possessions, agencies or instrumentalities of the United States of
America and of foreign governments, and to do all such other things and
execute all such instruments as they deem necessary, proper or
desirable in order to promote the interests of the Trust although such
things are not herein specifically mentioned. Any determination as to
what is in the interests of the Trust made by the Trustees in good
faith shall be conclusive. In construing the provisions of this
Declaration, the presumption shall be in favor of a grant of power to
the Trustees. The enumeration of any specific power herein shall not be
construed as limiting the aforesaid powers. Such powers of the Trustees
may be exercised without order of or resort to any court.

SECTION 2.2. INVESTMENTS. The Trustees shall have the power:

(a) To operate as and carry on the business of an investment company,
and exercise all the powers necessary and appropriate to the conduct of
such operations.

(b) To invest in, hold for investment, or reinvest in, cash;
securities, including common, preferred and preference stocks;
warrants; subscription rights; profit-sharing interests or
participations and all other contracts for or evidence of equity
interests; bonds, debentures, bills, time notes and all other evidences
of indebtedness; negotiable or non-negotiable instruments; government
securities, including securities of any state, municipality or other
political subdivision thereof, or any governmental or
quasi-governmental agency or instrumentality; and money market
instruments including bank certificates of deposit, finance paper,
commercial paper, bankers' acceptances and all kinds of repurchase
agreements, of any corporation, company, trust, association, firm or
other business organization however established, and of any country,
state, municipality or other political subdivision, or any governmental
or quasi-governmental agency or instrumentality; and the Trustees shall
be deemed to have the foregoing powers with respect to any additional
securities in which the Trust may invest should the Fundamental
Restrictions be amended.

(c) To acquire (by purchase, subscription or otherwise), to hold, to
trade in and deal in, to acquire any rights or options to purchase or
sell, to sell or otherwise dispose of, to lend and to pledge any such
securities, to enter into repurchase agreements, reverse repurchase
agreements, firm commitment agreements, and forward foreign currency
exchange contracts, to purchase and sell options on securities,
indices, currency or other financial assets, futures contracts and
options on futures contracts of all descriptions and to engage in all
types of hedging and risk management transactions.

(d) To exercise all rights, powers and privileges of ownership or
interest in all securities and repurchase agreements included in the
Trust Property, including the right to vote thereon and otherwise act
with respect thereto and to do all acts for the preservation,
protection, improvement and enhancement in value of all such securities
and repurchase agreements.

(e) To acquire (by purchase, lease or otherwise) and to hold, use,
maintain, develop and dispose of (by sale or otherwise) any property,
real or personal, including cash or foreign currency, and any interest
therein.

(f) To borrow money and in this connection issue notes or other
evidence of indebtedness; to secure borrowings by mortgaging, pledging
or otherwise subjecting as security the Trust Property; and to endorse,
guarantee, or undertake the performance of any obligation or engagement
of any other Person and to lend Trust Property.

(g) To aid by further investment any corporation, company, trust,
association or firm, any obligation of or interest in which is included
in the Trust Property or in the affairs of which the Trustees have any
direct or indirect interest; to do all acts and things designed to
protect, preserve, improve or enhance the value of such obligation or
interest; and to guarantee or become surety on any or all of the
contracts, stocks, bonds, notes, debentures and other obligations of
any such corporation, company, trust, association or firm.

(h) To enter into a plan of distribution and any related agreements
whereby the Trust may finance directly or indirectly any activity which
is primarily intended to result in sale of Shares.

(i) To adopt on behalf of the Trust or any Series thereof an
alternative purchase plan providing for the issuance of multiple
Classes of Shares (as authorized herein at Section 5.11), such Shares
being differentiated on the basis of purchase method and allocation of
distribution expenses.

(j) In general to carry on any other business in connection with or
incidental to any of the foregoing powers, to do everything necessary,
suitable or proper for the accomplishment of any purpose or the
attainment of any object or the furtherance of any power hereinbefore
set forth, either alone or in association with others, and to do every
other act or thing incidental or appurtenant to or arising out of or
connected with the aforesaid business or purposes, objects or powers.

The foregoing clauses shall be construed both as objects and powers,
and the foregoing enumeration of specific powers shall not be held to
limit or restrict in any manner the general powers of the Trustees.

The Trustees shall not be limited to investing in obligations maturing
before the possible termination of the Trust, nor shall the Trustees be
limited by any law limiting the investments which may be made by
fiduciaries.

SECTION 2.3. LEGAL TITLE. Legal title to all the Trust Property shall be vested
in the Trustees as joint tenants except that the Trustees shall have
power to cause legal title to any Trust Property to be held by or in
the name of one or more of the Trustees, or in the name of the Trust or
any Series of the Trust, or in the name of any other Person as nominee,
on such terms as the Trustees may determine, provided that the interest
of the Trust therein is deemed appropriately protected. The right,
title and interest of the Trustees in the Trust Property and the
Property of each Series of the Trust shall vest automatically in each
Person who may hereafter become a Trustee. Upon the termination of the
term of office, resignation, removal or death of a Trustee he shall
automatically cease to have any right, title or interest in any of the
Trust Property, and the right, title and interest of such Trustee in
the Trust Property shall vest automatically in the remaining Trustees.
Such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered.

SECTION 2.4. ISSUANCE AND REPURCHASE OF SHARES. The Trustees shall have the
power to issue, sell, repurchase, redeem, retire, cancel, acquire,
hold, resell, reissue, dispose of, transfer, and otherwise deal in
Shares and, subject to the provisions set forth in Articles VI and VII
and Section 5.11 hereof, to apply to any such repurchase, redemption,
retirement, cancellation or acquisition of Shares any funds or property
of the Trust, whether capital or surplus or otherwise, to the full
extent now or hereafter permitted by the laws of the Commonwealth of
Massachusetts governing business corporations.

SECTION 2.5. DELEGATION; COMMITTEES. The Trustees shall have power, consistent
with their continuing exclusive authority over the management of the
Trust and the Trust Property, to delegate from time to time to such of
their number or to officers, employees or agents of the Trust the doing
of such things and the execution of such instruments either in the name
of the Trust or any Series of the Trust or the names of the Trustees or
otherwise as the Trustees may deem expedient, to the same extent as
such delegation is permitted by the 1940 Act.

SECTION 2.6. COLLECTION AND PAYMENT. Subject to Section 5.11 hereof, the
Trustees shall have power to collect all property due to the Trust; to
pay all claims, including taxes, against the Trust Property; to
prosecute, defend, compromise or abandon any claims relating to the
Trust Property; to foreclose any security interest securing any
obligations, by virtue of which any property is owed to the Trust; and
to enter into releases, agreements and other instruments.

SECTION 2.7. EXPENSES. Subject to Section 5.11 hereof, the Trustees shall have
the power to incur and pay any expenses which in the opinion of the
Trustees are necessary or incidental to carry out any of the purposes
of this Declaration, and to pay reasonable compensation from the funds
of the Trust to themselves as Trustees. The Trustees shall fix the
compensation of all officers, employees and Trustees.

SECTION 2.8. MANNER OF ACTING; BY-LAWS. Except as otherwise provided herein or
in the By-laws, any action to be taken by the Trustees may be taken by
a majority of the Trustees present at a meeting of Trustees (a quorum
being present), including any meeting held by means of a conference
telephone circuit or similar communications equipment by means of which
all persons participating in the meeting can hear each other, or by
written consents of the entire number of Trustees then in office. The
Trustees may adopt By-laws not inconsistent with this Declaration to
provide for the conduct of the business of the Trust and may amend or
repeal such By-laws to the extent such power is not reserved to the
Shareholders. Notwithstanding the foregoing provisions of this Section
2.8 and in addition to such provisions or any other provision of this
Declaration or of the By-laws, the Trustees may by resolution appoint a
committee consisting of less than the whole number of Trustees then in
office, which committee may be empowered to act for and bind the
Trustees and the Trust, as if the acts of such committee were the acts
of all the Trustees then in office, with respect to the institution,
prosecution, dismissal, settlement, review or investigation of any
action, suit or proceeding which shall be pending or threatened to be
brought before any court, administrative agency or other adjudicatory
body.

SECTION 2.9. MISCELLANEOUS POWERS. Subject to Section 5.11 hereof, the Trustees
shall have the power to:

(a) employ or contract with such Persons as the Trustees may deem
desirable for the transaction of the business of the Trust or any
Series thereof;

(b) enter into joint ventures, partnerships and any other combinations
or associations;

(c) remove Trustees or fill vacancies in or add to their number, elect
and remove such officers and appoint and terminate such agents or
employees as they consider appropriate, and appoint from their own
number, and terminate, any one or more committees which may exercise
some or all of the power and authority of the Trustees as the Trustees
may determine;

(d) purchase, and pay for out of Trust Property or the Property of the
appropriate Series of the Trust, insurance policies insuring the
Shareholders, Trustees, officers, employees, agents, investment
advisers, administrators, distributors, selected dealers or independent
contractors of the Trust against all claims arising by reason of
holding any such position or by reason of any action taken or omitted
by any such Person in such capacity, whether or not constituting
negligence, or whether or not the Trust would have the power to
indemnify such Person against such liability;

(e) establish pension, profit-sharing, share purchase, and other
retirement, incentive and benefit plans for any Trustees, officers,
employees and agents of the Trust;

(f) to the extent permitted by law, indemnify any person with whom the
Trust or any Series thereof has dealings, including the Investment
Adviser, Administrator, Distributor, Transfer Agent and selected
dealers, to such extent as the Trustees shall determine;

(g) guarantee indebtedness or contractual obligations of others;

(h) determine and change the fiscal year of the Trust or any Series
thereof and the method by which its accounts shall be kept; and

(i) adopt a seal for the Trust, but the absence of such seal shall not
impair the validity of any instrument executed on behalf of the Trust.

SECTION 2.10. PRINCIPAL TRANSACTIONS. Except in transactions not permitted by
the 1940 Act or rules and regulations adopted by the Commission, the
Trustees may, on behalf of the Trust, buy any securities from or sell
any securities to, or lend any assets of the Trust or any Series
thereof to any Trustee or officer of the Trust or any firm of which any
such Trustee or officer is a member acting as principal, or have any
such dealings with the Investment Adviser, Distributor or Transfer
Agent or with any Interested Person of such Person; and the Trust or a
Series thereof may employ any such Person, or firm or company in which
such Person is an Interested Person, as broker, legal counsel,
registrar, transfer agent, dividend disbursing agent or custodian upon
customary terms.

SECTION 2.11. LITIGATION. The Trustees shall have the power to engage in and to
prosecute, defend, compromise, abandon, or adjust by arbitration, or
otherwise, any actions, suits, proceedings, disputes, claims, and
demands relating to the Trust, and out of the assets of the Trust or
any Series thereof to pay or to satisfy any debts, claims or expenses
incurred in connection therewith, including those of litigation, and
such power shall include without limitation the power of the Trustees
or any appropriate committee thereof, in the exercise of their or its
good faith business judgment, to dismiss any action, suit, proceeding,
dispute, claim, or demand, derivative or otherwise, brought by any
person, including a Shareholder in its own name or the name of the
Trust, whether or not the Trust or any of the Trustees may be named
individually therein or the subject matter arises by reason of business
for or on behalf of the Trust.

SECTION 2.12. NUMBER OF TRUSTEES. The number of Trustees shall be such number
as shall be fixed from time to time by a written instrument signed by a
majority of the Trustees, provided, however, that the number of
Trustees shall in no event be less than two (2) nor more than fifteen
(15).

SECTION 2.13. ELECTION AND TERM. Except for the Trustees named herein or
appointed to fill vacancies pursuant to Section 2.15 hereof, the
Trustees may succeed themselves and shall be elected by the
Shareholders owning of record a plurality of the Shares voting at a
meeting of Shareholders on a date fixed by the Trustees. Except in the
event of resignations or removals pursuant to Section 2.14 hereof, each
Trustee shall hold office until such time as less than a majority of
the Trustees holding office have been elected by Shareholders. In such
event the Trustees then in office will call a Shareholders meeting for
the election of Trustees. Except for the foregoing circumstances, the
Trustees shall continue to hold office and may appoint successor
Trustees.

SECTION 2.14. RESIGNATION AND REMOVAL. Any Trustee may resign his trust
(without the need for any prior or subsequent accounting) by an
instrument in writing signed by him and delivered to the other Trustees
and such resignation shall be effective upon such delivery, or at a
later date according to the terms of the instrument. Any of the
Trustees may be removed (provided the aggregate number of Trustees
after such removal shall not be less than two) with cause, by the
action of two thirds of the remaining Trustees or by action of
two-thirds of the outstanding Shares of the Trust (for purposes of
determining the circumstances and procedures under which any such
removal by the Shareholders may take place, the provisions of Section
16(c) of the 1940 Act shall be applicable to the same extent as if the
Trust were subject to the provisions of that Section). Upon the
resignation or removal of a Trustee, or his otherwise ceasing to be a
Trustee, he shall execute and deliver such documents as the remaining
Trustees shall require for the purpose of conveying to the Trust or the
remaining Trustees any Trust Property held in the name of the resigning
or removed Trustee. Upon the incapacity or death of any Trustee, his
legal representative shall execute and deliver on his behalf such
documents as the remaining Trustees shall require as provided in the
preceding sentence.

SECTION 2.15. VACANCIES. The term of office of a Trustee shall terminate and a
vacancy shall occur in the event of his death, retirement, resignation,
removal, bankruptcy, adjudicated incompetence or other incapacity to
perform the duties of the office of a Trustee. No such vacancy shall
operate to annul the Declaration or to revoke any existing agency
created pursuant to the terms of the Declaration. In the case of an
existing vacancy, including a vacancy existing by reason of an increase
in the number of Trustees, subject to the provisions of Section 16(a)
of the 1940 Act, the remaining Trustees shall fill such vacancy by the
appointment of such other person as they in their discretion shall see
fit, made by a written instrument signed by a majority of the Trustees
then in office. Any such appointment shall not become effective,
however, until the person named in the written instrument of
appointment shall have accepted in writing such appointment and agreed
in writing to be bound by the terms of the Declaration. An appointment
of a Trustee may be made in anticipation of a vacancy to occur at a
later date by reason of retirement, resignation or increase in the
number of Trustees, provided that such appointment shall not become
effective prior to such retirement, resignation or increase in the
number of Trustees. Whenever a vacancy in the number of Trustees shall
occur, until such vacancy is filled as provided in this Section 2.15,
the Trustees in office, regardless of their number, shall have all the
powers granted to the Trustees and shall discharge all the duties
imposed upon the Trustees by the Declaration. A written instrument
certifying the existence of such vacancy signed by a majority of the
Trustees in office shall be conclusive evidence of the existence of
such vacancy.

SECTION 2.16. DELEGATION OF POWER TO OTHER TRUSTEES. Any Trustee may, by power
of attorney, delegate his power for a period not exceeding six (6)
months at any one time to any other Trustee or Trustees; provided that
in no case shall fewer than two (2) Trustees personally exercise the
powers granted to the Trustees under this Declaration except as herein
otherwise expressly provided.

ARTICLE III
CONTRACTS

SECTION 3.1. DISTRIBUTION CONTRACT. The Trustees may in their discretion from
time to time enter into an exclusive or non exclusive distribution
contract or contracts providing for the sale of the Shares to net the
Trust or the applicable Series of the Trust not less than the amount
provided for in Section 7.1 of Article VII hereof, whereby the Trustees
may either agree to sell the Shares to the other party to the contract
or appoint such other party as their sales agent for the Shares, and in
either case on such terms and conditions, if any, as may be prescribed
in the By-laws, and such further terms and conditions as the Trustees
may in their discretion determine not inconsistent with the provisions
of this Article III or of the By-laws; and such contract may also
provide for the repurchase of the Shares by such other party as agent
of the Trustees.

SECTION 3.2. ADVISORY OR MANAGEMENT CONTRACT. Subject to approval by a vote of
a majority of Shares outstanding and entitled to vote, the Trustees may
in their discretion from time to time enter into one or more investment
advisory or management contracts or, if the Trustees establish multiple
Series, separate investment advisory or management contracts with
respect to one or more Series whereby the other party or parties to any
such contracts shall undertake to furnish the Trust or such Series
management, investment advisory, administration, accounting, legal,
statistical and research facilities and services, promotional or
marketing activities, and such other facilities and services, if any,
as the Trustees shall from time to time consider desirable and all upon
such terms and conditions as the Trustees may in their discretion
determine. Notwithstanding any provisions of the Declaration, the
Trustees may authorize the Investment Advisers, or any of them, under
any such contracts (subject to such general or specific instructions as
the Trustees may from time to time adopt) to effect purchases, sales,
loans or exchanges of portfolio securities and other investments of the
Trust on behalf of the Trustees or may authorize any officer, employee
or Trustee to effect such purchases, sales, loans or exchanges pursuant
to recommendations of such Investment Advisers, or any of them (and all
without further action by the Trustees). Any such purchases, sales,
loans and exchanges shall be deemed to have been authorized by all of
the Trustees. The Trustees may, in their sole discretion, call a
meeting of Shareholders in order to submit to a vote of Shareholders at
such meeting the approval or continuance of any such investment
advisory or management contract. If the Shareholders of any one or more
of the Series of the Trust should fail to approve any such investment
advisory or management contract, the Investment Adviser may nonetheless
serve as Investment Adviser with respect to any Series whose
Shareholders approve such contract.

SECTION 3.3. ADMINISTRATION AGREEMENT. The Trustees may in their discretion
from time to time enter into an administration agreement or, if the
Trustees establish multiple Series or Classes separate administration
agreements with respect to each Series or Class, whereby the other
party to such agreement shall undertake to manage the business affairs
of the Trust or of a Series or Class thereof of the Trust and furnish
the Trust or a Series or a Class thereof with office facilities, and
shall be responsible for the ordinary clerical, bookkeeping and
recordkeeping services at such office facilities, and other facilities
and services, if any, and all upon such terms and conditions as the
Trustees may in their discretion determine.

SECTION 3.4. SERVICE AGREEMENT. The Trustees may in their discretion from time
to time enter into Service Agreements with respect to one or more
Series or Classes of Shares whereby the other parties to such Service
Agreements will provide administration and/or support services pursuant
to Administration Plans and Service Plans, and all upon such terms and
conditions as the Trustees in their discretion may determine.

SECTION 3.5. TRANSFER AGENT. The Trustees may in their discretion from time to
time enter into a transfer agency and shareholder service contract
whereby the other party to such contract shall undertake to furnish
transfer agency and shareholder services to the Trust. The contract
shall have such terms and conditions as the Trustees may in their
discretion determine not inconsistent with the Declaration. Such
services may be provided by one or more Persons.

SECTION 3.6. CUSTODIAN. The Trustees may appoint or otherwise engage one or
more banks or trust companies, each having an aggregate capital,
surplus and undivided profits (as shown in its last published report)
of at least two million dollars ($2,000,000) to serve as Custodian with
authority as its agent, but subject to such restrictions, limitations
and other requirements, if any, as may be contained in the By-Laws of
the Trust. The Trustees may also authorize the Custodian to employ one
or more sub-custodians, including such foreign banks and securities
depositories as meet the requirements of applicable provisions of the
1940 Act, and upon such terms and conditions as may be agreed upon
between the Custodian and such sub-custodian, to hold securities and
other assets of the Trust and to perform the acts and services of the
Custodian, subject to applicable provisions of law and resolutions
adopted by the Trustees.

SECTION 3.7. AFFILIATIONS OF TRUSTEES OR OFFICERS, ETC. The fact that:
(i) any of the Shareholders, Trustees or officers of the Trust or any
Series thereof is a shareholder, director, officer, partner, trustee,
employee, manager, adviser or distributor of or for any partnership,
corporation, trust, association or other organization or of or for any
parent or affiliate of any organization, with which a contract of the
character described in Sections 3.1, 3.2, 3.3 or 3.4 above or for
services as Custodian, Transfer Agent or disbursing agent or for
related services may have been or may hereafter be made, or that any
such organization, or any parent or affiliate thereof, is a Shareholder
of or has an interest in the Trust, or that

(ii) any partnership, corporation, trust, association or other
organization with which a contract of the character described in
Sections 3.1, 3.2, 3.3 or 3.4 above or for services as Custodian,
Transfer Agent or disbursing agent or for related services may have
been or may hereafter be made also has any one or more of such
contracts with one or more other partnerships, corporations, trusts,
associations or other organizations, or has other business or
interests, shall not affect the validity of any such contract or
disqualify any Shareholder, Trustee or officer of the Trust from voting
upon or executing the same or create any liability or accountability to
the Trust or its Shareholders.

SECTION 3.8. COMPLIANCE WITH 1940 ACT. Any contract entered into pursuant to
Sections 3.1 or 3.2 shall be consistent with and subject to the
requirements of Section 15 of the 1940 Act (including any amendment
thereof or other applicable Act of Congress hereafter enacted), as
modified by any applicable order or orders of the Commission, with
respect to its continuance in effect, its termination and the method of
authorization and approval of such contract or renewal thereof.

ARTICLE IV
LIMITATIONS OF LIABILITY OF SHAREHOLDERS, TRUSTEES AND OTHERS

SECTION 4.1. NO PERSONAL LIABILITY OF SHAREHOLDERS, TRUSTEES, ETC. No
Shareholder shall be subject to any personal liability whatsoever to
any Person in connection with Trust Property or the acts, obligations
or affairs of the Trust or any Series thereof. No Trustee, officer,
employee or agent of the Trust or any Series thereof shall be subject
to any personal liability whatsoever to any Person, other than to the
Trust or its Shareholders, in connection with Trust Property or the
affairs of the Trust, save only that arising from bad faith, willful
misfeasance, gross negligence or reckless disregard of his duties with
respect to such Person; and all such Persons shall look solely to the
Trust Property, or to the Property of one or more specific Series of
the Trust if the claim arises from the conduct of such Trustee,
officer, employee or agent with respect to only such Series, for
satisfaction of claims of any nature arising in connection with the
affairs of the Trust. If any Shareholder, Trustee, officer, employee,
or agent, as such, of the Trust or any Series thereof, is made a party
to any suit or proceeding to enforce any such liability of the Trust or
any Series thereof, he shall not, on account thereof, be held to any
personal liability. The Trust shall indemnify and hold each Shareholder
harmless from and against all claims and liabilities, to which such
Shareholder may become subject by reason of his being or having been a
Shareholder, and shall reimburse such Shareholder or former Shareholder
(or his or her heirs, executors, administrators or other legal
representatives or in the case of a corporation or other entity, its
corporate or other general successor) out of the Trust Property for all
legal and other expenses reasonably incurred by him in connection with
any such claim or liability. The indemnification and reimbursement
required by the preceding sentence shall be made only out of assets of
the one or more Series whose Shares were held by said Shareholder at
the time the act or event occurred which gave rise to the claim against
or liability of said Shareholder. The rights accruing to a Shareholder
under this Section 4.1 shall not impair any other right to which such
Shareholder may be lawfully entitled, nor shall anything herein
contained restrict the right of the Trust or any Series thereof to
indemnify or reimburse a Shareholder in any appropriate situation even
though not specifically provided herein.

SECTION 4.2. NON-LIABILITY OF TRUSTEES, ETC. No Trustee, officer, employee or
agent of the Trust or any Series thereof shall be liable to the Trust,
its Shareholders, or to any Shareholder, Trustee, officer, employee, or
agent thereof for any action or failure to act (including without
limitation the failure to compel in any way any former or acting
Trustee to redress any breach of trust) except for his own bad faith,
willful misfeasance, gross negligence or reckless disregard of the
duties involved in the conduct of his office.

SECTION 4.3. MANDATORY INDEMNIFICATION.
(a) Subject to the exceptions and limitations contained in paragraph
(b) below:

(i) every person who is, or has been, a Trustee, officer,
employee or agent of the Trust (including any individual who
serves at its request as director, officer, partner, trustee
or the like of another organization in which it has any
interest as a shareholder, creditor or otherwise) shall be
indemnified by the Trust, or by one or more Series thereof if
the claim arises from his or her conduct with respect to only
such Series, to the fullest extent permitted by law against
all liability and against all expenses reasonably incurred or
paid by him in connection with any claim, action, suit or
proceeding in which he becomes involved as a party or
otherwise by virtue of his being or having been a Trustee or
officer and against amounts paid or incurred by him in the
settlement thereof;

(ii) the words "claim," "action," "suit," or "proceeding"
shall apply to all claims, actions, suits or proceedings
(civil, criminal, or other, including appeals), actual or
threatened; and the words "liability" and "expenses" shall
include, without limitation, attorneys' fees, costs,
judgments, amounts paid in settlement, fines, penalties and
other liabilities.

b) No indemnification shall be provided hereunder to a Trustee or
officer:

(i) against any liability to the Trust, a Series thereof or
the Shareholders by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved
in the conduct of his office;

(ii) with respect to any matter as to which he shall have been
finally adjudicated not to have acted in good faith in the
reasonable belief that his action was in the best interest of
the Trust or a Series thereof;

(iii) in the event of a settlement or other disposition not
involving a final adjudication as provided in paragraph
(b)(ii) resulting in a payment by a Trustee or officer, unless
there has been a determination that such Trustee or officer
did not engage in willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the
conduct of his office: (A) by the court or other body
approving the settlement or other disposition; (B) based upon
a review of readily available facts (as opposed to a full
trial-type inquiry) by (x) vote of a majority of the
Non-interested Trustees acting on the matter (provided that a
majority of the Non-interested Trustees then in office act on
the matter) or (y) written opinion of independent legal
counsel; or (C) a vote of a majority of the Shares outstanding
and entitled to vote (excluding Shares owned of record or
beneficially by such individual).

(c) The rights of indemnification herein provided may be insured
against by policies maintained by the Trust, shall be severable, shall
not affect any other rights to which any Trustee or officer may now or
hereafter be entitled, shall continue as to a person who has ceased to
be such Trustee or officer and shall inure to the benefit of the heirs,
executors, administrators and assigns of such a person. Nothing
contained herein shall affect any rights to indemnification to which
personnel of the Trust or any Series thereof other than Trustees and
officers may be entitled by contract or otherwise under law.

(d) Expenses of preparation and presentation of a defense to any claim,
action, suit or proceeding of the character described in paragraph (a)
of this Section 4.3 may be advanced by the Trust or a Series thereof
prior to final disposition thereof upon receipt of an undertaking by or
on behalf of the recipient to repay such amount if it is ultimately
determined that he is not entitled to indemnification under this
Section 4.3, provided that either:

(i) such undertaking is secured by a surety bond or some other
appropriate security provided by the recipient, or the Trust
or Series thereof shall be insured against losses arising out
of any such advances; or

(ii) a majority of the Non-interested Trustees acting on the
matter (provided that a majority of the Non-interested
Trustees act on the matter) or an independent legal counsel in
a written opinion shall determine, based upon a review of
readily available facts (as opposed to a full trial-type
inquiry), that there is reason to believe that the recipient
ultimately will be found entitled to indemnification. As used
in this Section 4.3, a "Non-interested Trustee" is one who (i)
is not an "Interested Person" of the Trust (including anyone
who has been exempted from being an "Interested Person" by any
rule, regulation or order of the Commission), and (ii) is not
involved in the claim, action, suit or proceeding.

SECTION 4.4. NO BOND REQUIRED OF TRUSTEES. No Trustee shall be obligated to
give any bond or other security for the performance of any of his
duties hereunder.

SECTION 4.5. NO DUTY OF INVESTIGATION; NOTICE IN TRUST INSTRUMENTS, ETC. No
purchaser, lender, transfer agent or other Person dealing with the
Trustees or any officer, employee or agent of the Trust or a Series
thereof shall be bound to make any inquiry concerning the validity of
any transaction purporting to be made by the Trustees or by said
officer, employee or agent or be liable for the application of money or
property paid, loaned, or delivered to or on the order of the Trustees
or of said officer, employee or agent. Every obligation, contract,
instrument, certificate, Share, other security of the Trust or a Series
thereof or undertaking, and every other act or thing whatsoever
executed in connection with the Trust shall be conclusively presumed to
have been executed or done by the executors thereof only in their
capacity as Trustees under this Declaration or in their capacity as
officers, employees or agents of the Trust or a Series thereof. Every
written obligation, contract, instrument, certificate, Share, other
security of the Trust or a Series thereof or undertaking made or issued
by the Trustees may recite that the same is executed or made by them
not individually, but as Trustees under the Declaration, and that the
obligations of the Trust or a Series thereof under any such instrument
are not binding upon any of the Trustees or Shareholders individually,
but bind only the Trust Property or the Trust Property of the
applicable Series, and may contain any further recital which they may
deem appropriate, but the omission of such recital shall not operate to
bind the Trustees individually. The Trustees shall at all times
maintain insurance for the protection of the Trust Property or the
Trust Property of the applicable Series, its Shareholders, Trustees,
officers, employees and agents in such amount as the Trustees shall
deem adequate to cover possible tort liability, and such other
insurance as the Trustees in their sole judgment shall deem advisable.

SECTION 4.6. RELIANCE ON EXPERTS, ETC. Each Trustee, officer or employee of the
Trust or a Series thereof shall, in the performance of his duties, be
fully and completely justified and protected with regard to any act or
any failure to act resulting from reliance in good faith upon the books
of account or other records of the Trust or a Series thereof, upon an
opinion of counsel, or upon reports made to the Trust or a Series
thereof by any of its officers or employees or by the Investment
Adviser, the Administrator, the Distributor, Transfer Agent, selected
dealers, accountants, appraisers or other experts or consultants
selected with reasonable care by the Trustees, officers or employees of
the Trust, regardless of whether such counsel or expert may also be a
Trustee.

ARTICLE V
SHARES OF BENEFICIAL INTEREST

SECTION 5.1. BENEFICIAL INTEREST. The interest of the beneficiaries hereunder
shall be divided into transferable Shares of beneficial interest
without par value. The number of such Shares of beneficial interest
authorized hereunder is unlimited. The Trustees shall have the
exclusive authority without the requirement of Shareholder approval to
establish and designate one or more Series of shares and one or more
Classes thereof as the Trustees deem necessary or desirable. Each Share
of any Series shall represent an equal proportionate Share in the
assets of that Series with each other Share in that Series. Subject to
the provisions of Section 5.11 hereof, the Trustees may also authorize
the creation of additional Series of Shares (the proceeds of which may
be invested in separate, independently managed portfolios) and
additional Classes of Shares within any Series. All Shares issued
hereunder including, without limitation, Shares issued in connection
with a dividend in Shares or a split in Shares, shall be fully paid and
nonassessable.

SECTION 5.2. RIGHTS OF SHAREHOLDERS. The ownership of the Trust Property of
every description and the right to conduct any business herein before
described are vested exclusively in the Trustees, and the Shareholders
shall have no interest therein other than the beneficial interest
conferred by their Shares, and they shall have no right to call for any
partition or division of any property, profits, rights or interests of
the Trust nor can they be called upon to share or assume any losses of
the Trust or suffer an assessment of any kind by virtue of their
ownership of Shares. The Shares shall be personal property giving only
the rights specifically set forth in this Declaration. The Shares shall
not entitle the holder to preference, preemptive, appraisal, conversion
or exchange rights, except as the Trustees may determine with respect
to any Series or Class of Shares.

SECTION 5.3. TRUST ONLY. It is the intention of the Trustees to create only the
relationship of Trustee and beneficiary between the Trustees and each
Shareholder from time to time. It is not the intention of the Trustees
to create a general partnership, limited partnership, joint stock
association, corporation, bailment or any form of legal relationship
other than a trust. Nothing in this Declaration of Trust shall be
construed to make the Shareholders, either by themselves or with the
Trustees, partners or members of a joint stock association.

SECTION 5.4. ISSUANCE OF SHARES. The Trustees in their discretion may, from
time to time without vote of the Shareholders, issue Shares, in
addition to the then issued and outstanding Shares and Shares held in
the treasury, to such party or parties and for such amount and type of
consideration, including cash or property, at such time or times and on
such terms as the Trustees may deem best, except that only Shares
previously contracted to be sold may be issued during any period when
the right of redemption is suspended pursuant to Section 6.9 hereof,
and may in such manner acquire other assets (including the acquisition
of assets subject to, and in connection with the assumption of,
liabilities) and businesses. In connection with any issuance of Shares,
the Trustees may issue fractional Shares and Shares held in the
treasury. The Trustees may from time to time divide or combine the
Shares of the Trust or, if the Shares be divided into Series or
Classes, of any Series or any Class thereof of the Trust, into a
greater or lesser number without thereby changing the proportionate
beneficial interests in the Trust or in the Trust Property allocated or
belonging to such Series or Class. Contributions to the Trust or Series
thereof may be accepted for, and Shares shall be redeemed as, whole
Shares and/or 1/1,000ths of a Share or integral multiples thereof.

SECTION 5.5. REGISTER OF SHARES. A register shall be kept at the principal
office of the Trust or an office of the Transfer Agent which shall
contain the names and addresses of the Shareholders and the number of
Shares held by them respectively and a record of all transfers thereof.
Such register shall be conclusive as to who are the holders of the
Shares and who shall be entitled to receive dividends or distributions
or otherwise to exercise or enjoy the rights of Shareholders. No
Shareholder shall be entitled to receive payment of any dividend or
distribution, nor to have notice given to him as provided herein or in
the By-laws, until he has given his address to the Transfer Agent or
such other officer or agent of the Trustees as shall keep the said
register for entry thereon. It is not contemplated that certificates
will be issued for the Shares; however, the Trustees, in their
discretion, may authorize the issuance of share certificates and
promulgate appropriate rules and regulations as to their use.

