Vote-By-Phone Solicitation Script for
Putnam Federal Income Trust
This script provides information to the shareholder and solicits
their vote by phone, to be confirmed by written confirmation.
Good Morning/Afternoon/Evening. May I please speak with (name of
shareholder)? I am representing Putnam Investments in Boston.
To verify that I am speaking with the shareholder of record, may
I confirm that you are (name of shareholder or record) and that
your address of record is (address of record)?
(If the person is unwilling to confirm this information, thank
them for their time and terminate the call.)
We noted that you have not yet voted on the proposal to approve
an amendment to the Fund's Agreement and Declaration of Trust to
permit the issuance of additional classes of shares. Do you have
any questions regarding this proposal I can clarify for you?
(If there are questions, please refer to the Q & A attached.)
Would you like to vote by phone?
(If not, ask the shareholder if he would like another ballot,
thank them for their time and terminate the call. If so, proceed
as follows:)
We previously sent you a letter describing our procedures for
voting your proxy ballot by telephone.
I will now read the information on the proxy card so that you can
provide us with your voting instructions.
Putnam Federal Income Trust
Proxy for a meeting of shareholders, May 5, 1994.
Let me remind you that this meeting was adjourned to June 2, 1994
for the reasons set forth in the letter you recently received.
This proxy is solicited on behalf the Trustees of the Fund.
The shareholder hereby appoints George Putnam, Hans H. Estin and
William F. Pounds, and each of them separately, proxies, with
power of substitution, and hereby authorizes them to represent
and vote, as designated hereafter, at the adjourned meeting of
shareholders of Putnam Federal Income Trust, on June 2, 1994, at
11:00 a.m., Boston time, and at any adjournments thereof, all of
the shares of the Fund which the shareholder would be entitled to
vote if personally present.
This proxy when properly authorized will be voted in the manner
directed herein by the shareholder. In their discretion, the
proxies are authorized to vote upon such other matters as may
properly come before the meeting. The Trustees recommend a vote
FOR the following proposal:
Proposal: Approve an amendment to the Fund's Agreement and
Declaration of Trust to permit the issuance of additional classes
of shares.
How would you like to vote on this proposal?
For, Against or Abstain?
Thank you. Do you wish to send the entire message?
To repeat your instructions:
You voted (for/against/abstain). Is this correct?
Thank you. We will be sending you a written confirmation of your
vote. Please call us if the information on the confirmation is
incorrect.
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Putnam Investments Q & A on Multiple Classes of Shares
On March 1, a proxy statement was sent to shareholders of Putnam
Federal Income Trust. Among other issues, the proxies propose
approval of an amendment to the Fund's Agreement and Declaration
of Trust to permit the issuance of additional classes of shares.
The meeting was adjourned from May 5 to June 2 to solicit
additional proxies for the proposal. Listed below are common
questions and concerns of shareholders regarding this proposal,
followed by answers and information regarding each issue.
What is being proposed in the proxy solicitation?
The proxy materials sent to investors included a proposal to
allow the fund to issue additional classes of shares.
What are "classes of shares"?
In general, classes of shares give investors different ways to
pay sales charges. When investors purchase a fund through a
broker, they commonly pay a fee to the brokerage firm in return
for which investors are entitled to investment advice and other
services from the broker. This fee can be paid in a number of
ways. Most Putnam funds currently offer two classes of shares,
class A and B shares.
What are class A and B shares?
The shares you currently own are the equivalent of class A shares
and are generally subject to a sales charge at the time of
purchase. On class B shares, there is no initial sales charge;
rather, a sales charge is paid if shares are redeemed within a
specified time after purchase. This sales charge is often called
a contingent deferred sales charge. In addition, class B shares
have a higher distribution (12b-1) fee than class A shares. Of
course, whether investors purchase class A or B shares, they are
still buying the same professionally managed portfolio.
Do Putnam's other funds offer both class A and B shares?
All of Putnam's mutual funds currently offer class A shares, and
most Putnam funds offer class B shares. Class B shares have been
added to Putnam funds on a rolling basis in recent years.
I purchased my shares of Putnam Federal Income Trust with an
initial sales charge, i.e., class A shares. Will this proposal
affect my investment?
The creation of new classes of shares would not affect the Fund's
current shareholders. There would be no negative effect
whatsoever on the performance or the value of your holdings. If
the Fund began offering class B shares and you decided to
purchase new shares of the fund, you would have the opportunity
to purchase either class A or B shares.
What is the benefit to current shareholders of multiple classes
of shares?
Multiple classes of shares offer investors a greater range of
choices. This has the potential to increase the size of the
fund, which could help reduce per share operating expenses by
spreading expenses over a larger number of shares.
Do you expect to offer other classes of shares?
New pricing options are always under consideration, as a way to
give investors more ways to purchase fund shares. If new options
are introduced, again, they would not affect the value of the
shares that shareholders currently owned.
