As filed with the Securities and Exchange Commission on October 7, 1999.
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
FILE NUMBER 811-0560
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. __)
[X] Filed by the Registrant
[ ] Filed by a Party other than the Registrant
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
JOHN HANCOCK INVESTMENT TRUST III
(Name of Registrant as Specified in Its Charter)
JOHN HANCOCK INVESTMENT TRUST III
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c) (1) (ii), 14a-6 (i) (1), or
14a-6 (i) (2) or Item 22(a) (2) or schedule 14A (sent by wire transmission).
[ ] Fee paid previously with preliminary materials.
[X] No fee required.
<PAGE>
- --------------------------------------------------------------------------------
Important Information
- --------------------------------------------------------------------------------
[LOGO] JOHN HANCOCK FUNDS
A Global Investment Management Firm
October 7, 1999
Dear Fellow Shareholder:
I am writing to ask for your vote on important matters concerning your
investment in the John Hancock Global Fund.
As you know, John Hancock Advisers, Inc. serves as your fund's investment
adviser. John Hancock Advisers International Limited serves as a subadviser to
your fund, providing the fund with investment advice. To provide the fund with
additional international advisory expertise, your fund's Trustees are asking you
to approve a new subadvisory contract between the adviser and Indocam
International Investment Services.
Your fund's Trustees are also asking you to remove or amend several investment
restrictions that limit your fund's ability to respond to changing market
conditions. Updating these restrictions will bring the fund in line with
established standards maintained by the majority of funds within John Hancock
Funds.
No Change in Investment Objective
It is important to note that these proposals do not in any way signal a change
in your fund's investment objective. Your fund will continue to seek long-term
growth of capital by investing primarily in stocks of companies located
throughout the world, including the United States.
These proposals have been unanimously approved by your fund's Board of Trustees,
who believe they will benefit you and your fellow shareholders. They are
detailed in the enclosed proxy statement and summarized in the questions and
answers on the following pages. I suggest you read both thoroughly before
voting.
Your Vote Makes a Difference!
No matter what size your investment may be, your vote is critical. I urge you to
review the enclosed materials and to complete, sign and return the enclosed
proxy ballot to us immediately. Your prompt response will help avoid the need
for additional mailings. For your convenience, we have provided a postage-paid
envelope.
If you have any questions or need additional information, please contact your
investment professional or call your Customer Service Representative at
1-800-225-5291, Monday through Friday between 8:00 A.M. and 8:00 P.M. Eastern
Time. I thank you for your prompt vote on this matter.
Sincerely,
/s/ Edward J. Boudreau, Jr.
---------------------------
Edward J. Boudreau, Jr.
Chairman and CEO
<PAGE>
Q&A
Q: Who is Indocam International Investment Services?
A: Indocam International Investment Services (IIIS) is a wholly owned
subsidiary of Indocam, the asset management affiliate of Credit Agricole,
a French banking group. Indocam is an indirect subsidiary of certain
holding companies of Caisse Nationale de Credit Agricole, one of the
largest financial and industrial groups in Europe. As of December 31,
1998, the Indocam group had over $150 billion in assets worldwide.
Indocam is a global investment firm, with a presence in financial centers
around the world, including Paris, London, Frankfurt, Hong Kong, Tokyo,
Singapore, New York and Boston. Based in Paris, Indocam is an asset
management firm maintaining established relationships with institutional,
corporate and individual investors around the world.
In addition to other management responsibilities, Indocam International
Investment Services serves as a subadviser to the John Hancock European
Equity Fund. Indocam Asia Advisers Limited, an affiliate of IIIS and
subsidiary of Indocam, serves as a subadviser to the John Hancock Pacific
Basin Equities Fund.
Q: How can the addition of Indocam International Investment Services to the
portfolio management team benefit me?
A: Upon approval of the proposed new subadvisory contract, the fund's
day-to-day portfolio management responsibilities will be assumed by
Indocam International Investment Services. Based in Paris, a team of
portfolio managers at IIIS will be able to draw on the vast investment
experience of strategists, analysts and portfolio managers in Indocam's
offices around the world. Your fund's Trustees believe that the investment
advice and local insight IIIS will be able to provide into European and
other international financial markets should benefit you and your fund.
Q: Does this change in portfolio management signify a change in the fund's
investment objective and strategy?
A: No, these proposals do not in any way signal a change in your fund's
investment objective or strategy. Your fund will continue to seek
long-term growth of capital by investing primarily in stocks of companies
located throughout the world, including the United States. To pursue this
objective, your fund's portfolio management team will continue to identify
investment opportunities by focusing on country allocation and stock
selection.
<PAGE>
Q: Will the addition of Indocam International Investment Services to the
portfolio management team cause an increase in my fund's management fee?