SECTION 5.6. TRANSFER OF SHARES. Shares shall be transferable on the records of
the Trust only by the record holder thereof or by his agent thereunto
duly authorized in writing, upon delivery to the Trustees or the
Transfer Agent of a duly executed instrument of transfer, together with
such evidence of the genuineness of each such execution and
authorization and of other matters as may reasonably be required. Upon
such delivery the transfer shall be recorded on the register of the
Trust. Until such record is made, the Shareholder of record shall be
deemed to be the holder of such Shares for all purposes hereunder and
neither the Trustees nor any transfer agent or registrar nor any
officer, employee or agent of the Trust shall be affected by any notice
of the proposed transfer. Any person becoming entitled to any Shares in
consequence of the death, bankruptcy, or incompetence of any
Shareholder, or otherwise by operation of law, shall be recorded on the
register of Shares as the holder of such Shares upon production of the
proper evidence thereof to the Trustees or the Transfer Agent, but
until such record is made, the Shareholder of record shall be deemed to
be the holder of such Shares for all purposes hereunder and neither the
Trustees nor any Transfer Agent or registrar nor any officer or agent
of the Trust shall be affected by any notice of such death, bankruptcy
or incompetence, or other operation of law.

SECTION 5.7. NOTICES. Any and all notices to which any Shareholder may be
entitled and any and all communications shall be deemed duly served or
given if mailed, postage prepaid, addressed to any Shareholder of
record at his last known address as recorded on the register of the
Trust.

SECTION 5.8. TREASURY SHARES. Shares held in the treasury shall, until resold
pursuant to Section 5.4, not confer any voting rights on the Trustees,
nor shall such Shares be entitled to any dividends or other
distributions declared with respect to the Shares.

SECTION 5.9. VOTING POWERS. The Shareholders shall have power to vote only

(i) for the election of Trustees as provided in Section 2.13;

(ii) with respect to any investment advisory contract entered
into pursuant to Section 3.2;

(iii) with respect to termination of the Trust or a Series or
Class thereof as provided in Section 8.2;

(iv) with respect to any amendment of this Declaration to the
extent and as provided in Section 8.3;

(v) with respect to any merger, consolidation or sale of
assets as provided in Section 8.4;

(vi) with respect to incorporation of the Trust to the extent
and as provided in Section 8.5;

(vii) to the same extent as the stockholders of a
Massachusetts business corporation as to whether or not a
court action, proceeding or claim should or should not be
brought or maintained derivatively or as a class action on
behalf of the Trust or a Series thereof or the Shareholders of
either;

(viii) with respect to any plan adopted pursuant to Rule 12b-1
(or any successor rule) under the 1940 Act, and related
matters; and

(ix) with respect to such additional matters relating to the
Trust as may be required by this Declaration, the By-laws or
any registration of the Trust as an investment company under
the 1940 Act with the Commission (or any successor agency) or
as the Trustees may consider necessary or desirable. Each
whole Share shall be entitled to one vote as to any matter on
which it is entitled to vote and each fractional Share shall
be entitled to a proportionate fractional vote. On any matter
submitted to a vote of Shareholders, all Shares shall be voted
by individual Series except (1) when permitted by the 1940
Act, Shares shall be voted in the aggregate and not by
individual Series; and (2) when the Trustees have determined
that the matter affects only the interests of one or more
Series or Class thereof, then only the Shareholders of such
Series or Class thereof shall be entitled to vote thereon. The
Trustees may, in conjunction with the establishment of any
further Series or any Classes of Shares, establish conditions
under which the several Series or Classes of Shares shall have
separate voting rights or no voting rights. There shall be no
cumulative voting in the election of Trustees. Until Shares
are issued, the Trustees may exercise all rights of
Shareholders and may take any action required by law, this
Declaration or the By-laws to be taken by Shareholders. The
By-laws may include further provisions for Shareholders' votes
and meetings and related matters.

SECTION 5.10. MEETINGS OF SHAREHOLDERS. No annual or regular meetings of
Shareholders are required. Special meetings of the Shareholders,
including meetings involving only the holders of Shares of one or more
but less than all Series or lasses thereof, may be called at any time
by the Chairman of the Board, President, or any Vice-President of the
Trust, and shall be called by the President or the Secretary at the
request, in writing or by resolution, of a majority of the Trustees, or
at the written request of the holder or holders of ten percent (10%) or
more of the total number of Shares then issued and outstanding of the
Trust entitled to vote at such meeting. Meetings of the Shareholders of
any Series of the Trust shall be called by the President or the
Secretary at the written request of the holder or holders of ten
percent (10%) or more of the total number of Shares then issued and
outstanding of such Series of the Trust entitled to vote at such
meeting. Any such request shall state the purpose of the proposed
meeting.

SECTION 5.11. SERIES OR CLASS DESIGNATION.

(a) Without limiting the authority of the Trustees set forth in Section
5.1 to establish and designate any further Series, it is hereby
confirmed that the Trust consists of the presently Outstanding Shares
of a single Series: John Hancock Special Equities Fund (the "Existing
Series").

(b) Without limiting the authority of the Trustees set forth in Section
5.1 to establish and designate any further Classes, there are hereby
established and designated three distinct Classes of Shares of the
Existing Series: "Class A"-Shares of which are subject to a sales
charge at time of purchase and a Class A Rule 12b-1 distribution plan
(the "Front-End Option"); "Class B"--Shares of which are subject to a
contingent deferred sales charge ("CDSC"), a Class B Rule 12b-1
distribution plan, and automatic conversion to Class A Shares seven
years after purchase, provided that there is an ongoing opinion of
counsel or an Internal Revenue Service Ruling that such conversion is a
nontaxable event (the "CDSC Option"); and "Class C"--Shares of which
are offered for purchase to certain institutional investors with no
sales charge and no Class C Rule 12b-1 distribution plan (the "No-Load
Option"). Each outstanding Share of any Series shall be of Class A
unless the Trustees, with the consent of the holder of the Share (which
consent shall be evidenced by the holder's subscription of Shares of a
specified Class or by any other action prescribed by the Trustees),
determines that such Share is or shall be of some other Class.

(c) The Shares of the existing Series and such Classes thereof herein
established and designated and any Shares of any further Series and
Classes thereof that may from time to time be established and
designated by the Trustees shall be established and designated, and the
variations in the relative rights and preferences as between the
different Series shall be fixed and determined, by the Trustees (unless
the Trustees otherwise determine with respect to further Series or
Classes at the time of establishing and designating the same);
provided, that all Shares shall be identical except that there may be
variations so fixed and determined between different Series or Classes
thereof as to investment objective, policies and restrictions, purchase
price, payment obligations, distribution expenses, right of redemption,
special and relative rights as to dividends and on liquidation,
conversion rights, exchange rights, and conditions under which the
several Series shall have separate voting rights, all of which are
subject to the limitations set forth below. All references to Shares in
this Declaration shall be deemed to be Shares of any or all Series or
Classes as the context may require.

(d) As to any existing Series and Classes, both heretofore and herein
established and designated, and any further division of Shares of the
Trust into additional Series or Classes, the following provisions shall
be applicable:

(i) The number of authorized Shares and the number of Shares
of each Series or Class thereof that may be issued shall be
unlimited. The Trustees may classify or reclassify any
unissued Shares or any Shares previously issued and reacquired
of any Series or Class into one or more Series or one or more
Classes that may be established and designated from time to
time. The Trustees may hold as treasury shares (of the same or
some other Series or Class), reissue for such consideration
and on such terms as they may determine, or cancel any Shares
of any Series or Class reacquired by the Trust at their
discretion from time to time.

(ii) All consideration received by the Trust for the issue or
sale of Shares of a particular Series or Class, together with
all assets in which such consideration is invested or
reinvested, all income, earnings, profits, and proceeds
thereof, including any proceeds derived from the sale,
exchange or liquidation of such assets, and any funds or
payments derived from any reinvestment of such proceeds in
whatever form the same may be, shall irrevocably belong to
that Series for all purposes, subject only to the rights of
creditors of such Series and except as may otherwise be
required by applicable tax laws, and shall be so recorded upon
the books of account of the Trust. In the event that there are
any assets, income, earnings, profits, and proceeds thereof,
funds, or payments which are not readily identifiable as
belonging to any particular Series, the Trustees shall
allocate them among any one or more of the Series established
and designated from time to time in such manner and on such
basis as they, in their sole discretion, deem fair and
equitable. Each such allocation by the Trustees shall be
conclusive and binding upon the Shareholders of all Series for
all purposes. No holder of Shares of any Series shall have any
claim on or right to any assets allocated or belonging to any
other Series.

(iii) The assets belonging to each particular Series shall be
charged with the liabilities of the Trust in respect of that
Series or the appropriate Class or Classes thereof and all
expenses, costs, charges and reserves attributable to that
Series or Class or Classes thereof, and any general
liabilities, expenses, costs, charges or reserves of the Trust
which are not readily identifiable as belonging to any
particular Series shall be allocated and charged by the
Trustees to and among any one or more of the Series
established and designated from time to time in such manner
and on such basis as the Trustees in their sole discretion
deem fair and equitable. Each allocation of liabilities,
expenses, costs, charges and reserves by the Trustees shall be
conclusive and binding upon the Shareholders of all Series and
Classes for all purposes. The Trustees shall have full
discretion, to the extent not inconsistent with the 1940 Act,
to determine which items are capital; and each such
determination and allocation shall be conclusive and binding
upon the Shareholders. The assets of a particular Series of
the Trust shall, under no circumstances, be charged with
liabilities attributable to any other Series or Class thereof
of the Trust. All persons extending credit to, or contracting
with or having any claim against a particular Series or Class
of the Trust shall look only to the assets of that particular
Series for payment of such credit, contract or claim.

(iv) The power of the Trustees to pay dividends and make
distributions shall be governed by Section 7.2 of this
Declaration with respect to any Series or Classes which
represent the interests in the assets of the Trust immediately
prior to the establishment of two or more Series or Classes.
With respect to any other Series or Class, dividends and
distributions on Shares of a particular Series or Class may be
paid with such frequency as the Trustees may determine, which
may be daily or otherwise, pursuant to a standing resolution
or resolutions adopted only once or with such frequency as the
Trustees may determine, to the holders of Shares of that
Series or Class, from such of the income and capital gains,
accrued or realized, from the assets belonging to that Series,
as the Trustees may determine, after providing for actual and
accrued liabilities belonging to that Series or Class. All
dividends and distributions on Shares of a particular Series
or Class shall be distributed pro rata to the Shareholders of
that Series or Class in proportion to the number of Shares of
that Series or Class held by such Shareholders at the time of
record established for the payment of such dividends or
distribution.

(v) Each Share of a Series of the Trust shall represent a
beneficial interest in the net assets of such Series. Each
holder of Shares of a Series or Class thereof shall be
entitled to receive his pro rata share of distributions of
income and capital gains made with respect to such Series or
Class net of expenses. Upon redemption of his Shares or
indemnification for liabilities incurred by reason of his
being or having been a Shareholder of a Series or Class, such
Shareholder shall be paid solely out of the funds and property
of such Series of the Trust. Upon liquidation or termination
of a Series or Class thereof of the Trust, Shareholders of
such Series or Class thereof shall be entitled to receive a
pro rata share of the net assets of such Series. A Shareholder
of a particular Series of the Trust shall not be entitled to
participate in a derivative or class action on behalf of any
other Series or the Shareholders of any other Series of the
Trust.

(vi) On each matter submitted to a vote of Shareholders, all
Shares of all Series and Classes shall vote as a single class;
provided, however, that (1) as to any matter with respect to
which a separate vote of any Series or Class is required by
the 1940 Act or is required by attributes applicable to any
Class or is required by any Rule 12b-1 plan, such requirements
as to a separate vote by that Series or Class shall apply, (2)
to the extent that a matter referred to in (1) above, affects
more than one Class or Series and the interests of each such
Class or Series in the matter are identical, then, subject to
(3) below, the Shares of all such affected Classes or Series
shall vote as a single Class; (3) as to any matter which does
not affect the interests of a particular Series or Class, only
the holders of Shares of the one or more affected Series or
Classes shall be entitled to vote; and (4) the provisions of
the following sentence shall apply. On any matter that
pertains to any particular Class of a particular Series or to
any class expenses with respect to any Series which matter may
be submitted to a vote of Shareholders, only Shares of the
affected Class, as the case may be, or that Series shall be
entitled to vote except that: (i) to the extent said matter
affects Shares of another Class or Series, such other Shares
shall also be entitled to vote, and in such cases Shares of
the affected Class, as the case may be, of such Series shall
be voted in the aggregate together with such other Shares; and
(ii) to the extent that said matter does not affect Shares of
a particular Class of such Series, said Shares shall not be
entitled to vote (except where otherwise required by law or
permitted by the Trustees acting in their sole discretion)
even though the matter is submitted to a vote of the
Shareholders of any other Class or Series.

(vii) Except as otherwise provided in this Article V, the
Trustees shall have the power to determine the designations,
preferences, privileges, payment obligations, limitations and
rights, including voting and dividend rights, of each Class
and Series of Shares. Subject to compliance with the
requirement of the 1940 Act, the Trustees shall have the
authority to provide that the holders of Shares of any Series
or Class shall have the right to convert or exchange said
Shares into Shares of one or more Series or Classes of Shares
in accordance with such requirements, conditions and
procedures as may be established by the Trustees.

(viii) The establishment and designation of any Series or
Classes of Shares shall be effective upon the execution by a
majority of the then Trustees of an instrument setting forth
such establishment and designation and the relative rights and
preferences of such Series or Classes, or as otherwise
provided in such instrument. At any time that there are no
Shares outstanding of any particular Series or Class
previously established and designated, the Trustees may by an
instrument executed by a majority of their number abolish that
Series or Class and the establishment and designation thereof.
Each instrument referred to in this section shall have the
status of an amendment to this Declaration.

SECTION 5.12. ASSENT TO DECLARATION OF TRUST. Every Shareholder, by virtue of
having become a Shareholder, shall be held to have expressly assented
and agreed to the terms hereof and to have become a party hereto.

ARTICLE VI
REDEMPTION AND REPURCHASE OF SHARES

SECTION 6.1. REDEMPTION OF SHARES.

(a) All Shares of the Trust shall be redeemable, at the redemption
price determined in the manner set out in this Declaration. Redeemed or
repurchased Shares may be resold by the Trust. The Trust may require
any Shareholder to pay a sales charge to the Trust, the underwriter, or
any other person designated by the Trustees upon redemption or
repurchase of Shares in such amount and upon such conditions as shall
be determined from time to time by the Trustees.

(b) The Trust shall redeem the Shares of the Trust or any Series or
Class thereof at the price determined as hereinafter set forth, upon
the appropriately verified written application of the record holder
thereof (or upon such other form of request as the Trustees may
determine) at such office or agency as may be designated from time to
time for that purpose by the Trustees. The Trustees may from time to
time specify additional conditions, not inconsistent with the 1940 Act,
regarding the redemption of Shares in the Trust's then effective
Prospectus.

SECTION 6.2. PRICE. Shares shall be redeemed at a price based on their net
asset value determined as set forth in Section 7.1 hereof as of such
time as the Trustees shall have theretofore prescribed by resolution.
In the absence of such resolution, the redemption price of Shares
deposited shall be based on the net asset value of such Shares next
determined as set forth in Section 7.1 hereof after receipt of such
application. The amount of any contingent deferred sales charge or
redemption fee payable upon redemption of Shares may be deducted from
the proceeds of such redemption.

SECTION 6.3. PAYMENT. Payment of the redemption price of Shares of the Trust or
any Series or Class thereof shall be made in cash or in property to the
Shareholder at such time and in the manner, not inconsistent with the
1940 Act or other applicable laws, as may be specified from time to
time in the Trust's then effective Prospectus, subject to the
provisions of Section 6.4 hereof. Notwithstanding the foregoing, the
Trustees may withhold from such redemption proceeds any amount arising
(i) from a liability of the redeeming Shareholder to the Trust or (ii)
in connection with any Federal or state tax withholding requirements.

SECTION 6.4. EFFECT OF SUSPENSION OF DETERMINATION OF NET ASSET VALUE. If,
pursuant to Section 6.9 hereof, the Trustees shall declare a suspension
of the determination of net asset value with respect to Shares of the
Trust or of any Series or Class thereof, the rights of Shareholders
(including those who shall have applied for redemption pursuant to
Section 6.1 hereof but who shall not yet have received payment) to have
Shares redeemed and paid for by the Trust or a Series or Class thereof
shall be suspended until the termination of such suspension is
declared. Any record holder who shall have his redemption right so
suspended may, during the period of such suspension, by appropriate
written notice of revocation at the office or agency where application
was made, revoke any application for redemption not honored and
withdraw any Share certificates on deposit. The redemption price of
Shares for which redemption applications have not been revoked shall be
based on the net asset value of such Shares next determined as set
forth in Section 7.1 after the termination of such suspension, and
payment shall be made within seven (7) days after the date upon which
the application was made plus the period after such application during
which the determination of net asset value was suspended.

SECTION 6.5. REPURCHASE BY AGREEMENT. The Trust may repurchase Shares directly,
or through the Distributor or another agent designated for the purpose,
by agreement with the owner thereof at a price not exceeding the net
asset value per share determined as of the time when the purchase or
contract of purchase is made or the net asset value as of any time
which may be later determined pursuant to Section 7.1 hereof, provided
payment is not made for the Shares prior to the time as of which such
net asset value is determined.

SECTION 6.6. REDEMPTION OF SHAREHOLDER'S INTEREST. The Trustees, in their sole
discretion, may cause the Trust to redeem all of the Shares of one or
more Series or Class thereof held by any Shareholder if the value of
such Shares held by such Shareholder is less than the minimum amount
established from time to time by the Trustees.

SECTION 6.7. REDEMPTION OF SHARES IN ORDER TO QUALIFY AS REGULATED INVESTMENT
COMPANY; DISCLOSURE OF HOLDING.

(a) If the Trustees shall, at any time and in good faith, be of the
opinion that direct or indirect ownership of Shares or other securities
of the Trust has or may become concentrated in any Person to an extent
which would disqualify the Trust or any Series of the Trust as a
regulated investment company under the Internal Revenue Code of 1986
then the Trustees shall have the power by lot or other means deemed
equitable by them

(i) to call for redemption by any such Person a number, or
principal amount, of Shares or other securities of the Trust
or any Series of the Trust sufficient to maintain or bring the
direct or indirect ownership of Shares or other securities of
the Trust or any Series of the Trust into conformity with the
requirements for such qualification and

(ii) to refuse to transfer or issue Shares or other securities
of the Trust or any Series of the Trust to any Person whose
acquisition of the Shares or other securities of the Trust or
any Series of, the Trust in question would result in such
disqualification. The redemption shall be effected at the
redemption price and in the manner provided in Section 6.1.

(b) The holders of Shares or other securities of the Trust shall upon
demand disclose to the Trustees in writing such information with
respect to direct and indirect ownership of Shares or other securities
of the Trust as the Trustees deem necessary to comply with the
provisions of the Internal Revenue Code of 1986, or to comply with the
requirements of any other taxing authority.

SECTION 6.8. REDUCTIONS IN NUMBER OF OUTSTANDING SHARES PURSUANT TO NET ASSET
VALUE FORMULA. The Trust may also reduce the number of outstanding
Shares of the Trust or of any Series of the Trust pursuant to the
provisions of Section 7.3.

SECTION 6.9. SUSPENSION OF RIGHT OF REDEMPTION. The Trust may declare a
suspension of the right of redemption or postpone the date of payment or
redemption for the whole or any part of any period

(i) during which the New York Stock Exchange is closed other
than customary weekend and holiday closings,

(ii) during which trading on the New York Stock Exchange is
restricted,

(iii) during which an emergency exists as a result of which
disposal by the Trust or a Series thereof of securities owned
by it is not reasonably practicable or it is not reasonably
practicable for the Trust or a Series thereof fairly to
determine the value of its net assets, or

(iv) during any other period when the Commission may for the
protection of Shareholders of the Trust by order permit
suspension of the right of redemption or postponement of the
date of payment or redemption; provided that applicable rules
and regulations of the Commission shall govern as to whether
the conditions prescribed in (ii), (iii), or (iv) exist. Such
suspension shall take effect at such time as the Trust shall
specify but not later than the close of business on the
business day next following the declaration of suspension, and
thereafter there shall be no right of redemption or payment on
redemption until the Trust shall declare the suspension at an
end, except that the suspension shall terminate in any event
on the first day on which said stock exchange shall have
reopened or the period specified in (ii) or (iii) shall have
expired (as to which in the absence of an official ruling by
the Commission, the determination of the Trust shall be
conclusive). In the case of a suspension of the right of
redemption, a Shareholder may either withdraw his request for
redemption or receive payment based on the net asset value
existing after the termination of the suspension.

ARTICLE VII
DETERMINATION OF NET ASSET VALUE, NET INCOME AND DISTRIBUTIONS

SECTION 7.1. NET ASSET VALUE. The net asset value of each outstanding Share of
the Trust or of each Series or Class thereof shall be determined on such days
and at such time or times as the Trustees may determine. The value of the assets
of the Trust or any Series thereof may be determined

(i) by a pricing service which utilizes electronic pricing
techniques based on general institutional trading,

(ii) by appraisal of the securities owned by the Trust or any
Series of the Trust,

(iii) in certain cases, at amortized cost, or

(iv) by such other method as shall be deemed to reflect the
fair value thereof, determined in good faith by or under the
direction of the Trustees. From the total value of said
assets, there shall be deducted all indebtedness, interest,
taxes, payable or accrued, including estimated taxes on
unrealized book profits, expenses and management charges
accrued to the appraisal date, net income determined and
declared as a distribution and all other items in the nature
of liabilities which shall be deemed appropriate, as incurred
by or allocated to the Trust or any Series or Class of the
Trust. The resulting amount which shall represent the total
net assets of the Trust or Series or Class thereof shall be
divided by the number of Shares of the Trust or Series or
Class thereof outstanding at the time and the quotient so
obtained shall be deemed to be the net asset value of the
Shares of the Trust or Series or Class thereof. The net asset
value of the Shares shall be determined at least once on each
business day, as of the close of regular trading on the New
York Stock Exchange or as of such other time or times as the
Trustees shall determine. The power and duty to make the daily
calculations may be delegated by the Trustees to the
Investment Adviser, the Administrator, the Custodian, the
Transfer Agent or such other Person as the Trustees by
resolution may determine. The Trustees may suspend the daily
determination of net asset value to the extent permitted by
the 1940 Act. It shall not be a violation of any provision of
this Declaration of Trust if Shares are sold, redeemed or
repurchased by the Trust at a price other than one based on
net asset value if the net asset value is affected by one or
more errors inadvertently made in the pricing of portfolio
securities or in accruing income, expenses or liabilities.

SECTION 7.2. DISTRIBUTIONS TO SHAREHOLDERS.

(a) The Trustees shall from time to time distribute ratably among the
Shareholders of the Trust or of a Series or Class thereof such
proportion of the net profits, surplus (including paid-in surplus),
capital, or assets of the Trust or such Series held by the Trustees as
they may deem proper. Such distributions may be made in cash or
property (including without limitation any type of obligations of the
Trust or Series or Class or any assets thereof), and the Trustees may
distribute ratably among the Shareholders of the Trust or Series or
Class thereof additional Shares of the Trust or Series or Class thereof
issuable hereunder in such manner, at such times, and on such terms as
the Trustees may deem proper. Such distributions may be among the
Shareholders of the Trust or Series or Class thereof at the time of
declaring a distribution or among the Shareholders of the Trust or
Series or Class thereof at such other date or time or dates or times as
the Trustees shall determine. The Trustees may in their discretion
determine that, solely for the purposes of such distributions,
Outstanding Shares shall exclude Shares for which orders have been
placed subsequent to a specified time on the date the distribution is
declared or on the next preceding day if the distribution is declared
as of a day on which Boston banks are not open for business, all as
described in the then effective prospectus under the Securities Act of
1933. The Trustees may always retain from the net profits such amount
as they may deem necessary to pay the debts or expenses of the Trust or
a Series or Class thereof or to meet obligations of the Trust or a
Series or Class thereof, or as they may deem desirable to use in the
conduct of its affairs or to retain for future requirements or
extensions of the business. The Trustees may adopt and offer to
Shareholders such dividend reinvestment plans, cash dividend payout
plans or related plans as the Trustees shall deem appropriate. The
Trustees may in their discretion determine that an account
administration fee or other similar charge may be deducted directly
from the income and other distributions paid on Shares to a
Shareholder's account in each Series or Class.

(b) Inasmuch as the computation of net income and gains for Federal
income tax purposes may vary from the computation thereof on the books,
the above provisions shall be interpreted to give the Trustees the
power in their discretion to distribute for any fiscal year as ordinary
dividends and as capital gains distributions, respectively, additional
amounts sufficient to enable the Trust or a Series or Class thereof to
avoid or reduce liability for taxes.

SECTION 7.3. DETERMINATION OF NET INCOME; CONSTANT NET ASSET VALUE; REDUCTION
OF OUTSTANDING SHARES. Subject to Section 5.11 hereof, the net income
of the Series and Classes thereof of the Trust shall be determined in
such manner as the Trustees shall provide by resolution. Expenses of
the Trust or of a Series or Class thereof, including the advisory or
management fee, shall be accrued each day. Each Class shall bear only
expenses relating to its Shares and an allocable share of Series
expenses in accordance with such policies as may be established by the
Trustees from time to time and as are not inconsistent with the
provisions of this Declaration of Trust or of any applicable document
filed by the Trust with the Commission or of the Internal Revenue Code
of 1986, as amended. Such net income may be determined by or under the
direction of the Trustees as of the close of trading on the New York
Stock Exchange on each day on which such market is open or as of such
other time or times as the Trustees shall determine, and, except as
provided herein, all the net income of any Series or Class of the
Trust, as so determined, may be declared as a dividend on the
Outstanding Shares of such Series or Class. If, for any reason, the net
income of any Series or Class of the Trust determined at any time is a
negative amount, the Trustees shall have the power with respect to such
Series or Class

(i) to offset each Shareholder's pro rata share of such
negative amount from the accrued dividend account of such
Shareholder, or

(ii) to reduce the number of Outstanding Shares of such Series
or Class by reducing the number of Shares in the account of
such Shareholder by that number of full and fractional Shares
which represents the amount of such excess negative net
income, or

(iii) to cause to be recorded on the books of the Trust an
asset account in the amount of such negative net income, which
account may be reduced by the amount, provided that the same
shall thereupon become the property of the Trust with respect
to such Series or Class and shall not be paid to any
Shareholder, of dividends declared thereafter upon the
Outstanding Shares of such Series or Class on the day such
negative net income is experienced, until such asset account
is reduced to zero. The Trustees shall have full discretion to
determine whether any cash or property received shall be
treated as income or as principal and whether any item of
expense shall be charged to the income or the principal
account, and their determination made in good faith shall be
conclusive upon the Shareholders. In the case of stock
dividends received, the Trustees shall have full discretion to
determine, in the light of the particular circumstances, how
much if any of the value thereof shall be treated as income,
the balance, if any, to be treated as principal.

SECTION 7.4. POWER TO MODIFY FOREGOING PROCEDURES. Notwithstanding any of the
foregoing provisions of this Article VII, but subject to Section 5.11
hereof, the Trustees may prescribe, in their absolute discretion, such
other bases and times for determining the per Share net asset value of
the Shares of the Trust or a Series or Class thereof or net income of
the Trust or a Series or Class thereof, or the declaration and payment
of dividends and distributions as they may deem necessary or desirable.
Without limiting the generality of the foregoing, the Trustees may
establish several Series or Classes of Shares in accordance with
Section 5.11, and declare dividends thereon in accordance with Section
5.11(d)(iv).

ARTICLE VIII
DURATION; TERMINATION OF TRUST OR A SERIES OR CLASS; AMENDMENT;
MERGERS, ETC.

SECTION 8.1. DURATION. The Trust shall continue without limitation of time but
subject to the provisions of this Article VIII.

SECTION 8.2. TERMINATION OF THE TRUST OR A SERIES OR A CLASS. The Trust or any
Series or Class thereof may be terminated by

(i) 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,

(ii) 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 or written consent of the holders of a
majority of the Shares of the Trust or a Series or Class
thereof outstanding and entitled to vote shall be sufficient
authorization, or

(iii) notice to Shareholders by means of an instrument in
writing signed by a majority of the Trustees, 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 such Series or a Class, the Trust or their
respective shareholders as a result of such factors or events
adversely affecting the ability of such Series or a Class or
the Trust to conduct its business and operations in an
economically viable manner. Such factors and events may
include (but are not limited to) the inability of a Series or
Class or the Trust to maintain its assets at an appropriate
size, changes in laws or regulations governing the Series or
Class or the Trust or affecting assets of the type in which
such Series or Class or the Trust invests or economic
developments or trends having a significant adverse impact on
the business or operations of such Series or Class or the
Trust. Upon the termination of the Trust or the Series or
Class,

(i) The Trust, Series or Class shall carry on no
business except for the purpose of winding up its
affairs.

(ii) The Trustees shall proceed to wind up the
affairs of the Trust, Series or Class and all of the
powers of the Trustees under this Declaration shall
continue until the affairs of the Trust, Series or
Class shall have been wound up, including the power
to fulfill or discharge the contracts of the Trust,
Series or Class, collect its assets, sell, convey,
assign, exchange, transfer or otherwise dispose of
all or any part of the remaining Trust Property or
Trust Property allocated or belonging to such Series
or Class to one or more persons at public or private
sale for consideration which may consist in whole or
in part of cash, securities or other property of any
kind, discharge or pay its liabilities, and do all
other acts appropriate to liquidate its business;
provided that any sale, conveyance, assignment,
exchange, transfer or other disposition of all or
substantially all the Trust Property or Trust
Property allocated or belonging to such Series or
Class that requires Shareholder approval in
accordance with Section 8.4 hereof shall receive the
approval so required.

(iii) After paying or adequately providing for the
payment of all liabilities, and upon receipt of such
releases, indemnities and refunding agreements as
they deem necessary for their protection, the
Trustees may distribute the remaining Trust Property
or the remaining property of the terminated Series or
Class, in cash or in kind or partly each, among the
Shareholders of the Trust or the Series or Class
according to their respective rights.

(b) After termination of the Trust, Series or Class and distribution to
the Shareholders as herein provided, a majority of the Trustees shall
execute and lodge among the records of the Trust and file with the
Office of the Secretary of the Commonwealth of Massachusetts an
instrument in writing setting forth the fact of such termination, and
the Trustees shall thereupon be discharged from all further liabilities
and duties with respect to the Trust or the terminated Series or Class,
and the rights and interests of all Shareholders of the Trust or the
terminated Series or Class shall thereupon cease.

SECTION 8.3. AMENDMENT PROCEDURE.

(a) This Declaration may be amended by a vote of the holders of a
majority of the Shares outstanding and entitled to vote or by any
instrument in writing, without a meeting, signed by a majority of the
Trustees and consented to by the holders of a majority of the Shares
outstanding and entitled to vote. The Trustees may amend this
Declaration without the vote or consent of Shareholders if they deem it
necessary to conform this Declaration to the requirements of applicable
federal or state laws or regulations or the requirements of the
regulated investment company provisions of the Internal Revenue Code,
but the Trustees shall not be liable for failing so to do. The Trustees
may also amend this Declaration without the vote or consent of
Shareholders if they deem it necessary or desirable to change the name
of the Trust or to make any other changes in the Declaration which do
not adversely affect the rights of Shareholders hereunder.

(b) No amendment may be made under this Section 8.3 which would change
any rights with respect to any Shares of the Trust or Series or Class
thereof by reducing the amount payable thereon upon liquidation of the
Trust or Series or Class thereof or by diminishing or eliminating any
voting rights pertaining thereto, except with the vote or consent of
the holders of two-thirds of the Shares of the Trust or such Series or
Class outstanding and entitled to vote. Nothing contained in this
Declaration shall permit the amendment of this Declaration to impair
the exemption from personal liability of the Shareholders, Trustees,
officers, employees and agents of the Trust or to permit assessments
upon Shareholders.

(c) A certificate signed by a majority of the Trustees setting forth an
amendment and reciting that it was duly adopted by the Shareholders or
by the Trustees as aforesaid or a copy of the Declaration, as amended,
and executed by a majority of the Trustees, shall be conclusive
evidence of such amendment when lodged among the records of the Trust.

SECTION 8.4. MERGER, CONSOLIDATION AND SALE OF ASSETS. The Trust or any Series
thereof may merge or consolidate with any other corporation,
association, trust or other organization or may sell, lease or exchange
all or substantially all of the Trust Property or Trust Property
allocated or belonging to such Series, including its good will, upon
such terms and conditions and for such consideration when and as
authorized at any meeting of Shareholders called for the purpose by the
affirmative vote of the holders of two-thirds of the Shares of the
Trust or such Series outstanding and entitled to vote, 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 such Series;
provided, however, that, if such merger, consolidation, sale, lease or
exchange is recommended by the Trustees, the vote or written consent of
the holders of a majority of the Shares of the Trust or such Series
outstanding and entitled to vote shall be sufficient authorization; and
any such merger, consolidation, sale, lease or exchange shall be deemed
for all purposes to have been accomplished under and pursuant to
Massachusetts law.

