STATE STREET RESEARCH EQUITY TRUST, DEFS14A, 1999-06-17

STATE STREET RESEARCH EQUITY TRUST
DEFS14A, 1999-06-17

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SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. __)

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12

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

State Street Research Equity Trust

(Name of Registrant as Specified In Its Charter)

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

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1) Title of each class of securities to which transaction applies:

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2) Aggregate number of securities to which transaction applies:

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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (Set forth the amount on which the
filing fee is calculated and state how it was determined):

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4) Proposed maximum aggregate value of transaction:
<PAGE>

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5) Total fee paid:

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[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

1) Amount Previously Paid:

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2) Form, Schedule or Registration Statement No.:

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3) Filing Party:

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4) Date Filed:

<PAGE>

[logo: State Street Research]

STATE STREET RESEARCH ARGO FUND
STATE STREET RESEARCH ALPHA FUND
STATE STREET RESEARCH GLOBAL RESOURCES FUND
STATE STREET RESEARCH ATHLETES FUND

Series of
State Street Research Equity Trust
One Financial Center
Boston, Massachusetts 02111

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

NOTICE OF SPECIAL MEETING
OF SHAREHOLDERS
To Be Held On September 14, 1999
--------------------------------------------

A Special Meeting of Shareholders ("Meeting") of State Street Research
Argo Fund (formerly, State Street Research Equity Investment Fund) ("Argo
Fund"), State Street Research Alpha Fund (formerly, State Street Research Equity
Income Fund) ("Alpha Fund"), State Street Research Global Resources Fund
("Global Resources Fund") and State Street Research Athletes Fund ("Athletes
Fund") (collectively the "Funds"), series of State Street Research Equity Trust,
a Massachusetts business trust ("Trust"), will be held at the offices of the
Trust, One Financial Center, 31st Floor, Boston, Massachusetts 02111, at 4:00
P.M. on September 14, 1999 for the following purposes:

1. (For all Funds) To elect Trustees of the Trust.

2. (For Argo Fund and Alpha Fund only) To amend fundamental policies
regarding diversification of investments.

3. (For Argo Fund, Alpha Fund and Global Resources Fund only) To amend
fundamental policies regarding industry concentration.

4. (For Alpha Fund only) To revise the Alpha Fund's investment objective
to provide for long-term growth of capital.

5. (For Argo Fund only) To revise the Argo Fund's investment objective to
provide for long-term growth of capital and, secondarily, growth of income.

6. (For Global Resources Fund and Athletes Fund only) To amend fundamental
policies regarding diversification of investments.

7. (For Argo Fund and Alpha Fund only) To amend the fundamental policy
regarding participation in underwritings.

<PAGE>

8. To consider and act upon any matter incidental to the foregoing and to
transact such other business as may properly come before the Meeting and any
adjournments thereof.

The matters referred to above may be acted upon at said Meeting and any
adjournments thereof.

The close of business on May 25, 1999 has been fixed as the record date
for the determination of shareholders entitled to notice of, and to vote at,
the Meeting and any adjournments thereof.

IT IS VERY IMPORTANT THAT YOUR VOTING INSTRUCTIONS BE RECEIVED NO LATER
THAN SEPTEMBER 10, 1999. Instructions for shares held of record in the name of
a nominee, such as a broker-dealer or trustee of an employee benefit plan, may
be subject to cut-off dates for receipt of such instructions established by
such intermediaries to facilitate a timely response.

YOUR VOTE IS IMPORTANT REGARDLESS OF THE SIZE OF YOUR HOLDINGS IN A FUND.
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE COMPLETE AND
SIGN THE ENCLOSED PROXY FORM AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
CERTAIN SHAREHOLDERS MAY ALSO VOTE BY TELEPHONE; PLEASE SEE PAGES 3 AND 4 FOR
DETAILS. IF YOU DESIRE TO VOTE IN PERSON AT THE MEETING, YOU MAY REVOKE YOUR
PROXY.

By Order of the Trustees
FRANCIS J. McNAMARA, III
Secretary

May 26, 1999
Date of Notice
<PAGE>

QUESTIONS AND ANSWERS

Q: Why is this material being sent to shareholders?

A: Shareholders of the Funds are being asked to vote on several proposals,
including the election of Trustees and changes which would give the Funds
more flexibility in making investments. These investment policy proposals
provide the Funds with flexibility to respond to industry developments and to
changing market conditions. The Trustees recommend that you vote FOR all the
proposals.

Q: What is a shareholder supposed to do with this material?

A: You should read the material and then vote. Certain shareholders may vote by
telephone; please see pages 3 and 4 for details. Or, you may vote by
marking the enclosed Proxy form and returning it.

Q: What if I have questions?

A: Call the State Street Research Service Center at 1-800-562-0032 for help with
your questions.

Q: (For all Funds) What is Proposal 1 relating to the election of Trustees?

A: Those current Trustees who have not been previously elected by shareholders,
plus one new nominee, are being presented for election. Background
information on all of the Trustees is included in the material.

Q: (Proposal 2 for Argo Fund and Alpha Fund; Proposal 6 for Global Resources
Fund and Athletes Fund) What are Proposal 2 and Proposal 6 on diversification
of investments?

A. Under current policies, each Fund is limited as to how much it can invest in
one company, including any one mutual fund. The change would give the Funds
more flexibility to invest more in individual companies, including other
mutual funds.

Q: (For Argo Fund, Alpha Fund and Global Resources Fund only) Under Proposal 3,
what is the change on industry concentration?

A: Under current policy, a Fund may not make an investment which would cause it
to have more than 25% of its assets invested in companies in any one
industry. The proposed change would recognize that the way an industry is
defined can vary over time and acknowledges that a Fund may want to redefine
industries as businesses evolve.

Q: (For Alpha Fund only) Under Proposal 4, what is the change in the Alpha
Fund's investment objective?

A: New classifications for all diversified stock mutual funds have been proposed
by Lipper Analytical Services, Inc., a major mutual fund statistical
organization that
<PAGE>

generates peer group rankings that are an industry standard for examining
performance. Under the new system, funds will be classified more finely
based on investment style, and Lipper is expected to classify the Alpha
Fund as a "mid-cap value" fund. The change in investment objective will
enable the Fund to be managed in a way that is competitive with its peers
in the new category.

Q: (For Argo Fund only) Under Proposal 5, what is the change in the Argo Fund's
investment objective?

A: New classifications for all diversified stock mutual funds have been proposed
by Lipper Analytical Services, Inc., a major mutual fund statistical
organization that generates peer group rankings that are an industry standard
for examining performance. Under the new system, funds will be classified
more finely based on investment style, and the Investment Manager believes
that the Argo Fund should be in the new "large-cap value" category. The
change in investment objective will better enable the Fund be managed in a
way that is competitive with its peers in the new category.

Q: (For Argo Fund and Alpha Fund only) What is Proposal 7 on underwritings?

A: An underwriting occurs when shares of stock of a company are sold in a public
distribution, e.g., a company "goes public." The change would make clear that
the Fund is allowed to sell its own holdings of a company as part of any new
public offering the company may make, but that the Fund would not actively
help a company make a public distribution.

- --------------------------------------------------------------------------------
Important additional information about the proposals is set forth in the
accompanying Proxy Statement. Please read it carefully.
- --------------------------------------------------------------------------------
<PAGE>

STATE STREET RESEARCH ARGO FUND
STATE STREET RESEARCH ALPHA FUND
STATE STREET RESEARCH GLOBAL RESOURCES FUND
STATE STREET RESEARCH ATHLETES FUND

Series of
State Street Research Equity Trust
One Financial Center
Boston, Massachusetts 02111

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

PROXY STATEMENT

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

The following table identifies each proposal set forth in the Notice of
Special Meeting of Shareholders and the checkmark ([checkmark]) indicates which
Fund's shareholders and classes are being solicited to approve which proposal.