A: No, there will be no change to your fund's management fee.
Q: Why are several investment restrictions being amended?
A: Your fund's restrictions were drafted in 1986 when the fund began and are
now more restrictive than federal law requires. Relaxing these
restrictions will bring your fund into conformity with the standards
maintained by most of John Hancock's other funds. Other restrictions have
been modernized to give your fund more flexibility to respond to
opportunities in the marketplace and to give your fund consistency with
other John Hancock funds.
Q: How do I vote?
A: Most shareholders typically vote by completing, signing and returning the
enclosed proxy card using the postage-paid envelope provided. If you
prefer to vote in person, you are cordially invited to attend a meeting of
shareholders of your fund, which will be held at 9:00 a.m. on December 1,
1999 at our 101 Huntington Avenue headquarters in Boston, Massachusetts.
If you vote now, you will help avoid further solicitations.
<PAGE>
JOHN HANCOCK GLOBAL FUND
(a series of John Hancock Investment Trust III)
101 Huntington Avenue
Boston, MA 02199
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 1, 1999
This is the formal agenda for your fund's special meeting. It tells you what
matters will be voted on and the time and place of the meeting, in case you want
to attend in person.
To the shareholders of John Hancock Global Fund:
A special meeting of shareholders of your fund will be held at 101 Huntington
Avenue, Boston, Massachusetts on Wednesday, December 1, 1999 at 9:00 A.M.,
Eastern Time, to consider the following:
1. A proposal to approve a new sub-investment management contract between
John Hancock Advisers, Inc. and Indocam International Investment
Services. Your board of trustees recommends that you vote FOR this
proposal.
2(a)-(j). Proposals to amend the fund's investment restrictions. Your board of
trustees recommends that you vote FOR these proposals.
3. Any other business that may properly come before the meeting.
Shareholders of record as of the close of business on September 14, 1999 are
entitled to vote at the meeting and any related follow-up meetings.
Whether or not you expect to attend the meeting, please complete and return the
enclosed proxy card. Please take a few minutes to vote now.
By order of the board of trustees,
/s/Susan S. Newton
------------------
Secretary
October 7, 1999
030PX 10/99
<PAGE>
PROXY STATEMENT OF
JOHN HANCOCK GLOBAL FUND
(a series of John Hancock Investment Trust III)
This proxy statement contains the information you should know before voting on
the proposals as summarized below.
Your fund will furnish without charge a copy of its most recent semiannual
report and annual report to any shareholder upon request. Shareholders who want
to obtain a copy of the fund's semiannual report and annual report should direct
all written requests to the attention of the fund, 101 Huntington Avenue,
Boston, Massachusetts 02199 or call John Hancock Funds at 1-800-225-5291.
INTRODUCTION
This proxy statement is being used by the board of trustees of your fund to
solicit proxies to be voted at a special meeting of shareholders of your fund.
This meeting will be held at the principal executive offices of the fund, 101
Huntington Avenue, Boston, Massachusetts on Wednesday, December 1, 1999 at 9:00
A.M., Eastern Time. The purpose of the meeting is to consider:
1. A proposal to approve a new sub-investment management contract between
John Hancock Advisers, Inc. and Indocam International Investment
Services.
2(a)-(j). Proposals to amend the fund's investment restrictions.
3. Any other business that may properly come before the meeting.
This proxy statement and the proxy card are being mailed to fund shareholders on
or about October 7, 1999.
Who is Eligible to Vote?
Shareholders of record on September 14, 1999 are entitled to attend and vote on
each proposal at the meeting or any adjourned meeting. Each share is entitled to
one vote. Shares represented by properly executed proxies, unless revoked before
or at the meeting, will be voted according to shareholder instructions. If you
sign a proxy, but do not fill in a vote, your shares will be voted "for" the
proposals. If any other business comes before the meeting, your shares will be
voted at the discretion of the persons named as proxies.
<PAGE>
PROPOSAL 1
APPROVAL OF A NEW
SUB-INVESTMENT MANAGEMENT CONTRACT
John Hancock Advisers, Inc. (the "adviser") serves as your fund's investment
adviser and is responsible for providing the fund with a continuous investment
program under an investment management contract dated July 1, 1996 (the
"management contract"). The management contract was most recently approved by
the shareholders of the fund at a meeting for that purpose held on June 26,
1996.
The adviser hired John Hancock Advisers International Limited ("JHAI") to serve
as a sub-investment adviser to the fund under a sub-investment management
contract dated October 1, 1992 (the "existing contract"). JHAI, subject to the
review of the fund's trustees and the overall supervision of the adviser,
provides the fund with investment advice. The existing contract was approved by
the shareholders of the fund on September 25, 1992.