SECTION 8.5. INCORPORATION. With the approval of the holders of a majority of
the Shares of the Trust or a Series thereof outstanding and entitled to
vote, the Trustees may cause to be organized or assist in organizing a
corporation or corporations under the laws of any jurisdiction or any
other trust, partnership, association or other organization to take
over all of the Trust Property or the Trust Property allocated or
belonging to such Series or to carry on any business in which the Trust
shall directly or indirectly have any interest, and to sell, convey and
transfer the Trust Property or the Trust Property allocated or
belonging to such Series to any such corporation, trust, association or
organization in exchange for the shares or securities thereof or
otherwise, and to lend money to, subscribe for the shares or securities
of, and enter into any contracts with any such corporation, trust,
partnership, association or organization, or any corporation,
partnership, trust, association or organization in which the Trust or
such Series holds or is about to acquire shares or any other interest.
The Trustees may also cause a merger or consolidation between the Trust
or any successor thereto and any such corporation, trust, partnership,
association or other organization if and to the extent permitted by
law, as provided under the law then in effect. Nothing contained herein
shall be construed as requiring approval of Shareholders for the
Trustees to organize or assist in organizing one or more corporations,
trusts, partnerships, associations or other organizations and selling,
conveying or transferring a portion of the Trust Property to such
organization or entities.

ARTICLE IX
REPORTS TO SHAREHOLDERS

The Trustees shall at least semi-annually submit to the Shareholders of
each Series a written financial report of the transactions of the Trust,
including financial statements which shall at least annually be certified by
independent public accountants.

ARTICLE X
MISCELLANEOUS

SECTION 10.1. EXECUTION AND FILING. This Declaration and any amendment hereto
shall be filed in the office of the Secretary of The Commonwealth of
Massachusetts and in such other places as may be required under the
laws of Massachusetts and may also be filed or recorded in such other
places as the Trustees deem appropriate. Each amendment so filed shall
be accompanied by a certificate signed and acknowledged by a Trustee
stating that such action was duly taken in a manner provided herein,
and unless such amendment or such certificate sets forth some later
time for the effectiveness of such amendment, such amendment shall be
effective upon its execution. A restated Declaration, integrating into
a single instrument all of the provisions of the Declaration which are
then in effect and operative, may be executed from time to time by a
majority of the Trustees and filed with the Secretary of The
Commonwealth of Massachusetts. A restated Declaration shall, upon
execution, be conclusive evidence of all amendments contained therein
and may hereafter be referred to in lieu of the original Declaration
and the various amendments thereto.

SECTION 10.2. GOVERNING LAW. This Declaration is executed by the Trustees and
delivered in The Commonwealth of Massachusetts and with reference to
the laws thereof, and the rights of all parties and the validity and
construction of every provision hereof shall be subject to and
construed according to the laws of said Commonwealth.

SECTION 10.3. COUNTERPARTS. This Declaration may be simultaneously executed in
several counterparts, each of which shall be deemed to be an original,
and such counterparts, together, shall constitute one and the same
instrument, which shall be sufficiently evidenced by any such original
counterpart.

SECTION 10.4. RELIANCE BY THIRD PARTIES. Any certificate executed by an
individual who, according to the records of the Trust appears to be a
Trustee hereunder, certifying

(a) the number or identity of Trustees or Shareholders,

(b) the due authorization of the execution of any instrument or
writing,

(d) the fact that the number of Trustees or Shareholders present at any
meeting or executing any written instrument satisfies the requirements
of this Declaration,

(e) the form of any By-laws adopted by or the identity of any officers
elected by the Trustees, or

(f) the existence of any fact or facts which in any manner relate to
the affairs of the Trust, shall be conclusive evidence as to the
matters so certified in favor of any Person dealing with the Trustees
and their successors.

SECTION 10.5. PROVISIONS IN CONFLICT WITH LAW OR REGULATIONS.

(a) The provisions of this Declaration are severable, and if the
Trustees shall determine, with the advice of counsel, that any of such
provisions is in conflict with the 1940 Act, the regulated investment
company provisions of the Internal Revenue Code of 1986 or with other
applicable laws and regulations, the conflicting provision shall be
deemed never to have constituted a part of this Declaration; provided,
however, that such determination shall not affect any of the remaining
provisions of this Declaration or render invalid or improper any action
taken or omitted prior to such determination.

(b) If any provision of this Declaration shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability
shall attach only to such provision in such jurisdiction and shall not
in any manner affect such provisions in any other jurisdiction or any
other provision of this Declaration in any jurisdiction.

IN WITNESS WHEREOF, the undersigned have executed this instrument this
28th day of February, 1992.

/s/ Edward J. Boudreau, Jr.
Edward J. Boudreau, Jr., Chairman
as Trustee and not individually
101 Huntington Avenue
Boston, Massachusetts 02199-7603

/s/ Dennis S. Aronowitz
Dennis S. Aronowitz
as Trustee and not individually
101 Huntington Avenue
Boston, Massachusetts 02199-7603

/s/ Richard P. Chapman
Richard P. Chapman
as Trustee and not individually
101 Huntington Avenue
Boston, Massachusetts 02199-7603

Francis C. Cleary, Jr.
Francis C. Cleary, Jr.
as Trustee and not individually
101 Huntington Avenue
Boston, Massachusetts 02199-7603

/s/ William J. Cosgrove
as Trustee and not individually
101 Huntington Avenue
Boston, Massachusetts 02199-7603

/s/ James V. Fletcher
James V. Fletcher
as Trustee and not individually
101 Huntington Avenue
Boston, Massachusetts 02199-7603

/s/ Bayard Henry
Bayard Henry
as Trustee and not individually
101 Huntington Avenue
Boston, Massachusetts 02199-7603

/s/ Richard S. Scipione
Richard S. Scipione
as Trustee and not individually
101 Huntington Avenue
Boston, Massachusetts 02199-7603

/s/ Edward J. Spellman
Edward J. Spellman
as Trustee and not individually
101 Huntington Avenue
Boston, Massachusetts 02199-7603

THE COMMONWEALTH OF MASSACHUSETTS

SUFFOLK COUNTY, MASSACHUSETTS

February 28, 1992

Then personally appeared the above-named persons, Edward J, Boudreau, Jr.,
Dennis S. Aronowitz, Richard P. Chapman, Francis C. Cleary, Jr., William J.
Cosgrove, James V. Fletcher, Bayard Henry, Richard S. Scipione, Edward J.
Spellman, who acknowledged the foregoing instrument to be their free act and
deed.

Before me,

Notary Public

My commission expires:

<PAGE>
Exhibit 99.2

John Hancock Capital Series
John Hancock Cash Management Fund
John Hancock Income Securities Trust
John Hancock Investors Trust
John Hancock Limited Term Government Fund
John Hancock Sovereign Bond Fund
John Hancock Special Equities Fund
John Hancock Strategic Series
John Hancock Tax-Exempt Income Fund
John Hancock Tax-Exempt Series Fund
John Hancock World Fund

AMENDMENT TO BY-LAWS

RESOLVED, that the By-Laws of the Trust be and hereby are amended to
create the office of Vice Chairman of the Trust by adding the following as
Article VI, Sub-Section 6.5A of the By-Laws:

Section 6.5A. Powers and Duties of the Vice Chairman. The Trustees may, but need
not, appoint one or more Vice Chairmen of the Trust. A Vice Chairman shall be an
executive officer of the Trust and shall have the powers and duties of a Vice
President of the Trust, as provided in Section 6.7 of this Article VI. The Vice
Chairman shall perform such duties as may be assigned to him or her from time to
time by the Trustees of the Chairman.

<PAGE>

BY-LAWS

JOHN HANCOCK SPECIAL EQUITIES FUND

As Adopted on December 8, 1993

<PAGE>

Table of Contents

Page

ARTICLE I -- Definitions................................................... 1

ARTICLE II -- Offices and Seal ............................................. 1

Section 2.1 Principal Office...................................... 1
Section 2.2 Other Offices......................................... 1
Section 2.3 Seal.................................................. 1

ARTICLE III -- Shareholders ................................................ 2

Section 3.1 Meetings.............................................. 2
Section 3.2 Place of Meeting...................................... 2
Section 3.3 Notice of Meetings.................................... 2
Section 3.4 Shareholders Entitled to Vote......................... 2
Section 3.5 Quorum................................................ 2
Section 3.6 Treatment of Abstentions.............................. 3
Section 3.7 Voting of Shares Held in Street Name.................. 3
Section 3.8 Adjournment........................................... 3
Section 3.9 Proxies............................................... 3
Section 3.10 Inspection of Records................................. 3
Section 3.11 Record Dates.......................................... 3

ARTICLE IV -- Meetings of Trustees.......................................... 4

Section 4.1 Regular Meetings...................................... 4
Section 4.2 Special Meetings...................................... 4
Section 4.3 Notice................................................ 4
Section 4.4 Waiver of Notice...................................... 4
Section 4.5 Quorum, Adjournment and Voting........................ 4
Section 4.6 Compensation.......................................... 4

ARTICLE V -- Executive Committee and Other
Committees.................................................. 5

Section 5.1 How Constituted....................................... 5
Section 5.2 Powers of the Executive
Committee........................................... 5
Section 5.3 Other Committees of Trustees.......................... 5
Section 5.4 Proceedings, Quorum and Manner of
Acting.............................................. 5
Section 5.5 Other Committees...................................... 5

ARTICLE VI -- Officers ..................................................... 6

Section 6.1 General............................................... 6
Section 6.2 Election, Term of Office and
Qualifications...................................... 6
Section 6.3 Resignations and Removals............................. 6
Section 6.4 Vacancies and Newly Created
Offices............................................. 6
Section 6.5 Chairman of the Board................................. 6
Section 6.6 President............................................. 7
Section 6.7 Vice President........................................ 7
Section 6.8 Chief Financial Officer, Treasurer
and Assistant Treasurers............................ 7
Section 6.9 Secretary and Assistant
Secretaries......................................... 7
Section 6.10 Subordinate Officers.................................. 8
Section 6.11 Remuneration.......................................... 8
Section 6.12 Surety Bonds.......................................... 8

ARTICLE VII -- Execution of Instruments; Voting of Securities .............. 8

Section 7.1 Execution of Instruments.............................. 8
Section 7.2 Voting of Securities.................................. 9

ARTICLE VIII -- Fiscal Year, Accountants.................................... 9

Section 8.1 Fiscal Year........................................... 9
Section 8.2 Accountants........................................... 9

ARTICLE IX -- Amendments ................................................... 9

Section 9.1 General............................................... 9

<PAGE>

BY-LAWS

JOHN HANCOCK SPECIAL EQUITIES FUND

ARTICLE I

Definitions

The terms "Class," "Commission," "Declaration," "Interested Person,"
"1940 Act," "Series," "Shareholder," "Shares," "Trust," "Trust Property" and
"Trustees" have the meanings given them in the Amended and Restated Declaration
of Trust of John Hancock Special Equities Fund dated February 28, 1992, as
amended from time to time.

ARTICLE II

Offices and Seal

Section 2.1. Principal Office. The principal office of the Trust shall
be located in the City of Boston, The Commonwealth of Massachusetts.

Section 2.2. Other Offices. The Trust may establish and maintain such
other offices and places of business within or without The Commonwealth of
Massachusetts as the Trustees may from time to time determine.

Section 2.3. Seal. The seal of the Trust shall be circular in form and
shall bear the name of the Trust, the year of its organization, and the words
"Common Seal" and "A Massachusetts Voluntary Association." The form of the seal
shall be subject to alteration by the Trustees and the seal may be used by
causing it or a facsimile to be impressed or affixed or printed or otherwise
reproduced. Any officer or Trustee of the Trust shall have authority to affix
the seal of the Trust to any document requiring the same but, unless otherwise
required by the Trustees, the seal shall not be necessary to be placed on, and
its absence shall not impair the validity of, any document, instrument or other
paper executed and delivered by or on behalf of the Trust.

<PAGE>

ARTICLE III

Shareholders

Section 3.1. Meetings. A Shareholders' meeting for the election of
Trustees and the transaction of other proper business shall be held when
authorized or required by the Declaration.

Section 3.2. Place of Meeting. All Shareholders' meetings shall be held
at such place within or without The Commonwealth of Massachusetts as the
Trustees shall designate.

Section 3.3. Notice of Meetings. Notice of all Shareholders' meetings,
stating the time, place and purpose of the meeting, shall be given by the
Secretary or an Assistant Secretary of the Trust by mail to each Shareholder
entitled to notice of and to vote at such meeting at his address as recorded on
the register of the Trust. Such notice shall be mailed at least 10 days and not
more than 60 days before the meeting. Such notice shall be deemed to be given
when deposited in the United States mail, with postage thereon prepaid. Any
adjourned meeting may be held as adjourned without further notice. No notice
need be given (A) to any Shareholder if a written waiver of notice, executed
before or after the meeting by such Shareholder or his attorney thereunto duly
authorized, is filed with the records of the meeting, or (B) to any Shareholder
who attends the meeting without protesting prior thereto or at its commencement
the lack of notice to him. A waiver of notice need not specify the purposes of
the meeting.

Section 3.4. Shareholders Entitled to Vote. If, pursuant to Section
3.11 hereof, a record date has been fixed for the determination of Shareholders
entitled to notice of and to vote at any Shareholders' meeting, each Shareholder
of the Trust shall be entitled to vote, in accordance with the applicable
provisions of the Declaration, in person or by proxy, each Share or fraction
thereof standing in his name on the register of the Trust at the time of
determining net asset value on such record date. If the Declaration or the 1940
Act requires that Shares be voted by Series or Class, each Shareholder shall
only be entitled to vote, in person or by proxy, each Share or fraction thereof
of such Series or Class standing in his name on the register of the Trust at the
time of determining net asset value on such record date. If no record date has
been fixed for the determination of Shareholders so entitled, the record date
for the determination of Shareholders entitled to notice of and to vote at a
Shareholders' meeting shall be at the close of business on the day on which
notice of the meeting is mailed or, if notice is waived by all Shareholders, at
the close of business on the tenth day next preceding the day on which the
meeting is held.

Section 3.5. Quorum. The presence at any Shareholders' meeting in
person or by proxy, of Shareholders entitled to cast a majority of the votes
thereat shall be a quorum for the transaction of business.

Section 3.6. Treatment of Abstentions. Shares represented in person or
by proxy, including Shares which abstain or do not vote with respect to one or
more proposals presented for shareholder approval, will be counted for purposes
of determining whether a quorum is present. Abstentions will be treated as
Shares that are present and entitled to vote with respect to any particular
proposal, but will not be counted as a vote in favor of such proposal. An
abstention from voting on a proposal will have the same effect as a vote against
such proposal.

Section 3.7. Voting of Shares Held in Street Name. If a broker or
nominee holding Shares in "street name" indicates on a proxy that it does not
have discretionary authority to vote those Shares as to a particular proposal
presented for shareholder approval, those Shares will be considered to be
outstanding, but will not be considered as present and entitled to vote with
respect to such proposal.

Section 3.8. Adjournment. The holders of a majority of the Shares
entitled to vote at the meeting and present thereat, in person or by proxy,
whether or not constituting a quorum, or, if no Shareholder entitled to vote is
present thereat, in person or by proxy, any Trustee or officer present thereat
entitled to preside or act as Secretary of such meeting, may adjourn the meeting
sine die or from time to time. Any business that might have been transacted at
the meeting originally called may be transacted at any such adjourned meeting at
which a quorum is present.

Section 3.9. Proxies. Shares may be voted in person or by proxy. When
any Share is held jointly by several persons, any one of them may vote at any
meeting, in person or by proxy in respect of such Share unless at or prior to
exercise of the vote the Trustees receive a specific written notice to the
contrary from any one of them. If more than one such joint owner shall be
present at such meeting, in person or by proxy, and such joint owners or their
proxies so present disagree as to any vote cast, such vote shall not be received
in respect of such Share. A proxy purporting to be executed by or on behalf of a
Shareholder shall be deemed valid unless challenged at or prior to its exercise
and the burden of proving invalidity shall rest on the challenger.

Section 3.10. Inspection of Records. The records of the Trust shall be
open to inspection by Shareholders to the same extent as is permitted
shareholders of a Massachusetts business corporation.

Section 3.11. Record Dates. The Trustees may fix in advance a date as a
record date for the purpose of determining the Shareholders who are entitled to
notice of and to vote at any meeting or any adjournment thereof, or to express
consent in writing without a meeting to any action of the Trustees, or who shall
receive payment of any dividend or of any other distribution, or for the purpose
of any other lawful action, provided that such record date shall be not more
than 60 days before the date on which the particular action requiring such
determination of Shareholders is to be taken. In such case, subject to the
provisions of Section 3.4, each eligible Shareholder of record on such record
date shall be entitled to notice of, and to vote at, such meeting or
adjournment, or to express such consent, or to receive payment of such dividend
or distribution or to take such other action, as the case may be,
notwithstanding any transfer of Shares on the register of the Trust after the
record date.

ARTICLE IV

Meetings of Trustees

Section 4.1. Regular Meetings. The Trustees from time to time shall
provide by resolution for the holding of regular meetings for the election of
officers and the transaction of other proper business and shall fix the place
and time for such meetings to be held within or without The Commonwealth of
Massachusetts.

Section 4.2. Special Meetings. Special meetings of the Trustees shall
be held whenever called by the Chairman of the Board, the President (or, in the
absence or disability of the President, by any Vice President), the Treasurer,
the Secretary or two or more Trustees, at the time and place within or without
The Commonwealth of Massachusetts specified in the respective notices or waivers
of notice of such meetings.

Section 4.3. Notice. Notice of regular and special meetings, stating
the time and place, shall be (a) mailed to each Trustee at his residence or
regular place of business at least five days before the day on which the meeting
is to be held or (b) caused to be delivered to him personally or to be
transmitted to him by telegraph, cable or wireless at least two days before the
day on which the meeting is to be held. Unless otherwise required by law, such
notice need not include a statement of the business to be transacted at, or the
purpose of, the meeting. No notice of adjournment of a meeting of the Trustees
to another time or place need be given if such time and place are announced at
such meeting.

Section 4.4. Waiver of Notice. Notice of a meeting need not be given to
any Trustee if a written waiver of notice, executed by him before or after the
meeting, is filed with the records of the meeting, or to any Trustee who attends
the meeting without protesting prior thereto or at its commencement the lack of
notice to him. A waiver of notice need not specify the purposes of the meeting.

Section 4.5. Quorum, Adjournment and Voting. At all meetings of the
Trustees, the presence of a majority of the total number of Trustees authorized,
but not less than two, shall constitute a quorum for the transaction of
business. A majority of the Trustees present, whether or not constituting a
quorum, may adjourn the meeting, from time to time. The action of a majority of
the Trustees present at a meeting at which a quorum is present shall be the
action of the Trustees unless the concurrence of a greater proportion is
required for such action by law, by the Declaration or by these By-Laws.

Section 4.6. Compensation. Each Trustee may receive such remuneration
for his services as such as shall be fixed from time to time by resolution of
the Trustees.

<PAGE>

ARTICLE V

Executive Committee and Other Committees

Section 5.1. How Constituted. The Trustees may, by resolution,
designate one or more committees, including an Executive Committee, an Audit
Committee and a Committee on Administration, each consisting of at least two
Trustees. The Trustees may, by resolution, designate one or more alternate
members of any committee to serve in the absence of any member or other
alternate member of such committee. Each member and alternate member of a
committee shall be a Trustee and shall hold office at the pleasure of the
Trustees. The Chairman of the Board and the President shall be members of the
Executive Committee.

Section 5.2. Powers of the Executive Committee. Unless otherwise
provided by resolution of the Trustees, the Executive Committee shall have and
may exercise all of the power and authority of the Trustees, provided that the
power and authority of the Executive Committee shall be subject to the
limitations contained in the Declaration.

Section 5.3. Other Committees of Trustees. To the extent provided by
resolution of the Trustees, other committees shall have and may exercise any of
the power and authority that may lawfully be granted to the Executive Committee.

Section 5.4. Proceedings, Quorum and Manner of Acting. In the absence
of appropriate resolution of the Trustees, each committee may adopt such rules
and regulations governing its proceedings, quorum and manner of acting as it
shall deem proper and desirable, provided that the quorum shall not be less than
two Trustees. In the absence of any member or alternate member of any such
committee, the members thereof present at any meeting, whether or not they
constitute a quorum, may appoint a Trustee to act in the place of such absent
member or alternate member. Members and alternate members of a committee may
participate in a meeting of such committee by means of a conference telephone or
similar communications equipment if all persons participating in the meeting can
hear each other at the same time. Participation in a meeting by these means
shall constitute presence in person at the meeting.

Section 5.5. Other Committees. The Trustees may appoint other
committees, each consisting of one or more persons who need not be Trustees.
Each such committee shall have such powers and perform such duties as may be
assigned to it from time to time by the Trustees, but shall not exercise any
power which may lawfully be exercised only by the Trustees or a committee
thereof.

<PAGE>

ARTICLE VI

Officers

Section 6.1. General. The officers of the Trust shall be a Chairman of
the Board, a President, a Secretary, and a Treasurer, and may include one or
more Vice Presidents, one or more Assistant Secretaries, one or more Assistant
Treasurers, and such other officers as may be appointed in accordance with the
provisions of Section 6.10 of this Article VI.

Section 6.2. Election, Term of Office and Qualifications. The officers
of the Trust and any Series thereof (except those appointed pursuant to Section
6.10) shall be elected by the Trustees at their first meeting. If any officer or
officers are not elected at any such meeting, such officer or officers may be
elected at any subsequent regular or special meeting of the Trustees. Except as
provided in Sections 6.3 and 6.4 of this Article VI, each officer elected by the
Trustees shall hold office until his successor shall have been chosen and
qualified. No person shall hold more than one office of the Trust or any Series
thereof, except that the President may hold the office of Chairman of the Board
and any Treasurer, Assistant Treasurer, Secretary or Assistant Secretary of the
Trust may also hold the office of Vice President. The Chairman of the Board and
the President shall be selected from among the Trustees and may hold such
offices only so long as they continue to be Trustees. Any Trustee or officer may
be but need not be a Shareholder of the Trust.

Section 6.3. Resignations and Removals. Any officer may resign his
office at any time by delivering a written resignation to the Trustees, the
President, the Secretary or any Assistant Secretary. Unless otherwise specified
therein, such resignation shall take effect upon delivery. Any officer may be
removed from office with or without cause by the vote of a majority of the
Trustees at any regular meeting or any special meeting. Except to the extent
expressly provided in a written agreement with the Trust, no officer resigning
and no officer removed shall have any right to any compensation for any period
following his resignation or removal or any right to damages on account of such
removal.

Section 6.4. Vacancies and Newly Created Offices. If any vacancy shall
occur in any office by reason of death, resignation, removal, disqualification
or other cause, or if any new office shall be created, such vacancies or newly
created offices may be filled by the Trustees at any regular or special meeting
or, in the case of any office created pursuant to Section 6.10 of this Article
VI, by any officer upon whom such power shall have been conferred by the
Trustees.

Section 6.5. Chairman of the Board. The Chairman of the Board shall be
the chief executive officer of the Trust and each Series thereof, shall preside
at all Shareholders' meetings and at all meetings of the Trustees and shall be
ex officio a member of all committees of the Trustees and each Series thereof,
except the Audit Committee. Subject to the supervision of the Trustees, he shall
have general charge of the business of the Trust and each Series thereof, the
Trust Property and the officers, employees and agents of the Trust and each
Series thereof. He shall have such other powers and perform such other duties as
may be assigned to him from time to time by the Trustees.

Section 6.6. President. The President shall be the chief operating
officer of the Trust and each Series thereof and, at the request of or in the
absence or disability of the Chairman of the Board, he shall preside at all
Shareholders' meetings and at all meetings of the Trustees and shall in general
exercise the powers and perform the duties of the Chairman of the Board. Subject
to the supervision of the Trustees and such direction and control as the
Chairman of the Board may exercise, he shall have general charge of the
operations of the Trust and each Series and Class thereof and its officers,
employees and agents. He shall exercise such other powers and perform such other
duties as from time to time may be assigned to him by the Trustees.

Section 6.7. Vice President. The Trustees may, from time to
time, designate and elect one or more Vice Presidents who shall have such powers
and perform such duties as from time to time may be assigned to them by the
Trustees or the President. At the request or in the absence or disability of the
President, the Vice President (or, if there are two or more Vice Presidents,
then the senior in length of time in office of the Vice Presidents present and
able to act) may perform all the duties of the President and, when so acting,
shall have all the powers of and be subject to all the restrictions upon the
President.

Section 6.8 Chief Financial Officer, Treasurer and Assistant
Treasurers. The Chief Financial Officer shall be the principal financial and
accounting officer of the Trust and each Series thereof and shall have general
charge of the finances and books of account of the Trust and each Series and
Class thereof. Except as otherwise provided by the Trustees, he shall have
general supervision of the funds and property of the Trust and each Series
thereof and of the performance by the Custodian, appointed pursuant to Section
3.6 of the Declaration of its duties with respect thereto. The Chief Financial
Officer shall render a statement of condition of the finances of the Trust and
each Series and Class thereof to the Trustees as often as they shall require the
same and he shall in general perform all the duties incident to the office of
the Chief Financial Officer and such other duties as from time to time may be
assigned to him by the Trustees.

The Treasurer or any Assistant Treasurer may perform such duties of the
Chief Financial Officer as the Chief Financial Officer or the Trustees may
assign. In the absence of the Chief Financial Officer, the Treasurer may perform
all duties of the Chief Financial Officer. In the absence of the Chief Financial
Officer and the Treasurer, any Assistant Treasurer may perform all duties of the
Chief Financial Officer.

Section 6.9. Secretary and Assistant Secretaries. The Secretary shall
attend to the giving and serving of all notices of the Trust and each Series and
Class thereof and shall record all proceedings of the meetings of the
Shareholders and Trustees in one or more books to be kept for that purpose. He
shall keep in safe custody the seal of the Trust, and shall have charge of the
records of the Trust and each Series and Class thereof, including the register
of shares and such other books and papers as the Trustees may direct and such
books, reports, certificates and other documents required by law to be kept, all
of which shall at all reasonable times be open to inspection by any Trustee. He
shall perform such other duties as appertain to his office or as may be required
by the Trustees.

Any Assistant Secretary may perform such duties of the Secretary as the
Secretary or the Trustees may assign, and, in the absence of the Secretary, he
may perform all the duties of the Secretary.

Section 6.10. Subordinate Officers. The Trustees from time to time may
appoint such other subordinate officers or agents as they may deem advisable,
each of whom shall have such title, hold office for such period, have such
authority and perform such duties as the Trustees may determine. The Trustees
from time to time may delegate to one or more officers or agents the power to
appoint any such subordinate officers or agents and to prescribe their
respective rights, terms of office, authorities and duties.

Section 6.11. Remuneration. The salaries or other compensation of the
officers of the Trust and any Series thereof shall be fixed from time to time by
resolution of the Trustees, except that the Trustees may by resolution delegate
to any person or group of persons the power to fix the salaries or other
compensation of any subordinate officers or agents appointed in accordance with
the provisions of Section 6.10 hereof.

Section 6.12. Surety Bonds. The Trustees may require any officer or
agent of the Trust or any Series thereof to execute a bond (including, without
limitation, any bond required by the 1940 Act and the rules and regulations of
the Commission) to the Trustees in such sum and with such surety or sureties as
the Trustees may determine, conditioned upon the faithful performance of his
duties to the Trust, including responsibility for negligence and for the
accounting of any of the Trust Property that may come into his hands. In any
such case, a new bond of like character shall be given at least every six years,
so that the date of the new bond shall not be more than six years subsequent to
the date of the bond immediately preceding.

ARTICLE VII

Execution of Instruments, Voting of Securities

Section 7.1. Execution of Instruments. All deeds, documents, transfers,
contracts, agreements, requisitions or orders, promissory notes, assignments,
endorsements, checks and drafts for the payment of money by the Trust or any
Series thereof, and other instruments requiring execution either in the name of
the Trust or the names of the Trustees or otherwise may be signed by the
Chairman, the President, a Vice President or the Secretary and by the Chief
Financial Officer, Treasurer or an Assistant Treasurer, or as the Trustees may
otherwise, from time to time, authorize, provided that instructions in
connection with the execution of portfolio securities actions may be signed by
one such officer. Any such authorization may be general or confined to specific
instances.

Section 7.2. Voting of Securities. Unless otherwise ordered by the
Trustees, the Chairman, the President or any Vice President shall have full
power and authority on behalf of the Trustees to attend and to act and to vote,
or in the name of the Trustees to execute proxies to vote, at any meeting of
stockholders of any company in which the Trust or any Series thereof may hold
stock. At any such meeting such officer shall possess and may exercise (in
person or by proxy) any and all rights, powers, and privileges incident to the
ownership of such stock. The Trustees may by resolution from time to time confer
like powers upon any other person or persons.

ARTICLE VIII

Fiscal Year; Accountants

Section 8.1. Fiscal Year. The fiscal year of the Trust and any Series
thereof shall be established by resolution of the Trustees.

Section 8.2. Accountants.

(a) The Trustees shall employ a public accountant or firm of
independent public accountants as their accountant to examine the accounts of
the Trust and to sign and certify at least annually financial statements filed
by the Trust. The accountant's certificates and reports shall be addressed both
to the Trustees and to the Shareholders.

(b) A majority of the Trustees who are not Interested Persons of the
Trust shall select the accountant at any meeting held before the initial
registration statement of the Trust becomes effective, and thereafter shall
select the accountant annually by votes, cast in person, at a meeting held
within 30 days before or after the beginning of the fiscal year of the Trust.

(c) Any vacancy occurring due to the death or resignation of the
accountant, may be filled at a meeting called for the purpose by the vote, cast
in person, of a majority of those Trustees who are not Interested Persons of the
Trust.

ARTICLE IX

Amendments

Section 9.1. General. These By-Laws may be amended or repealed, in
whole or in part, by a majority of the Trustees then in office at any meeting of
the Trustees, or by one or more writings signed by such a majority.

<PAGE>
Exhibit 99.4
JOHN HANCOCK
SPECIAL EQUITIES FUND
A MASSACHUSETTS VOLUNTARY ASSOCIATION
CLASS A

fully paid and non-assessable shares of beneficial interest, without par value,
in John Hancock Special Equities Fund (the "Fund"), a Massachusetts voluntary
association established by the Amended and Restated Declaration of Trust dated
February 28, 1992, as amended from time to time, a copy of which, together with
any amendments thereto (the "Declaration"), is on file with the Secretary of the
Commonwealth of Massachusetts. The provisions of the Declaration are hereby
incorporated in and made a part of this certificate as fully as if set forth
herein in their entirety, to all of which provisions the holder and every
transferee or assignee hereof by accepting or holding the same agrees to be
bound. This certificate, and the shares represented hereby are negotiable and
transferable on the books of the Fund by the registered holder hereof in person
or by attorney upon surrender of this certificate properly endorsed. This
certificate is issued by the Trustees of John Hancock Special Equities Fund,
acting not individually but as such Trustees, and is not valid until
countersigned by the Transfer Agent.

The name John Hancock Special Equities Fund is the designation of the Trustees
under the Amended and Restated Declaration of Trust dated February 28, 1992, as
amended from time to time. The obligations hereunder are not personally binding
upon, nor shall resort be had to the private property of, any of the Trustees,
shareholders, officers, employees or agents of the Fund, but the Fund property
or a specific portion thereof only shall be bound.

Change date 9/10/93...fpb

Mass Fund

signed by Boudreau, Chairman

<PAGE>
JOHN HANCOCK
SPECIAL EQUITIES FUND
A MASSACHUSETTS VOLUNTARY ASSOCIATION
CLASS B

<PAGE>
JOHN HANCOCK
SPECIAL EQUITIES FUND
A MASSACHUSETTS VOLUNTARY ASSOCIATION
CLASS C

<PAGE>
Exhibit 99.5

JOHN HANCOCK SPECIAL EQUITIES FUND

Investment Management Contract

Dated January 1, 1994

<PAGE>

JOHN HANCOCK SPECIAL EQUITIES FUND

Boston, Massachusetts

John Hancock Advisers, Inc.
101 Huntington Avenue
Boston, Massachusetts 02199

Investment Management Contract

Ladies and Gentlemen:

John Hancock Special Equities Fund (the "Fund") has been organized as a
business trust under the laws of the Commonwealth of Massachusetts to engage in
the business of an investment company. The Fund's shares of beneficial interest
may be classified into series, each series representing the entire undivided
interest in a separate portfolio of assets. Series may be established or
terminated from time to time by action of the Board of Trustees of the Fund. As
of the date hereof, other than the Fund, there are no additional series of the
Fund.

The Board of Trustees of the Fund (the "Trustees") has selected John
Hancock Advisers, Inc. (the "Adviser") to provide overall investment advice and
management for the Fund, and to provide certain other services, as more fully
set forth below, and the Adviser is willing to provide such advice, management
and services under the terms and conditions hereinafter set forth. Accordingly,
the Fund and the Adviser agree as follows:

1. Delivery of Documents. The Fund has furnished the Adviser with copies,
properly certified or otherwise authenticated, of each of the following:

(a) Restated and Amended Declaration of Trust of the Fund, dated
February 28, 1992 (the "Declaration of Trust");

(b) By-Laws of the Fund as in effect on the date hereof;

(c) Resolutions of the Trustees selecting the Adviser as
investment adviser for the Fund and approving the form of this
Agreement; and

(d) commitments, limitations and undertakings made by the Fund to
state securities or "blue sky" authorities for the purpose of
qualifying shares of the Fund for sale in such states.

<PAGE>
The Fund will furnish to the Adviser from time to time copies, properly
certified or otherwise authenticated, of all amendments of or supplements to the
foregoing, if any.