<TABLE>
<CAPTION>
Global
Resources Athletes
Argo Fund, Alpha Fund, Fund, Fund,
Proposal all classes all classes all classes all classes
- ----------------------------------- ------------- ------------- ------------- ------------
<S> <C> <C> <C> <C>
1. Trustees [checkmark] [checkmark] [checkmark] [checkmark]
2. Diversification of investments [checkmark] [checkmark]
3. Industry concentration [checkmark] [checkmark] [checkmark]
4. Investment objective [checkmark]
5. Investment objective [checkmark]
6. Diversification of investments [checkmark] [checkmark]
7. Underwriting [checkmark] [checkmark]
</TABLE>

This Proxy Statement is furnished to the shareholders of State Street
Research Equity Trust ("Trust"), in connection with the solicitation of proxies
by and on behalf of the Trust's Board of Trustees to be used at a Special
Meeting of Shareholders ("Meeting"), to be held at the offices of the Trust,
One Financial Center, 31st Floor, Boston, Massachusetts 02111, at 4 P.M., on
September 14, 1999, and at any adjournments thereof.

Shareholders of record of the Trust at the close of business on May 25,
1999 (the "Record Date") are entitled to notice of, and to vote at, the Meeting
or any adjournments thereof. This Proxy Statement, Proxy form and accompanying
Notice of Special Meeting of Shareholders were first sent or given to
shareholders on or about June 14, 1999. The Trust is presently comprised of
four separate portfolio series: State Street Research Argo Fund (formerly, State
Street Research Equity Investment Fund) ("Argo Fund"), State Street Research
Alpha Fund (formerly, State Street Research Equity Income Fund) ("Alpha Fund"),
State Street Research Global Resources Fund ("Global Resources Fund") and State
Street Research Athletes Fund ("Athletes Fund") (collectively, the "Funds").

<PAGE>

The chart below reflects the total number of shares issued and outstanding
for the Funds as of the Record Date. Each share is entitled to one vote with a
proportionate vote for each fractional share.

<TABLE>

<CAPTION>
Fund Class A Class B Class B(1) Class C Class S Total
---- ------- ------- ---------- ------- ------- -----
<S> <C> <C> <C> <C> <C> <C>
Argo Fund 3,606,557 2,886,507 165,304 89,979 3,193,942 9,942,289
Alpha Fund 7,277,782 9,153,931 365,079 1,562,188 2,783,256 21,142,236
Global Resources Fund 5,578,006 5,038,219 411,222 2,294,324 464,454 13,786,226
Athletes Fund 242,361 81,507 66,549 71,441 1,512,180 1,974,038
</TABLE>

Although each Fund is participating separately in the Meeting, proxies are
being solicited through use of this combined Proxy Statement. With respect to
proposal 1 regarding the election of Trustees of the Trust, shareholders of
each Fund will vote together with each other Fund that is a series of the
Trust. All shares of a Fund, regardless of class designation, are entitled to
vote and will vote together on proposal 1.

If the enclosed Proxy is properly executed and returned, or telephone
votes are received, in time, the shares represented thereby will be voted at
the Meeting in accordance with the shareholder's instructions. The Proxy grants
discretion to the persons named therein, as proxies, to take such further
action as they may determine appropriate in connection with any other matter
which may properly come before the Meeting or any adjournments thereof. The
Board of Trustees does not currently know of any matter to be considered at the
Meeting other than the matters set forth in the Notice of Special Meeting of
Shareholders.

A majority of shares entitled to vote constitutes a quorum for the
transaction of business at the Meeting. In the event a quorum is not present at
the Meeting, or in the event a quorum is present at the Meeting but sufficient
votes to approve any of the proposals are not received, the persons named as
proxies may propose one or more adjournments of such Meeting without further
notice to permit further solicitation of Proxies, provided such persons
determine that an adjournment and additional solicitation are reasonable and in
the interest of shareholders, after consideration of all relevant factors,
including the nature of the relevant proposals, the percentage of votes then
cast, the percentage of negative votes then cast and the nature of the proposed
solicitation activities. A shareholder vote may be taken on one or more of the
proposals in this Proxy Statement prior to such adjournment if sufficient votes
have been received and such vote is otherwise appropriate. Any such adjournment
will require the affirmative vote of a majority of those shares present at the
Meeting in person or by proxy.

For purposes of determining the presence of a quorum for transacting
business at the Meeting and for determining whether sufficient votes have been
received for approval of any proposal to be acted upon at the Meeting,
abstentions and broker "non-votes" may in the discretion of the Trust be
treated as present at the Meeting and entitled to vote on the matter, but which
have not been voted. Broker non-votes

2
<PAGE>

are proxies from brokers or nominees indicating that such persons have not
received instructions from the beneficial owner or other persons entitled to
vote shares on a particular matter with respect to which the brokers or
nominees do not have, or choose not to exercise, discretionary power. For this
reason, abstentions and broker non-votes could assist the Trust in obtaining a
quorum; both have the practical effect of a "no" vote for purposes of obtaining
the requisite vote for approval of proposals 2 through 7 to be acted upon at
the Meeting, but will have no effect on the determination of plurality votes in
connection with proposal 1 regarding the election of Trustees.

A shareholder may vote:

o By telephone

-Through fully automated touch-tone voting

-Verbally, with a telephone representative

o By mail

o In person at the Meeting

There are two convenient methods to vote by using the telephone. (Please
note, however, that these two telephone methods of voting are not available to
shareholders whose shares are held by a broker or other intermediary on the
shareholder's behalf.) If telephone voting is available for a shareholder's
account, toll-free telephone numbers will be printed on the Proxy form. Prior
to calling, the shareholder should read the Proxy Statement and have his or her
Proxy form at hand.

First, a shareholder may use the automated touch-tone voting method by
calling the toll-free number for that method provided on the Proxy form. At the
prompt, the shareholder enters the control number provided on the Proxy form,
then follows the menu.

Second, a separate toll-free number is provided on the Proxy form for
shareholders who wish to speak to a telephone representative directly and give
verbal instructions. The telephone representative will assist the shareholder
with the voting process. Although a telephone representative will assist with
any questions, the answers to which are contained in the Proxy Statement, the
representative will not make recommendations on how to vote on any proposal.

A written confirmation of the shareholder's telephone instructions will be
mailed within 72 hours. The shareholder should immediately call 1-877-392-4944
toll-free between 9 A.M. and 6 P.M. Monday through Friday Boston time if no
confirmation is received or if the shareholder's instructions have not been
properly reflected.

Shareholders voting their Proxies by either telephone method should not
return their Proxy forms by mail.

By using the telephone to submit voting instructions, the shareholder is
authorizing First Data Investor Services Group, Inc. ("FDISG"), a proxy
solicitation firm,

3
<PAGE>

and its agents, to execute a proxy to vote the shareholder's shares at the
Meeting as the shareholder has indicated. Questions about the proposals
themselves should be directed to the State Street Research Service Center at
1-800-562-0032.

If a shareholder wishes to participate in the Meeting, but does not wish
to authorize the execution of a Proxy by telephone, the shareholder may still
mail the Proxy form included with this Proxy Statement or attend the Meeting in
person.

Any shareholder who has given a Proxy, by telephone or in written form,
has the right to revoke it at any time prior to its exercise by submitting a
subsequent telephone vote, or a written notice of revocation or a later-dated
Proxy, or by attending the Meeting and voting his or her shares in person.

The Trust believes that the procedures for authorizing the execution of a
Proxy by telephone set forth above are reasonably designed to ensure that the
identity of the shareholder casting the vote is accurately determined and that
the voting instructions of the shareholder are accurately recorded. Telephone
calls will be recorded.

In some cases, proxy solicitation materials may be included in one package
for more than one account with the same tax I.D. number and address of record.

Representatives of the State Street Research Service Center and other
representatives of the Trust, such as FDISG, may also solicit Proxies by
contacting shareholders by telephone or in person.