At a meeting of your fund's trustees held on September 14, 1999, the trustees,
including all of the independent trustees (those who are not "interested
persons" as defined in the Investment Company Act of 1940, as amended (the "1940
Act")), unanimously approved and voted to recommend that shareholders of your
fund approve a new subadvisory contract (the "proposed contract") between the
adviser and Indocam International Investment Services ("IIIS"). The form of
proposed contract is attached to this proxy statement as Exhibit A.
Pursuant to the proposed contract, IIIS will serve as a co-subadviser to the
fund, together with JHAI, in order to provide the fund with additional
international advisory expertise. IIIS, with its principal office in Paris,
France, will be able to provide the fund with investment advice and local
insight into European and other international financial markets.
Approval of the proposed contract will not result in any increase in fees
payable by the fund. As with JHAI under the existing contract, the adviser will
be solely responsible for paying the subadvisory fee to IIIS under the proposed
contract.
Under the proposed contract, IIIS will provide the fund with advice and
recommendations regarding the fund's investments. IIIS will also provide the
fund on a continuous basis with economic, financial and political information,
research and assistance concerning international markets.
Indocam International Investment Services
IIIS is organized under the laws of France and is a wholly owned subsidiary of
Indocam, the asset management affiliate of Credit Agricole, a French banking
group. Indocam is an indirect subsidiary of certain holding companies of Caisse
Nationale de Credit Agricole ("CNCA"), 91-93 Boulevard Pasteur, Paris,
2
<PAGE>
France 75015, one of the largest financial and industrial groups in Europe. As
of December 31, 1998, the Indocam group had over $150 billion in assets
worldwide.
IIIS currently serves as investment adviser to The France Growth Fund, Inc., a
registered closed-end investment company. In addition, IIIS serves as subadviser
to three open-end investment companies (mutual funds): BNY Hamilton
International Equity Fund, Victory International Growth Fund and John Hancock
European Equity Fund. For each fund managed or subadvised by IIIS with a similar
investment objective, the asset size and the fee rate payable to them are as
follows:
Fund Fund Assets* Fee Rate
- --------------------------------------------------------------------------------
BNY Hamilton International Equity Fund $7.7 million 0.425%
(Sub-investment
management fee)
Victory International Growth Fund $133 million 0.550%
(Sub-investment
management fee)
*As of June 30, 1999.
Although IIIS operates on a fully independent basis and makes its own investment
decisions in rendering investment advice, it has access to the extensive
research and other resources of CNCA's group of affiliated entities. The
investment personnel of IIIS also are employed by and act as investment
personnel for Indocam and/or Indocam Hong Kong Limited, an affiliate of IIIS
that serves as adviser to certain Asian country funds. The address of IIIS is 90
Boulevard Pasteur, Paris, France 75015.
The principal executive officer and the directors of IIIS are listed below,
along with their principal occupations.
Name* Principal Occupation
================================================================================
Jean-Claude Kaltenbach Chairman and Chief Executive Officer of IIIS.
Principal Executive Officer,
Chairman
- --------------------------------------------------------------------------------
Ian Gerald McEvatt Managing Director and Chief Investment
Director Officer of Indocam Hong Kong Ltd.
- --------------------------------------------------------------------------------
Claude Rene Doumic Chairman of Societe de Port de Tanger
Director (closed-end fund).
- --------------------------------------------------------------------------------
Didier Guyot de la Pommeraye International Development for Indosuez
Director Asset Management.
- --------------------------------------------------------------------------------
Charles Denis Jules Vergnot Chairman of Danubexsa.
Director
- --------------------------------------------------------------------------------
Eric Harrison Jostrom Chief Executive Officer and Chief
Director Investment Officer of Constitution
Management Company, Inc.
================================================================================
* The business address of each person listed is 90 Boulevard Pasteur, Paris,
France 75015.
3
<PAGE>
The Adviser
The adviser is a wholly owned subsidiary of The Berkeley Financial Group, Inc.
(the "Berkeley Group"), which is a wholly owned subsidiary of John Hancock
Subsidiaries, Inc., which is a wholly owned subsidiary of John Hancock Mutual
Life Insurance Company (the "Insurance Company"), John Hancock Place, P.O. Box
111, Boston, MA 02117. The adviser currently has more than $30 billion in assets
under management in its capacity as investment adviser to the fund and other
funds in the John Hancock Group of Funds as well as other institutional
accounts.
The principal executive officer and the directors of the adviser are listed
below, along with their principal occupations.