2. Investment and Management Services. The Adviser will use its best efforts to
provide to the Fund continuing and suitable investment programs with respect to
investments, consistent with the investment policies, objectives and
restrictions of the Fund. In the performance of the Adviser's duties hereunder,
subject always (x) to the provisions contained in the documents delivered to the
Adviser pursuant to Section 1, as each of the same may from time to time be
amended or supplemented, and (y) to the limitations set forth in the
registration statement of the Fund as in effect from time to time under the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended (the "1940 Act"), the Adviser will, at its own expense:

(a) furnish the Fund with advice and recommendations, consistent
with the investment policies, objectives and restrictions of
the Fund, with respect to the purchase, holding and
disposition of portfolio securities including, the purchase
and sale of options, alone or in consultation with any
sub-adviser or sub-advisers appointed pursuant to this
Agreement and subject to the provisions of any sub-investment
management contract respecting the responsibilities of such
sub-adviser or sub-advisers;

(b) advise the Fund in connection with policy decisions to be made
by the Trustees or any committee thereof with respect to the
Fund's investments and, as requested, furnish the Fund with
research, economic and statistical data in connection with the
Fund's investments and investment policies;

(d) submit such reports relating to the valuation of the Fund's
securities as the Trustees may reasonably request;

(e) assist the Fund in any negotiations relating to the Fund's
investments with issuers, investment banking firms, securities
brokers or dealers and other institutions or investors;

(f) consistent with the provisions of Section 7 of this Agreement,
place orders for the purchase, sale or exchange of portfolio
securities with brokers or dealers selected by the Adviser,
provided that in connection with the placing of such orders
and the selection of such brokers or dealers the Adviser shall
seek to obtain execution and pricing within the policy
guidelines determined by the Trustees and set forth in the
Prospectus and Statement of Additional Information of the Fund
as in effect from time to time;

<PAGE>
(g) provide office space and office equipment and supplies, the
use of accounting equipment when required, and necessary
executive, clerical and secretarial personnel for the
administration of the affairs of the Fund;

(h) from time to time or at any time requested by the Trustees,
make reports to the Fund of the Adviser's performance of the
foregoing services and furnish advice and recommendations with
respect to other aspects of the business and affairs of the
Fund;

(i) maintain all books and records with respect to the Fund's
securities transactions required by the 1940 Act, including
sub-paragraphs (b)(5), (6), (9) and (10) and paragraph (f) of
Rule 31a-1 thereunder (other than those records being
maintained by the Fund's custodian or transfer agent) and
preserve such records for the periods prescribed therefor by
Rule 31a-2 of the 1940 Act (the Adviser agrees that such
records are the property of the Fund and will be surrendered
to the Fund promptly upon request therefor);

(j) obtain and evaluate such information relating to economies,
industries, businesses, securities markets and securities as
the Adviser may deem necessary or useful in the discharge of
the Adviser's duties hereunder;

(k) oversee, and use the Adviser's best efforts to assure the
performance of the activities and services of the custodian,
transfer agent or other similar agents retained by the Fund;

(l) give instructions to the Fund's custodian as to deliveries of
securities to and from such custodian and transfer of payment
of cash for the account of the Fund; and

(m) appoint and employ one or more sub-advisers satisfactory to
the Fund under sub-investment management agreements.

3. Expenses paid by the Adviser. The Adviser will pay:

(a) the compensation and expenses of all officers and employees of
the Fund;

(b) the expenses of office rent, telephone and other utilities,
office furniture, equipment, supplies and other expenses of
the Fund;

(d) premiums for such insurance as may be agreed upon by the
Adviser and the Trustees.

<PAGE>
4. Expenses of the Fund Not Paid by the Adviser. The Adviser will not be
required to pay any expenses which this Agreement does not expressly make
payable by it. In particular, and without limiting the generality of the
foregoing but subject to the provisions of Section 3, the Adviser will not be
required to pay under this Agreement:

(a) the expenses of organizing the Fund (including without
limitation, legal, accounting and auditing fees and expenses
incurred in connection with the matters referred to in this
clause (a)), of initially registering shares of the Fund under
the Securities Act of 1933, as amended, and of qualifying the
shares for sale under state securities laws for the initial
offering and sale of shares;

(b) the compensation and expenses of Trustees who are not
interested persons (as used in this Agreement, such term shall
have the meaning specified in the 1940 Act) of the Adviser and
of independent advisers, independent contractors, consultants,
managers and other unaffiliated agents employed by the Fund
other than through the Adviser;

(d) the fees and disbursements of custodians and depositories of
the Fund's assets, transfer agents, disbursing agents, plan
agents and registrars;

(e) taxes and governmental fees assessed against the Fund's assets
and payable by the Fund;

(f) the cost of preparing and mailing dividends, distributions,
reports, notices and proxy materials to shareholders of the
Fund;

(g) brokers' commissions and underwriting fees; and

(h) the expense of periodic calculations of the net asset value of
the shares of the Fund.

5. Compensation of the Adviser. For all services to be rendered, facilities
furnished and expenses paid or assumed by the Adviser as herein provided, the
Fund will pay to the Adviser monthly in arrears a fee at the annual rate of
0.85% of the average daily et asset value of the Fund during such month which
does not exceed $250,000,000 and 0.80% of the portion, if any, of the average
daily net asset value of the Fund during such month that is in excess of
$250,000,000. The "average daily net assets" of the Fund shall be determined on
the basis set forth in the Fund's Prospectus or otherwise consistent with the
1940 Act and the regulations promulgated thereunder. The Adviser will receive a
pro rata portion of such monthly fee for any periods in which the Adviser serves
as investment adviser to the Fund for less than a full month.

In the event that normal operating expenses of the Fund, exclusive of
certain expenses prescribed by state law, are in excess of any limitation
imposed by the law of a state where the Fund is registered to sell shares of
beneficial interest, the fee payable to the Adviser will be reduced to the
extent required by law, and the Adviser will make any additional arrangements
that the Adviser is required by law to make.

<PAGE>
In addition to the foregoing, the Adviser may from time to time agree
not to impose all or a portion of its fee otherwise payable hereunder (in
advance of the time such fee or portion thereof would otherwise accrue) and/or
undertake to pay or reimburse the Fund for all or a portion of its expenses not
otherwise required to be borne or reimbursed by the Adviser. Any such fee
reduction or undertaking may be discontinued or modified by the Adviser at any
time.

6. Other Activities of the Adviser and Its Affiliates. Nothing herein contained
shall prevent the Adviser or any affiliate or associate of the Adviser from
engaging in any other business or from acting as investment adviser or
investment manager for any other person or entity, whether or not having
investment policies or portfolios similar to the Fund's; and it is specifically
understood that officers, directors and employees of the Adviser and those of
its parent company, John Hancock Mutual Life Insurance Company, or other
affiliates may continue to engage in providing portfolio management services and
advice to other investment companies, whether or not registered, to other
investment advisory clients of the Adviser or of its affiliates and to said
affiliates themselves.

7. Avoidance of Inconsistent Position. In connection with purchases or sales of
portfolio securities for the account of the Fund, neither the Adviser nor any of
its investment management subsidiaries, nor any of the Adviser's or such
investment management subsidiaries' directors, officers or employees will act as
principal or agent or receive any commission, except as may be permitted by the
1940 Act and rules and regulations promulgated thereunder. If any occasions
shall arise in which the Adviser advises persons concerning the shares of the
Fund, the Adviser will act solely on its own behalf and not in any way on behalf
of the Fund.

Nothing herein contained shall limit or restrict the Adviser or any of
its officers, affiliates or employees from buying, selling or trading in any
securities for its or their own account or accounts. The Fund acknowledges that
the Adviser and its officers, affiliates, and employees, and its other clients
may at any time have, acquire, increase, decrease or dispose of positions in
investments which are at the same time being acquired or disposed of hereunder.
The Adviser shall have no obligation to acquire with respect to the Fund, a
position in any investment which the Adviser, its officers, affiliates or
employees may acquire for its or their own accounts or for the account of
another client, if in the sole discretion of the Adviser, it is not feasible or
desirable to acquire a position in such investment on behalf of the Fund.
Nothing herein contained shall prevent the Adviser from purchasing or
recommending the purchase of a particular security for one or more funds or
clients while other funds or clients may be selling the same security.

8. No Partnership or Joint Venture. The Fund and the Adviser are not partners of
or joint venturers with each other and nothing herein shall be construed so as
to make them such partners or joint venturers or impose any liability as such on
any of them.

<PAGE>
9. Name of the Fund. The Fund may use the name "John Hancock" or any name
derived from or similar to the name "John Hancock Advisers, Inc." or "John
Hancock Mutual Life Insurance Company" only for so long as this Agreement
remains in effect. At such time as this Agreement shall no longer be in effect,
the Fund will (to the extent that it lawfully can) cease to use such a name or
any other name indicating that the Fund is advised by or otherwise connected
with the Adviser. The Fund acknowledges that it has adopted the name "John
Hancock Special Equities Fund" through permission of John Hancock Mutual Life
Insurance Company, a Massachusetts insurance company, and agrees that John
Hancock Mutual Life Insurance Company reserves to itself and any successor to
its business the right to grant the non-exclusive right to use the name "John
Hancock" or any similar name to any other corporation or entity, including but
not limited to any investment company of which John Hancock Mutual Life
Insurance Company or any subsidiary or affiliate thereof shall be the investment
adviser.

10. Limitation of Liability of the Adviser. The Adviser shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the Fund in
connection with the matters to which this Agreement relates, except a loss
resulting from willful misfeasance, bad faith or gross negligence on the part of
the Adviser in the performance of its duties or from reckless disregard by it of
its obligations and duties under this Agreement. Any person, even though also
employed by the Adviser, who may be or become an employee of and paid by the
Fund shall be deemed, when acting within the scope of his employment by the
Fund, to be acting in such employment solely for the Fund and not as the
Adviser's employee or agent.

11. Duration and Termination of this Agreement. This Agreement shall remain in
force until the second anniversary of the date upon which this Agreement was
executed by the parties hereto, and from year to year thereafter, but only so
long as such continuance is specifically approved at least annually by (a) a
majority of the Trustees who are not interested persons of the Adviser or (other
than as Board members) of the Fund, cast in person at a meeting called for the
purpose of voting on such approval, and (b) either (i) the Trustees or (ii) a
majority of the outstanding voting securities of the Fund. This Agreement may,
on 60 days' written notice, be terminated at any time without the payment of any
penalty by the Fund by vote of a majority of the outstanding voting securities
of the Fund, by the Trustees or by the Adviser. Termination of this Agreement
with respect to the Fund shall not be deemed to terminate or otherwise
invalidate any provisions of any contract between the Adviser and any other
series of the Fund. This Agreement shall automatically terminate in the event of
its assignment. In interpreting the provisions of this Section 11, the
definitions contained in Section 2(a) of the 1940 Act (particularly the
definitions of "assignment," "interested person" or "voting security"), shall be
applied.

12. Amendment of this Agreement. No provision of this Agreement may be changed,
waived, discharged or terminated orally, but only by an instrument in writing
signed by the party against which enforcement of the change, waiver, discharge
or termination is sought, and no amendment, transfer, assignment, sale,
hypothecation or pledge of this Agreement shall be effective until approved by
(a) the Trustees, including a majority of the Trustees who are not interested
persons of the Adviser or (other than as Board members) of the Fund, cast in
person at a meeting called for the purpose of voting on such approval, and (b) a
majority of the outstanding voting securities of the Fund, as defined in the
1940 Act.

<PAGE>
13. Governing Law. This Agreement shall be governed and construed in accordance
with the laws of the Commonwealth of Massachusetts.

14. Severability. The provisions of this Agreement are independent of and
separable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be deemed invalid or unenforceable in whole or in part.

15. Miscellaneous. The captions in this Agreement are included for convenience
of reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument. The name John Hancock Special Equities Fund is the designation of
the Trustees under the [Restated and Amended Declaration of Trust of the Fund
dated November 2, 1984], as amended from time to time. The [Restated and Amended
Declaration of Trust] has been filed with the Secretary of the Commonwealth of
Massachusetts. The obligations of the Fund are not personally binding upon, nor
shall resort be had to the private property of, any of the Trustees,
shareholders, officers, employees or agents of the Fund, but only the Fund's
property shall be bound. The Fund shall not be liable for the obligations of any
other series of the Fund.

Yours very truly,

JOHN HANCOCK SPECIAL EQUITIES FUND

By: /s/ Robert G. Freedman

Title: President

The foregoing contract is hereby agreed to as of the date hereof.

JOHN HANCOCK ADVISERS, INC.

By: /s/ Robert G. Freedman

Title: President

<PAGE>
Exhibit 99.6

August 1, 1991

JOHN HANCOCK BROKER DISTRIBUTION SERVICES, INC.
BOSTON, MASSACHUSETTS

DISTRIBUTION AGREEMENT

Dear Sir:

John Hancock Special Equities Fund (the "Fund") has been organized as a business
trust under the laws of the Commonwealth of Massachusetts to engage in the
business of an investment company. The Fund's Board of Directors has selected
you to act as principal underwriter (as such term is defined in Section 2(a)(29)
of the Investment Company Act of 1940, as amended) of the shares of beneficial
interest ("shares") of the Fund and you are willing, as agent for the Fund, to
sell the shares to the public, to broker-dealers or to both, in the manner and
on the conditions hereinafter set forth. Accordingly, the Fund hereby agrees
with you as follows:

1. Delivery of Documents. The Fund will furnish you promptly with copies,
properly certified or otherwise authenticated, of any registration
statements filed by it with the Securities and Exchange Commission
under the Securities Act of 1933, as amended, or the Investment Company
Act of 1940, as amended, together with any financial statements and
exhibits included therein, and all amendments or supplements thereto
hereafter filed.

2. Registration and Sale of Additional Shares. The Fund will from time to
time use its best efforts to register under the Securities Act of 1933,
as amended, such shares not already so registered as you may reasonably
be expected to sell as agent on behalf of the Fund. This Agreement
relates to the issue and sale of shares that are duly authorized and
registered and available for sale by the Fund if, but only if, the Fund
sees fit to sell them. You and the Fund will cooperate in taking such
action as may be necessary from time to time to qualify shares for sale
in Massachusetts and in any other states mutually agreeable to you and
the Fund, and to maintain such qualification if and so long as such
shares are duly registered under the Securities Act of 1933, as
amended.

3. Solicitation of Orders. You will use your best efforts (but only in
states in which you may lawfully do so) to obtain from investors
unconditional orders for shares authorized for issue by the Fund and
registered under the Securities Act of 1933, as amended, provided that
you may in your discretion refuse to accept orders for such shares from
any particular applicant.

4. Sale of Shares. Subject to the provisions of Sections 5 and 6 hereof
and to such minimum purchase requirements as may from time to time be
currently indicated in the Fund's prospectus, you are authorized to
sell as agent on behalf of the Fund authorized and issued shares
registered under the Securities Act of 1933, as amended. Such sales may
be made by you on behalf of the Fund by accepting unconditional orders
to purchase such shares placed with your investors. The sales price to
the public of such shares shall be the public offering price as defined
in Section 6 hereof.

5. Sale of Shares to Investors by the Fund. Any right granted to you to
accept orders for shares or make sales on behalf of the Fund will not
apply to shares issued in connection with the merger or consolidation
of any other investment company with the Fund or its acquisition, by
purchase or otherwise, of all or substantially all the assets of any
investment company or substantially all the outstanding shares of any
such company, and such right shall not apply to shares that may be
offered or otherwise issued by the Fund to shareholders by virtue of
their being shareholders of the Fund.

6. Public Offering Price. All shares sold by you as agent for the Fund
will be sold at the public offering price, which will be determined in
the manner provided in the Fund's prospectus or statement of additional
information, as now in effect or as it may be amended.

7. No Sales Discount. The Fund shall receive the applicable net asset
value on all sales of shares by you as agent of the Fund.

8. Delivery of Payments. You will deliver to the Transfer Agent all
payments made pursuant to orders accepted by you, and accompanied by
proper applications for the purchase of shares, no later than the first
business day following the receipt by you in your home office of such
payments and applications.

9. Suspension of Sales. If and whenever a suspension of the right of
redemption or a postponement of the date of payment or redemption has
been declared pursuant to the Fund's Articles of Incorporation and has
become effective, then, until such suspension or postponement is
terminated, no further orders for shares shall be accepted by you
except such unconditional orders placed with you before you have
knowledge of the suspension. The Fund reserves the right to suspend the
sale of shares and your authority to accept orders for shares on behalf
of the Fund if, in the judgment of a majority of the Fund's Board of
Directors, it is in the best interests of the Fund to do so, such
suspension to continue for such period as may be determined by such
majority; and in that event, no shares will be sold by the Fund or by
you on behalf of the Fund while such suspension remains in effect
except for shares necessary to cover unconditional orders accepted by
you before you had knowledge of the suspension.

10. Expenses. The Fund will pay (or will enter into arrangements providing
that persons other than you will pay) all fees and expenses in
connection with the preparation and filing of any registration
statement and prospectus or amendments thereto under the Securities Act
of 1933, as amended, covering the issue and sale of shares and in
connection with the qualification of shares for sale in the various
states in which the fund shall determine it advisable to qualify such
shares for sale. It will also pay the issue taxes or (in the case of
shares redeemed) any initial transfer taxes thereon. You will pay all
expenses of printing prospectuses and other sales literature, all fees
and expenses in connection with your qualification as a dealer in
various states, and all other expenses in connection with the sale and
offering for sale of the shares of the Fund which have not been herein
specifically allocated to the Fund.

11. Conformity with Law. You agree that in selling the shares you will duly
conform in all respects with the laws of the United States and any
state in which such shares may be offered for sale by you pursuant to
this Agreement.

12. Indemnification. You agree to indemnify and hold harmless the Fund and
each of its Board members and officers and each person, if any, who
controls the Fund within the meaning of Section 15 of the Securities
Act of 1933, as amended, against any and all losses, claims, damages,
liabilities or litigation (including legal and other expenses) to which
the Fund or such Board members, officers or controlling person may
become subject under such Act, under any other statute, at common law
or otherwise, arising out of the acquisition of any shares by any
person which (a) may be based upon any wrongful act by you or any of
your employees or representatives or (b) may be based upon any untrue
statement or alleged untrue statement of a material fact contained in a
registration statement, prospectus or statement of additional
information covering shares of the Fund or any amendment thereof or
supplement thereto or the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading if such statement or omission was
made in reliance upon information furnished or confirmed in writing to
the Fund by you, or (c) may be incurred or arise by reason of your
acting as the Fund's agent instead of purchasing and reselling shares
as principal in distributing shares to the public, provided that in no
case is your indemnity in favor of a Board member or officer of the
Fund or any other person deemed to protect such Board member or officer
of the Fund or other person against any liability to which any such
person would otherwise be subject by reason of willful misfeasance, bad
faith, or gross negligence in the performance of his duties or by
reason of his reckless disregard of obligations and duties under this
Agreement.

You are not authorized to give any information or to make any
representations on behalf of the Fund or in connection with the sale of
shares other than the information and representations contained in a
registration statement, prospectus, or statement of additional
information covering shares, as such registration statement, prospectus
and statement of additional information may be amended or supplemented
from time to time. No person other than you is authorized to act as
principal underwriter for the Fund.

13. Duration and Termination of this Agreement. This Agreement shall remain
in force until the conclusion of the first meeting of shareholders of
the Fund following the first public offering of shares and, if approved
at that meeting, from year to year thereafter, but only so long as such
continuance is specifically approved at least annually by (a) a
majority of the Board of Directors who are not interested persons of
you (other than as Board members) or of the Fund, cast in person at a
meeting called for the purpose of voting on such approval, and (b)
either (i) the Board of Directors of the Fund, or (ii) a majority of
the outstanding voting securities of the Fund. This Agreement may, on
60 days' written notice, be terminated at any time, without the payment
of any penalty, by the Board of Directors of the Fund, by a vote of a
majority of the outstanding voting securities of the Fund, or by you.
This Agreement will automatically terminate in the event of its
assignment by you. In interpreting the provisions of this Section 13,
the definitions contained in Section 2(a) of the Investment Company Act
of 1940 (particularly the definitions of "interested person",
"assignment" and "voting security") shall be applied.

14. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against which enforcement of
the change, waiver, discharge or termination is sought. If the Fund
should at any time deem it necessary or advisable in the best interests
of the Fund that any amendment of this agreement be made in order to
comply with the recommendations or requirements of the Securities and
Exchange Commission or other governmental authority or to obtain any
advantage under state or federal tax laws and should notify you of the
form of such amendment, and the reasons therefor, and if you should
decline to assent to such amendment, the Fund may terminate this
agreement forthwith. If you should at any time request that a change be
made in the Fund's Certificate of Incorporation or By-Laws, or in its
methods of doing business, in order to comply with any requirements of
federal law or regulations of the Securities and Exchange Commission or
of a national securities association of which you are or may be a
member, relating to the sale of shares, and the Fund should not make
such necessary change within a reasonable time, you may terminate this
Agreement forthwith.

Very truly yours,

JOHN HANCOCK SPECIAL EQUITIES FUND

By: /s/Edward J. Boudreau, Jr.
Chairman

The foregoing Agreement is hereby
accepted as of the date hereof.

JOHN HANCOCK BROKER
DISTRIBUTION SERVICES, INC.

By: /s/ C. Troy Shaver
President

<PAGE>

SOLICITING DEALER AGREEMENT

[LOGO]

JOHN HANCOCK FUNDS, INC.

BOSTON -- MASSACHUSETTS -- 02199-7603

<PAGE>
JOHN HANCOCK FUNDS, INC.
101 HUNTINGTON AVENUE
BOSTON, MA 02199-7603

SOLICITING DEALER AGREEMENT

Date
------------------------------

John Hancock Funds, Inc. ("the Distributor" or "Distributor") is the
principal distributor of the shares of beneficial interest (the "securities") of
each of the John Hancock Funds, ("We" or "us"), (the "Funds"). Such Funds are
those listed on Schedule A hereto which may be amended or supplemented from time
to time by the Distributor to include additional Funds for which the Distributor
is the principal distributor. You represent that you are a member of the
National Association of Securities Dealers, Inc., (the "NASD") and, accordingly,
we invite you to become a non-exclusive soliciting dealer to distribute the
securities of the Funds and you agree to solicit orders for the purchase of the
securities on the following terms. Securities are offered pursuant to each
Fund's prospectus and statement of additional information, as such prospectus
and statement of additional information may be amended from time to time. To the
extent that the prospectus or statement of additional information contains
provisions that are inconsistent with the terms of this Agreement, the terms of
the prospectus or statement of additional information shall be controlling.

OFFERINGS

1. You agree to abide by the Rules of Fair Practice of the NASD and to all other
rules and regulations that are now or may become applicable to transactions
hereunder.

2. As principal distributor of the Funds, we shall have full authority to take
such action as we deem advisable in respect of all matters pertaining to the
distribution. This offer of shares of the Funds to you is made only in such
jurisdictions in which we may lawfully sell such shares of the Funds.

3. You shall not make any representation concerning the Funds or their
securities except those contained in the then- current prospectus or statement
of additional information for each Fund.

4. With the exception of listings of product offerings, you agree not to furnish
or cause to be furnished to any person or display, or publish any information or
materials relating to any Fund (including, without limitation, promotional
materials, sales literature, advertisements, press releases, announcements,
posters, signs and other similar materials), except such information and
materials as may be furnished to you by the Distributor or the Fund. All other
materials must receive written approval by the Distributor before distribution
or display to the public. Use of all approved advertising and sales literature
materials is restricted to appropriate distribution channels.

5. You are not authorized to act as our agent. Nothing shall constitute you as a
syndicate, association, joint venture, partnership, unincorporated business, or
other separate entity or otherwise partners with us, but you shall be liable for
your proportionate share of any tax, liability or expense based on any claim
arising from the sale of shares of the Funds under this Agreement. We shall not
be under any liability to you, except for obligations expressly assumed by us in
this Agreement and liabilities under Section 11(f) of the Securities Act of
1933, and no obligations on our part shall be implied or inferred herefrom.

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<PAGE>

6. DEALER COMPLIANCE/SUITABILITY STANDARDS (CLASS A AND CLASS B SHARES) -
Certain mutual funds distributed by the Distributor are being offered with two
or more classes of shares of the same investment portfolio ("Fund") - refer to
each Fund prospectus for availability and details. It is essential that the
following minimum compliance/suitability standards be adhered to in offering and
selling shares of these Funds to investors. All dealers offering shares of the
Funds and their associated persons agree to comply with these general
suitability and compliance standards.

SUITABILITY

With two classes of shares of certain funds available to individual
investors, (Class A and Class B), it is important that each investor purchases
not only the fund that best suits his or her investment objective but also the
class of shares that offers the most beneficial distribution financing method
for the investor based upon his or her particular situation and preferences.
Fund share recommendations and orders must be carefully reviewed by you and your
registered representatives in light of all the facts and circumstances, to
ascertain that the class of shares to be purchased by each investor is
appropriate and suitable. These recommendations should be based on several
factors, including but not limited to:

(A) the amount of money to be invested initially and over a period of
time;
(B) the current level of front-end sales load or back-end sales load
imposed by the Fund;
(C) the period of time over which the client expects to retain the
investment;
(D) the anticipated level of yield from fixed income funds' Class A and
Class B shares;
(E) any other relevant circumstances such as the availability of reduced
sales charges under letters of intent and/or rights of accumulation.

There are instances when one distribution financing method may be more
appropriate than another. For example, shares subject to a front-end sales
charge may be more appropriate than shares subject to a contingent deferred
sales charge for large investors who qualify for a significant quantity discount
on the front-end sales charge. In addition, shares subject to a contingent
deferred sales charge may be more appropriate for investors whose orders would
not qualify for quantity discounts and who, therefore, may prefer to defer sales
charges and also for investors who determine it to be advantageous to have all
of their funds invested without deduction of a front-end sales commission.
However, if it is anticipated that an investor may redeem his or her shares
within a short period of time, the investor may, depending on the amount of his
or her purchase, bear higher distribution expenses by purchasing contingent
deferred sales charge shares than if he or she had purchased shares subject to a
front-end sales charge.

COMPLIANCE

Your supervisory procedures should be adequate to assure that an
appropriate person reviews and approves transactions entered into pursuant to
this Soliciting Dealer Agreement for compliance with the foregoing standards. In
certain instances, it may be appropriate to discuss the purchase with the
registered representatives involved or to review the advantages and
disadvantages of selecting one class of shares over another with the client. The
Distributor will not accept orders for Class B Shares in any Fund from you for
accounts maintained in street name. Trades for Class B Shares will only be
accepted in the name of the shareholder.

7. CLASS C SHARES - Certain mutual funds distributed by the Distributor may be
offered with Class C shares. Refer to each Fund prospectus for availability and
details. Class C shares are designed for institutional investors and qualified
benefit plans, including pension funds, and are sold without a sales charge or
12b-1 fee. If a commission is paid to you for transactions in Class C shares, it
will be paid by the Distributor out of its own resources.

SALES

8. Orders for securities received by you from investors will be for the sale of
the securities at the public offering price, which will be the net asset value
per share as determined in the manner provided in the relevant Fund's
prospectus, as now in effect or as amended from time to time, next after receipt
by us (or the relevant Fund's transfer agent) of the purchase application and
payment for the securities, plus the relevant sales charges set forth in the
relevant Fund's then- current prospectus (the "Public Offering Price"). The
procedures relating to the handling of orders shall be subject to our
instructions which we will forward from time to time to you. All orders are
subject to acceptance by us, and we reserve the right in our sole discretion to
reject any order.

-3-

<PAGE>
In addition to the foregoing, you acknowledge and agree to the initial and
subsequent investment minimums, which may vary from year to year, as described
in the then-current prospectus for each Fund.

9. You agree to sell the securities only (a) to your customers at the public
offering price then in effect, or (b) back to the Funds at the currently quoted
net asset value.

10. The amount of sales charge to be reallowed to you (the "Reallowance") as a
percentage of the offering price is set forth in the then-current prospectus of
each Fund.

If a sales charge on the purchase is reduced in accordance with the
provisions of the relevant Fund's then-current prospectus pertaining to "Methods
of Obtaining Reduced Sales Charges," the Reallowance shall be reduced pro rata.

11. We shall pay a Reallowance subject to the provisions of this agreement as
set forth in Schedule B hereto on all purchases made by your customers pursuant
to orders accepted by us (a) where an order for the purchase of securities is
obtained by a registered representative in your employ and remitted to us
promptly by you, (b) where a subsequent investment is made to an account
established by a registered representative in your employ or (c) where a
subsequent investment is made to an account established by a broker/dealer other
than you and is accompanied by a signed request from the account shareholder
that your registered representative receive the Reallowance for that investment
and/or for subsequent investments made in such account. If for any reason, a
purchase transaction is reversed, you shall not be entitled to receive or retain
any part of the Reallowance on such purchase and shall pay to us on demand in
full the amount of the Reallowance received by you in connection with any such
purchase. We may withhold and retain from the amount of the Reallowance due you
a sum sufficient to discharge any amount due and payable by you to us.

12. Certain of the Funds have adopted a plan under Investment Company Act Rule
12b-1 ("Distribution Plan" as described in the the prospectus). To the extent
you provide distribution and marketing services in the promotion of the sale of
shares of these Funds, including furnishing services and assistance to your
customers who invest in and own shares of such Funds and including, but not
limited to, answering routine inquiries regarding such Funds and assisting in
changing distribution options, account designations and addresses, you may be
entitled to receive compensation from us as set forth in Schedule C hereto. All
compensation, including 12b-1 fees, shall be payable to you only to the extent
that funds are received and in the possession of the Distributor.

13. We will advise you as to the jurisdictions in which we believe the shares
have been qualified for sale under the respective securities or "blue sky" laws
of such jurisdictions, but we assume no responsibility or obligations as to your
right to sell the shares of the Funds in any state or jurisdiction.

14. Orders may be placed through:
John Hancock Funds, Inc.
101 Huntington Avenue
Boston, MA 02199-7603
1-800-338-4265

SETTLEMENT

15. Settlements for wire orders shall be made within five business days after
our acceptance of your order to purchase shares of the Funds. Certificates, when
requested, will be delivered to you upon payment in full of the sum due for the
sale of the shares of the Funds. If payment is not so received or made, we
reserve the right forthwith to cancel the sale, or, at our option, to liquidate
the shares of the Fund subject to such sale at the then prevailing net asset
value, in which latter case you will agree to be responsible for any loss
resulting to the Funds or to us from your failure to make payments as aforesaid.

-4-

<PAGE>
INDEMNIFICATION

16. The parties to this agreement hereby agree to indemnify and hold harmless
each other, their officers and directors, and any person who is or may be deemed
to be a controlling person of each other, from and against any losses, claims,
damages, liabilities or expenses (including reasonable fees of counsel), whether
joint or several, to which any such person or entity may become subject insofar
as such losses, claims, damages, liabilities or expenses (or actions in respect
thereof) arise out of or are based upon, (a) any untrue statement or alleged
untrue statement of material fact, or any omission or alleged omission to state
a material fact made or omitted by it herein, or, (b) any willful misfeasance or
gross misconduct by it in the performance of its duties and obligations
hereunder.

17. NSCC INDEMNITY - SHAREHOLDER AND HOUSE ACCOUNTS - In consideration of the
Distributor and John Hancock Investor Services Corporation ("Investor Services")
liquidating, exchanging, and/or transferring unissued shares of the Funds for
your customers without the use of original or underlying documentation
supporting such instructions (e.g., a signed stock power or signature
guarantee), you hereby agree to indemnify the Distributor, Investor Services and
each respective Fund against any losses, including reasonable attorney's fees,
that may arise from such liquidation exchange, and/or transfer of unissued
shares upon your direction. This indemnification shall apply only to the
liquidation, exchange and/or transfer of unissued shares in shareholder and
house accounts executed as wire orders transmitted via NSCC's Fund/SERVsystem.
You represent and warrant to the Funds, the Distributor and Investor Services
that all such transactions shall be properly authorized by your customers.

The indemnification in this Section 16 shall not apply to any losses
(including attorney's fees) caused by a failure of the Distributor, Investor
Services or a Fund to comply with any of your instructions governing any of the
above transactions, or any negligent act or omission of the Distributor,
Investor Services or a Fund, or any of their directors, officers, employees or
agents. All transactions shall be settled upon your confirmation through NSCC
transmission to Investor Services.

The Distributor, Investor Services or you may revoke the indemnity
contained in this Section 16 upon prior written notice to each of the other
parties hereto, and in the case of such revocation, this indemnity agreement
shall remain effective as to trades made prior to such revocation.

MISCELLANEOUS

18. We will supply to you at our expense additional copies of the prospectus and
statement of additional information for each of the Funds and any printed
information supplemental to such material in reasonable quantities upon request.

19. Any notice to you shall be duly given if mailed or telegraphed to you at
your address as registered from time to time with the NASD.

20. Miscellaneous provisions, if any, are attached hereto and incorporated
herein by reference.

21. This agreement, which shall be construed in accordance with the laws of the
Commonwealth of Massachusetts, may be terminated by any party hereto at any time
upon written notice.