The Trust intends to use FDISG, and its agents, to assist with the mailing
and tabulation effort and any special, personal solicitation of Proxies. The
costs of retaining FDISG and its agents to perform such services, which are not
expected to exceed $25,000 per Fund, will be borne by the relevant Fund, in
addition to out-of-pocket expenditures for postage, printing and related items.
Each Fund will reimburse brokerage firms and others for their expenses in
forwarding solicitation material to the beneficial owners of shares of a Fund.

Upon request by a shareholder of a Fund to State Street Research Service
Center, One Financial Center, Boston, Massachusetts 02111 at 1-800-562-0032,
the annual report and most recent semiannual report succeeding the annual
report, if any, for the Fund will be furnished without charge to the requesting
shareholder.

State Street Research & Management Company (the "Investment Manager")
serves as investment manager of the Funds and State Street Research Investment
Services, Inc. (the "Distributor") serves as distributor of the Funds. The
Investment Manager and the Distributor are located at One Financial Center,
Boston, Massachusetts 02111 and are indirect, wholly-owned subsidiaries of
Metropolitan Life Insurance Company ("Metropolitan"). Metropolitan and its
affiliates have indicated that with respect to shares of a Fund for which they
have voting authority, they intend to vote

4
<PAGE>

for and against each proposal in the same relative proportion as do the other
shareholders of the Fund who cast votes at the Meeting, except as otherwise
indicated.

Listed below are the persons or entities that were the beneficial owners
of 5% or more of the shares of each Fund, where applicable, as of March 31,
1999.

<TABLE>
<CAPTION>
Name and Address of Amount and Nature of % of
Name of Fund Beneficial Owner Beneficial Ownership Fund
- ------------ ------------------- -------------------- ----
<S> <C> <C> <C>
Athletes Fund F. Gardner Jackson, Jr. 125,693 shares 6.5
c/o State Street Research Service Center
One Financial Center
Boston, Massachusetts 02111
Athletes Fund Metropolitan Life Insurance Company 714,714 shares 36.8
One Madison Avenue
New York, New York 10010
Athletes Fund Turtle & Co.(1) 1,046,231 shares 53.9
c/o State Street Research Service
Center
One Financial Center
Boston, Massachusetts 02111
</TABLE>

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

(1) Turtle & Co. is a nominee name for shares held in private advisory accounts
managed by the Investment Manager. The Investment Manager has indicated
that it plans to vote the Turtle & Co. shares in favor of all proposals.

PROPOSAL 1
ELECTION OF TRUSTEES
(FOR ALL FUNDS)

The shareholders of the Trust are being asked to elect the persons named
below to serve as Trustees of the Trust. All shares represented by valid proxies
will be voted in favor of the election of the nominees, unless authority to vote
therefor is withheld. The nominees named have agreed to serve as Trustees if
elected. If for any reason any of the nominees should not be available for
election as contemplated, the proxies hereby solicited may, unless otherwise
limited, be voted to elect such substitute nomi nees, if any, as may be
designated by the Board of Trustees of the Trust, subject to the applicable
provisions of the Investment Company Act of 1940, as amended (the "1940 Act").
Some of the nominees currently serve as Trustees and are being presented for
shareholder election for the first time. The other current Trustees were
previously elected by the shareholders and are not being voted upon at this
Meeting. This election will help assure continued compliance with 1940 Act
provisions regarding the election of Trustees. Background information on all of
the Trustees has been provided.

5
<PAGE>

<TABLE>
<CAPTION>
Shares of Fund
Deemed Beneficially Owned on
March 31, 1999
Number of Shares / % of Class
-----------------------------
Class A
----------------------------------------------------
Nominee Standing Year First Global
for Election by Position Became Argo Alpha Resources Athletes
Shareholders with Trust Trustee Fund Fund Fund Fund
------------ ---------- ------- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Bruce R. Bond ................... Trustee 1999
Steve A. Garban ................. Trustee 1997
Malcolm T. Hopkins .............. Trustee 1997 1,584/(2)
Susan M. Phillips ............... None(1) --
Previously Elected by
Shareholders and Not
Standing for Election
---------------------
Dean O. Morton .................. Trustee 1986 7,111/(2)
Toby Rosenblatt ................. Trustee 1993
Michael S. Scott Morton ......... Trustee 1987 47,460/(2) 55/(2)
*Ralph F. Verni ................. Trustee, 1992 35,932/(2)
Chairman of the
Board, Chief
Executive Officer
and President

Trustees and Principal Officers of the Trust as a Group ....... 15,277/(2) 91,089/1.2 11,534/(2) 125,693/53.5
</TABLE>
- -----------------

* Individual who is deemed to be an "interested person" of the Trust under
the 1940 Act because of his affiliation with the Funds' investment manager.

(1) Dr. Phillips currently serves as a Trustee of nine other investment
companies in the State Street Research complex of mutual funds. Dr.
Phillips is being nominated for the first time to serve as a Trustee of the
Trust.

(2) Less than 1%.

Information on all the nominees and current Trustees, in alphabetical
order, is set forth below.

Bruce R. Bond is Chairman of the Board, Chief Executive Officer and
President of PictureTel Corporation. He is 53. Mr. Bond's other principal
business affiliations include Director of WITCO Corporation (a specialty
chemical company) and Ceridian Corporation (an information services company).
During the past five years, he has also served as Chief Executive Officer of
ANS Communications (a communications networking company) and as managing
director of British Telecommunications PLC. Mr. Bond is also a Trustee of nine
other investment companies for which the Investment Manager serves as
investment adviser.

Steve A. Garban is retired and was formerly Senior Vice President, Finance
and Operations and Treasurer, The Pennsylvania State University. He is 61. Mr.
Garban's other principal business affiliations include Director of Metropolitan
Series Fund, Inc. (an investment company). Mr. Garban is also a Trustee or
Director of 10 investment companies for which the Investment Manager serves as
investment adviser.

6
<PAGE>

Malcolm T. Hopkins is engaged primarily in private investments.
Previously, he was Vice Chairman of the Board and Chief Financial Officer, St.
Regis Corp. (a forest and paper products company). He is 71. Mr. Hopkins's
other principal business affiliations include Director of Metropolitan Series
Fund, Inc. (an investment company), Columbia Energy Group (an integrated
natural gas company) and U.S. Home Corporation (a single-family home builder).
Mr. Hopkins is also a Trustee or Director of 10 investment companies for which
the Investment Manager serves as investment adviser.

Dean O. Morton is retired and was formerly Executive Vice President, Chief
Operating Officer and Director, Hewlett-Packard Company. He is 67. Mr. Morton's
other principal business affiliations include Director of Metropolitan Series
Fund, Inc. (an investment company), Alza Corp. (a therapeutic systems
developer), Raychem Corp. (a materials science company), The Clorox Company (a
consumer products company), KLA-Tencor Corporation (a scientific instruments
company), BEA Systems, Inc. (a software company) and Centigram Communications
Corporation (a communications equipment company). Mr. Morton is also a Trustee
or Director of 10 investment companies for which the Investment Manager serves
as investment adviser.

Susan M. Phillips is Dean of the School of Business and Public Management
at George Washington University and Professor of Finance. She is 54. Dr.
Phillips's other principal business affiliations include Director of Cantor
Fitzgerald Futures Exchange, Inc. and State Farm Life Insurance Company.
Previously, Dr. Phillips was a member of the Board of Governors of the Federal
Reserve System and Chairman and Commissioner of the Commodity Futures Trading
Commission. Dr. Phillips is a Trustee of nine investment companies for which
the Investment Manager serves as investment adviser.

Toby Rosenblatt is President of The Glen Ellen Company, a private
investment company, and Vice President of Founders Investments Ltd. He is 60.
Mr. Rosenblatt's other principal business affiliations include Director of
Advanced Polymer Systems, Inc. (a specialty chemicals, drugs and cosmetics
company) and Pherin Corporation (proprietary compounds for human health). Mr.
Rosenblatt is also a Trustee or Director of 10 investment companies for which
the Investment Manager serves as investment adviser.

