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Previous: PUTNAM INVESTMENTS INC, SC 13G/A, 1996-02-09 |
Next: ROCKEFELLER CENTER PROPERTIES INC, PRER14A, 1996-02-09 |
GMO TRUST
SUPPLEMENT DATED FEBRUARY 7, 1996
TO
PROSPECTUS DATED JANUARY 1, 1996
GMO Short-Term Income Fund and GMO Foreign Fund - Fee Changes
Effective February 7, 1996, Grantham, Mayo, Van Otterloo & Co. ("GMO"),
will amend its voluntary fee waiver and expense limitation policy to effectively
lower the total fees of the GMO Short-Term Income Fund and the GMO Foreign Fund,
as described below:
GMO Short-Term Income Fund: Total Fund Operating Expenses will be lowered from
0.25% to 0.20%.
GMO Foreign Fund: While the expense limitation will remain at 0.75% for this
Fund, the limitation will now include custodial expenses, which have been
estimated to be 0.13% during the Fund's first year of operations. Thus, the
Total Fund Operating Expenses have effectively been lowered from an estimated
0.88% during the first year to 0.75%. The GMO Foreign Fund has not yet commenced
operations but is expected to be open in April.
Attached to this Supplement is a revised Schedule of Fees and Expenses
reflecting the changes described above.
<PAGE>
SCHEDULE OF FEES AND EXPENSES
<TABLE>
<CAPTION>
GMO FUND NAME SHAREHOLDER TRANSACTION EXPENSES ANNUAL FUND OPERATING EXPENSES
Cash Purchase
Premium (as a Redemption Fees Management Total Fund
percentage of (as a percentage of Fees after Fee Other Operating
amount invested)1 amount redeemed)2 Waiver3 Expenses3 Expenses3
<S> <C> <C> <C> <C> <C>
Core Fund .17% None .45% .03% .48%
Tobacco-Free Core Fund .17% None .23% .25% .48%
Value Allocation Fund .15% None .56% .05% .61%
Growth Allocation Fund .17% None .42% .06% .48%
U.S. Sector Allocation Fund .17% None .40% .08% .48%
Core II Secondaries Fund .75% .75% .39% .09% .48%
Fundamental Value Fund .15% None .68% .07% .75%
International Core Fund .75% None .59%7 .10%7 .69%
Currency Hedged
International Core Fund .75% None .43% .26%12 .69%
Foreign Fund None None .57% .18%12 .75%
International Small
Companies Fund 1.25% .75% .47% .29% .76%
Japan Fund .40% .70% .58%11 .30%9 .88%
Emerging Markets Fund 1.60% .40%6 .98%7 .58%7 1.56%
Global Hedged
Equity Fund .60% 1.40%5 .61% .19%4 .80%
Domestic Bond Fund None None .21% .04%4 .25%
Short-Term Income Fund None None .01%13 .19% .20%13
International Bond Fund .15% None .19% .21% .40%
Currency Hedged
International Bond Fund .15% None .28% .12%4 .40%
Global Bond Fund .15% None .05% .29%12 .34%
Emerging Country
Debt Fund .50% .25%8 .29% .21%10 .50%
Core Emerging Country
Debt Fund .40% None .00% .45%12 .45%
</TABLE>
SCHEDULE OF FEES AND EXPENSES (Continued)
<TABLE>
<CAPTION>
EXAMPLES
You would pay the following
expenses on a $1,000 invest- You would pay the following
ment assuming 5% annual expenses on the same
return with redemption at the investment assuming no
end of each time period: redemption:
1Yr. 3 Yr. 5 Yr. 10 Yr. 1 Yr. 3 Yr. 5 Yr. 10 Yr.
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Core Fund $7 $17 $29 $62 $7 $17 $29 $62
Tobacco-Free Core Fund $7 $17 $29 $62 $7 $17 $29 $62
Value Allocation Fund $8 $21 $35 $78 $8 $21 $35 $78
Growth Allocation Fund $7 $17 $29 $62 $7 $17 $29 $62
U.S. Sector Allocation Fund $7 $17 $29 $62 $7 $17 $29 $62
Core II Secondaries Fund $20 $31 $43 $79 $12 $23 $34 $67
Fundamental Value Fund $9 $25 $43 $94 $9 $25 $43 $94
International Core Fund $15 $29 $46 $93 $15 $29 $46 $93
Currency Hedged
International Core Fund $15 $29 $15 $29
Foreign Fund $8 $24 $8 $24
International Small
Companies Fund $28 $45 $63 $117 $20 $36 $54 $106
Japan Fund $20 $40 $61 $122 $13 $32 $53 $112
Emerging Markets Fund $36 $69 $104 $204 $32 1 $65 $100 $199
Global Hedged
Equity Fund $29 $47 $67 $125 $14 $31 $50 $104
Domestic Bond Fund $3 $8 $14 $32 $3 $8 $14 $32
Short-Term Income Fund $2 $6 $11 $26 $2 $6 $11 $26
International Bond Fund $6 $14 $24 $52 $6 $14 $24 $52
Currency Hedged
International Bond Fund $6 $14 $24 $52 $6 $14 $24 $52
Global Bond Fund $5 $12 $5 $12
Emerging Country
Debt Fund $13 $24 $36 $71 $10 $21 $33 $68
Core Emerging Country
Debt Fund $9 $18 $9 $18
</TABLE>
SCHEDULE OF FEES AND EXPENSES
Footnotes
1 Applies only with respect to certain cash transactions as set forth under
the heading "Purchase of Shares". The Manager may waive purchase premiums if
there are minimal brokerage and transaction costs incurred in connection
with the purchase. Normally, no purchase premium is charged with respect to
in-kind purchases of Fund shares. However, in the case of in-kind purchases
involving transfers of large positions in markets where the costs of
re-registration and/or other transfer expenses are high, the International
Core Fund, Currency Hedged International Core Fund, International Small
Companies Fund, Japan Fund and Global Hedged Equity Fund may each charge a
premium of 0.10% and the Emerging Markets Fund may charge a premium of
0.20%.