-5-

<PAGE>
SOLICITING DEALER

-------------------------------------------------
Name of Organization

By:-------------------------------------------------
Authorized Signature of Soliciting Dealer

-------------------------------------------------
Please Print or Type Name

-------------------------------------------------
Title

-------------------------------------------------
Print or Type Address

-------------------------------------------------
Telephone Number

Date:
-------------------------------------------------

In order to service you efficiently, please provide the following
information on your Mutual Funds Operations Department:

OPERATIONS MANAGER:
---------------------------------------------
ORDER ROOM MANAGER:
---------------------------------------------
OPERATIONS ADDRESS:
---------------------------------------------

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

TELEPHONE: FAX:
-------------------------------- ------------------------------

<TABLE>
<S> <C>
TO BE COMPLETED BY: TO BE COMPLETED BY:
JOHN HANCOCK FUNDS, INC. JOHN HANCOCK INVESTOR
SERVICES CORPORATION

BY: BY:
------------------------------------------- -------------------------------------------

- ---------------------------------------------- ----------------------------------------------
TITLE TITLE

</TABLE>

DEALER NUMBER:
------------------------------------

-6-

<PAGE>
JOHNHANCOCK
MUTUAL FUNDS

John Hancock Broker Distrubution Services, Inc.
101 Huntington Avenue Boston, MA 02199-7608 1-800-225-5291

/s/ John Hancock

<PAGE>
JOHN HANCOCK FUNDS, INC.
SCHEDULE A

DATED JANUARY 1, 1995 TO THE
SOLICITING DEALER AGREEMENT RELATING TO SHARES OF
JOHN HANCOCK FUNDS

<TABLE>
<S> <C>
John Hancock Sovereign Achievers Fund John Hancock National Aviation & Technology Fund
John Hancock Sovereign Investors Fund John Hancock Regional Bank Fund
John Hancock Sovereign Balanced Fund John Hancock Gold and Government Fund
John Hancock Sovereign Bond Fund John Hancock Global Rx Fund
John Hancock Sovereign U.S. Government Income Fund John Hancock Global Technology Fund
John Hancock Special Equities Fund* John Hancock Global Fund
John Hancock Special Opportunities Fund John Hancock Pacific Basin Equities Fund
John Hancock Discovery Fund John Hancock Global Income Fund
John Hancock Growth Fund John Hancock International Fund
John Hancock Strategic Income Fund John Hancock Global Resources Fund
John Hancock Limited-Term Government Fund John Hancock Emerging Growth Fund
John Hancock Cash Management Fund John Hancock Capital Growth Fund
John Hancock Managed Tax-Exempt Fund John Hancock Growth & Income Fund
John Hancock Tax-Exempt Income Fund John Hancock High Yield Bond Fund
John Hancock Tax-Exempt Series Fund John Hancock Investment Quality Bond Fund
John Hancock Special Value Fund John Hancock Government Securities Fund
John Hancock Strategic Short-Term Income Fund John Hancock U.S. Government Fund
John Hancock CA Tax-Free Fund John Hancock Government Income Fund
John Hancock High Yield Tax-Free Fund John Hancock Intermediate Government Fund
John Hancock Tax-Free Bond Fund John Hancock Adjustable U.S. Government Fund
John Hancock U.S. Government Cash Reserve Fund John Hancock Cash Reserve Money Market B Fund
</TABLE>

From time to time John Hancock Funds, Inc., as principal distributor of the
John Hancock funds, will offer additional funds for sale. These funds will
automatically become part of this Agreement and will be subject to all its
provisions unless otherwise directed by John Hancock Funds, Inc.

*Closed to new investors as of 9/30/94

<PAGE>
JOHN HANCOCK FUNDS, INC.

SCHEDULE B

DATED JANUARY 1, 1995 TO THE
SOLICITING DEALER AGREEMENT RELATING TO SHARES OF
JOHN HANCOCK FUNDS

I. REALLOWANCE

The Reallowance paid to the selling Brokers for sales of John Hancock
Funds is set forth in each Fund's then- current prospectus. No Commission will
be paid on sales of John Hancock Cash Management Fund or any John Hancock Fund
that is without a sales charge. Purchases of Class A shares of $1 million or
more, or purchases into an account or accounts whose aggregate value of fund
shares is $1 million or more will be made at net asset value with no initial
sales charge. On purchases of this type, John Hancock Funds, Inc. will pay a
commission as set forth in each Fund's then-current prospectus. John Hancock
Funds, Inc. will pay Brokers for sales of Class B shares of the Funds a
marketing fee as set forth in each Fund's then-current prospectus.

<PAGE>
JOHN HANCOCK FUNDS, INC.

SCHEDULE C

DATED JANUARY 1, 1995 TO THE
SOLICITING DEALER AGREEMENT RELATING TO SHARES OF
JOHN HANCOCK FUNDS

FIRST YEAR SERVICE FEES

Pursuant to the Distribution Plan applicable to each of the Funds
listed in Schedule A, John Hancock Funds, Inc. will advance to you a First Year
Service Fee related to the purchase of Class A shares (only if subject to sales
charge) or Class B shares of any of the Funds, as the case may be, sold by your
firm. This Service Fee will be compensation for your personal service and/or the
maintenance of shareholder accounts ("Customer Servicing") during the
twelve-month period immediately following the purchase of such shares, in the
amount not to exceed .25 of 1% of net assets invested in Class A shares or Class
B shares of the Fund, as the case may be, purchased by your customers.

SERVICE FEE SUBSEQUENT TO THE FIRST YEAR

Pursuant to the Distribution Plan applicable to each of the Funds
listed in Schedule A, the Distributor will pay you quarterly, in arrears, a
Service Fee commencing at the end of the twelve month period immediately
following the purchase of Class A shares (only if subject to sales charge) or
Class B shares, as the case may be, sold by your firm, for Customer Servicing,
in an amount not to exceed .25 of 1% of the average daily net assets
attributable to the Class A shares or Class B shares of the Fund, as the case
may be, purchased by your customers, provided your firm has under management
with the Funds combined average daily net assets for the preceding quarter of no
less than $1 million, or an individual representative of your firm has under
management with the Funds combined average daily net assets for the preceding
quarter of no less than $250,000 (an "Eligible Firm").

<PAGE>
JOHN HANCOCK BROKER DISTRIBUTION SERVICES, INC.

SCHEDULE D

DATED JULY 1, 1992 TO THE
SOLICITING DEALER AGREEMENT RELATING TO SHARES OF
JOHN HANCOCK MUTUAL FUNDS

No broker/dealer shall represent the FUnds or Distribution Services in any
written communications without prior receipt of written approval from John
Hancock Broker Distribution Services, Inc. This includes but is not limited to
all advertising, public relations, marketing and sales literature, and media
contacts.

Further, subsequent to the creation of such materialsbefore written
approval from JHBDS will be given, a copy of the NASD review document applicable
to such materials must be furnished to John Hancock Broker Distribution
Services, Inc. for its review and files.

FOR PURPOSES OF THIS SCHEDULE D, THE FOLLOWING TERMS ARE DEFINED:

Advertising:

materials designed for the mass market, e.g. print ads, radio and tv
commercials, billboards, etc.

Sales literature:

materials designed for a directed market, e.g. prospecting letters,
brochures, mailers, stuffers, etc.

Coop Advertising:

advertising materials (as defined above) used by selling group members
for which John Hancock pays some or all of the costs of publication
whether the materials were developed by JHBDS Marketing or not.

John Hancock Broker Distribution Services, Inc. Approval of Advertising:

Approval has four meanings:approval of the material itself from a
marketing perspective (JHBDS product managers), proactive compliance
officer), parent company corporate advertising approval (John Hancock
Mutual Life Insurance Company Advertising Dept. personnel) and approval
for use and related cost-sharing arrangements (national sales
coordinators).

NASD Filing:

Materials created by JHBDS will be filed with the NASD by the JHBDS
Compliance Department. Materials not created by JHBDS but to be included
in the coop program will be filed with the NASD by the broker-dealer
creating the materials. However, prior to use of the materials in our
coop program, we will need a copy of the final version of the material
as well as the NASDcomment letter. When this is received, the above
approvals can be obtained.

<PAGE>

FINANCIAL INSTITUTION
SALES AND SERVICE AGREEMENT

[LOGO]

JOHN HANCOCK FUNDS, INC.

Boston - Massachusetts - 02199-7603

<PAGE>
JOHN HANCOCK FUNDS, INC.
101 HUNTINGTON AVENUE
BOSTON, MA 02199-7603

FINANCIAL INSTITUTION
SALES AND SERVICE AGREEMENT

Date
--------------------------------

John Hancock Funds, Inc. ("The Distributor", or "Distributor"), ("We" or
"us"), is the principal distributor of the shares of beneficial interest (the
"securities") of each of the John Hancock Funds (the "Funds"). Such Funds are
those listed on Schedule A hereto which may be amended or supplemented from time
to time by the Distributor to include additional Funds for which the Distributor
is the principal distributor. You hereby represent that you are a "bank" as
defined in Section 3(a)(b) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and at the time of each transaction in shares of the
Funds, are not required to register as a broker/dealer under the Exchange Act or
regulations thereunder. We invite you to become a non-exclusive soliciting
financial institution ("Financial Institution") to distribute the securities of
the Funds and you agree to solicit orders for the purchase of the securities on
the following terms. Securities are offered pursuant to each Fund's prospectus
and statement of additional information, as such prospectus and statement of
additional information may be amended from time to time. To the extent that the
prospectus or statement of additional information contains provisions that are
inconsistent with the terms of this Agreement, the terms of the prospectus or
statement of additional information shall be controlling.

OFFERINGS

1. You represent and warrant that you will use your best efforts to ensure that
any purchase of shares of the Funds by your customers constitutes a suitable
investment for such customers. You acknowledge that you will base such a
decision of suitability on all the facts you have gathered about your customer's
financial situation, investment objectives, risk tolerance and sophistication.

2. You represent and warrant that a copy of the then-current prospectus of a
Fund will be delivered to your customer before any purchase of shares of that
Fund are effected for that customer. You shall not effect any transaction in, or
induce any purchase or sale of, any shares of the Funds by means of any
manipulative, deceptive or other fraudulent device or contrivance, and shall
otherwise deal equitably and fairly with your customers with respect to
transactions in shares of a Fund.

3. You represent and warrant that you will not make shares of any Fund available
to your customers, including your fiduciary customers, except in compliance with
all Federal and state laws and rules and regulations of regulatory agencies or
authorities applicable to you, or any of your affiliates engaging in such
activity, which may affect your business practices. You confirm that you are not
in violation of any banking law or regulations as to which you are subject. You
agree that you will comply with the requirements of Banking Circular 274 issued
by the Office of the Comptroller of the Currency in offering shares of the Funds
to your customers. We agree that we will comply with all Federal and state laws
and rules and regulations of regulatory agencies or authorities applicable to
us. We and you acknowledge and agree that the offering of shares of the Funds
pursuant to this agreement is subject to the oversight of your management and
the regulatory authorities by which you are subject to review, and that
appropriate records and materials relating to any activity by you or us
undertaken pursuant to this agreement may be accessed by bank examiners in the
due course of any regulatory review to which you may be subject.

4. As principal distributor of the Funds, we shall have full authority to take
such action as we deem advisable in respect of all matters pertaining to the
distribution. This offer of shares of the Funds to you is made only in such
jurisdictions in which we may lawfully sell such shares of the Funds.

-2-

<PAGE>

5. You shall not make any representation concerning the Funds or their
securities except those contained in the then-current prospectus or statement of
additional information for each Fund.

6. We will supply to you at our expense additional copies of the then-current
prospectus and statement of additional information for each of the Funds and any
printed information supplemental to such material in reasonable quantities upon
request. It shall be your obligation to ensure that all such information and
materials are distributed to your customers who own or seek to own shares of the
Funds in accordance with securities and/or banking law and regulations and any
other applicable regulations.

7. With the exception of listings of product offerings, you agree not to furnish
or cause to be furnished to any person or display, or publish any information or
materials relating to any Fund (including, without limitation, promotional
materials, sales literature, advertisements, press releases, announcements,
posters, signs and other similar materials), except such information and
materials as may be furnished to you by us the Distributor or the Fund. All
other materials must receive written approval by the Distributor before
distribution or display to the public. Use of all approved advertising and sales
literature materials is restricted to appropriate distribution channels.

8. You are not authorized to act as our agent. In making available shares of the
Funds under this Financial Institution Sales and Service Agreement, nothing
herein shall be construed to constitute you or any of your agents, employees or
representatives as our agent or employee, or as an agent or employee of the
Funds, and you shall not make any representations to the contrary. Nothing shall
constitute you as a syndicate, association, unincorporated business, or other
separate entity or partners with us, but you shall be liable for your
proportionate share of any tax, liability or expense based on any claim arising
from the sale of shares of the Funds under this Agreement. We shall not be under
any liability to you, except for obligations expressly assumed by us in this
Agreement and liabilities under Section 11(f) of the Securities Act of 1933, and
no obligations on our part shall be implied or inferred herefrom.

9. DEALER COMPLIANCE/SUITABILITY STANDARDS (CLASS A AND CLASS B SHARES) -
Certain mutual funds distributed by the Distributor are being offered with two
or more classes of shares of the same investment portfolio ("Fund") - refer to
each Fund prospectus for availability and details. It is essential that the
following minimum compliance/suitability standards be adhered to in offering and
selling shares of these Funds to investors. All soliciting financial
institutions offering shares of the Funds and their agents, employees and
representatives agree to comply with these general suitability and compliance
standards.

SUITABILITY

With two classes of shares of certain funds available to individual
investors, (Class A and Class B), it is important that each investor purchases
not only the fund that best suits his or her investment objective but also the
class of shares that offers the most beneficial distribution financing method
for the investor based upon his or her particular situation and preferences.
Fund share recommendations and orders must be carefully reviewed by you and your
agents, employees and representatives in light of all the facts and
circumstances, to ascertain that the class of shares to be purchased by each
investor is appropriate and suitable. These recommendations should be based on
several factors, including but not limited to:

(A) the amount of money to be invested initially and over
a period of time;
(B) the current level of front-end sales load or back-end
sales load imposed by the Fund;
(C) the period of time over which the customer expects to
retain the investment;
(D) the anticipated level of yield from fixed income funds' Class A and
Class B shares;
(E) any other relevant circumstances such as the availability of reduced
sales charges under letters of intent and/or rights of accumulation.

-3-

<PAGE>

COMPLIANCE

Your supervisory procedures should be adequate to assure that an
appropriate person reviews and approves transactions entered into pursuant to
this Financial Institution Sales and Service Agreement for compliance with the
foregoing standards. In certain instances, it may be appropriate to discuss the
purchase with the agents, employees and representatives involved or to review
the advantages and disadvantages of selecting one class of shares over another
with the client. The Distributor will not accept orders for Class B Shares in
any Fund from you for accounts maintained in your name or in the name of your
nominee for the benefit of certain of your customers. Trades for Class B Shares
will only be accepted in the name of the shareholder.

10. CLASS C SHARES - Certain mutual funds distributed by the Distributor may be
offered with Class C shares. Refer to each Fund prospectus for availability and
details. Class C shares are designed for institutional investors and qualified
benefit plans, including pension funds, and are sold without a sales charge or
12b-1 fee. If a commission is paid to you for transactions in Class C shares, it
will be paid by the Distributor out of its own resources.

SALES

11. With respect to any and all transactions in the shares of any Fund pursuant
to this Financial Institution Sales and Service Agreement it is understood and
agreed in each case that: (a) you shall be acting solely as agent for the
account of your customer; (b) each transaction shall be initiated solely upon
the order of your customer; (c) we shall execute transactions only upon
receiving instructions from you acting as agent for your customer or upon
receiving instructions directly from your customer; (d) as between you and your
customer, your customer will have full beneficial ownership of all shares; (c)
each transaction shall be for the account of your customer and not for your
account; and (f) unless otherwise agreed in writing we will serve as a clearing
broker for you on a fully disclosed basis, and you shall serve as the
introducing agent for your customers' accounts. Subject to the foregoing,
however, and except for Class B shares, as described in Section 8 above, you may
maintain record ownership of such customers' shares in an account registered in
your name or the name of your nominee, for the benefit of such customers. Each
transaction shall be without recourse to you provided that you act in accordance
with the terms of this Financial Institution Sales and Service Agreement. You
represent and warrant to us that you will have full right, power and authority
to effect transactions (including, without limitation, any purchases and
redemptions) in shares of the Funds on behalf of all customer accounts provided
by you.

12. Orders for securities received by you from your customers will be for the
sale of the securities at the public offering price, which will be the net asset
value per share as determined in the manner provided in the relevant Fund's
prospectus, as now in effect or as amended from time to time, next after receipt
by us (or the relevant Fund's transfer agent) of the purchase application and
payment for the securities, plus the relevant sales charges set forth in the
relevant Fund's then-current prospectus (the "Public Offering Price"). The
procedures relating to the handling of orders shall be subject to our
instructions which we will forward from time to time to you. All orders are
subject to acceptance by us, and we reserve the right in our sole discretion to
reject any order.

In addition to the foregoing, you acknowledge and agree to the initial and
subsequent investment minimums, which may vary from year to year, as described
in the then-current prospectus for each Fund.

13. You agree to sell the securities only (a) to your customers at the public
offering price then in effect, or (b) back to the Funds at the currently quoted
net asset value.

14. The amount of sales charge to be reallowed to you (the "Reallowance") as a
percentage of the offering price is set forth in the then-current prospectus of
each Fund.

If a sales charge on the purchase is reduced in accordance with the
provisions of the relevant Fund's then- current prospectus pertaining to
"Methods of Obtaining Reduced Sales Charges," the Reallowance shall be reduced
pro rata.

15. We shall pay a Reallowance subject to the provisions of this agreement as
set forth in Schedule B hereto on all purchases made by your customers pursuant
to orders accepted by us (a) where an order for the purchase of securities is
obtained by you and remitted to us promptly by you, (b) where a subsequent
investment is made to an account established by you or (c) where a subsequent
investment is made to an account established by a financial institution or

-4-

<PAGE>
registered broker/dealer other than you and is accompanied by a signed request
from the account shareholder that you receive the Reallowance for that
investment and/or for subsequent investments made in such account. If for any
reason, a purchase transaction is reversed, you shall not be entitled to receive
or retain any part of the Reallowance on such purchase and shall pay to us on
demand in full the amount of the Reallowance received by you in connection with
any such purchase. We may withhold and retain from the amount of the Reallowance
due you a sum sufficient to discharge any amount due and payable by you to us.

16. Certain of the Funds have adopted a plan under Investment Company Act Rule
12b-1 ("Distribution Plan" as described in the prospectus). To the extent you
provide distribution and marketing services in the promotion of the sale of
shares of these Funds, including furnishing services and assistance to your
customers who invest in and own shares of such Funds and including, but not
limited to, answering routine inquiries regarding such Funds and assisting in
changing distribution options, account designations and addresses, you may be
entitled to receive compensation from us as set forth in Schedule C hereto. All
compensation, including 12b-1 fees, shall be payable to you only to the extent
that funds are received and in the possession of the Distributor.

17. We will advise you as to the jurisdictions in which we believe the shares
have been qualified for sale under the respective securities or "blue sky" laws
of such jurisdictions, but we assume no responsibility or obligations as to your
right to sell the shares of the Funds in any state or jurisdiction.

18. Orders may be placed through:
John Hancock Funds, Inc.
101 Huntington Avenue
Boston, MA 02199-7603
1-800-338-4265

SETTLEMENT

19. Settlements for wire orders shall be made within five business days after
our acceptance of your order to purchase shares of the Funds. Certificates, when
requested, will be delivered to you upon payment in full of the sum due for the
sale of the shares of the Funds. If payment is not so received or made, we
reserve the right forthwith to cancel the sale, or, at our option, to liquidate
the shares of the Fund subject to such sale at the then prevailing net asset
value, in which latter case you will agree to be responsible for any loss
resulting to the Funds or to us from your failure to make payments as aforesaid.

INDEMNIFICATION

20. The parties to this agreement hereby agree to indemnify and hold harmless
each other, their officers and directors, and any person who is or may be deemed
to be a controlling person of each other, from and against any losses, claims,
damages, liabilities or expenses (including reasonable fees of counsel), whether
joint or several, to which any such person or entity may become subject insofar
as such losses, claims, damages, liabilities or expenses (or actions in respect
thereof) arise out of or are based upon, (a) any untrue statement or alleged
untrue statement of material fact, or any omission or alleged omission to state
a material fact made or omitted by it herein, or, (b) any willful misfeasance or
gross misconduct by it in the performance of its duties and obligations
hereunder.

MISCELLANEOUS

21. Any notice to you shall be duly given if mailed or telegraphed to you at
your address as most recently furnished to us by you.

22. Miscellaneous provisions, if any, are attached hereto and incorporated
herein by reference.

23. This agreement, which shall be construed in accordance with the laws of the
Commonwealth of Massachusetts, may be terminated by any party hereto at any time
upon written notice.

-5-

<PAGE>
FINANCIAL INSTITUTION

-------------------------------------------------
Financial Institution

By:
-------------------------------------------------
Authorized Signature of Financial Institution

-------------------------------------------------
Please Print or Type Name

-------------------------------------------------
Title

-------------------------------------------------
Print or Type Address

-------------------------------------------------
Telephone Number

Date:
-------------------------------------------------

In order to service you efficiently, please provide the following
information on your Mutual Funds Operations Department:

OPERATIONS MANAGER:
---------------------------------------------

ORDER ROOM MANAGER:
---------------------------------------------

OPERATIONS ADDRESS:
---------------------------------------------

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

TELEPHONE: FAX:
--------------------- ----------------------------

TO BE COMPLETED BY: JOHN HANCOCK INVESTOR
JOHN HANCOCK FUNDS, INC. SERVICES CORPORATION

By: By:
--------------------------------- ------------------------------------

- ------------------------------------ ------------------------------------
Title Title

TO BE COMPLETED BY:

FINANCIAL INSTITUTION NUMBER:
----------------------------------------------

-6-

<PAGE>

JOHN HANCOCK FUNDS, INC.

SCHEDULE A

DATED JANUARY 1, 1995 TO THE
FINANCIAL INSTITUTION SALES AND SERVICE
AGREEMENT RELATING TO SHARES OF
JOHN HANCOCK FUNDS

<TABLE>
<S> <C>
John Hancock Sovereign Achievers Fund John Hancock National Aviation & Technology Fund
John Hancock Sovereign Investors Fund John Hancock Regional Bank Fund
John Hancock Sovereign Balanced Fund John Hancock Gold and Government Fund
John Hancock Sovereign Bond Fund John Hancock Global Rx Fund
John Hancock Sovereign U.S. Government Income Fund John Hancock Global Technology Fund
John Hancock Special Equities Fund* John Hancock Global Fund
John Hancock Special Opportunities Fund John Hancock Pacific Basin Equities Fund
John Hancock Discovery Fund John Hancock Global Income Fund
John Hancock Growth Fund John Hancock International Fund
John Hancock Strategic Income Fund John Hancock Global Rescources Fund
John Hancock Limited Term Government Fund John Hancock Emerging Growth Fund
John Hancock Cash Management Fund John Hancock Capital Growth Fund
John Hancock Managed Tax-Exempt Fund John Hancock Growth & Income Fund
John Hancock Tax-Exempt Income Fund John Hancock High Yield Bond Fund
John Hancock Tax-Exempt Series Fund John Hancock Investment Quality Bond Fund
John Hancock Special Value Fund John Hancock Government SecurritiesFund
John Hancock Strategic Short-Term Income Fund John Hancock U.S. Government Fund
John Hancock CA Tax-Free Fund John Hancock Governtment Income Fund
John Hancock High Yield Tax-Free Fund John Hancock Intermediate Government Fund
John Hancock Tax-Free Bond Fund John Hancock Adjustable U.S. Government Fund
John Hancock U.S. Government Cash Reserve Fund John Hancock Cash Reserve Money Market B Fund

</TABLE>

From time to time John Hancock Funds, as principal distributor of the
John Hancock Funds, will offer additional funds for sale. These funds will
automatically become part of this Agreement and will be subject to all its
provisions unless otherwise directed by John Hancock Funds, Inc.
* Closed to new invstors as of 9/30/94.

<PAGE>
JOHN HANCOCK FUNDS, INC.

SCHEDULE B

DATED JANUARY 1, 1995 TO THE
FINANCIAL INSTITUTION SALES AND SERVICE
AGREEMENT RELATING TO SHARES OF
JOHN HANCOCK FUNDS

I. REALLOWANCE

The Reallowance paid to Financial Institutions for sales of John Hancock
Funds is the same as that paid to Selling Brokers described and set forth in
each Fund's then-current prospectus. No Commission will be paid on sales of
John Hancock Cash Management Fund or any John Hancock Fund that is without a
sales charge. Purchases of Class A shares of $1 million or more, or
purchases into an account or accounts whose aggregate value of fund shares
is $1 million or more will be made at net asset value with no initial sales
charge. On purchases of this type, the Distributor will pay a commission as
set forth in each Fund's then-current prospectus. John Hancock Funds, Inc.
will pay Financial Institutions for sales of Class B shares of the Funds a
marketing fee as set forth in each Fund's then-current prospectus for
Selling Brokers.

<PAGE>
JOHN HANCOCK FUNDS, INC.

SCHEDULE C

DISTRIBUTION PLAN SCHEDULE OF COMPENSATION

DATED JANUARY 1, 1995 TO THE
FINANCIAL INSTITUTION SALES AND SERVICE
AGREEMENT RELATING TO SHARES OF
JOHN HANCOCK FUNDS

FIRST YEAR SERVICE FEE

Pursuant to the Distribution Plan applicable to each of the Funds
listed in Schedule A, the Distributor will advance to you a First Year Service
Fee related to the purchase of Class A shares (only if subject to sales charge)
or Class B shares of any of the Funds, as the case maybe, sold by your firm on
or after July 1, 1993. This Service Fee will be compensation for your personal
service and/or the maintenance of shareholder accounts ("Customer Servicing")
during the twelve-month period immediately following the purchase of such
shares, in an amount not to exceed .25 of 1% of the average daily net assets
attributable to Class A shares or Class B shares of the Fund, as the case may
be, purchased by your customers.

SERVICE FEE SUBSEQUENT TO THE FIRST YEAR

Pursuant to the Distribution Plan applicable to each of the Funds
listed in Schedule A, the Distributor will pay you quarterly, in arrears, a
Service Fee commencing at the end of the twelve-month period immediately
following the purchase of Class A shares (only if subject to sales charge) or
Class B shares, as the case may be, sold by your firm, for Customer Servicing,
in an amount not to exceed .25 of 1% of the average daily net assets
attributable to the Class A shares or Class B shares of the Fund, as the case
may be, purchased by your customers, provided your Financial Institution has
under management with the Funds combined average daily net assets for the
preceding quarter of no less than $1 million, or an individual representative of
your Financial Institution has under management with the Funds combined average
daily net assets for the preceding quarter of no less than $250,000 (an
"Eligible Financial Institution").

<PAGE>

MASTER CUSTODIAN AGREEMENT

between

JOHN HANCOCK MUTUAL FUNDS

and

INVESTORS BANK & TRUST COMPANY

<PAGE>
<TABLE>
TABLE OF CONTENTS
-----------------

<S> <C> <C>
1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-3
2. Employment of Custodian and Property to be held by it . . . . . . . . . . . . . . . 3-4
3. Duties of the Custodian with Respect toProperty of the Fund . . . . . . . . . . . . 4
A. Safekeeping and Holding of Property . . . . . . . . . . . . . . . . . . . . . 4
B. Delivery of Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-8
C. Registration of Securities . . . . . . . . . . . . . . . . . . . . . . . . . . 8
D. Bank Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-9
E. Payments for Shares of the Fund . . . . . . . . . . . . . . . . . . . . . . . 9
F. Investment and Availability of Federal Funds . . . . . . . . . . . . . . . . . 9
G. Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9-10
H. Payment of Fund Moneys . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10-12
I. Liability for Payment in Advance of Receipt of Securities Purchased . . . . . 12-13
J. Payments for Repurchases of Redemptions of Shares of the Fund . . . . . . . . 13
K. Appointment of Agents by the Custodian . . . . . . . . . . . . . . . . . . . . 13
L. Deposit of Fund Portfolio Securities in Securities Systems . . . . . . . . . . 13-16
M. Deposit of Fund Commercial Paper in an Approved
Book-Entry System for Commercial Paper . . . . . . . . . . . . . . . . . . 16-18
N. Segregated Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18-19
O. Ownership Certificates for Tax Purposes . . . . . . . . . . . . . . . . . . . 19
P. Proxies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Q. Communications Relating to Fund Portfolio Securities . . . . . . . . . . . . . 19-20
</TABLE>

<PAGE>

<TABLE>
<S> <C> <C>
R. Exercise of Rights; Tender Offers . . . . . . . . . . . . . . . . . . . . . . 20

S. Depository Receipts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20-21

T. Interest Bearing Call or Time Deposits . . . . . . . . . . . . . . . . . . . . 21

U. Options, Futures Contracts and Foreign Currency Transactions . . . . . . . . . 21-23

V. Actions Permitted Without Express Authority . . . . . . . . . . . . . . . . . 23-24

4. Duties of Bank with Respect to Books of Account and
Calculations of Net Asset Value . . . . . . . . . . . . . . . . . . . . . . . . . . 24

5. Records and Miscellaneous Duties . . . . . . . . . . . . . . . . . . . . . . . . . . 24-25

6. Opinion of Fund`s Independent Public Accountants . . . . . . . . . . . . . . . . . . 25

7. Compensation and Expenses of Bank . . . . . . . . . . . . . . . . . . . . . . . . . 25-26

8. Responsibility of Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26-27

9. Persons Having Access to Assets of the Fund . . . . . . . . . . . . . . . . . . . . 27

10. Effective Period, Termination and Amendment; Successor Custodian . . . . . . . . . . 27-28

11. Interpretive and Additional Provisions . . . . . . . . . . . . . . . . . . . . . . . 28-29

12. Certification as to Authorized Officers . . . . . . . . . . . . . . . . . . . . . . 29

13. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

14. Massachusetts Law to Apply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

15. Adoption of the Agreement by the Fund . . . . . . . . . . . . . . . . . . . . . . . 30
</TABLE>

<PAGE>
MASTER CUSTODIAN AGREEMENT

This Agreement is made as of December 15, 1992 between each investment
company advised by John Hancock Advisers, Inc. which has adopted this Agreement
in the manner provided herein and Investors Bank & Trust Company (hereinafter
called "Bank", "Custodian" and "Agent"), a trust company established under the
laws of Massachusetts with a principal place of business in Boston,
Massachusetts.

Whereas, each such investment company is registered under the Investment
Company Act of 1940 and has appointed the Bank to act as Custodian of its
property and to perform certain duties as its Agent, as more fully hereinafter
set forth; and

Whereas, the Bank is willing and able to act as each such investment
company's Custodian and Agent, subject to and in accordance with the provisions
hereof;

Now, therefore, in consideration of the premises and of the mutual
covenants and agreements herein contained, each such investment company and the
Bank agree as follows:

1. Definitions
-----------

Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:

(a) "Fund" shall mean the investment company which has adopted this
Agreement and is listed on Appendix A hereto. If the Fund is a Massachusetts
business trust or Maryland corporation, it may in the future establish and
designate other separate and distinct series of shares, each of which may be
called a "portfolio"; in such case, the term "Fund" shall also refer to each
such separate series or portfolio.

(b) "Board" shall mean the board of directors/trustees/managing general
partners/director general partners of the Fund, as the case may be.

(c) "The Depository Trust Company", a clearing agency registered with the
Securities and Exchange Commission under Section 17A of the Securities Exchange
Act of 1934 which acts as a securities depository and which has been
specifically approved as a securities depository for the Fund by the Board.

(d) "Authorized Officer", shall mean any of the following officers of the
Trust: The Chairman of the Board of Trustees, the President, a Vice President,
the Secretary, the Treasurer or Assistant Secretary or Assistant Treasurer, or
any other officer of the Trust duly authorized to sign by appropriate resolution
of the Board of Trustees of the Trust.

(e) "Participants Trust Company", a clearing agency registered with the
Securities and Exchange Commission under Section 17A of the Securities Exchange
Act of 1934 which acts as a securities depository and which has been
specifically approved as a securities depository for the Fund by the Board.

<PAGE>

(f) "Approved Clearing Agency" shall mean any other domestic clearing
agency registered with the Securities and Exchange Commission under Section 17A
of the Securities Exchange Act of 1934 which acts as a securities depository but
only if the Custodian has received a certified copy of a vote of the Board
approving such clearing agency as a securities depository for the Fund.

(g) "Federal Book-Entry System" shall mean the book-entry system referred
to in Rule 17f-4(b) under the Investment Company Act of 1940 for United States
and federal agency securities (i.e., as provided in Subpart O of Treasury
Circular No. 300, 31 CFR 306, Subpart B of 31 CFR Part 350, and the book-entry
regulations of federal agencies substantially in the form of Subpart O).

(h) "Approved Foreign Securities Depository" shall mean a foreign
securities depository or clearing agency referred to in rule 17f-4 under the
Investment Company Act of 1940 for foreign securities but only if the Custodian
has received a certified copy of a vote of the Board approving such depository
or clearing agency as a foreign securities depository for the Fund.

(i) "Approved Book-Entry System for Commercial Paper" shall mean a system
maintained by the Custodian or by a subcustodian employed pursuant to Section 2
hereof for the holding of commercial paper in book-entry form but only if the
Custodian has received a certified copy of a vote of the Board approving the
participation by the Fund in such system.