Michael S. Scott Morton is Jay W. Forrester Professor of Management at
Sloan School of Management, Massachusetts Institute of Technology. He is 61.
Dr. Scott Morton's other principal business affiliations include Director of
Metropolitan Series Fund, Inc. (an investment company), Merrill Corporation (a
document management company) and Sequent Computer Systems, Inc. (a computer
manufacturer). Dr. Scott Morton is also a Trustee or Director of 10 investment
companies for which the Investment Manager serves as investment adviser.

Ralph F. Verni's principal occupation is Chairman of the Board, President,
Chief Executive Officer and Director of the Investment Manager. He is 56. Mr.
Verni's other

7
<PAGE>

principal business affiliations include Chairman of the Board and Director of
State Street Research Investment Services, Inc., member of the Advisory Board
of Commonwealth Capital Ventures, L.P.; Chairman of the Board and Director of
SSR Realty Advisors, Inc.; and President, Chief Executive Officer and Director
of SSRM Holdings, Inc. Mr. Verni is also a Trustee or Director of 10 investment
companies for which the Investment Manager serves as investment adviser.

A candidate elected as a Trustee will serve as such until any successor is
elected and qualified. A Trustee serves until he retires, resigns or is removed
as provided in the Master Trust Agreement, as amended ("Master Trust Agreement")
of the Trust. The Trust is not required to hold regularly scheduled annual
meetings for the election of Trustees. (See "No Annual Meetings of
Shareholders," below.)

The following persons are principal officers, but not Trustees, of the
Trust:

Peter C. Bennett has served as Vice President of the Trust since 1990. He
is 60. His principal occupation is currently, and during the past five years
has been, Executive Vice President of the Investment Manager. Mr. Bennett is
also a Director and Chief Investment Officer-Equity of the Investment Manager.
Mr. Bennett's other principal business affiliations include Director, State
Street Research Investment Services, Inc.

Bartlett R. Geer has served as Vice President of the Trust since 1992. He
is 43. His principal occupation is currently, and during the past five years
has been, Senior Vice President of the Investment Manager.

F. Gardner Jackson, Jr. has served as Vice President of the Trust since
1998. He is 56. His principal occupation is currently, and during the past five
years has been, Senior Vice President of the Investment Manager.

Gerard P. Maus has served as Treasurer of the Trust since 1993. He is 48.
His principal occupation is Executive Vice President, Treasurer, Chief
Financial Officer, Chief Administrative Officer, and Director of the Investment
Manager. Mr. Maus's other principal business affiliations include Executive
Vice President, Chief Financial Officer, Chief Administrative Officer,
Treasurer and Director of State Street Research Investment Services, Inc.;
Treasurer and Chief Financial Officer of SSRM Holdings, Inc.; and Director of
SSR Realty Advisors, Inc.

Francis J. McNamara, III has served as Secretary and General Counsel of
the Trust since 1995. He is 43. His principal occupation is Executive Vice
President, General Counsel and Secretary of the Investment Manager. During the
past five years he has also served as Senior Vice President of the Investment
Manager and as Senior Vice President and General Counsel of The Boston Company
Inc., Boston Safe Deposit and Trust Company and The Boston Company Advisors,
Inc. Mr. McNamara's other principal business affiliations include Executive
Vice President, General

8
<PAGE>

Counsel and Clerk of State Street Research Investment Services, Inc.; and
Secretary and General Counsel of SSRM Holdings, Inc.

Thomas P. Moore, Jr. has served as Vice President of the Trust since 1994.
He is 60. His principal occupation is currently, and during the past five years
has been, Senior Vice President of the Investment Manager.

Brian O'Dell has served as Vice President of the Trust since 1998. He is
33. His principal occupation is Assistant Portfolio Manager for the Investment
Manager. During the past five years he has also served as a portfolio manager
and analyst at Freedom Capital Management Corporation.

Daniel J. Rice III has served as Vice President of the Trust since 1990.
He is 47. His principal occupation is currently, and during the past five years
has been, Senior Vice President of the Investment Manager.

James M. Weiss has served as Vice President of the Trust since 1996. He is
52. His principal occupation is Executive Vice President of the Investment
Manager. During the past five years he has also served as Senior Vice President
of the Investment Manager and as President and Chief Investment Officer of IDS
Equity Advisors.

John T. Wilson has served as Vice President of the Trust since 1996. He is
35. His principal occupation is Senior Vice President of the Investment
Manager. During the past five years he has also served as a Vice President of
the Investment Manager, as an analyst and portfolio manager at Phoenix Home
Life Mutual Insurance Company and as a Vice President of Phoenix Investment
Counsel Inc.

Peter A. Zuger has served as Vice President of the Trust since 1998. He is
50. His principal occupation is Senior Vice President of the Investment
Manager. During the past five years he has also served as vice president of
American Century Investment Management Company.

These officers are deemed to be "interested persons" of the Fund under the
1940 Act inasmuch as they are affiliated with the Investment Manager as noted.

Board Meetings and Committees

During the most recently completed fiscal year of the Trust, the Board of
Trustees held a total of four meetings.

The Audit Committee of the Board of Trustees held two meetings during the
most recently completed fiscal year. The present members of the Audit Committee
are Messrs. Garban, Morton and Scott Morton. The duties of this Committee
include meeting with representatives of the Trust's independent public
accountants both to review the range of the accountants' activities and to
discuss the Trust's system of internal controls. Thereafter, the Committee
reports to the Board on the Committee's

9
<PAGE>

findings and recommendations concerning internal accounting matters as well as
its recommendation for retention or dismissal of the auditing firm.

The Governance Committee of the Board of Trustees held four meetings in
1998. The present members of the Governance Committee of the Board of Trustees
are Messrs. Garban, Morton, Rosenblatt and Scott Morton. The duties of this
Committee include consideration of recommendations on nominations for Trustees,
review of the composition of the Board, and recommendations respecting
attendance, frequency of meetings, compensation and similar matters. The
Governance Committee will consider nominees recommended by shareholders;
shareholders may submit recommendations to the attention of the Secretary of
the Trust, One Financial Center, 30th Floor, Boston, Massachusetts 02111.

Remuneration of Principal Officers and Trustees

The executive officers of the Trust and those of its Trustees who are
officers of the Investment Manager receive no direct remuneration from the
Trust. Such executive officers and Trustees receive remuneration from the
Investment Manager. Trustees who are not officers of the Investment Manager are
compensated for attendance at each meeting of the Board of Trustees and
committees of the Board and reimbursed for reasonable expenses incurred in
connection therewith, and are paid an annual retainer.

The current Trustees have been compensated as follows:

<TABLE>
<CAPTION>
Total Compensation
Total from All
Compensation Street Research
from All Funds and
State Street Metropolitan
Research Series Fund, Inc.
Aggregate Compensation Funds Paid to Paid to
from the Funds (1) Trustees (2) Trustees (3)
------------------ ------------ ------------
Global
Argo Alpha Resources Athletes
Name of Current Trustee Fund Fund Fund Fund
- ----------------------- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Bruce R. Bond -- -- -- -- -- --
Steve A. Garban $4,200 $4,200 $4,200 $475 $81,300 $110,300
Malcolm T. Hopkins $4,000 $4,000 $4,000 $375 $69,700 $ 97,200
Dean O. Morton $4,400 $4,400 $4,400 $375 $84,700 $110,700
Toby Rosenblatt $4,200 $4,200 $4,200 $475 $72,600 $ 72,600
Michael S. Scott Morton $4,600 $4,600 $4,600 $575 $89,500 $115,500
*Ralph F. Verni $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
</TABLE>

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

* Individual who is deemed to be an "interested person" of the Trust under the
1940 Act because of his affiliation with the Fund's investment manager.

(1) For each Fund's fiscal year ended June 30, 1998.

(2) Includes compensation on behalf of all series of 11 investment companies
for which the Investment Manager serves as sole investment adviser. The
figure in this column is for the 12 months ended December 31, 1998. The
Trust does not provide any pension or retirement benefits for the Trustees.