2 The Manager may waive redemption fees as set forth under the heading
"Redemption of Shares" if there are minimal brokerage and transaction costs
incurred in connection with the redemption.
3 The Manager has voluntarily undertaken to reduce its management fees and to
bear certain expenses with respect to each Fund until further notice to the
extent that a Fund's total annual operating expenses (excluding brokerage
commissions, extraordinary expenses (including taxes), securities lending
fees and expenses and transfer taxes; and, in the case of the Japan Fund,
Emerging Markets Fund and Global Hedged Equity Fund, excluding custodial
fees; and, in the case of the Global Hedged Equity Fund only, also excluding
hedging transaction fees) would otherwise exceed the percentage of that
Fund's daily net assets specified below. Therefore so long as the Manager
agrees so to reduce its fee and bear certain expenses, total annual
operating expenses (subject to such exclusions) of the Fund will not exceed
these stated limitations. The Manager has also voluntarily undertaken, until
further notice, to limit its management fee for the Emerging Markets Fund to
0.98% regardless of the total operating expenses of the Fund. Absent such
undertakings, management fees for each Fund and the annual operating
expenses for each Fund would be as shown below.
<TABLE>
<CAPTION>
Total Fund
Voluntary Management Operating
Expense Fee (Absent Expenses
Fund Limit Waiver) (Absent Waiver)
<S> <C> <C> <C>
Core Fund .48% .525% .553%
Tobacco-Free Core Fund .48% .50% .75%
Value Allocation Fund .61% .70% .75%
Growth Allocation Fund .48% .50% .56%
U.S. Sector Allocation Fund .48% .49% .57%
Core II Secondaries Fund .48% .50% .59%
Fundamental Value Fund .75% .75% .82%
International Core Fund .69% .75% .84%
Currency Hedged
International Core Fund .69% .75% 1.01%
Foreign Fund .75% .75% .93%
International Small Companies Fund .75% 1.25% 1.54%
Japan Fund .69% .75% 1.05%
Emerging Markets Fund 1.20% 1.00% 1.58%
Global Hedged Equity Fund .65% .65% .84%
Domestic Bond Fund .25% .25% .29%
Short-Term Income Fund .20% .25% .44%
International Bond Fund .40% .40% .61%
Currency Hedged International
Bond Fund .40% .50% .62%
Global Bond Fund .34% .35% .64%
Emerging Country Debt Fund .50% .50% .71%
Core Emerging Country Debt Fund .45% .45% .90%
</TABLE>
4 Based on estimated amounts for the Fund's first complete fiscal year based
on actual expenses incurred through August 31, 1995.
5 May be reduced if it is not necessary to incur costs relating to the early
termination of hedging transactions to meet redemption requests.
6 Applies only to shares acquired on or after June 1, 1995 (including shares
acquired by reinvestment of dividends or other distributions on or after
such date).
7 Figure based on actual expenses for the fiscal year ended February 28, 1995
but restated to give effect to a change in the fee waiver and/or expense
limitation of the Fund, which change was effective as of June 27, 1995.
8 Applies only to shares acquired on or after July 1, 1995 (including shares
acquired by reinvestment of dividends or other distributions on or after
such date).
9 Restated to reflect higher expenses anticipated for the current fiscal year.
10 Based on expenses during the period ended February 28, 1995.
11 Figure based on actual expenses for the fiscal year ended February 28, 1995,
but restated to give effect to a change in the fee waiver and/or expense
limitation of the Fund, which change is effective as of the date of this
prospectus.
12 Based on estimated amounts for the Fund's first fiscal year.
13 Figure based on actual expenses for the fiscal year ended Feburary 28,1995,
but restated to give effect to a change in the fee waiver and/or expense
limitation of the Fund, which change was effective February 7, 1996.
Unless otherwise noted, Annual Fund Operating Expenses shown are actual
expenses for the year ended February 28, 1995. Where a purchase premium and/or
redemption fee is indicated as being charged by a Fund in certain instances, the
foregoing examples assume the payment of such purchase premium and/or redemption
fee even though such purchase premium and/or redemption fee is not applicable in
all cases. (See "Purchase of Shares" and "Redemption of Shares").
The purpose of the foregoing tables is to assist in understanding the
various costs and expenses of each Fund that are borne by holders of Fund
shares. THE FIVE PERCENT ANNUAL RETURN AND EXPENSE NUMBERS USED ARE NOT
REPRESENTATIONS OF FUTURE PERFORMANCE OR EXPENSES: SUBJECT TO THE MANAGER'S
UNDERTAKING TO WAIVE ITS FEE AND/OR BEAR CERTAIN EXPENSES FOR EACH FUND AS
DESCRIBED IN THE FOREGOING TABLES, ACTUAL PERFORMANCE AND/OR EXPENSES MAY BE
MORE OR LESS THAN SHOWN.
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