(j) The Custodian shall be deemed to have received "proper instructions"
in respect of any of the matters referred to in this Agreement upon receipt of
written or facsimile instructions signed by such one or more person or persons
as the Board shall have from time to time authorized to give the particular
class of instructions in question. Electronic instructions for the purchase and
sale of securities which are transmitted by John Hancock Advisers, Inc. to the
Custodian through the John Hancock equity trading system and the John Hancock
fixed income trading system shall be deemed to be proper instructions; the Fund
shall cause all such instructions to be confirmed in writing. Different persons
may be authorized to give instructions for different purposes. A certified copy
of a vote of the Board may be received and accepted by the Custodian as
conclusive evidence of the authority of any such person to act and may be
considered as in full force and effect until receipt of written notice to the
contrary. Such instructions may be general or specific in terms and, where
appropriate, may be standing instructions. Unless the vote delegating authority
to any person or persons to give a particular class of instructions specifically
requires that the approval of any person, persons or committee shall first have
been obtained before the Custodian may act on instructions of that class, the
Custodian shall be under no obligation to question the right of the person or
persons giving such instructions in so doing. Oral instructions will be
considered proper instructions if the Custodian reasonably believes them to have
been given by a person authorized to give such instructions with respect to the
transaction involved. The Fund shall cause all oral

<PAGE>

instructions to be confirmed in writing. The Fund authorizes the Custodian to
tape record any and all telephonic or other oral instructions given to the
Custodian. Upon receipt of a certificate signed by two officers of the Fund as
to the authorization by the President and the Treasurer of the Fund accompanied
by a detailed description of the communication procedures approved by the
President and the Treasurer of the Fund, "proper instructions" may also include
communications effected directly between electromechanical or electronic devices
provided that the President and Treasurer of the Fund and the Custodian are
satisfied that such procedures afford adequate safeguards for the Fund's assets.
In performing its duties generally, and more particularly in connection with the
purchase, sale and exchange of securities made by or for the Fund, the Custodian
may take cognizance of the provisions of the governing documents and
registration statement of the Fund as the same may from time to time be in
effect (and votes, resolutions or proceedings of the shareholders or the Board),
but, nevertheless, except as otherwise expressly provided herein, the Custodian
may assume unless and until notified in writing to the contrary that so-called
proper instructions received by it are not in conflict with or in any way
contrary to any provisions of such governing documents and registration
statement, or votes, resolutions or proceedings of the shareholders or the
Board.

2. Employment of Custodian and Property to be Held by It
-----------------------------------------------------

The Fund hereby appoints and employs the Bank as its Custodian and Agent
in accordance with and subject to the provisions hereof, and the Bank hereby
accepts such appointment and employment. The Fund agrees to deliver to the
Custodian all securities, participation interests, cash and other assets owned
by it, and all payments of income, payments of principal and capital
distributions and adjustments received by it with respect to all securities and
participation interests owned by the Fund from time to time, and the cash
consideration received by it for such new or treasury shares ("Shares") of the
Fund as may be issued or sold from time to time. The Custodian shall not be
responsible for any property of the Fund held by the Fund and not delivered by
the Fund to the Custodian. The Fund will also deliver to the Bank from time to
time copies of its currently effective charter (or declaration of trust or
partnership agreement, as the case may be), by-laws, prospectus, statement of
additional information and distribution agreement with its principal
underwriter, together with such resolutions, votes and other proceedings of the
Fund as may be necessary for or convenient to the Bank in the performance of its
duties hereunder.

The Custodian may from time to time employ one or more subcustodians to
perform such acts and services upon such terms and conditions as shall be
approved from time to time by the Board. Any such subcustodian so employed by
the Custodian shall be deemed to be the agent of the Custodian, and the
Custodian shall remain primarily responsible for the securities, participation
interests, moneys and other property of the Fund held by such subcustodian. Any
foreign subcustodian shall be a bank or trust company which is an eligible
foreign custodian within the meaning of Rule 17f-5 under the Investment Company
Act of 1940, and the foreign custody arrangements shall be approved by the Board
and shall be in accordance with and subject to the provisions of said Rule. For

<PAGE>

the purposes of this Agreement, any property of the Fund held by any such
subcustodian (domestic or foreign) shall be deemed to be held by the Custodian
under the terms of this Agreement.

3. Duties of the Custodian with Respect to Property of the Fund
------------------------------------------------------------

A. SAFEKEEPING AND HOLDING OF PROPERTY The Custodian shall keep safely
all property of the Fund and on behalf of the Fund shall from time
to time receive delivery of Fund property for safekeeping. The
Custodian shall hold, earmark and segregate on its books and
records for the account of the Fund all property of the Fund,
including all securities, participation interests and other assets
of the Fund (1) physically held by the Custodian, (2) held by any
subcustodian referred to in Section 2 hereof or by any agent
referred to in Paragraph K hereof, (3) held by or maintained in The
Depository Trust Company or in Participants Trust Company or in an
Approved Clearing Agency or in the Federal Book- Entry System or in
an Approved Foreign Securities Depository, each of which from time
to time is referred to herein as a "Securities System", and (4)
held by the Custodian or by any subcustodian referred to in Section
2 hereof and maintained in any Approved Book-Entry System for
Commercial Paper.

B. DELIVERY OF SECURITIES The Custodian shall release and deliver
securities or participation interests owned by the Fund held (or
deemed to be held) by the Custodian or maintained in a Securities
System account or in an Approved Book-Entry System for Commercial
Paper account only upon receipt of proper instructions, which may
be continuing instructions when deemed appropriate by the parties,
and only in the following cases:

1) Upon sale of such securities or participation interests for
the account of the Fund, BUT ONLY against receipt of
payment therefor; if delivery is made in Boston or New York
City, payment therefor shall be made in accordance with
generally accepted clearing house procedures or by use of
Federal Reserve Wire System procedures; if delivery is made
elsewhere payment therefor shall be in accordance with the
then current "street delivery" custom or in accordance with
such procedures agreed to in writing from time to time by
the parties hereto; if the sale is effected through a
Securities System, delivery and payment therefor shall be
made in accordance with the provisions of Paragraph L
hereof; if the sale of commercial paper is to be effected
through an Approved Book-Entry System for Commercial Paper,
delivery and payment therefor shall be made in accordance
with the provisions of Paragraph M hereof; if the
securities are to be sold outside the United States,
delivery may be made in accordance with procedures agreed
to in writing from time to time by the parties hereto; for
the purposes of this subparagraph, the term "sale" shall
include the disposition of a portfolio

<PAGE>

security (i) upon the exercise of an option written by the
Fund and (ii) upon the failure by the Fund to make a
successful bid with respect to a portfolio security, the
continued holding of which is contingent upon the making of
such a bid;

2) Upon the receipt of payment in connection with any
repurchase agreement or reverse repurchase agreement
relating to such securities and entered into by the Fund;

3) To the depository agent in connection with tender or other
similar offers for portfolio securities of the Fund;

4) To the issuer thereof or its agent when such securities or
participation interests are called, redeemed, retired or
otherwise become payable; provided that, in any such case,
the cash or other consideration is to be delivered to the
Custodian or any subcustodian employed pursuant to Section
2 hereof;

5) To the issuer thereof, or its agent, for transfer into the
name of the Fund or into the name of any nominee of the
Custodian or into the name or nominee name of any agent
appointed pursuant to Paragraph K hereof or into the name
or nominee name of any subcustodian employed pursuant to
Section 2 hereof; or for exchange for a different number of
bonds, certificates or other evidence representing the same
aggregate face amount or number of units; provided that, in
any such case, the new securities or participation
interests are to be delivered to the Custodian or any
subcustodian employed pursuant to Section 2 hereof;

6) To the broker selling the same for examination in
accordance with the "street delivery" custom; provided that
the Custodian shall adopt such procedures as the Fund from
time to time shall approve to ensure their prompt return to
the Custodian by the broker in the event the broker elects
not to accept them;

7) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or
readjustment of the securities of the issuer of such
securities, or pursuant to provisions for conversion of
such securities, or pursuant to any deposit agreement;
provided that, in any such case, the new securities and
cash, if any, are to be delivered to the Custodian or any
subcustodian employed pursuant to Section 2 hereof;

<PAGE>
8) In the case of warrants, rights or similar securities, the
surrender thereof in connection with the exercise of such
warrants, rights or similar securities, or the surrender of
interim receipts or temporary securities for definitive
securities; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the
Custodian or any subcustodian employed pursuant to Section
2 hereof;

9) For delivery in connection with any loans of securities
made by the Fund (such loans to be made pursuant to the
terms of the Fund's current registration statement), but
only against receipt of adequate collateral as agreed upon
from time to time by the Custodian and the Fund, which may
be in the form of cash or obligations issued by the United
States government, its agencies or instrumentalities.

10) For delivery as security in connection with any borrowings
by the Fund requiring a pledge or hypothecation of assets
by the Fund (if then permitted under circumstances
described in the current registration statement of the
Fund), provided, that the securities shall be released only
upon payment to the Custodian of the monies borrowed,
except that in cases where additional collateral is
required to secure a borrowing already made, further
securities may be released for that purpose; upon receipt
of proper instructions, the Custodian may pay any such loan
upon redelivery to it of the securities pledged or
hypothecated therefor and upon surrender of the note or
notes evidencing the loan;

11) When required for delivery in connection with any
redemption or repurchase of Shares of the Fund in
accordance with the provisions of Paragraph J hereof;

12) For delivery in accordance with the provisions of any
agreement between the Custodian (or a subcustodian employed
pursuant to Section 2 hereof) and a broker-dealer
registered under the Securities Exchange Act of 1934 and,
if necessary, the Fund, relating to compliance with the
rules of The Options Clearing Corporation or of any
registered national securities exchange, or of any similar
organization or organizations, regarding deposit or escrow
or other arrangements in connection with options
transactions by the Fund;

13) For delivery in accordance with the provisions of any
agreement among the Fund, the Custodian (or a subcustodian
employed pursuant to Section 2 hereof),

and a futures commission merchant, relating to compliance
with the rules of the Commodity Futures Trading Commission
and/or of any

<PAGE>

contract market or commodities exchange or similar
organization, regarding futures margin account deposits or
payments in connection with futures transactions by the
Fund;

14) For any other proper corporate purpose, but only upon
receipt of, in addition to proper instructions, a certified
copy of a vote of the Board specifying the securities to be
delivered, setting forth the purpose for which such
delivery is to be made, declaring such purpose to be proper
corporate purpose, and naming the person or persons to whom
delivery of such securities shall be made.

C. REGISTRATION OF SECURITIES Securities held by the Custodian (other
than bearer securities) for the account of the Fund shall be
registered in the name of the Fund or in the name of any nominee of
the Fund or of any nominee of the Custodian, or in the name or
nominee name of any agent appointed pursuant to Paragraph K hereof,
or in the name or nominee name of any subcustodian employed
pursuant to Section 2 hereof, or in the name or nominee name of The
Depository Trust Company or Participants Trust Company or Approved
Clearing Agency or Federal Book-Entry System or Approved Book-Entry
System for Commercial Paper; provided, that securities are held in
an account of the Custodian or of such agent or of such
subcustodian containing only assets of the Fund or only assets held
by the Custodian or such agent or such subcustodian as a custodian
or subcustodian or in a fiduciary capacity for customers. All
certificates for securities accepted by the Custodian or any such
agent or subcustodian on behalf of the Fund shall be in "street" or
other good delivery form or shall be returned to the selling broker
or dealer who shall be advised of the reason thereof.

D. BANK ACCOUNTS The Custodian shall open and maintain a separate bank
account or accounts in the name of the Fund, subject only to draft
or order by the Custodian acting in pursuant to the terms of this
Agreement, and shall hold in such account or accounts, subject to
the provisions hereof, all cash received by it from or for the
account of the Fund other than cash maintained by the Fund in a
bank account established and used in accordance with Rule 17f-3
under the Investment Company Act of 1940. Funds held by the
Custodian for the Fund may be deposited by it to its credit as
Custodian in the Banking Department of the Custodian or in such
other banks or trust companies as the Custodian may in its
discretion deem necessary or desirable; provided, however, that
every such bank or trust company shall be qualified to act as a
custodian under the Investment Company Act of 1940 and that each
such bank or trust company and the funds to be deposited with each
such bank or trust company shall be approved in writing by two
officers of the Fund. Such funds shall be deposited by the
Custodian in its capacity as Custodian and shall be subject to
withdrawal only by the Custodian in that capacity.

<PAGE>

E. PAYMENT FOR SHARES OF THE FUND The Custodian shall make appropriate
arrangements with the Transfer Agent and the principal underwriter
of the Fund to enable the Custodian to make certain it promptly
receives the cash or other consideration due to the Fund for such
new or treasury Shares as may be issued or sold from time to time
by the Fund, in accordance with the governing documents and
offering prospectus and statement of additional information of the
Fund. The Custodian will provide prompt notification to the Fund of
any receipt by it of payments for Shares of the Fund.

F. INVESTMENT AND AVAILABILITY OF FEDERAL FUNDS Upon agreement between
the Fund and the Custodian, the Custodian shall, upon the receipt
of proper instructions, which may be continuing instructions when
deemed appropriate by the parties, invest in such securities and
instruments as may be set forth in such instructions on the same
day as received all federal funds received after a time agreed upon
between the Custodian and the Fund.

G. COLLECTIONS The Custodian shall promptly collect all income and
other payments with respect to registered securities held hereunder
to which the Fund shall be entitled either by law or pursuant to
custom in the securities business, and shall promptly collect all
income and other payments with respect to bearer securities if, on
the date of payment by the issuer, such securities are held by the
Custodian or agent thereof and shall credit such income, as
collected, to the Fund's custodian account.

The Custodian shall do all things necessary and proper in connection with such
prompt collections and, without limiting the generality of the foregoing, the
Custodian shall

1) Present for payment all coupons and other income items
requiring presentations;

2) Present for payment all securities which may mature or be
called, redeemed, retired or otherwise become payable;

3) Endorse and deposit for collection, in the name of the
Fund, checks, drafts or other negotiable instruments;

4) Credit income from securities maintained in a Securities
System or in an Approved Book-Entry System for Commercial
Paper at the time funds become available to the Custodian;
in the case of securities maintained in The Depository
Trust Company funds shall be deemed available to the Fund
not later than the opening of business on the first
business day after receipt of such funds by the Custodian.

<PAGE>

The Custodian shall notify the Fund as soon as reasonably practicable whenever
income due on any security is not promptly collected. In any case in which the
Custodian does not receive any due and unpaid income after it has made demand
for the same, it shall immediately so notify the Fund in writing, enclosing
copies of any demand letter, any written response thereto, and memoranda of all
oral responses thereto and to telephonic demands, and await instructions from
the Fund; the Custodian shall in no case have any liability for any nonpayment
of such income provided the Custodian meets the standard of care set forth in
Section 8 hereof. The Custodian shall not be obligated to take legal action for
collection unless and until reasonably indemnified to its satisfaction.

The Custodian shall also receive and collect all stock dividends, rights and
other items of like nature, and deal with the same pursuant to proper
instructions relative thereto.

H. PAYMENT OF FUND MONEYS Upon receipt of proper instructions, which
may be continuing instructions when deemed appropriate by the
parties, the Custodian shall pay out moneys of the Fund in the
following cases only:

1) Upon the purchase of securities, participation interests,
options, futures contracts, forward contracts and options
on futures contracts purchased for the account of the Fund
but only (a) against the receipt of

(i) such securities registered as provided in
Paragraph C hereof or in proper form for transfer
or

(ii) detailed instructions signed by an officer of the
Fund regarding the participation interests to be
purchased or

(iii) written confirmation of the purchase by the Fund
of the options, futures contracts, forward
contracts or options on futures contracts

by the Custodian (or by a subcustodian employed pursuant to
Section 2 hereof or by a clearing corporation of a national
securities exchange of which the Custodian is a member or
by any bank, banking institution or trust company doing
business in the United States or abroad which is qualified
under the Investment Company Act of 1940 to act as a
custodian and which has been designated by the Custodian as
its agent for this purpose or by the agent specifically
designated in such instructions as representing the
purchasers of a new issue of privately placed securities);
(b) in the case of a purchase effected through a Securities
System, upon receipt of the securities by the Securities
System in accordance with the conditions set forth in
Paragraph L hereof; (c) in the case of a purchase of
commercial paper effected through an Approved Book-Entry
System for Commercial Paper, upon

<PAGE>
receipt of the paper by the Custodian or subcustodian in
accordance with the conditions set forth in Paragraph M
hereof; (d) in the case of repurchase agreements entered
into between the Fund and another bank or a broker-dealer,
against receipt by the Custodian of the securities
underlying the repurchase agreement either in certificate
form or through an entry crediting the Custodian's
segregated, non-proprietary account at the Federal Reserve
Bank of Boston with such securities along with written
evidence of the agreement by the bank or broker-dealer to
repurchase such securities from the Fund; or (e) with
respect to securities purchased outside of the United
States, in accordance with written procedures agreed to
from time to time in writing by the parties hereto;

2) When required in connection with the conversion, exchange
or surrender of securities owned by the Fund as set forth
in Paragraph B hereof;

3) When required for the redemption or repurchase of Shares of
the Fund in accordance with the provisions of Paragraph J
hereof;

4) For the payment of any expense or liability incurred by the
Fund, including but not limited to the following payments
for the account of the Fund: advisory fees, distribution
plan payments, interest, taxes, management compensation and
expenses, accounting, transfer agent and legal fees, and
other operating expenses of the Fund whether or not such
expenses are to be in whole or part capitalized or treated
as deferred expenses;

5) For the payment of any dividends or other distributions to
holders of Shares declared or authorized by the Board; and

6) For any other proper corporate purpose, but only upon
receipt of, in addition to proper instructions, a certified
copy of a vote of the Board, specifying the amount of such
payment, setting forth the purpose for which such payment
is to be made, declaring such purpose to be a proper
corporate purpose, and naming the person or persons to whom
such payment is to be made.

I. LIABILITY FOR PAYMENT IN ADVANCE OF RECEIPT OF SECURITIES PURCHASED
In any and every case where payment for purchase of securities for
the account of the Fund is made by the Custodian in advance of
receipt of the securities purchased in the absence of specific
written instructions signed by two officers of the Fund to so pay
in advance, the Custodian shall be absolutely liable to the Fund
for such securities to the same extent as if the securities had
been received by the Custodian; EXCEPT that in the case of a
repurchase agreement

<PAGE>

entered into by the Fund with a bank which is a member of the
Federal Reserve System, the Custodian may transfer funds to the
account of such bank prior to the receipt of (i) the securities in
certificate form subject to such repurchase agreement or (ii)
written evidence that the securities subject to such repurchase
agreement have been transferred by book-entry into a segregated
non-proprietary account of the Custodian maintained with the
Federal Reserve Bank of Boston or (iii) the safekeeping receipt,
PROVIDED that such securities have in fact been so transferred by
book-entry and the written repurchase agreement is received by the
Custodian in due course; AND EXCEPT that if the securities are to
be

purchased outside the United States, payment may be made in
accordance with procedures agreed to from time to time by the
parties hereto.

J. PAYMENTS FOR REPURCHASES OR REDEMPTIONS OF SHARES OF THE FUND From
such funds as may be available for the purpose, but subject to any
applicable votes of the Board and the current redemption and
repurchase procedures of the Fund, the Custodian shall, upon
receipt of written instructions from the Fund or from the Fund's
transfer agent or from the principal underwriter, make funds and/or
portfolio securities available for payment to holders of Shares who
have caused their Shares to be redeemed or repurchased by the Fund
or for the Fund's account by its transfer agent or principal
underwriter.

The Custodian may maintain a special checking account upon which
special checks may be drawn by shareholders of the Fund holding
Shares for which certificates have not been issued. Such checking
account and such special checks shall be subject to such rules and
regulations as the Custodian and the Fund may from time to time
adopt. The Custodian or the Fund may suspend or terminate use of
such checking account or such special checks (either generally or
for one or more shareholders) at any time. The Custodian and the
Fund shall notify the other immediately of any such suspension or
termination.

K. APPOINTMENT OF AGENTS BY THE CUSTODIAN The Custodian may at any
time or times in its discretion appoint (and may at any time
remove) any other bank or trust company (provided such bank or
trust company is itself qualified under the Investment Company Act
of 1940 to act as a custodian or is itself an eligible foreign
custodian within the meaning of Rule 17f-5 under said Act) as the
agent of the Custodian to carry out such of the duties and
functions of the Custodian described in this Section 3 as the
Custodian may from time to time direct; provided, however, that the
appointment of any such agent shall not relieve the Custodian of
any of its responsibilities or liabilities hereunder, and as
between the Fund and the Custodian the Custodian shall be fully
responsible for the acts and omissions of any such agent. For the
purposes of this Agreement, any property of the Fund held by any
such agent shall be deemed to be held by the Custodian hereunder.

<PAGE>

L. DEPOSIT OF FUND PORTFOLIO SECURITIES IN SECURITIES SYSTEMS The
Custodian may deposit and/or maintain securities owned by the Fund

(1) in The Depository Trust Company;

(2) in Participants Trust Company;

(3) in any other Approved Clearing Agency;

(4) in the Federal Book-Entry System; or

(5) in an Approved Foreign Securities Depository

in each case only in accordance with applicable Federal Reserve
Board and Securities and Exchange Commission rules and
regulations, and at all times subject to the following provisions:

(a) The Custodian may (either directly or through one or more
subcustodians employed pursuant to Section 2) keep securities of
the Fund in a Securities System provided that such securities are
maintained in a non-proprietary account ("Account") of the
Custodian or such subcustodian in the Securities System which shall
not include any assets of the Custodian or such subcustodian or any
other person other than assets held by the Custodian or such
subcustodian as a fiduciary, custodian, or otherwise for its
customers.

(b) The records of the Custodian with respect to securities of the Fund
which are maintained in a Securities System shall identify by
book-entry those securities belonging to the Fund, and the
Custodian shall be fully and completely responsible for maintaining
a recordkeeping system capable of accurately and currently stating
the Fund's holdings maintained in each such Securities System.

(c) The Custodian shall pay for securities purchased in book-entry form
for the account of the Fund only upon (i) receipt of notice or
advice from the Securities System that such securities have been
transferred to the Account, and (ii) the making of any entry on the
records of the Custodian to reflect such payment and transfer for
the account of the Fund. The Custodian shall transfer securities
sold for the account of the Fund only upon (i) receipt of notice or
advice from the Securities System that payment for such securities
has been transferred to the Account, and (ii) the making of an
entry on the records of the Custodian to reflect such transfer and
payment for the account of the Fund. Copies of all notices or
advises from the Securities System of transfers of securities for
the account of the Fund shall identify the Fund, be maintained for
the Fund by the Custodian and be promptly provided to the Fund at
its request.

<PAGE>

The Custodian shall promptly send to the Fund confirmation of each
transfer to or from the

account of the Fund in the form of a written advice or notice of
each such transaction, and shall furnish to the Fund copies of
daily transaction sheets reflecting each day's transactions in the
Securities System for the account of the Fund on the next business
day.

(d) The Custodian shall promptly send to the Fund any report or other
communication received or obtained by the Custodian relating to the
Securities System's accounting system, system of internal
accounting controls or procedures for safeguarding securities
deposited in the Securities System; the Custodian shall promptly
send to the Fund any report or other communication relating to the
Custodian's internal accounting controls and procedures for
safeguarding securities deposited in any Securities System; and the
Custodian shall ensure that any agent appointed pursuant to
Paragraph K hereof or any subcustodian employed pursuant to Section
2 hereof shall promptly send to the Fund and to the Custodian any
report or other communication relating to such agent's or
subcustodian's internal accounting controls and procedures for
safeguarding securities deposited in any Securities System. The
Custodian's books and records relating to the Fund's participation
in each Securities System will at all times during regular business
hours be open to the inspection of the Fund's authorized officers,
employees or agents.

(e) The Custodian shall not act under this Paragraph L in the absence
of receipt of a certificate of an officer of the Fund that the
Board has approved the use of a particular Securities System; the
Custodian shall also obtain appropriate assurance from the officers
of the Fund that the Board has annually reviewed and approved the
continued use by the Fund of each Securities System, so long as
such review and approval is required by Rule 17f-4 under the
Investment Company Act of 1940, and the Fund shall promptly notify
the Custodian if the use of a Securities System is to be
discontinued; at the request of the Fund, the Custodian will
terminate the use of any such Securities System as promptly as
practicable.

(f) Anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Fund for any loss or damage to the
Fund resulting from use of the Securities System by reason of any
negligence, misfeasance or misconduct of the Custodian or any of
its agents or subcustodians or of any of its or their employees or
from any failure of the Custodian or any such agent or subcustodian
to enforce effectively such rights as it may have against the
Securities System or any other person; at the election of the Fund,
it shall be entitled to be

<PAGE>

subrogated to the rights of the Custodian with respect to any claim
against the Securities System or any other person which the
Custodian may have as a consequence of any such loss or damage if
and to the extent that the Fund has not been made whole for any
such loss or damage.

M. DEPOSIT OF FUND COMMERCIAL PAPER IN AN APPROVED BOOK-ENTRY SYSTEM FOR
COMMERCIAL PAPER Upon receipt of proper instructions with respect to
each issue of direct issue commercial paper purchased by the Fund, the
Custodian may deposit and/or maintain direct issue commercial paper
owned by the Fund in any Approved Book-Entry System for Commercial
Paper, in each case only in accordance with applicable Securities and
Exchange Commission rules, regulations, and no-action correspondence,
and at all times subject to the following provisions:

(a) The Custodian may (either directly or through one or more
subcustodians employed pursuant to Section 2) keep
commercial paper of the Fund in an Approved Book-Entry
System for Commercial Paper, provided that such paper is
issued in book entry form by the Custodian or subcustodian
on behalf of an issuer with which the Custodian or
subcustodian has entered into a book-entry agreement and
provided further that such paper is maintained in a
non-proprietary account ("Account") of the Custodian or
such subcustodian in an Approved Book-Entry System for
Commercial Paper which shall not include any assets of the
Custodian or such subcustodian or any other person other
than assets held by the Custodian or such subcustodian as a
fiduciary, custodian, or otherwise for its customers.

(b) The records of the Custodian with respect to commercial
paper of the Fund which is maintained in an Approved
Book-Entry System for Commercial Paper shall identify by
book-entry each specific issue of commercial paper
purchased by the Fund which is included in the System and
shall at all times during regular business hours be open
for inspection by authorized officers, employees or agents
of the Fund. The Custodian shall be fully and completely
responsible for maintaining a recordkeeping system capable
of accurately and currently stating the Fund's holdings of
commercial paper maintained in each such System.

(c) The Custodian shall pay for commercial paper purchased in
book-entry form for the account of the Fund only upon
contemporaneous (i) receipt of notice or advice

from the issuer that such paper has been issued, sold and
transferred to the Account, and (ii) the making of an entry
on the records of the Custodian to reflect such purchase,
payment and transfer for the account of the Fund. The
Custodian shall transfer such commercial

<PAGE>

paper which is sold or cancel such commercial paper which
is redeemed for the account of the Fund only upon
contemporaneous (i) receipt of notice or advice that
payment for such paper has been transferred to the Account,
and (ii) the making of an entry on the records of the
Custodian to reflect such transfer or redemption and
payment for the account of the Fund. Copies of all notices,
advises and confirmations of transfers of commercial paper
for the account of the Fund shall identify the Fund, be
maintained for the Fund by the Custodian and be promptly
provided to the Fund at its request. The Custodian shall
promptly send to the Fund confirmation of each transfer to
or from the account of the Fund in the form of a written
advice or notice of each such transaction, and shall
furnish to the Fund copies of daily transaction sheets
reflecting each day's transactions in the System for the
account of the Fund on the next business day.

(d) The Custodian shall promptly send to the Fund any report or
other communication received or obtained by the Custodian
relating to each System's accounting system, system of
internal accounting controls or procedures for safeguarding
commercial paper deposited in the System; the Custodian
shall promptly send to the Fund any report or other
communication relating to the Custodian's internal
accounting controls and procedures for safeguarding
commercial paper deposited in any Approved Book-Entry
System for Commercial Paper; and the Custodian shall ensure
that any agent appointed pursuant to Paragraph K hereof or
any subcustodian employed pursuant to Section 2 hereof
shall promptly send to the Fund and to the Custodian any
report or other communication relating to such agent's or
subcustodian's internal accounting controls and procedures
for safeguarding securities deposited in any Approved
Book-Entry System for Commercial Paper.

(e) The Custodian shall not act under this Paragraph M in the
absence of receipt of a certificate of an officer of the
Fund that the Board has approved the use of a particular
Approved Book-Entry System for Commercial Paper; the
Custodian shall also obtain appropriate assurance from the
officers of the Fund that the Board

has annually reviewed and approved the continued use by the
Fund of each Approved Book-Entry System for Commercial
Paper, so long as such review and approval is required by
Rule 17f-4 under the Investment Company Act of 1940, and
the Fund shall promptly notify the Custodian if the use of
an Approved Book-Entry System for Commercial Paper is to be
discontinued; at the request of the Fund, the Custodian
will terminate the use of any such System as promptly as
practicable.

<PAGE>

(f) The Custodian (or subcustodian, if the Approved Book-Entry
System for Commercial Paper is maintained by the
subcustodian) shall issue physical commercial paper or
promissory notes whenever requested to do so by the Fund or
in the event of an electronic system failure which impedes
issuance, transfer or custody of direct issue commercial
paper by book-entry.

(g) Anything to the contrary in this Agreement notwithstanding,
the Custodian shall be liable to the Fund for any loss or
damage to the Fund resulting from use of any Approved
Book-Entry System for Commercial Paper by reason of any
negligence, misfeasance or misconduct of the Custodian or
any of its agents or subcustodians or of any of its or
their employees or from any failure of the Custodian or any
such agent or subcustodian to enforce effectively such
rights as it may have against the System, the issuer of the
commercial paper or any other person; at the election of
the Fund, it shall be entitled to be subrogated to the
rights of the Custodian with respect to any claim against
the System, the issuer of the commercial paper or any other
person which the Custodian may have as a consequence of any
such loss or damage if and to the extent that the Fund has
not been made whole for any such loss or damage.

N. SEGREGATED ACCOUNT The Custodian shall upon receipt of proper
instructions establish and maintain a segregated account or
accounts for and on behalf of the Fund, into which account or
accounts may be transferred cash and/or securities, including
securities maintained in an account by the Custodian pursuant to
Paragraph L hereof, (i) in accordance with the provisions of any
agreement among the Fund, the Custodian and any registered
broker-dealer (or any futures commission merchant), relating to
compliance with the rules of the Options Clearing Corporation and
of any registered national securities exchange (or of the Commodity
Futures Trading Commission or of any contract market or commodities
exchange), or of any similar

organization or organizations, regarding escrow or deposit or other
arrangements in connection with transactions by the Fund, (ii) for
purposes of segregating cash or U.S. Government securities in
connection with options purchased, sold or written by the Fund or
futures contracts or options thereon purchased or sold by the Fund,
(iii) for the purposes of compliance by the Fund with the
procedures required by Investment Company Act Release No. 10666, or
any subsequent release or releases of the Securities and Exchange
Commission relating to the maintenance of segregated accounts by
registered investment companies and (iv) for other proper purposes,
but only, in the case of clause (iv), upon receipt of, in addition
to proper instructions, a certificate signed by two officers of the
Fund, setting forth the purpose such segregated account and
declaring such purpose to be a proper purpose.

<PAGE>

O. OWNERSHIP CERTIFICATES FOR TAX PURPOSES The Custodian shall execute
ownership and other certificates and affidavits for all federal and
state tax purposes in connection with receipt of income or other
payments with respect to securities of the Fund held by it and in
connection with transfers of securities.

P. PROXIES The Custodian shall, with respect to the securities held by
it hereunder, cause to be promptly delivered to the Fund all forms
of proxies and all notices of meetings and any other notices or
announcements or other written information affecting or relating to
the securities, and upon receipt of proper instructions shall
execute and deliver or cause its nominee to execute and deliver
such proxies or other authorizations as may be required. Neither
the Custodian nor its nominee shall vote upon any of the securities
or execute any proxy to vote thereon or give any consent or take
any other action with respect thereto (except as otherwise herein
provided) unless ordered to do so by proper instructions.

Q. COMMUNICATIONS RELATING TO FUND PORTFOLIO SECURITIES The Custodian
shall deliver promptly to the Fund all written information
(including, without limitation, pendency of call and maturities of
securities and participation interests and expirations of rights in
connection therewith and notices of exercise of call and put
options written by the Fund and the maturity of futures contracts
purchased or sold by the Fund) received by the Custodian from
issuers and other persons relating to the securities and
participation interests being held for the Fund. With respect to
tender or exchange offers, the Custodian shall deliver promptly to
the Fund all written information

received by the Custodian from issuers and other persons relating
to the securities and participation interests whose tender or
exchange is sought and from the party (or his agents) making the
tender or exchange offer.