10
<PAGE>

(3) Includes compensation on behalf of all series of 11 investment companies
for which the Investment Manager serves as sole investment adviser and all
series of Metropolitan Series Fund, Inc. The primary adviser to
Metropolitan Series Fund, Inc. is Metropolitan Life Insurance Company,
which has retained State Street Research & Management Company as
sub-adviser to certain series of Metropolitan Series Fund, Inc. The figure
in this column includes compensation relating to series of Metropolitan
Series Fund, Inc. which are not advised by State Street Research &
Management Company. The figure is for the 12 months ended December 31, 1998.

Required Vote

A plurality of the aggregate number of shares of the Trust cast in person
or by proxy at the Meeting, provided a quorum is represented, is required for
the election of a Trustee.

PROPOSAL 2
(FOR ARGO FUND AND ALPHA FUND ONLY)
TO AMEND EACH FUND'S FUNDAMENTAL POLICIES REGARDING
DIVERSIFICATION OF INVESTMENTS

Changes in investment policies are being proposed in order to provide
greater flexibility in managing the investments of the Argo Fund and the Alpha
Fund. At present, there are limitations on the amount a Fund may invest in any
one issuer. The proposed policy revisions would change those limitations and
enable a Fund to take better advantage of opportunities to invest more in
certain issuers.

Under the current policies, a Fund may not invest more than 5% of its
total assets in any one issuer ("5% issuer test"). In addition, a Fund may not
invest in an issuer if the investment would result in a Fund owning more than
10% of the outstanding voting securities of an issuer ("10% securities test").
The major difference between the current policies and proposed policies is that
under the proposed policies, the two tests would only apply to 75% of a Fund's
assets. As a result, a Fund would have the investment flexibility to exceed the
5% issuer test and the 10% securities test as to the remaining 25% of its
assets.

The added flexibility to invest more in one issuer would enable the Fund
to take advantage of potential investment opportunities where, for example, the
particular issuer appears to be very attractive because of its investment
potential, its high creditworthiness, or any other compelling financial
reasons. In addition, where a relatively low supply of other comparable issuers
exists, the Fund could be interested in investing more in the limited number of
issuers available. In short, circumstances can arise where the best interests
of shareholders can be served by investing more in certain companies.

Under the current policies, securities issued by the U.S. Government, its
agencies or instrumentalities are not included in the percentage limitations.
The change

11
<PAGE>

would also make clear that other U.S. Government securities, as defined under
the 1940 Act and as interpreted by the Securities and Exchange Commission
("SEC"), are also excludable.

Under the proposed policies, shares of other investment companies will
also be excluded from the percentage limitations. The 1940 Act has provisions
governing the amount of assets that one mutual fund may invest in another
mutual fund. The proposed policy revisions would enable a Fund to utilize the
flexibility made available under SEC interpretations and the recent amendment
to the 1940 Act that enable a fund to invest more of its assets than previously
allowed in unaffiliated and affiliated funds. Rather than invest directly in,
for example, a number of small capitalization growth stocks, a Fund could
invest in one or more funds that focus on such stocks. By investing in another
fund with a large portfolio in a given sector, a Fund could obtain greater
diversification than by investing in a few stocks directly.

The current and proposed fundamental policies regarding diversification of
investments for each Fund read as follows:

Current policies:

Both Funds currently have the same diversification policies, which are as
follows:

"not to invest in a security if the transaction would result in more than
5% of the Fund's total assets being invested in any one issuer, except that
the restriction does not apply to investments in securities issued or
guaranteed by the U.S. Government or its agencies or instrumentalities; and

"not to invest in a security if the transaction would result in the Fund
owning more than 10% of the outstanding voting securities of an issuer,
except that this restriction does not apply to investments in securities
issued or guaranteed by the U.S. Government or its agencies or
instrumentalities."

Proposed policies:

The new policy would read as follows:

"not to purchase a security of any one issuer (other than securities of
other investment companies, and U.S. Government securities as defined under
the Investment Company Act of 1940, as amended, and as interpreted from
time to time by the Securities and Exchange Commission) if such purchase
would, with respect to 75% of the Fund's total assets, cause more than 5%
of the Fund's total assets to be invested in the securities of such issuer
or cause more than 10% of the outstanding voting securities of such issuer
to be held by the Fund."

The Trustees believe that the proposed policy revisions are in the best
interests of each Fund. The Trustees, including the Trustees who are not
interested persons,

12
<PAGE>

recommend a vote FOR approval of this proposal. If the proposal is not approved
by the shareholders of a given Fund, that Fund's present investment policies
will remain in effect.

PROPOSAL 3
(FOR ARGO FUND, ALPHA FUND AND GLOBAL RESOURCES FUND ONLY)
TO AMEND EACH FUND'S FUNDAMENTAL POLICY
REGARDING INDUSTRY CONCENTRATION

Each Fund has a policy that limits the amount that can be invested in
companies in any one industry. This proposal would revise the policy to make
clear that the definition of a given industry can change over time as business
developments occur.

The current policy contains specific examples of how a few industries will
be defined, and can be misconstrued as inferring that no other kinds of
distinctions will be made for other industries. Each Fund in fact has always
reserved the right to define industries as appropriate over time on the basis
of evolutionary changes in the overall economy and in specific businesses. For
example, the burgeoning growth and changes in what was formerly lumped together
as the electronic industry is now considered by the Funds to involve separate
industries for electronic components and electronic equipment. The proposed
change in the Fund's policy would make clear that each Fund will define and
redefine industries over time as economic and market conditions evolve. In
addition, under the Global Resources Fund's current policy, the limitation does
not apply to any energy industry. The proposed change would also exclude any
natural resource industry from the limitation.

The current and proposed fundamental policies regarding industry
concentration for each Fund read as follows:

Argo Fund and Alpha Fund

Current policies:

Each Fund's current policy is:

"not to make any investment which would cause more than 25% of the value of
the Fund's total assets to be invested in securities of issuers principally
engaged in any one industry (for purposes of this restriction, (a)
utilities will be divided according to their services so that, for example,
gas, gas transmission, electric and telephone companies will each be deemed
in a separate industry, (b) oil and oil related companies will be divided
by type so that, for example, oil production companies, oil service
companies and refining and marketing companies will each be deemed in a
separate industry and (c) securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities shall be excluded)."

13
<PAGE>

Proposed policies:

The new policies would read as follows:

"not to make any investment which would cause more than 25% of the value of
the Fund's total assets to be invested in the securities of issuers
principally engaged in any one industry, as described in the Fund's
Prospectus or Statement of Additional Information, as amended from time to
time."

Global Resources Fund

Current policy:

The Fund's policy is:

"not to make any investment which would cause more than 25% of the value of
the Fund's total assets to be invested in securities of issuers principally
engaged in any one industry other than any energy industry [for purposes of
this restriction, (a) energy and nonenergy industries will be divided
according to their services, so that, for example, in the case of (i)
utilities, gas, gas transmission, electric and telephone companies each
will be deemed to be in a separate industry, and (ii) oil and oil related
companies will be divided by types, with oil production companies, oil
service companies and marketing companies each deemed to be in a separate
industry, (b) finance companies will be classified according to the
industries of their parent companies and (c) securities issued or
guaranteed by the U.S. Government, or its agencies or instrumentalities
(including repurchase agreements involving such U.S. Government securities
to the extent excludable under relevant regulatory interpretations) shall
be excluded]."

Proposed policy:

The new policy would read as follows:

"not to make any investment which would cause more than 25% of the value of
the Fund's total assets to be invested in securities of issuers principally
engaged in any one industry, other than any energy or natural resource
industry, as described in the Fund's Prospectus or Statement of Additional
Information, as amended from time to time."

The Trustees believe that the proposed policy revisions are in the best
interests of each Fund. The Trustees, including the Trustees who are not
interested persons, recommend a vote FOR approval of this proposal. If the
proposal is not approved by the shareholders of a given Fund, that Fund's
present investment policy will remain in effect.

14
<PAGE>

PROPOSAL 4
(FOR ALPHA FUND ONLY)

TO CHANGE THE FUND'S INVESTMENT OBJECTIVE

A revision in the Alpha Fund's investment objective is being proposed in
order to provide flexibility in managing the Fund in light of changes in the
mutual fund industry and the needs of investors. Increasingly today, investors
are interested in identifying funds on the basis of the fund's investment
style, such as large-cap growth, mid-cap value, or similar descriptions. With a
clearer understanding of the investment style of a fund, investors can
determine how a given fund fits their personal investment strategy and how to
allocate their assets to different funds accordingly.

To help investors differentiate among investment styles, Lipper Analytical
Services, Inc. ("Lipper"), an independent research firm that publishes data on
mutual funds, is developing a new system for categorizing funds based on
investment style. Under the current system, funds are generally classified
based on their investment objectives, the broad investment parameters and
flexibility the investment manager has, and how aggressively the fund can be
managed. Under the new system, funds will be assigned to a particular category,
and will be rated and ranked within that category, based on some of the same
criteria plus additional considerations. The supplemental criteria will include
a fund's investment style, the capitalization size of its holdings and other
portfolio characteristics, and its historical performance, among other things.
Other rating services, such as Morningstar, Inc., have classified and rated
funds under a system using comparable characteristics for several years, and
the Investment Manager believes shareholders are increasingly using style
differentiation for purposes of their personal financial planning.

Currently, the Alpha Fund is in the "equity income" category. Under the
Lipper proposals, the Fund is expected to be placed in the "mid-cap value"
category, which is comprised of funds with portfolios of mid-capitalization
size companies which are considered undervalued and have potential for growth
in value. If the Alpha Fund continues to follow the current investment
objective after it is placed in the proposed new mid-cap value category,
potential confusion for shareholders may result. The Fund's performance could
appear to be higher or lower, depending on market conditions, relative to its
new peers in the mid-cap value category. This appearance of inconsistent
relative performance is not in the best interest of shareholders because of the
possibility of confusion as to whether their personal objectives are being
achieved. In addition, it could be detrimental to the Fund over the long term,
because of possible redemptions by existing shareholders and the possible lack
of investment by new investors, both of which can cause the Fund to decrease in
size and cause its expenses to be higher as a percentage of its assets.

This recommended change in the Fund's investment objective would enable
the Fund to compete with its new peers and would more closely align the Fund
with its

15
<PAGE>

new Lipper category. If the proposed change in investment objective is
approved, the Fund intends to seek long-term growth of capital by focusing more
on mid-cap value stocks, with less emphasis on income. The Fund generally
expects that most of its investments will be in stocks of companies that are of
comparable size to companies in the Russell Midcap(TM) Value Index, or a similar
index.

The Fund's current investment objective is

"to seek to provide a high level of current income, and secondarily,
long-term growth of capital, by investing primarily in common stocks that
offer above-average dividend yields, and in convertible securities."

The proposed investment objective is

"to seek to provide long-term growth of capital."

The Trustees believe that the proposed revision in the investment
objective is in the best interests of the Fund. The Trustees, including the
Trustees who are not interested persons, recommend a vote FOR approval of this
proposal. If the proposal is not approved by the shareholders, the Fund's
present investment objective will remain in effect.

PROPOSAL 5
(FOR ARGO FUND ONLY)

TO CHANGE THE FUND'S INVESTMENT OBJECTIVE

A revision in the Argo Fund's investment objective is being proposed in
order to provide flexibility in managing the Fund in light of changes in the
mutual fund industry and the needs of investors. Increasingly today, investors
are interested in identifying funds on the basis of the fund's investment
style, such as large-cap growth, mid-cap value, or similar descriptions. With a
clearer understanding of the investment style of a fund, investors can
determine how a given fund fits their personal investment strategy and how to
allocate their assets to different funds accordingly.

16
<PAGE>

funds under a system using comparable characteristics for several years, and
the Investment Manager believes shareholders are increasingly using style
differentiation for purposes of their personal financial planning.

Currently, the Argo Fund is in the "growth and income" category. Under the
Lipper proposals, the Fund could be assigned to one of two new categories:
"large-cap core" or "large-cap value," based on the Fund's current investment
approach. The Fund's current investment strategy and style is to focus
primarily on large-cap value stocks; these are large-capitalization size
companies which are considered undervalued and have potential for growth in
value. Of the two new possible Lipper categories, the Investment Manager
believes that the Fund should be in the large-cap value category.

The proposed change in the statement of the Fund's investment objective
would give the Investment Manager greater flexibility to manage the Fund
consistent with the large-cap value style. The change would enable the Fund to
compete with its new peers and more closely align the Fund with its
appropriate, new Lipper category. If the investment objective is revised, the
Fund expects to invest in large-cap value stocks of companies that are of
comparable size to companies in the Russell 1000[RegTM] Value Index, or a
similar index.

This proposal would revise the Fund's investment objective. The Fund's
current investment objective is:

"to seek to provide long-term growth of capital and, secondarily, long-term
growth of income by investing primarily in common stocks (and equity and
debt securities convertible into or carrying the right to acquire common
stocks) of established companies with above-average prospects for growth."

The proposed investment objective is:

"to seek to provide long-term growth of capital and, secondarily, income."

PROPOSAL 6
(FOR GLOBAL RESOURCES FUND AND ATHLETES FUND ONLY)

TO AMEND EACH FUND'S FUNDAMENTAL POLICIES REGARDING
DIVERSIFICATION OF INVESTMENTS

For each of the Global Resources Fund and the Athletes Fund, the thrust of
the proposed change is to provide greater flexibility in managing the Fund.
Specifically, the change would exclude shares of other investment companies
from the percentage

17
<PAGE>

limitations that apply to investments in different issuers. The 1940 Act has
provisions governing the amount of assets that one mutual fund may invest in
another mutual fund. The proposed policy revisions would enable the Funds to
utilize the flexibility made available under SEC interpretations and the recent
amendment to the 1940 Act that enable a fund to invest more of its assets than
previously allowed in unaffiliated and affiliated funds. Rather than invest
directly in, for example, a number of small capitalization growth stocks, a
Fund could invest in one or more funds that focus on such stocks. By investing
in another fund with a large portfolio in a given sector, a Fund could obtain
greater diversification than by investing in a few stocks directly.

In the case of the Global Resources Fund only, the change would also make
clear that U.S. Government securities, as defined under the 1940 Act and as
interpreted from time to time by the Securities and Exchange Commission, are
also excludable. The change would also give the Global Resources Fund the
flexibility to invest in more than 10% of the outstanding voting securities of
an issuer, provided such investments do not exceed 25% of the Fund's assets.

The current and proposed fundamental policies regarding diversification of
investments for each Fund read as follows:

Global Resources Fund

Current policy:

The Fund's current policy is:

"not to invest in a security if the transaction would result in the Fund
owning more than 10% of any class of voting securities of an issuer, except
that this restriction does not apply to investments in securities issued or
guaranteed by the U.S. Government or its agencies or instrumentalities or
backed by the U.S. Government."

Proposed policy:

The new policy would read as follows:

"not to purchase a security of any one issuer (other than securities of
other investment companies, and U.S. Government securities as defined under
the Investment Company Act of 1940, as amended, and as interpreted from
time to time by the Securities and Exchange Commission) if such purchase
would, with respect to 75% of its total assets, cause more than 10% of the
outstanding voting securities of such issuer to be held by the Fund."

Athletes Fund

Current policy:

The Fund's current policy is:

18
<PAGE>

"not to purchase a security of any one issuer (other than securities issued
or guaranteed as to principal or interest by the U.S. Government or its
agencies or instrumentalities or mixed-ownership Government corporations or
sponsored enterprises) if such purchase would, with respect to 75% of the
Fund's total assets, cause more than 5% of the Fund's total assets to be
invested in the securities of such issuer or cause more than 10% of the
voting securities of such issuer to be held by the Fund."