R. EXERCISE OF RIGHTS; TENDER OFFERS In the case of tender offers,
similar offers to purchase or exercise rights (including, without
limitation, pendency of calls and maturities of securities and
participation interests and expirations of rights in connection
therewith and notices of exercise of call and put options and the
maturity of futures contracts) affecting or relating to securities
and participation interests held by the Custodian under this
Agreement, the Custodian shall have responsibility for promptly
notifying the Fund of all such offers in accordance with the
standard of reasonable care set forth in Section 8 hereof. For all
such offers for which the Custodian is responsible as provided in
this Paragraph R, the Fund shall have responsibility for providing
the Custodian with all necessary instructions in timely fashion.
Upon receipt of proper instructions, the Custodian shall timely
deliver to the issuer or trustee thereof, or to the agent of
either, warrants, puts, calls, rights or similar

<PAGE>

securities for the purpose of being exercised or sold upon proper
receipt therefor and upon receipt of assurances satisfactory to the
Custodian that the new securities and cash, if any, acquired by
such action are to be delivered to the Custodian or any
subcustodian employed pursuant to Section 2 hereof. Upon receipt of
proper instructions, the Custodian shall timely deposit securities
upon invitations for tenders of securities upon proper receipt
therefor and upon receipt of assurances satisfactory to the
Custodian that the consideration to be paid or delivered or the
tendered securities are to be returned to the Custodian or
subcustodian employed pursuant to Section 2 hereof. Notwithstanding
any provision of this Agreement to the contrary, the Custodian
shall take all necessary action, unless otherwise directed to the
contrary by proper instructions, to comply with the terms of all
mandatory or compulsory exchanges, calls, tenders, redemptions, or
similar rights of security ownership, and shall thereafter promptly
notify the Fund in writing of such action.

S. DEPOSITORY RECEIPTS The Custodian shall, upon receipt of proper
instructions, surrender or cause to be surrendered foreign
securities to the depository used by an issuer of American
Depository Receipts, European Depository Receipts or International
Depository Receipts (hereinafter collectively referred to as
"ADRs") for such securities,

against a written receipt therefor adequately describing such
securities and written evidence satisfactory to the Custodian that
the depository has acknowledged receipt of instructions to issue
with respect to such securities ADRs in the name of a nominee of
the Custodian or in the name or nominee name of any subcustodian
employed pursuant to Section 2 hereof, for delivery to the
Custodian or such subcustodian at such place as the Custodian or
such subcustodian may from time to time designate. The Custodian
shall, upon receipt of proper instructions, surrender ADRs to the
issuer thereof against a written receipt therefor adequately
describing the ADRs surrendered and written evidence satisfactory
to the Custodian that the issuer of the ADRs has acknowledged
receipt of instructions to cause its depository to deliver the
securities underlying such ADRs to the Custodian or to a
subcustodian employed pursuant to Section 2 hereof.

T. INTEREST BEARING CALL OR TIME DEPOSITS The Custodian shall, upon
receipt of proper instructions, place interest bearing fixed term
and call deposits with the banking department of such banking
institution (other than the Custodian) and in such amounts as the
Fund may designate. Deposits may be denominated in U.S. Dollars or
other currencies. The Custodian shall include in its records with
respect to the assets of the Fund appropriate notation as to the
amount and currency of each such deposit, the accepting banking
institution and other appropriate details and shall retain such
forms of advice or receipt evidencing the deposit, if any, as may
be forwarded to the Custodian by the banking

<PAGE>

institution. Such deposits shall be deemed portfolio securities of
the applicable Fund for the purposes of this Agreement, and the
Custodian shall be responsible for the collection of income from
such accounts and the transmission of cash to and from such
accounts.

U. Options, Futures Contracts and Foreign Currency Transactions
------------------------------------------------------------

1. OPTIONS. The Custodians shall, upon receipt of proper
instructions and in accordance with the provisions of any
agreement between the Custodian, any registered
broker-dealer and, if necessary, the Fund, relating to
compliance with the rules of the Options Clearing
Corporation or of any registered national securities
exchange or similar organization or organizations, receive
and retain confirmations or other documents, if any,
evidencing the purchase or writing of an option on a
security, securities index, currency or other financial
instrument or index by the Fund;

deposit and maintain in a segregated account for each Fund
separately, either physically or by book-entry in a
Securities System, securities subject to a covered call
option written by the Fund; and release and/or transfer
such securities or other assets only in accordance with a
notice or other communication evidencing the expiration,
termination or exercise of such covered option furnished by
the Options Clearing Corporation, the securities or options
exchange on which such covered option is traded or such
other organization as may be responsible for handling such
options transactions. The Custodian and the broker-dealer
shall be responsible for the sufficiency of assets held in
each Fund's segregated account in compliance with
applicable margin maintenance requirements.

2. FUTURES CONTRACTS The Custodian shall, upon receipt of
proper instructions, receive and retain confirmations and
other documents, if any, evidencing the purchase or sale of
a futures contract or an option on a futures contract by
the Fund; deposit and maintain in a segregated account, for
the benefit of any futures commission merchant, assets
designated by the Fund as initial, maintenance or variation
"margin" deposits (including mark- to-market payments)
intended to secure the Fund's performance of its
obligations under any futures contracts purchased or sold
or any options on futures contracts written by Fund, in
accordance with the provisions of any agreement or
agreements among the Fund, the Custodian and such futures
commission merchant, designed to comply with the rules of
the Commodity Futures Trading Commission and/or of any
contract market or commodities exchange or similar
organization regarding such margin deposits or payments;
and release and/or transfer assets in such margin accounts
only in

<PAGE>

accordance with any such agreements or rules. The Custodian
and the futures commission merchant shall be responsible
for the sufficiency of assets held in the segregated
account in compliance with the applicable margin
maintenance and mark-to-market payment requirements.

3. FOREIGN EXCHANGE TRANSACTIONS The Custodian shall, pursuant
to proper instructions, enter into or cause a subcustodian
to enter into foreign exchange contracts, currency swaps or
options to purchase and sell foreign currencies for spot
and future delivery on behalf and for the account of the
Fund. Such transactions may be undertaken by the Custodian
or subcustodian with such

banking or financial institutions or other currency
brokers, as set forth in proper instructions. Foreign
exchange contracts, swaps and options shall be deemed to be
portfolio securities of the Fund; and accordingly, the
responsibility of the Custodian therefor shall be the same
as and no greater than the Custodian's responsibility in
respect of other portfolio securities of the Fund. The
Custodian shall be responsible for the transmittal to and
receipt of cash from the currency broker or banking or
financial institution with which the contract or option is
made, the maintenance of proper records with respect to the
transaction and the maintenance of any segregated account
required in connection with the transaction. The Custodian
shall have no duty with respect to the selection of the
currency brokers or banking or financial institutions with
which the Fund deals or for their failure to comply with
the terms of any contract or option. Without limiting the
foregoing, it is agreed that upon receipt of proper
instructions and insofar as funds are made available to the
Custodian for the purpose, the Custodian may (if determined
necessary by the Custodian to consummate a particular
transaction on behalf and for the account of the Fund) make
free outgoing payments of cash in the form of U.S. dollars
or foreign currency before receiving confirmation of a
foreign exchange contract or swap or confirmation that the
countervalue currency completing the foreign exchange
contract or swap has been delivered or received. The
Custodian shall not be responsible for any costs and
interest charges which may be incurred by the Fund or the
Custodian as a result of the failure or delay of third
parties to deliver foreign exchange; provided that the
Custodian shall nevertheless be held to the standard of
care set forth in, and shall be liable to the Fund in
accordance with, the provisions of Section 8.

V. ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY The Custodian may in its
discretion, without express authority from the Fund:

<PAGE>

1) make payments to itself or others for minor expenses of
handling securities or other similar items relating to its
duties under this Agreement, PROVIDED, that all such
payments shall be accounted for by the Custodian to the
Treasurer of the Fund;

2) surrender securities in temporary form for securities in
definitive form;

3) endorse for collection, in the name of the Fund, checks,
drafts and other negotiable instruments; and

4) in general, attend to all nondiscretionary details in
connection with the sale, exchange, substitution, purchase,
transfer and other dealings with the securities and
property of the Fund except as otherwise directed by the
Fund.

4. Duties of Bank with Respect to Books of Account and Calculations of Net
Asset Value
-----------------------------------------------------------------------

The Bank shall as Agent (or as Custodian, as the case may be) keep such books of
account and render as at the close of business on each day a detailed statement
of the amounts received or paid out and of securities received or delivered for
the account of the Fund during said day and such other statements, including a
daily trial balance and inventory of the Fund's portfolio securities; and shall
furnish such other financial information and data as from time to time requested
by the Treasurer or any authorized officer of the Fund; and shall compute and
determine, as of the close of regular trading on the New York Stock Exchange, or
at such other time or times as the Board may determine, the net asset value of a
Share in the Fund, such computation and determination to be made in accordance
with the governing documents of the Fund and the votes and instructions of the
Board at the time in force and applicable, and promptly notify the Fund and its
investment adviser and such other persons as the Fund may request of the result
of such computation and determination. In computing the net asset value the
Custodian may rely upon security quotations received by telephone or otherwise
from sources or pricing services designated by the Fund by proper instructions,
and may further rely upon information furnished to it by any authorized officer
of the Fund relative (a) to liabilities of the Fund not appearing on its books
of account, (b) to the existence, status and proper treatment of any reserve or
reserves, (c) to any procedures established by the Board regarding the valuation
of portfolio securities, and (d) to the value to be assigned to any bond, note,
debenture, Treasury bill, repurchase agreement, subscription right, security,
participation interest or other asset or property for which market quotations
are not readily available.

5. Records and Miscellaneous Duties
--------------------------------

The Bank shall create, maintain and preserve all records relating to its
activities and obligations under this Agreement in such manner as will meet the
obligations of the Fund

<PAGE>

under the Investment Company Act of 1940, with particular attention to Section
31 thereof and Rules 31a-1 and 31a-2 thereunder, applicable federal and state
tax laws and any other law or administrative rules or procedures which may be
applicable to the Fund. All books of account and records maintained by the Bank
in connection with the performance of its duties under this Agreement shall be
the property of the Fund, shall at all times during the regular business hours
of the Bank be open for inspection by authorized officers, employees or agents
of the Fund, and in the event of termination of this Agreement shall be
delivered to the Fund or to such other person or persons as shall be designated
by the Fund. Disposition of any account or record after any required period of
preservation shall be only in accordance with specific instructions received
from the Fund. The Bank shall assist generally in the preparation of reports to
shareholders, audits of accounts, and other ministerial matters of like nature;
and, upon request, shall furnish the Fund's auditors with an attested inventory
of securities held with appropriate information as to securities in transit or
in the process of purchase or sale and with such other information as said
auditors may from time to time request. The Custodian shall also maintain
records of all receipts, deliveries and locations of such securities, together
with a current inventory thereof, and shall conduct periodic verifications
(including sampling counts at the Custodian) of certificates representing bonds
and other securities for which it is responsible under this Agreement in such
manner as the Custodian shall determine from time to time to be advisable in
order to verify the accuracy of such inventory. The Bank shall not disclose or
use any books or records it has prepared or maintained by reason of this
Agreement in any manner except as expressly authorized herein or directed by the
Fund, and the Bank shall keep confidential any information obtained by reason of
this Agreement.

6. Opinion of Fund's Independent Public Accountants
------------------------------------------------

The Custodian shall take all reasonable action, as the Fund may from time to
time request, to enable the Fund to obtain from year to year favorable opinions
from the Fund's independent public accountants with respect to its activities
hereunder in connection with the preparation of the Fund's registration
statement and Form N-SAR or other periodic reports to the Securities and
Exchange Commission and with respect to any other requirements of such
Commission.

7. Compensation and Expenses of Bank
---------------------------------

The Bank shall be entitled to reasonable compensation for its services as
Custodian and Agent, as agreed upon from time to time between the Fund and the
Bank. The Bank shall entitled to receive from the Fund on demand reimbursement
for its cash disbursements, expenses and charges, including counsel fees, in
connection with its duties as Custodian and Agent hereunder, but excluding
salaries and usual overhead expenses.

8. Responsibility of Bank
----------------------

<PAGE>

So long as and to the extent that it is in the exercise of reasonable care, the
Bank as Custodian and Agent shall be held harmless in acting upon any notice,
request, consent, certificate or other instrument reasonably believed by it to
be genuine and to be signed by the proper party or parties.

The Bank as Custodian and Agent shall be entitled to rely on and may act upon
advice of counsel (who may be counsel for the Fund) on all matters, and shall be
without liability for any action reasonably taken or omitted pursuant to such
advice.

The Bank as Custodian and Agent shall be held to the exercise of reasonable care
in carrying out the provisions of this Agreement but shall be liable only for
its own negligent or bad faith acts or failures to act. Notwithstanding the
foregoing, nothing contained in this paragraph is intended to nor shall it be
construed to modify the standards of care and responsibility set forth in
Section 2 hereof with respect to subcustodians and in subparagraph f of
Paragraph L of Section 3 hereof with respect to Securities Systems and in
subparagraph g of Paragraph M of Section 3 hereof with respect to an Approved
Book-Entry System for Commercial Paper.

The Custodian shall be liable for the acts or omissions of a foreign banking
institution to the same extent as set forth with respect to subcustodians
generally in Section 2 hereof, provided that, regardless of whether assets are
maintained in the custody of a foreign banking institution, a foreign securities
depository or a branch of a U.S. bank, the Custodian shall not be liable for any
loss, damage, cost, expense, liability or claim resulting from, or caused by,
the direction of or authorization by the Fund to maintain custody of any
securities or cash of the Fund in a foreign county including, but not limited
to, losses resulting from nationalization, expropriation, currency restrictions,
acts of war, civil war or terrorism, insurrection, revolution, military or
usurped powers, nuclear fission, fusion or radiation, earthquake, storm or other
disturbance of nature or acts of God.

If the Fund requires the Bank in any capacity to take any action with respect to
securities, which action involves the payment of money or which action may, in
the opinion of the Bank, result in the Bank or its nominee assigned to the Fund
being liable for the payment of money or incurring liability of some other form,
the Fund, as a prerequisite to requiring the Custodian to take such action,
shall provide indemnity to the Custodian in an amount and form satisfactory to
it.

9. Persons Having Access to Assets of the Fund
-------------------------------------------

(i) No trustee, director, general partner, officer, employee or
agent of the Fund shall have physical access to the assets
of the Fund held by the Custodian or be authorized or
permitted to withdraw any investments of the Fund, nor
shall the Custodian deliver any assets of the Fund to any
such person. No officer or director, employee or agent of
the Custodian who holds any similar position with the Fund
or the

<PAGE>

investment adviser of the Fund shall have access to the
assets of the Fund.

(ii) Access to assets of the Fund held hereunder shall only be
available to duly authorized officers, employees,
representatives or agents of the Custodian or other persons
or entities for whose actions the Custodian shall be
responsible to the extent permitted hereunder, or to the
Fund's independent public accountants in connection with
their auditing duties performed on behalf of the Fund.

(iii) Nothing in this Section 9 shall prohibit any officer,
employee or agent of the Fund or of the investment adviser
of the Fund from giving instructions to the Custodian or
executing a certificate so long as it does not result in
delivery of or access to assets of the Fund prohibited by
paragraph (i) of this Section 9.

10. Effective Period, Termination and Amendment; Successor Custodian
----------------------------------------------------------------

This Agreement shall become effective as of its execution, shall continue in
full force and effect until terminated as hereinafter provided, may be amended
at any time by mutual agreement of the parties hereto and may be terminated by
either party by an instrument in writing delivered or mailed, postage prepaid to
the other party, such termination to take effect not sooner than sixty (60) days
after the date of such delivery or mailing; provided, that the Fund may at any
time by action of its Board, (i) substitute another bank or trust company for
the Custodian by giving notice as described above to the Custodian, or (ii)
immediately terminate this Agreement in the event of the appointment of a
conservator or receiver for the Custodian by the Federal Deposit Insurance
Corporation or by the Banking Commissioner of The Commonwealth of Massachusetts
or upon the happening of a like event at the direction of an appropriate
regulatory agency or court of competent jurisdiction. Upon termination of the
Agreement, the Fund shall pay to the Custodian such compensation as may be due
as of the date of such termination and shall likewise reimburse the Custodian
for its costs, expenses and disbursements.

Unless the holders of a majority of the outstanding Shares of the Fund vote to
have the securities, funds and other properties held hereunder delivered and
paid over to some other bank or trust company, specified in the vote, having not
less than $2,000,000 of aggregate capital, surplus and undivided profits, as
shown by its last published report, and meeting such other qualifications for
custodians set forth in the Investment Company Act of 1940, the Board shall,
forthwith, upon giving or receiving notice of termination of this Agreement,
appoint as successor custodian, a bank or trust company having such
qualifications. The Bank, as Custodian, Agent or otherwise, shall, upon
termination of the Agreement, deliver to such successor custodian, all
securities then held hereunder and all funds or other properties of the Fund
deposited with or held by the Bank hereunder and all books of account and
records kept by the Bank pursuant to this Agreement, and all documents held by
the Bank relative thereto. In the event that no such vote has been

<PAGE>

adopted by the shareholders and that no written order designating a successor
custodian shall have been delivered to the Bank on or before the date when such
termination shall become effective, then the Bank shall not deliver the
securities, funds and other properties of the Fund to the Fund but shall have
the right to deliver to a bank or trust company doing business in Boston,
Massachusetts of its own selection, having an aggregate capital, surplus and
undivided profits, as shown by its last published report, of not less than
$2,000,000, all funds, securities and properties of the Fund held by or
deposited with the Bank, and all books of account and records kept by the Bank
pursuant to this Agreement, and all documents held by the Bank relative thereto.
Thereafter such bank or trust company shall be the successor of the Custodian
under this Agreement.

11. Interpretive and Additional Provisions
--------------------------------------

In connection with the operation of this Agreement, the Custodian and the Fund
may from time to time agree on such provisions interpretive of or in addition to
the provisions of this Agreement as may in their joint opinion be consistent
with the general tenor of this Agreement. Any such interpretive or additional
provisions shall be in a writing signed by both parties and shall be annexed
hereto, provided that no such interpretive or additional provisions shall
contravene any applicable federal or state regulations or any provision of the
governing instruments of the Fund. No interpretive or additional provisions made
as provided in the preceding sentence shall be deemed to be an amendment of this
Agreement.

12. Certification as to Authorized Officers
---------------------------------------

The Secretary of the Fund shall at all times maintain on file with the Bank his
certification to the Bank, in such form as may be acceptable to the Bank, of the
names and signatures of the authorized officers of each fund, it being
understood that upon the occurence of any change in the information set forth in
the most recent certification on file (including without limitation any person
named in the most recent certification who has ceased to hold the office
designated therein), the Secretary of the Fund shall sign a new or amended
certification setting forth the change and the new, additional or ommitted names
or signatures. The Bank shall be entitled to rely and act upon any officers
named in the most recent certification.

13. Notices
-------

Notices and other writings delivered or mailed postage prepaid to the Fund
addressed to Thomas H. Drohan, John Hancock Advisers, Inc., 101 Huntington
Avenue, Boston, Massachusetts 02199, or to such other address as the Fund may
have designated to the Bank, in writing, or to Investors Bank & Trust Company,
24 Federal Street, Boston, Massachusetts 02110, shall be deemed to have been
properly delivered or given hereunder to the respective addressees.

<PAGE>

14. Massachusetts Law to Apply; Limitations on Liability
----------------------------------------------------

This Agreement shall be construed and the provisions thereof interpreted under
and in accordance with the laws of The Commonwealth of Massachusetts.

If the Fund is a Massachusetts business trust, the Custodian expressly
acknowledges the provision in the Fund's declaration of trust limiting the
personal liability of the trustees and shareholders of the Fund; and the
Custodian agrees that it shall have recourse only to the assets of the Fund for
the payment of claims or obligations as between the Custodian and the Fund
arising out of this Agreement, and the Custodian shall not seek satisfaction of
any such claim or obligation from the trustees or shareholders of the Fund. Each
Fund, and each series or portfolio of a Fund, shall be liable only for its own
obligations to the Custodian under this Agreement and shall not be jointly or
severally liable for the obligations of any other Fund, series or portfolio
hereunder.

<PAGE>

15. Adoption of the Agreement by the Fund
-------------------------------------

The Fund represents that its Board has approved this Agreement and has duly
authorized the Fund to adopt this Agreement. This Agreement shall be deemed to
supersede and terminate, as of the date first written above, all prior
agreements between the Fund and the Bank relating to the custody of the Fund's
assets.

* * * *

<PAGE>

In Witness Whereof, the parties hereto have caused this agreement to be executed
in duplicate as of the date first written above by their respective officers
thereunto duly authorized.

John Hancock Mutual Funds

by: /s/ Robert G. Freedman
----------------------
Attest:

/s/Avery P. Maher
- -----------------

Investors Bank & Trust Company

by: /s/ Henry M. Joyce
------------------

Attest:

/s/ JM Keenan
- -------------

<PAGE>

Page 1 of 2

INVESTORS BANK & TRUST COMPANY

APPENDIX A

[EFFECTIVE JANUARY 30, 1995]

John Hancock Limited Term Government Fund
John Hancock Capital Series
John Hancock Special Value Fund
John Hancock Growth Fund
John Hancock Income Securities Trust John Hancock Investors Trust John Hancock
Sovereign Bond Fund John Hancock Sovereign Investors Fund, Inc.
John Hancock Sovereign Investors Fund
John Hancock Sovereign Balanced Fund
John Hancock Special Equities Fund
John Hancock Strategic Series
John Hancock Independence Diversified Core Equity Fund
John Hancock Strategic Income Fund
John Hancock Utilities Fund
John Hancock Tax-Exempt Income Fund
John Hancock Tax-Exempt Series Fund
California Portfolio
Massachusetts Portfolio
New York Portfolio
John Hancock Technology Series, Inc.
John Hancock National Aviation & Technology Fund
John Hancock Global Technology Fund
Freedom Investment Trust
John Hancock Gold & Government Fund
John Hancock Regional Bank Fund
John Hancock Sovereign U.S. Government Income Fund
John Hancock Managed Tax-Exempt Fund
John Hancock Sovereign Achievers Fund
Freedom Investment Trust II
John Hancock Special Opportunities Fund
Freedom Investment Trust III
John Hancock Discovery Fund

<PAGE>
Page 2 of 2

INVESTORS BANK & TRUST COMPANY

APPENDIX A

[EFFECTIVE JANUARY 30, 1995]

John Hancock Series, Inc.
John Hancock Emerging Growth Fund
John Hancock Global Resources Fund
John Hancock Government Income Fund
John Hancock High Yield Bond Fund
John Hancock High Yield Tax-Free Fund
John Hancock Money Market Fund B
John Hancock Cash Reserve, Inc.
John Hancock Current Interest
John Hancock U.S. Government Cash Reserve
John Hancock Capital Growth Fund
John Hancock Investment Trust
John Hancock Growth and Income Fund
John Hancock California Tax-Free Income Fund
John Hancock Tax-Free Bond Fund
John Hancock Bond Fund
John Hancock Investment Quality Bond Fund
John Hancock Government Securities Trust
John Hancock U.S. Government Trust
John Hancock Adjustable U.S. Government Trust
John Hancock Adjustable U.S. Government Fund
John Hancock Intermediate Government Trust
John Hancock Institutional Series Trust John Hancock Berkeley Dividend
Performers Fund John Hancock Berkeley Bond Fund John Hancock Berkeley
Fundamental Value Fund John Hancock Berkeley Sector Opportunity Fund
John Hancock Independence Diversified Core Equity Fund II John Hancock
Independence Value Fund John Hancock Independence Growth Fund John
Hancock Independence Medium Capitalization Fund John Hancock
Independence Balanced Fund

<PAGE>
Exhibit 99.9

JOHN HANCOCK SPECIAL EQUITIES TRUST

TRANSFER AGENCY AND SERVICE AGREEMENT

Dated January 1, 1991

<PAGE>

TRANSFER AGENCY AND SERVICE AGREEMENT

AGREEMENT made as of the 1st day of January, 1991 by and between John
Hancock Special Equities Trust, a Massachusetts business trust, having its
principal office and place of business at 101 Huntington Avenue, Boston,
Massachusetts (the "Fund"), and John Hancock Fund Services, Inc., a Delaware
corporation having its principal office and place of business at 101 Huntington
Avenue, Boston, Massachusetts 02117 ("JHFSI").

WITNESSETH:

WHEREAS, the Fund desires to appoint JHFSI as its transfer agent,
dividend disbursing agent and agent in connection with certain other activities,
and JHFSI desires to accept such appointment;

NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:

ARTICLE 1 TERMS OF APPOINTMENT: DUTIES OF JHFSI
1.01 Subject to the terms and conditions set forth in this Agreement,
the Fund hereby, employs and appoints JHFSI to act as, and JHFSI agrees to act
as transfer agent for the Fund's authorized and issued shares of capital stock
("Shares"), with any accumulation, open-account or similar plans provided to the
shareholders of the Fund ("Shareholders") and set out in the currently effective
prospectus of the Fund, including without limitation any periodic investment
plan or periodic withdrawal program.
<PAGE>
1.02 JHFSI agrees that it will perform the following services:

(a) In accordance with procedures established from time to time by
agreement between the Fund and JHFSI, JHFSI shall:

(i) Receive for acceptance, orders for the purchase of Shares,
and promptly deliver payment and appropriate documentation
therefor to the Custodian of the Fund authorized pursuant
to the Declaration of Trust of the Fund (the "Custodian");

(ii) Pursuant to purchase orders, issue the appropriate number
of Shares and hold such Shares in the appropriate
Shareholder account;

(iii) Receive for acceptance, redemption requests and redemption
directions and deliver the appropriate documentation
therefor to the Custodian;

(iv) At the appropriate time as and when it receives monies
paid to it by the Custodian with respect to any
redemption, pay over or cause to be paid over in the
appropriate manner such monies as instructed by the
redeeming Shareholders;

(v) Effect transfers of Shares by the registered owners
thereof upon receipt of appropriate instructions;

(vi) Prepare and transmit payments for dividends and
distributions declared by the Fund; and

(vii) Maintain records of account for and advise the Fund and
its Shareholders as to the foregoing; and

(viii) Record the issuance of Shares of the Fund and maintain
pursuant to SEC Rule 17Ad-10(e) a record of the total
number of Shares of the Fund which are authorized, based
upon data provided to it by the Fund, and issued and
outstanding. JHFSI shall also provide the Fund on a
regular basis with the total number of Shares which are
authorized and issued and outstanding and shall have no
obligation, when recording the issuance of Shares, to
monitor the issuance of such Shares or to take cognizance
of any laws relating to the issue or sale of such Shares,
which functions shall be the sole responsibility of the
Fund.

<PAGE>
(b) In addition to and not in lieu of the services set forth in the
above paragraph (a), JHFSI shall: (i) perform all of the customary services of a
transfer agent, dividend disbursing agent and, as relevant, agent in connection
with accumulation, open-account or similar plans (including without limitation
any periodic investment plan or periodic withdrawal program); including but not
limited to: maintaining all Shareholder accounts, preparing Shareholder meeting
lists, mailing proxies, receiving and tabulating proxies, mailing Shareholder
reports and prospectuses to current Shareholders, withholding taxes on U.S.
resident and non-resident alien accounts, preparing and filing U.S. Treasury
Department Forms 1099 and other appropriate forms required with respect to
dividends and distributions by federal authorities for all Shareholders,
preparing and mailing confirmations forms and statements of account to
Shareholders for all purchases and redemptions of Shares and other confirmable
transactions in Shareholder accounts, preparing and mailing activity statements
for Shareholders, and providing Shareholder account information and (ii) provide
a system which will enable the Fund to monitor the total number of Shares sold
in each State.

(c) In addition, the Fund shall (i) identify to JHFSI in writing those
transactions and assets to be treated as exempt from the blue sky reporting for
each State and (ii) verify the establishment of transactions for each State on
the system prior to activation and thereafter monitor the daily activity for
each State. The responsibility of JHFSI for the Fund's blue sky State
registration status is solely limited to the initial establishment of
transactions subject to blue sky compliance by the Fund and the reporting of
such transactions to the Fund as provided above.

(d) Additionally, JHFSI shall:

(i) Utilize a system to identify all share transactions which
involve purchase and redemption orders that are processed at a time
other than the time of the computation of net asset value per share next
computed after receipt of such orders, and shall compute the net effect
upon the Fund of such transactions so identified on a daily and
cumulative basis.

(ii) If upon any day the cumulative net effect of such
transactions upon the Fund is negative and exceed a dollar amount
equivalent to 1/2 of 1 cent per share, JHFSI shall promptly make a
payment to the Fund in cash or through the use of a credit, in the
manner described in paragraph (iv) below, in such amount as may be
necessary to reduce the negative cumulative net effect to less than 1/2
of 1 cent per share.
<PAGE>
(iii) If on the last business day of any month the cumulative
net effect upon the Fund (adjusted by the amount of all prior payments
and credits by JHFSI and the Fund) is negative, the Fund shall be
entitled to a reduction in the fee next payable under the Agreement by
an equivalent amount, except as provided in paragraph (iv) below. If on
the last business day in any month the cumulative net effect upon the
Fund (adjusted by the amount of all prior payments and credits by JHFSI
and the Fund) is positive, JHFSI shall be entitled to recover certain
past payments and reductions in fees, and to credit against all future
payments and fee reductions that may be required under the Agreement as
herein described in paragraph (iv) below.

(iv) At the end of each month, any positive cumulative net
effect upon the Fund shall be deemed to be a credit to JHFSI which shall
first be applied to permit JHFSI to recover any prior cash payments and
fee reductions made by it to the Fund under paragraphs (ii) and (iii)
above during the calendar year, by increasing the amount of the monthly
fee under the Agreement next payable in an amount equal to prior
payments and fee reductions made by JHFSI during such calendar year, but
not exceeding the sum of that month's credit and credits arising in
prior months during such calendar year to the extent such prior credits
have not previously been utilized as contemplated by this paragraph. Any
portion of a credit to JHFSI not so used by it shall remain as a credit
to be used as payment against the amount of any future negative
cumulative net effects that would otherwise require a cash payment or
fee reduction to be made to the Fund pursuant to paragraphs (ii) or
(iii) above (regardless of whether or not the credit or any portion
thereof arose in the same calendar year as that in which the negative
cumulative net effects or any portion thereof arose).

<PAGE>
(v) JHFSI shall supply to the Fund from time to time, as
mutually agreed upon, reports summarizing the transactions identified
pursuant to paragraph (i) above, and the daily and cumulative net
effects of such transactions, and shall advise the Fund at the end of
each month of the net cumulative effect at such time. JHFSI shall
promptly advise the Fund if at any time the cumulative net effect
exceeds a dollar amount equivalent to 1/2 of 1 cent per share.

(vi) In the event that this Agreement is terminated for whatever
cause, or this provision 1.02 (d) is terminated pursuant to paragraph
(vii) below, the Fund shall promptly pay to JHFSI an amount in cash
equal to the amount by which the cumulative net effect upon the Fund is
positive or, if the cumulative net effect upon the Fund is negative,
JHFSI shall promptly pay to the Fund an amount in cash equal to the
amount of such cumulative net effect.

(vii) This provision 1.02 (d) of the Agreement may be terminated
by JHFSI at any time without cause, effective as of the close of
business on the date written notice (which may be by telex) is received
by the Fund.

Procedures applicable to certain of these services may be establishes
from time to time by agreement between the Fund and JHFSI.

ARTICLE 2 FEES AND EXPENSES
2.01 For performance by JHFSI pursuant to this Agreement, the Fund
agrees to pay JHFSI an annual maintenance fee for each Shareholder account as
set out in the initial fee schedule attached hereto. Such fees and out-of-pocket
expenses and advances identified under Section 2.02 below may be changed from
time to time subject to mutual written agreement between the Fund and JHFSI.

<PAGE>
2.02 In addition to the fee paid under Section 2.01 above. the Fund
agrees to reimburse JHFSI for out-of-pocket expenses or advances incurred by
JHFSI for the items set out in the fee schedule attached hereto. In addition,
any other expenses incurred by JHFSI at the request or with the consent of the
Fund, will be reimbursed by the Fund.

2.03 The Fund agrees to pay all fees and reimbursable expenses promptly
following the mailing of the respective billing notice. Postage for mailing of
dividends, proxies, Fund reports and other mailings to all shareholder accounts
shall be advanced to JHFSI by the Fund at least seven (7) days prior to the
mailing date of such materials.

ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF JHFSI

JHFSI represents and warrants to the Fund that:

3.01 It is a Delaware corporation duly organized and existing and in
good standing under the laws of the State of Delaware, and as a Foreign
Corporation under the Laws of the Commonwealth of Massachusetts.

3.02 It is duly qualified to carry on its business in the Commonwealth
of Massachusetts.

3.03 It is empowered under applicable laws and by its charter and
By-Laws to enter into and perform this Agreement.

3.04 All requisite corporate proceedings have been taken to authorize it
to enter into and perform this Agreement.

3.05 It has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and obligations under
this Agreement.

<PAGE>
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE FUND

The Fund represents and warrants to JHFSI that:

4.01 It is a business trust duly organized and existing and in good
standing under the laws of the Commonwealth of Massachusetts.

4.02 It is empowered under applicable laws and by its Declaration of
Trust and By-Laws to enter into and perform this Agreement.

4.03 All Trust proceedings required by said Declaration of Trust and
By-Laws have been taken to authorize it to enter into and perform this
Agreement.

4.04 It is an open-end and diversified investment company registered
under the Investment Company Act of 1940.

4.05 A registration statement under the Securities Act of 1933 is
currently effective and will remain effective, and appropriate state securities
law filings have been made and will continue to be made, with respect to all
Shares of the Fund being offered for sale.

ARTICLE 5 INDEMNIFICATION

5.01 JHFSI shall not be responsible for, and the Fund shall indemnify
and hold JHFSI harmless from and against, any and all losses, damages, costs,
charges, counsel fees, payments, expenses and liabilities arising out of or
attributable to:

(a) All actions of JHFSI or its agent or subcontractors required to be
taken pursuant to this Agreement, provided that such actions are taken in good
faith and without negligence or willful misconduct.

(b) The Fund's refusal or failure to comply with the terms of this
Agreement, or which arise out of the Fund's lack of good faith, negligence or
willful misconduct or which arise out of the breach of any representation or
warranty of the Fund hereunder.