Proposed policy:

The new policy would read as follows:

"not to purchase a security of any one issuer (other than securities of
other investment companies, and U.S. Government securities as defined under
the Investment Company Act of 1940, as amended, and as interpreted from
time to time by the Securities and Exchange Commission) if such purchase
would, with respect to 75% of the Fund's total assets, cause more than 5%
of the Fund's total assets to be invested in the securities of such issuer
or cause more than 10% of the voting securities of such issuer to be held
by the Fund."

The Trustees believe that the proposed policy revisions are in the best
interests of each Fund. The Trustees, including the Trustees who are not
interested persons, recommend a vote FOR approval of this proposal. If the
proposal is not approved by a given Fund's shareholders, that Fund's present
investment policy will remain in effect.

PROPOSAL 7
(FOR ARGO FUND AND ALPHA FUND ONLY)

TO AMEND THE FUND'S FUNDAMENTAL POLICY REGARDING
PARTICIPATION IN UNDERWRITINGS

The proposal is to amend each Fund's fundamental policy regarding the
Fund's participation in underwriting of securities. The reasons for the change
relate primarily to the disposition of portfolio securities acquired by a Fund.
From time to time, a Fund may invest in securities that have not been
registered under the federal securities law. Opportunities can arise to sell or
dispose of such securities by participating in a public offering under which
such securities could be sold directly or indirectly as registered securities.
For example, the Fund could piggyback on a registration of a public offering of
securities by the issuer -- that is, the Fund could be a so-called selling
shareholder in a registered offering by the issuer and other selling
shareholders. Under those circumstances, the Fund could be deemed, under the
relevant laws, to be an underwriter, which is not the kind of underwriting that
the current policy has been interpreted as precluding. The current provisions
were only intended to preclude

19
<PAGE>

investment banking or brokerage activities where the initial purpose is to
effect a public distribution of securities from the issuer to the public
through one or more closely planned and connected transactions. The proposed
change would make clear that the Fund can, for example, be a selling
shareholder in an issuer's public offering. If the proposal is adopted, no
material change in investment practice is currently anticipated.

The fundamental policy regarding participation in underwritings currently
reads as follows for the Argo Fund and the Alpha Fund. The policy is:

"not to underwrite or participate in the marketing of securities of other
issuers, although the Fund may, acting alone or in syndicates or groups, if
determined by the Trust's Board of Trustees, purchase or otherwise acquire
securities of other issuers for investment, either from the issuers or from
persons in a control relationship with the issuers or from underwriters of
such securities."

The proposed policy is:

"not to underwrite or participate in the marketing of securities of other
issuers, except (a) the Fund may, acting alone or in a syndicate or group,
purchase or otherwise acquire securities of other issuers for investment,
either from the issuers or from persons in a control relationship with the
issuers or from underwriters of such securities; and (b) to the extent
that, in connection with the disposition of the Fund's securities, the Fund
may be a selling shareholder in an offering or deemed to be an underwriter
under certain federal securities laws."

The Trustees, including the Trustees who are not interested persons,
recommend a vote FOR approval of this proposal. If the proposal is not approved
by a given Fund's shareholders, that Fund's present investment policy will
remain in effect.

VOTES REQUIRED FOR APPROVAL OF PROPOSALS 2 THROUGH 7

Approval of each of proposals 2 through 7 requires the affirmative vote
of a majority of the outstanding voting securities of the relevant Fund as
defined in the 1940 Act. Under the 1940 Act, the vote of a majority of the
outstanding voting shares means the vote of the lesser of (a) 67% or more of
the voting shares present at the Meeting if the holders of more than 50% of the
outstanding voting shares are present or represented by proxy or (b) more than
50% of the outstanding voting shares.

OTHER MATTERS TO COME BEFORE THE MEETING

The Trustees do not intend to present any other business at the Meeting,
nor are they aware that any shareholder intends to do so. If however, any other
matters are properly brought before the Meeting, the persons named in the
accompanying Proxy will vote thereon in accordance with their judgment.

20
<PAGE>

NO ANNUAL MEETINGS OF SHAREHOLDERS

There will no annual or further special meetings of shareholders of the
Trust unless required by applicable law or called by the Trustees in their
discretion. In accordance with the 1940 Act, or under the Master Trust
Agreement of the Trust, any Trustee may be removed (i) by a written instrument,
signed by at least two thirds of the number of Trustees in office immediately
prior to such removal, specifying the date upon which such removal shall become
effective; or (ii) by a vote of shareholders holding not less than two thirds
of the shares of the Trust then outstanding, cast in person or by proxy at a
meeting called for the purpose. Shareholders holding 10% or more of the shares
of the Trust then outstanding can require that the Trustees call a meeting of
shareholders for the purpose of voting on the removal of one or more Trustees.
In addition, if ten or more shareholders who have been such for at least six
months and who hold in the aggregate shares with a net asset value of at least
$25,000 or at least 1% of the outstanding Trust shares, inform the Trustees
that they wish to communicate with other shareholders, the Trustees will either
give such shareholders access to the shareholder list or inform them of the
cost involved if the Trust forwards material to shareholders on their behalf.
If the Trustees object to mailing such materials, they must inform the
Securities and Exchange Commission and thereafter comply with the requirements
of the 1940 Act.

Shareholders wishing to submit proposals for inclusion in a proxy
statement for a subsequent shareholder meeting should send their written
proposals to the Secretary of the Trust, One Financial Center, Boston,
Massachusetts 02111. Shareholder proposals should be received in a reasonable
time before the solicitation is made.

WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, PLEASE FILL IN, DATE AND
SIGN THE ENCLOSED PROXY FORM AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. NO
POSTAGE IS NECESSARY IF IT IS MAILED IN THE UNITED STATES. CERTAIN SHAREHOLDERS
MAY ALSO VOTE BY TELEPHONE; PLEASE SEE PAGES 3 AND 4 FOR DETAILS.

May 26, 1999
Date of Proxy Statement

<PAGE>

FOR FASTER, MORE CONVENIENT VOTING
USE THE PHONE

Vote this proxy card TODAY! Your prompt response will save your fund
the expense of additional mailings.

Option 1: Automated Touch Tone Voting: Call toll-free 1-888-221-0697

Option 2: Telephone Rep. Assisted Voting: Call toll-free 1-877-392-4944

Special Meeting of Shareholders-
September 14, 1999

*** CONTROL NUMBER: ***

[arrow down] Please detach at perforation before mailing [arrow down]

STATE STREET RESEARCH EQUITY TRUST: STATE STREET RESEARCH __________ FUND

The undersigned hereby appoints Ralph F. Verni, Francis J. McNamara, III and
Darman A. Wing, and each of them, as proxies with full power of substitution to
act for and vote on behalf of the undersigned all shares of the above fund,
which the undersigned would be entitled to vote if personally present at the
Special Meeting of Shareholders to be held at the principal offices of the fund,
One Financial Center, 31st Floor, Boston, Massachusetts 02111, at 4 p.m. on
September 14, 1999, or at any adjournments thereof, on the items described on
the other side of this form, as set forth in the Notice of Special Meeting of
Shareholders and the accompanying Proxy Statement dated May 26, 1999, receipt of
which is acknowledged by the undersigned. PLEASE INDICATE ANY CHANGE OF ADDRESS
BELOW. This proxy may be revoked at any time prior to the exercise of the powers
conferred thereby. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES.

IF NOT VOTING BY PHONE, IT IS IMPORTANT
THAT THIS PROXY BE SIGNED AND RETURNED
IN THE ENCLOSED ENVELOPE.

DATE: __________________, 1999

NOTE: Please date and sign exactly as name or
names appear hereon and return in the enclosed
envelope, which requires no postage. When signing
as attorney, executor, trustee, guardian or
officer of a corporation, please give title as
such.