(c) The reliance on or use by JHFSI or its agents or subcontractors of
information, records and documents which (i) are received by JHFSI or its agents
or subcontractors and furnished to it by or on behalf of the Fund, and (ii) have
been prepared and/or maintained by the Fund or any other person or firm on
behalf of the Fund.

(d) The reliance on, or the carrying out by JHFSI or its agents or
subcontractors of any instructions or requests of the Fund.

<PAGE>
(e) The offer or sale of Shares in violation of any requirement under
the federal securities laws or regulations or the securities laws or regulations
of any state that such Shares be registered in such state or in violation of any
stop order or other determination or ruling by any federal agency or any state
with respect to the offer or sale of such Shares in such state.

5.02 JHFSI shall indemnify and hold the Fund harmless from and against
any and all losses, damages, costs, charges, counsel fees, payments, expenses
and liabilities arising out of or attributed to any action or failure or
omission to act by JHFSI as a result of JHFSI's lack of good faith, negligence
or willful misconduct.

5.03 At any time JHFSI may apply to any officer of the Fund for
instructions, and may consult with legal counsel with respect to any matter
arising in connection with the services to be performed by JHFSI under this
Agreement, and JHFSI and its agents or subcontractors shall not be liable and
shall be indemnified by the Fund for any action taken or omitted by it in
reliance upon such instructions or upon the opinion of such counsel. JHFSI, its
agents and subcontractors shall be protected and indemnified in acting upon any
paper or document furnished by or on behalf of the Fund, reasonably believed to
be genuine and to have been signed by the proper person or persons, or upon any
instruction, information, data, records or documents provided JHFSI or its
agents or subcontractors by machine readable input, telex, CRT data entry or
other similar means authorized by the Fund, and shall not be held to have notice
of any change of authority of any person, until receipt of written notice
thereof from the Fund. JHFSI, its agents and subcontractors shall also be
protected and indemnified in recognizing stock certificates which are reasonably
believed to bear the proper manual or facsimile signatures of the officer of the
Fund, and the proper countersignature of any former transfer agent or registrar,
or of a co-transfer agent or co-registrar.

5.04 In the event either party is unable to perform its obligations
under the terms of this Agreement because of acts of God, strikes, equipment or
transmission failure or damage reasonably beyond its control, or other causes
reasonably beyond its control, such party shall not be liable for damages to the
other for any damages resulting from such failure to perform or otherwise from
such causes.
<PAGE>
5.05 Neither party to this Agreement shall be liable to the other party
for consequential damages under any provision of this Agreement or for any act
or failure to act hereunder.

5.06 In order that the indemnification provisions contained in this
Article 5 shall apply, upon the assertion of a claim for which either party may
be required to indemnify the other, the party seeking indemnification shall
promptly notify the other party of such assertion, and shall keep the other
party advised with respect to all developments concerning such claim. The party
who may be required to indemnify shall have the option to participate with the
party seeking indemnification in the defense of such claim. The party seeking
indemnification shall in no case confess any claim or make any compromise in any
case in which the other party may be required to indemnify it except with the
other party's prior written consent.

ARTICLE 6 COVENANTS OF THE FUND AND JHFSI

6.01 The Fund shall promptly furnish to JHFSI the following:

(a) A certified copy of the resolution of the Trustee of the Fund
authorizing the appointment of JHFSI and the execution and delivery of this
Agreement.

(b) A copy of the Declaration of Trust and By-Laws of the Fund and all
amendments thereto.

6.02 JHFSI hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Fund for safekeeping of stock
certificates, check forms and facsimile signature imprinting devices, if any;
and for the preparation or use, and for keeping account of, such certificates,
forms and devices.

6.03 JHFSI shall keep records relating to the services to be performed
hereunder, in the form and manner as it may deem advisable. To the extent
required by Section 31 of the Investment Company Act of 1940, as amended, and
the Rules thereunder, JHFSI agrees that all such records prepared or maintained
by JHFSI relating to the services to be performed by JHFSI hereunder are the
property of the Fund and will be preserved, maintained and made available in
accordance with such Section and Rules, and will be surrendered to the Fund on
and in accordance with its request.

<PAGE>
6.04 JHFSI and the Fund agree that all books, records, information and
data pertaining to the business of the other party which are exchanged or
received pursuant to the negotiation or the carrying out of this Agreement shall
remain confidential, and shall not be voluntarily disclosed to any other person,
except as may be required by law.

6.05 In case of any requests or demands for the inspection of the
Shareholder records of the Fund, JHFSI will endeavor to notify the Fund and to
secure instructions from an authorized officer of the Fund as to such
instruction. JHFSI reserves the right, however, to exhibit the Shareholder
records to any person whenever it is advised by its counsel that it may be held
liable for the failure to exhibit the Shareholder records to such person.

ARTICLE 7 TERMINATION OF AGREEMENT

7.01 This Agreement may be terminated by either party upon one hundred
twenty (120) days written notice to the other.

7.02 Should the Fund exercise its right to terminate, all out-of-pocket
expenses associated with the movement of records and material will be borne by
the Fund. Additionally, JHFSI reserves the right to charge for any other
reasonable expenses associated with such termination.

ARTICLE 8 ASSIGNMENT

8.01 Except as provided in Section 8.03 below, neither this Agreement
nor any rights or obligations hereunder may be assigned by either party without
the written consent of the other party.

8.02 This Agreement shall inure to the benefit of and be binding upon
the parties and their respective permitted successors and assigns.

<PAGE>
8.03 JHFSI may, without further consent on the part of the Fund,
subcontract for the performance hereof with (i) Boston Financial Data Services,
Inc., a Massachusetts corporation ("BFDS") which is duly registered as a
transfer agent pursuant to Section 17A (c)(1) of the Securities Exchange Act of
1934 ("Section 17A (c)(1)"), (ii) 440 Financial Group, (iii) or any other entity
JHFSI deems appropriate in order to comply with the terms and conditions of this
Agreement, provided, however, that JHFSI shall be as fully responsible to the
Fund for the acts and omissions of any subcontractor as it is for its own acts
and omissions.

ARTICLE 9 AMENDMENT

9.01 This Agreement may be amended or modified by a written agreement
executed by both parties and authorized or approved by a resolution of the
Trustees of the Fund.

ARTICLE 10 MASSACHUSETTS LAW TO APPLY

10.01 This Agreement shall be construed and the provisions thereof
interpreted under and In accordance with the laws of The Commonwealth of
Massachusetts.

ARTICLE 11 MERGER OF AGREEMENT

11.01 This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject hereof
whether oral or written.

ARTICLE 12 LIMITATION ON LIABILITY

12.01 The name John Hancock Special Equities Trust is the designation of
the Trustees under the Declaration of Trust dated November 21, 1984, as amended
from time to time. The obligations of such Trust as not personally binding upon,
nor shall resort be had to the property of, any of the Trustees, shareholders,
officers, employees or agents of such Trust, but the Trust's property only shall
be bound.

<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their names and on their behalf under their seals by and through
their duly authorized officers, as of the day and year first above written.

ATTEST: JOHN HANCOCK SPECIAL EQUITIES TRUST

/s/ Thomas H. Drohan BY: /s/ Edward J. Boudreau, Jr.

ATTEST: JOHN HANCOCK FUND SERVICES, INC.

/s/ Thomas H. Drohan BY: /s/ Robert H. Watts

<PAGE>
Exhibit 99.10
ROPES AND GRAY
225 FRANKLIN STREET
BOSTON, MASSACHUSETTS 02110

December 18, 1984

John Hancock Special Equities Trust
John Hancock Place
Boston, Massachusetts 02117

Gentlemen:

We are furnishing this opinion with respect to the proposed offer and
sale from time to time of shares of beneficial interest (the "Shares") of John
Hancock Special Equities Trust (the "Trust") being registered under the
Securities Act of 1933 and the Investment Company Act of 1940.

We have acted as Massachusetts counsel to the Trust in connection with
and since its establishment. For purposes of our opinion, we have examined:

(a) an executed copy of the Restated and Amended Declaration of
Trust of the Trust dated November 21, 1984 (the "Declaration
of Trust") and a certificate of recent date of the Secretary
of the Commonwealth of Massachusetts as to the existence of
the Trust in Massachusetts and as to filings with respect to
the Trust made in the office of such Secretary or other
evidence satisfactory to us regarding such filings;

(b) a certificate of recent date of the City Clerk of Boston,
Massachusetts as to filings with respect to the Trust made in
the office of said Clerk or other evidence satisfactory to us
regarding such filings.

(d) copies of minutes of meetings of the Trustees and of written
action taken by the Trustees and shareholders through today,
certified by an officer of the Trust, and

(e) such other documents and certificates as we deemed necessary
for this opinion.

We express no opinion as to the applicability of, compliance with, or
effect of, Federal law or Massachusetts securities or insurance laws or the law
of any jurisdiction other than Massachusetts.

Based on the foregoing, it is our opinion that under Massachusetts law
as now in effect:

<PAGE>
(1) The Trust has been duly established as an unincorporated voluntary
association under Massachusetts law and has made all filings required to be made
by a voluntary association under Chapter 182 of the Massachusetts General Laws.

(2) Upon the issue of any of the Shares for cash at net asset value and
receipt by the Trust of the authorized consideration therefore, the Shares so
issued will be validly issued, fully paid and non-assessable by the Trust.

The Trust is an entity of the type commonly known as a "Massachusetts
business trust." Under Massachusetts law, shareholder could, under certain
circumstances, be held personally liable for the obligations of the Trust.
However, the Declaration of Trust disclaims shareholder liability for acts,
obligations or affairs of the Trust and requires that notice of such disclaimer
be given in each agreement, obligation, or instrument entered into or executed
by the Trust or the Trustees. The Declaration of Trust provides for
indemnification out of the Trust property for all loss and expense of any
shareholder held personally liable for the obligations of the Trust. Thus, the
risk of a shareholder incurring financial loss on account of shareholder
liability is limited to circumstances in which the Trust itself would be unable
to meet its obligations.

We understand that this opinion is to be used in connection with the
registration of the Shares for offering and sale pursuant to the Securities Act
of 1933. We consent to the filing of this opinion with and as a part of the
Registration Statement relating to such registration.

Very truly yours,

Ropes & Gray

<PAGE>
EXHIBIT 99.B11
CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the references to our firm under the captions "The Fund's
Financial Highlights" in the Prospectus and "Independent Auditors" in the
Statement of Additional Information and to the use, in this Post-Effective
Amendment Number 11 to Registration Statement (Form N-1A No. 2-92548) dated
March 1, 1995, of our report on the financial statements and financial
highlights of John Hancock Special Equities Fund dated December 14, 1994.

Ernst & Young
Boston, Massachusetts
February 21, 1995

<PAGE>
Exhibit 99.13
SUBSCRIPTION AGREEMENT

December 17, 1984

JOHN HANCOCK SPECIAL EQUITIES TRUST, a business trust organized under
the laws of the Commonwealth of Massachusetts (the "Trust"), and JOHN HANCOCK
ADVISERS, INC., a Delaware corporation (the "Purchaser"), hereby agree with each
other as follows:

1. Proposed Registration of Shares of Beneficial Interest. The Trust
proposes to issue and sell to the public shares of beneficial interest
("Shares") pursuant to a registration statement on Form N-1A (the "Registration
Statement") to be filed with the Securities and Exchange Commission. In order to
provide the Trust with a net worth of at least $100,000 as required by Section
14 of the Investment Company Act of 1940, as amended, and additional
capitalization, the Trust hereby offers the Purchaser at private placement
20,000 Shares at a price of $5.00 per share for purpose prior to the effective
date of the Registration Statement.

2. Purchase of Shares. The Purchaser agrees to purchase 20,000 Shares
two days prior to the effective date of the Registration Statement (or such
earlier date as the parties may agree upon). The Shares will be purchased at the
purchase price of $5.00 per share. The Purchaser will make payment for the
20,000 Shares to be purchased by it by delivery of a certified or official bank
check payable to the order of the Trust at least two business days prior to the
date specified by the Trust as the proposed effective date of the Registration
Statement in a written notice delivered to the Purchaser by the Trust no later
than three business days prior to such proposed effective date.

3. Purchase for Investment. The Purchaser represents and warrants to
the Trust that the Shares are being acquired by it for investment and not with a
view to the resale or further distribution thereof and that it has no present
intention to redeem the Shares.

4. Execution. This instrument is executed and made on behalf of the
Trust by an officer of the Trust. The name John Hancock Special Equities Trust
is the designation of the Trustees under the Restated and Amended Declaration of
Trust dated November 21, 1984, as amended from time to time. The Restated and
Amended Declaration of Trust has been filed from time to time. The Restated and
Amended Declaration of Trust has been filed with the Secretary of State of the
Commonwealth of Massachusetts. The obligations of the Trust are not personally
binding upon, nor shall resort be had to the private property of, any of the
Trustees, shareholders, officers, employees or agents of the Trust, but the
Trust's property only shall be bound.

5. Assignment. The right of the Purchaser to purchase the Shares as set
forth herein is not assignable without the consent of the Trust.

6. Notices, etc. All notices, requests and other communications
hereunder shall be in writing and shall be deemed to have been sufficiently
given if mailed by first-class mail or telegraphed and addressed as follows:

To the Trust: John Hancock Place
P.O. Box 111
Boston, Massachusetts 02117

To the Purchaser: John Hancock Place
P.O. Box 111
Boston, Massachusetts 02117

or if in any case to such other address as shall have been specified by notice
from the addressee to the sender of such notice, request or other communication.

IN WITNESS WHEREOF, the parties hereto have executed this agreement as
of the date first above written.

JOHN HANCOCK SPECIAL EQUITIES TRUST

By: /s/ R. Bruce Oliver
Chairman of the Board and President

JOHN HANCOCK ADVISERS, INC.

By: /s/ R. Bruce Oliver
Chairman of the Board and President

<PAGE>
Exhibit 99.15

JOHN HANCOCK SPECIAL EQUITIES FUND

Amended and Restated Distribution Plan

Class A Shares

January 3, 1994

ARTICLE I. THIS PLAN

This amended and restated Distribution Plan (the "Plan") sets forth the
terms and conditions on which John Hancock Special Equities Fund (the "Fund"),
on behalf of its Class A shares, will, after the effective date hereof, pay
certain amounts to John Hancock Broker Distribution Services, Inc. ("Broker
Services") in connection with the provision by Broker Services of certain
services to the Fund and its Class A shareholders, as set forth herein. Certain
of such payments by the Fund may, under Rule 12b-1 of the Securities and
Exchange Commission, as from time to time amended (the "Rule"), under the
Investment Company Act of 1940, as amended (the "Act"), be deemed to constitute
the financing of distribution by the Fund of its shares. This Plan describes all
material aspects of such financing as contemplated by the Rule and shall be
administered and interpreted, and implemented and continued, in a manner
consistent with the Rule. The Fund and Broker Services heretofore entered into a
Distribution Agreement, dated August 1, 1991 (the "Agreement"), the terms of
which, as heretofore and from time to time continued, are incorporated herein by
reference.

ARTICLE II. DISTRIBUTION AND SERVICE EXPENSES

The Fund shall pay to Broker Services a fee in the amount specified in
Article III hereof. Such fee may be spent by Broker Services on any activities
or expenses primarily intended to result in the sale of Class A shares of the
Fund, including, but not limited to the payment of Distribution Expenses (as
defined below) and Service Expenses (as defined below). Distribution Expenses
include but are not limited to, (a) initial and ongoing sales compensation out
of such fee as it is received by Broker Services of the Fund or other
broker-dealers ("Selling Brokers") that have entered into an agreement with
Broker Services for the sale of Class A shares of the Fund, (b) direct
out-of-pocket expenses incurred in connection with the distribution of Class A
shares of the Fund, including expenses related to printing of prospectuses and
reports to other than existing Class A shareholders of the Fund, and
preparation, printing and distribution of sales literature and advertising
materials, and (c) an allocation of overhead and other branch office expenses of
Broker Services related to the distribution of Class A shares of the Fund.

Service Expenses include payments made to, or on account of, account
executives of selected broker-dealers (including affiliates of Broker Services)
and others who furnish personal and shareholder account maintenance services to
Class A shareholders of the Fund.

ARTICLE III. MAXIMUM EXPENDITURES

The expenditures to be made by the Fund pursuant to this Plan, and the
basis upon which such expenditures will be made, shall be determined by the
Fund, and in no event shall such expenditures exceed 0.30% of the average daily
net asset value of the Class A shares of the Fund (determined in accordance with
the Fund's prospectus as from time to time in effect) on an annual basis to
cover Distribution Expenses and Service Expenses, provided that the portion of
such fee used to cover service expenses shall not exceed an annual rate of up to
0.25% of the average daily net asset value of the Class A shares of the Fund.
Such expenditures shall be calculated and accrued daily and paid monthly or at
such other intervals as the Trustees shall determine. In the event Broker
Services is not fully reimbursed for payments made or other expenses incurred by
it under this Plan, such expenses will not be carried beyond one year from the
date such expenses were incurred. Any fees paid to Broker Services under this
Plan during any fiscal year of the Fund and not expended or allocated by Broker
Services for actual or budgeted Distribution Expenses and Service Expenses
during such fiscal year will be promptly returned to the Fund.

ARTICLE IV. EXPENSES BORNE BY THE FUND

Notwithstanding any other provision of this Plan, the Fund and its
investment adviser, John Hancock Advisers, Inc. (the "Adviser"), shall bear the
respective expenses to be borne by them under the Investment Management
Contract, as amended, dated January 1, 1994, as from time to time continued and
amended (the "Management Contract"), and under the Fund's current prospectus as
it is from time to time in effect. Except as otherwise contemplated by this
Plan, the Fund shall not, directly or indirectly, engage in financing any
activity which is primarily intended to or should reasonably result in the sale
of shares of the Fund.

ARTICLE V. APPROVAL BY TRUSTEES, ETC.

This Plan shall not take effect until it has been approved, together
with any related agreements, by votes, cast in person at a meeting called for
the purpose of voting on this Plan or such agreements, of a majority (or
whatever greater percentage may, from time to time, be required by Section 12(b)
of the Act or the rules and regulations thereunder) of (a) all of the Trustees
of the Fund and (b) those Trustees of the Fund who are not "interested persons"
of the Fund, as such term may be from time to time defined under the Act, and
have no direct or indirect financial interest in the operation of this Plan or
any agreements related to it (the "Independent Trustees").

ARTICLE VI. CONTINUANCE

This Plan and any related agreements shall continue in effect for so
long as such continuance is specifically approved at least annually in advance
in the manner provided for the approval of this Plan in Article V.

ARTICLE VII. INFORMATION

Broker Services shall furnish the Fund and its Trustees quarterly, or
at such other intervals as the Fund shall specify, a written report of amounts
expended or incurred for Distribution Expenses and Service Expenses pursuant to
this Plan and the purposes for which such expenditures were made and such other
information as the Trustees may request.

ARTICLE VIII. TERMINATION

This Plan may be terminated (a) at any time by vote of a majority of
the Trustees, a majority of the Independent Trustees, or a majority of the
Fund's outstanding voting Class A shares, or (b) by Broker Services on 60 days'
notice in writing to the Fund.

ARTICLE IX. AGREEMENTS

Each agreement with any person relating to implementation of this Plan
shall be in writing, and each agreement related to this Plan shall provide:

(a) That, with respect to the Fund, such agreement may be terminated at any
time, without payment of any penalty, by vote of a majority of the Independent
Trustees or by vote of a majority of the Fund's then outstanding voting Class A
shares.

(b) That such agreement shall terminate automatically in the event of its
assignment.

ARTICLE X. AMENDMENTS

This Plan may not be amended to increase the maximum amount of the fees
payable by the Fund hereunder without the approval of a majority of the
outstanding voting Class A shares of the Fund. No material amendment to the Plan
shall, in any event, be effective unless it is approved in the same manner as is
provided for approval of this Plan in Article V.

ARTICLE XI. LIMITATION OF LIABILITY

The name "John Hancock Special Equities Fund" is the designation of the
Trustees under the Declaration of Trust, dated February 28, 1992, as amended
from time to time. The Declaration of Trust has been filed with the Secretary of
State of the Commonwealth of Massachusetts. The obligations of the Fund are not
personally binding upon, nor shall resort be had to the private property of, any
of the Trustees, shareholders, officers, employees or agents of the Fund, but
only the Fund's property shall be bound. No series of the Fund shall be
responsible for the obligations of any other series of the Fund.

IN WITNESS WHEREOF, the Fund has executed this amended and restated
Distribution Plan effective as of the 3rd day of January, 1994 in Boston,
Massachusetts.

JOHN HANCOCK SPECIAL EQUITIES FUND

By: /s/ Robert G. Freedman
President

JOHN HANCOCK BROKER DISTRIBUTION SERVICES, INC.

By: /s/ C. Troy Shaver, Jr.
President

<PAGE>
Exhibit 99.15A
JOHN HANCOCK SPECIAL EQUITIES FUND

AMENDED AND RESTATED DISTRIBUTION PLAN

CLASS B SHARES

JULY 1, 1993

Article I. This Plan

This amended and restated Distribution Plan (the "Plan") sets forth the
terms and conditions under which John Hancock Special Equities Fund (the
"Fund"), will, after the effective date hereof, pay certain amounts to John
Hancock Broker Distribution Services, Inc. ("Broker Services") in connection
with the provision by Broker Services of certain services to the Fund and its
Class B shareholders, as set forth herein. Certain of such payments by the Fund
may, under Rule 12b-1 of the Securities and Exchange Commission, as from time to
time amended (the "Rule"), under the Investment Company Act of 1940, as amended
(the "Act"), be deemed to constitute the financing of distribution by the Fund
of its shares. This Plan describes all material aspects of such financing as
contemplated by the Rule and shall be administered and interpreted, and
implemented and continued, in a manner consistent with the Rule. The Fund and
Broker Services heretofore entered into a Distribution Agreement, dated October
23, 1991 (the "Agreement"), the terms of which, as heretofore and from time to
time continued, are incorporated herein by reference.

Article II. Distribution and Service Expenses

The Fund shall pay to Broker Services a fee in the amount specified in
Article III hereof. Such fee may be spent by Broker Services on any activities
or expenses primarily intended to result in the sale of Class B shares of the
Fund, including, but not limited to the payment of Distribution Expenses (as
defined below) and Service Expenses (as defined below). Distribution Expenses
include but are not limited to, (a) initial and ongoing sales compensation out
of such fee as it is received by Broker Services or other broker-dealers
("Selling Brokers") that have entered into an agreement with Broker Services for
the sale of Class B shares of the Fund, (b) direct out-of pocket expenses
incurred in connection with the distribution of Class B shares of the Fund,
including expenses related to printing of prospectuses and reports to other than
existing Class B shareholders of the Fund, and preparation, printing and
distribution of sales literature and advertising materials, (c) an allocation of
overhead and other branch office expenses of Broker Services related to the
distribution of Class B shares of the Fund, and (d) interest expenses on
unreimbursed distribution expenses related to Class B shares, as described in
Article IV.

Service Expenses include payments made to, or on account of account
executives of selected broker-dealers (including affiliates of Broker Services)
and others who furnish personal and shareholder account maintenance services to
Class B shareholders of the Fund.

Article III. Maximum Expenditures

Article IV. Unreimbursed Distribution Expenses

In the event that Broker Services is not fully reimbursed for payments
made or expenses incurred by it as contemplated hereunder, in any fiscal year,
Broker Services shall be entitled to carry forward such expenses to subsequent
fiscal years for submission to the Class B shares of the Fund for payment,
subject always to the annual maximum expenditures set forth in Article III
hereof; provided, however, that nothing herein shall prohibit or limit the
Trustees from terminating this Plan and all payments hereunder at any time
pursuant to Article IX hereof.

Article V. Expenses Borne by the Fund

Notwithstanding any other provision of this Plan, the Fund and its
investment adviser, John Hancock Advisers, Inc. (the "Adviser"), shall bear the
respective expenses to be borne by them under the Investment Management Contract
between them, dated April 23, 1987 as from time to time continued and amended
(the "Management Contract"), and under the Fund's current prospectus as it is
from time to time in effect. Except as otherwise contemplated by this Plan, the
Fund shall not, directly or indirectly, engage in financing any activity which
is primarily intended to or should reasonably result in the sale of shares of
the Fund.

Article VI. Approval by Trustees, etc.

Article VII. Continuance

Article VIII. Information

Broker Services shall furnish the Fund and its Trustees quarterly, or
at such other intervals as the Fund shall specify, a written report of amounts
expended or incurred for Distribution Expenses and Services Expenses pursuant to
this Plan and the purposes for which such expenditures were made and such other
information as the Trustees may request.

Article IX. Termination

This Plan may be terminated (a) at any time by vote of a majority of
the Trustees, a majority of the Independent Trustees, or a majority of the
Fund's outstanding voting Class B shares, or (b) by Broker Services on 60 days'
notice in writing to the Fund.

Article X. Agreements

Each Agreement with any person relating to implementation of this Plan
shall be in writing, and each agreement related to this Plan shall provide:

(b) That such agreement shall terminate automatically in the event of its
assignment.

Article XI. Amendments

This Plan may not be amended to increase the maximum amount of the fees
payable by the Fund hereunder without the approval of a majority of the
outstanding voting Class B shares of the Fund. No material amendment to the Plan
shall, in any event, be effective unless it is approved in the same manner as is
provided for approval of this Plan in Article VII.

Article XII. Limitation of Liability

The name "John Hancock Special Equities Fund" is the designation of the
Trustees under the Declaration of Trust, dated February 28, 1992, as restated
and amended from time to time. The Declaration of Trust has been filed with the
Secretary of State of the Commonwealth of Massachusetts. The obligations of the
Fund are not personally binding upon, nor shall resort be had to the private
property of, any of the Trustees, shareholders, officers, employees or agents of
the Fund, but only the Fund's property shall be bound. No series of the Fund
shall be responsible for the obligations of any other series of the Fund.

IN WITNESS WHEREOF, the Fund has executed this amended and restated
Distribution Plan effective as of the 1st day of July, 1993 in Boston,
Massachusetts.

JOHN HANCOCK SPECIAL EQUITIES FUND

By: /s/ Robert G. Freedman
President

JOHN HANCOCK BROKER DISTRIBUTION SERVICES, INC.

By: /s/ C. Troy Shaver, Jr.
President

<PAGE>
Exhibit 99.17
POWER OF ATTORNEY

KNOW ALL BY THESE PRESENTS, that the undersigned Trustee of John Hancock Special
Equities Fund does hereby constitute and appoint EDWARD J. BOUDREAU, JR., THOMAS
H. DROHAN, AND JAMES B. LITTLE and each of them individually his true and lawful
attorneys and agents to take any and all action and execute any and all
instruments which said attorneys and agents may deem necessary or advisable

(i) to enable the Trust to comply with the Securities Act of 1933, as
amended, and any rules regulations, orders or other requirements of the
Securities and Exchange Commission thereunder, in connection with the
registration under such Securities Act of 1933 of shares of beneficial interest
of the Trust to be offered by the Trust, and

(ii) in connection with the registration of the Trust under the
Investment Company Act of 1940, as amended,

including specifically, but without limitation of the foregoing, power and
authority to sign his name in his behalf as Director as indicated below,
opposite his signature hereto, to any amendment or supplement (including
post-effective amendments) to the registration statement or statements filed
with the Securities and Exchange Commission under such Securities Act of 1933
and such Investment Company Act of 1940, and to execute any instruments or
documents filed or to be filed as a part of or in connection with such
registration statement or statements; and does hereby ratify and confirm all
that said attorneys and agents shall do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, we have hereunto set our hands on the date
indicated below.

SIGNATURE TITLE DATE AS OF:

/s/ Edward J. Boudreau, Jr. Chairman, Trustee November 15, 1988
- --------------------------- and Principal
Edward J. Boudreau, Jr. Executive Officer

/s/ James B. Little Treasurer, June 22, 1994
- -------------------------- Principal
James B. Little Accounting Officer
and Principal
Financial Officer

/s/ Thomas H. Drohan Senior Vice President November 20, 1984
- --------------------------- and Secretary
Thomas H. Drohan

<PAGE>
/s/ Dennis S. Aronowitz Trustee May 17, 1988
- ---------------------------
Dennis S. Aronowitz

/s/ Richard P. Chapman Trustee November 20, 1984
- ---------------------------
Richard P. Chapman

/s/ Francis C. Cleary, Jr. Trustee May 21, 1988
- ---------------------------
Francis C. Cleary, Jr.

/s/ William J. Cosgrove Trustee October 15, 1991
- ---------------------------
William J. Cosgrove

/s/ Gail D. Fosler Trustee January 1, 1994
- ---------------------------
Gail D. Fosler

/s/ Bayard Henry Trustee November 20, 1984
- ---------------------------
Bayard Henry

/s/ Richard S. Scipione Trustee July 22, 1985
- ---------------------------
Richard S. Scipione

/s/ Edward J. Spellman Trustee May 21, 1991
- ---------------------------
Edward J. Spellman

WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.

<ARTICLE> 6

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1994
<PERIOD-START> NOV-01-1993
<PERIOD-END> OCT-31-1994
<INVESTMENTS-AT-COST> 401,813,769
<INVESTMENTS-AT-VALUE> 522,944,707
<RECEIVABLES> 9,013,481
<ASSETS-OTHER> 24,514
<OTHER-ITEMS-ASSETS> 121,130,938
<TOTAL-ASSETS> 531,982,702
<PAYABLE-FOR-SECURITIES> 21,382,487
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 873,333
<TOTAL-LIABILITIES> 22,255,820
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 414,616,084
<SHARES-COMMON-STOCK> 19,287,318
<SHARES-COMMON-PRIOR> 18,395,245
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (26,020,140)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 121,130,938
<NET-ASSETS> 509,726,882
<DIVIDEND-INCOME> 288,263
<INTEREST-INCOME> 672,928
<OTHER-INCOME> 0
<EXPENSES-NET> 8,034,651
<NET-INVESTMENT-INCOME> (7,073,460)
<REALIZED-GAINS-CURRENT> (20,708,728)
<APPREC-INCREASE-CURRENT> 29,140,783
<NET-CHANGE-FROM-OPS> 1,358,595
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 15,399,407
<NUMBER-OF-SHARES-REDEEMED> 14,507,334
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 51,815,796
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (5,311,412)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 3,458,972
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 8,034,651
<AVERAGE-NET-ASSETS> 277,444,704
<PER-SHARE-NAV-BEGIN> 16.13
<PER-SHARE-NII> (0.21)
<PER-SHARE-GAIN-APPREC> 0.19
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 16.11
<EXPENSE-RATIO> 1.62
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.

<ARTICLE> 6

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1994
<PERIOD-START> NOV-01-1993
<PERIOD-END> OCT-31-1994
<INVESTMENTS-AT-COST> 401,813,769
<INVESTMENTS-AT-VALUE> 522,944,707
<RECEIVABLES> 9,013,481
<ASSETS-OTHER> 24,514
<OTHER-ITEMS-ASSETS> 121,130,938
<TOTAL-ASSETS> 531,982,702
<PAYABLE-FOR-SECURITIES> 21,382,487
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 873,333
<TOTAL-LIABILITIES> 22,255,820
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 414,616,084
<SHARES-COMMON-STOCK> 12,021,618
<SHARES-COMMON-PRIOR> 9,844,158
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (26,020,140)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 121,130,938
<NET-ASSETS> 509,726,882
<DIVIDEND-INCOME> 288,263
<INTEREST-INCOME> 672,928
<OTHER-INCOME> 0
<EXPENSES-NET> 8,034,651
<NET-INVESTMENT-INCOME> (7,073,460)
<REALIZED-GAINS-CURRENT> (20,708,728)
<APPREC-INCREASE-CURRENT> 29,140,783
<NET-CHANGE-FROM-OPS> 1,358,595
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 4,220,733
<NUMBER-OF-SHARES-REDEEMED> 2,043,273
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 51,815,796
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (5,311,412)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 3,458,972
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 8,034,651
<AVERAGE-NET-ASSETS> 154,734,243
<PER-SHARE-NAV-BEGIN> 16.08
<PER-SHARE-NII> (0.30)
<PER-SHARE-GAIN-APPREC> 0.19
<PER-SHARE-DIVIDEND> 0
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<PER-SHARE-NAV-END> 15.97
<EXPENSE-RATIO> 2.25
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<ARTICLE> 6

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1994
<PERIOD-START> NOV-01-1993
<PERIOD-END> OCT-31-1994
<INVESTMENTS-AT-COST> 401,813,769
<INVESTMENTS-AT-VALUE> 522,944,707
<RECEIVABLES> 9,013,481
<ASSETS-OTHER> 24,514
<OTHER-ITEMS-ASSETS> 121,130,938
<TOTAL-ASSETS> 531,982,702
<PAYABLE-FOR-SECURITIES> 21,382,487
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<OTHER-ITEMS-LIABILITIES> 873,333
<TOTAL-LIABILITIES> 22,255,820
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 44,616,084
<SHARES-COMMON-STOCK> 439,601
<SHARES-COMMON-PRIOR> 178,777
<ACCUMULATED-NII-CURRENT> 0
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<ACCUMULATED-NET-GAINS> (26,020,140)
<OVERDISTRIBUTION-GAINS> 0
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<NET-ASSETS> 509,726,882
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<INTEREST-INCOME> 672,928
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<NET-INVESTMENT-INCOME> (7,073,460)
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<PER-SHARE-NAV-END> 16.20
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<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>