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

--------------------------------------------
Signature(s) if held jointly (Title(s), if required)

CONTINUED ON REVERSE SIDE

<PAGE>

- --------------------------------------------------------------------------------
PLEASE DETACH AND RETURN BOTTOM PORTION IN THE ENCLOSED ENVELOPE
- --------------------------------------------------------------------------------

If a choice is specified for a proposal, this proxy will be voted as indicated.
IF NO CHOICE IS SPECIFIED, THIS PROXY WILL BE VOTED FOR THE PROPOSAL. IF NO
CHOICES ARE SPECIFIED FOR ANY PROPOSALS, THIS PROXY WILL BE VOTED FOR ALL
PROPOSALS. In their discretion the proxies are authorized to vote upon such
other business as may properly come before the Meeting. The Board of Trustees
recommends a vote FOR all proposals.

Please vote by filling in the boxes below.

<TABLE>
<S> <C> <C>
1. Election of Trustees. FOR all WITHHOLD
Nominees: (01) Bruce R. Bond, (02) Steve A. Garban nominees listed authority
(03) Malcolm T. Hopkins, (04) Susan M. Phillips (except as to vote for all
noted in nominees listed
space provided)
To withhold authority to vote for any individual nominee, write that
nominee's name in the following space. [ ] [ ]

- ---------------------------------------------
</TABLE>

<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN

2. To amend the Fund's fundamental policies regarding [ ] [ ] [ ]
diversification of investments.

3. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
industry concentration.

4. To revise the Alpha Fund's objective as described [ ] [ ] [ ]
in the Proxy Statement.

7. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
participation in underwritings.
</TABLE>

<TABLE>
<S> <C> <C>
I PLAN TO
ATTEND THE YES NO
MEETING: [ ] [ ]
</TABLE>

PLEASE SIGN ON REVERSE SIDE

<PAGE>

Please vote by filling in the boxes below.

- ---------------------------------------------
</TABLE>

<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN

2. To amend the Fund's fundamental policies regarding [ ] [ ] [ ]
diversification of investments.

3. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
industry concentration.

5. To revise the Argo Fund's objective as described in [ ] [ ] [ ]
the Proxy Statement.

7. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
participation in underwritings.
</TABLE>

<TABLE>
<S> <C> <C>
I PLAN TO
ATTEND THE YES NO
MEETING: [ ] [ ]
</TABLE>

PLEASE SIGN ON REVERSE SIDE

<PAGE>

Please vote by filling in the boxes below.

- ---------------------------------------------
</TABLE>

<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN

3. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
industry concentration.

6. To amend the Fund's fundamental policies regarding [ ] [ ] [ ]
diversification of investments.
</TABLE>

<TABLE>
<S> <C> <C>
I PLAN TO
ATTEND THE YES NO
MEETING: [ ] [ ]
</TABLE>

PLEASE SIGN ON REVERSE SIDE

<PAGE>

Please vote by filling in the boxes below.

- ---------------------------------------------
</TABLE>

<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN

6. To amend the Fund's fundamental policies regarding [ ] [ ] [ ]
diversification of investments.
</TABLE>

<TABLE>
<S> <C> <C>
I PLAN TO
ATTEND THE YES NO
MEETING: [ ] [ ]
</TABLE>

PLEASE SIGN ON REVERSE SIDE

<PAGE>

REQUEST TO RECONSIDER
PRIOR [ABSTENTION] ["AGAINST" VOTE]

(date)

To Shareholders of the
State Street Research _____________ Fund

Recently we solicited your proxy vote on a number of important proposals.
Because you returned a proxy form which indicated that you [abstained from
voting on] [voted "against"] one or more proposals that are still open, we are
contacting you again to ask that you reconsider your [abstention] [vote
"against"] and vote in favor of the proposals. The Fund is very close to the
requisite vote to approve the proposals and your vote may make a difference. The
meeting has been adjourned to allow more time to obtain votes.

The open proposals are proposal(s) [proposal number(s)]. The proposal(s) would
help the Fund achieve its investment objective. If the proposals are approved,
the Investment Manager would have more investment flexibility in the future to
adapt to changing market environments, and to invest in a broader range of
investment vehicles, all in the best interests of shareholders. The proposals
are described in more detail in the Proxy Statement. Please call 1-800-562-0032
if you need another copy of the Proxy Statement.

Please indicate your vote, sign and return promptly the enclosed Supplemental
Proxy form in the special accompanying envelope which will expedite processing
and does not require any postage from you. (If your return envelope is for
Federal Express, call for free pick-up at 1-800-238-5355.)

You may receive a telephone call urging you to return your Supplemental Proxy
form. If you have any questions, please contact the State Street Research
Service Center toll-free nationwide at 1-800-562-0032 between 8 a.m. and 6 p.m.
Eastern Standard Time.

Thank you.

State Street Research
Service Center

<PAGE>

SUPPLEMENTAL PROXY FORM

Special Meeting of Shareholders -- September 14, 1999

The undersigned hereby submits this Supplemental Proxy to make the below
indicated changes to the [vote(s)] [abstention(s)] previously submitted by the
undersigned in connection with a Special Meeting of Shareholders as described in
a related Proxy Statement dated May 26, 1999.

THIS SUPPLEMENTAL PROXY WILL SUPERCEDE ANY PRIOR PROXY FORM SUBMITTED.

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES.

IF NOT VOTING BY PHONE, IT IS IMPORTANT
THAT THIS PROXY BE SIGNED AND RETURNED
IN THE ENCLOSED ENVELOPE.

DATE: __________________, 1999

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

--------------------------------------------
Signature(s) if held jointly (Title(s), if required)

CONTINUED ON REVERSE SIDE
<PAGE>

To withhold authority to vote for any individual nominee, write that
nominee's name in the following space. [ ] [ ]
- ---------------------------------------------
</TABLE>

<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN

2. To amend the Fund's fundamental policies regarding [ ] [ ] [ ]
diversification of investments.

3. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
industry concentration.

4. To revise the Alpha Fund's objective as described in the [ ] [ ] [ ]
Proxy Statement.

7. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
participation in underwritings.
</TABLE>

<TABLE>
<S> <C> <C>
I PLAN TO
ATTEND THE YES NO
MEETING: [ ] [ ]
</TABLE>

PLEASE SIGN ON REVERSE SIDE

<PAGE>

To withhold authority to vote for any individual nominee, write that
nominee's name in the following space. [ ] [ ]
- ---------------------------------------------
</TABLE>

<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN

2. To amend the Fund's fundamental policies regarding [ ] [ ] [ ]
diversification of investments.

3. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
industry concentration.

5. To revise the Argo Fund's objective as described in [ ] [ ] [ ]
the Proxy Statement.

7. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
participation in underwritings.
</TABLE>

<TABLE>
<S> <C> <C>
I PLAN TO
ATTEND THE YES NO
MEETING: [ ] [ ]
</TABLE>

PLEASE SIGN ON REVERSE SIDE

<PAGE>

To withhold authority to vote for any individual nominee, write that
nominee's name in the following space. [ ] [ ]
- ---------------------------------------------
</TABLE>

<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN

3. To amend the Fund's fundamental policy regarding [ ] [ ] [ ]
industry concentration.

6. To amend the Fund's fundamental policies regarding [ ] [ ] [ ]
diversification of investments.

</TABLE>

<TABLE>
<S> <C> <C>
I PLAN TO
ATTEND THE YES NO
MEETING: [ ] [ ]
</TABLE>

PLEASE SIGN ON REVERSE SIDE

<PAGE>

To withhold authority to vote for any individual nominee, write that
nominee's name in the following space. [ ] [ ]
- ---------------------------------------------
</TABLE>

<TABLE>
<S> <C> <C> <C>
FOR AGAINST ABSTAIN

6. To amend the Fund's fundamental policies regarding [ ] [ ] [ ]
diversification of investments.
</TABLE>

<TABLE>
<S> <C> <C>
I PLAN TO
ATTEND THE YES NO
MEETING: [ ] [ ]
</TABLE>

PLEASE SIGN ON REVERSE SIDE