================================================================================
Name and Address Principal Occupation
================================================================================
Edward J. Boudreau, Jr. Chairman and Chief Executive Officer of
Principal Executive Officer, the adviser, the Berkeley Group, John
Chairman Hancock Funds, Inc., Sovereign Asset
101 Huntington Avenue Management Corporation, NM Capital
Boston, MA 02199 Management, Inc., JHAI and First
Signature Bank & Trust Company; Director
of John Hancock Advisers International
(Ireland) Ltd.
- --------------------------------------------------------------------------------
Foster L. Aborn Vice Chairman and Chief Investment
Director Officer, the Insurance Company; Director
John Hancock Place of John Hancock Capital Growth
P.O. Box 111 Management, Inc., the Berkeley Group,
Boston, MA 02117 the adviser, John Hancock Funds, Inc.,
Independence Investment Associates,
Inc., John Hancock Capital Corporation
and John Hancock Subsidiaries, Inc.
- --------------------------------------------------------------------------------
Stephen L. Brown Chairman and Chief Executive Officer of
Director the Insurance Company; Director of the
John Hancock Place Berkeley Group, the adviser, John
P.O. Box 111 Hancock Funds, Inc. and John Hancock
Boston, MA 02117 Subsidiaries, Inc.
================================================================================
4
<PAGE>
================================================================================
Name and Address Principal Occupation
================================================================================
David F. D'Alessandro Director of John Hancock Insurance
Director Agency, Inc., the adviser, the Berkeley
John Hancock Place Group, John Hancock Funds, Inc. and John
P.O. Box 111 Hancock Subsidiaries, Inc.; Chairman and
Boston, MA 02117 Director, John Hancock Variable Life
Insurance Company and John Hancock
Mutual Life Insurance Company of
America; Director, President and Chief
Operating Officer of the Insurance
Company.
- --------------------------------------------------------------------------------
John M. DeCiccio Senior Vice President, the Insurance
Director Company; Director of the Berkeley Group,
John Hancock Place the adviser and John Hancock Funds, Inc.
P.O. Box 111
Boston, MA 02117
- --------------------------------------------------------------------------------
William C. Fletcher President and Director of Independence
Director Investment Associates, Inc.; Director of
John Hancock Place Independence International Associates,
P.O. Box 111 Inc., the Berkeley Group, the adviser,
Boston, MA 02117 John Hancock Funds, Inc., Hancock
Natural Resource Group, Inc. and Hancock
Energy Resources Management, Inc.;
Chairman and Director of JHM Capital
Management, Inc.
- --------------------------------------------------------------------------------
Maureen R. Ford President of broker/dealer distribution
Director of the Insurance Company; Director of
101 Huntington Avenue the adviser, the Berkeley Group, John
Boston, MA 02199 Hancock Funds, Inc.; President and
Director of John Hancock Insurance
Agency, Inc.
- --------------------------------------------------------------------------------
Anne C. Hodsdon Director, President and Chief Operating
Director, President, Chief Officer of the adviser and the Berkeley
Operating Officer and Group; Director and Executive Vice
Chief Investment Officer President of John Hancock Funds, Inc.;
101 Huntington Avenue President and Director of NM Capital
Boston, MA 02199 Management, Inc. and Sovereign Asset
Management Corporation; Director of John
Hancock International (Ireland) Ltd. and
JHAI.
================================================================================
5
<PAGE>
================================================================================
Name and Address Principal Occupation
================================================================================
David A. King Chief Executive Officer, President and
Director Director of John Hancock Signature
John Hancock Place Services, Inc.; Chairman of Networking
P.O. Box 111 Insurance Agency; Vice Chairman of First
Boston, MA 02117 Signature Bank & Trust; Director of the
adviser, the Berkeley Group and John
Hancock Funds, Inc.; Senior Vice
President of the Insurance Company.
- --------------------------------------------------------------------------------
Jeanne M. Livermore Senior Vice President of the Insurance
Director Company; Director of the Berkeley Group,
John Hancock Place the adviser, John Hancock Funds, Inc.
P.O. Box 111 and JHAI.
Boston, MA 02117
- --------------------------------------------------------------------------------
Thomas E. Moloney Chief Financial Officer of the Insurance
Director Company; Director of the adviser, the
John Hancock Place Berkeley Group, John Hancock Funds,
P.O. Box 111 Inc., John Hancock Realty Services and
Boston, MA 02117 John Hancock Capital Corporation;
Chairman of John Hancock Property &
Casualty; Director and Chief Financial
Officer of John Hancock Subsidiaries,
Inc.; Director and Chairman of John
Hancock Signature Services, Inc.
- --------------------------------------------------------------------------------
Richard S. Scipione General Counsel of the Insurance
Director Company; Director of Sovereign Asset
John Hancock Place Management Corporation, NM Capital
P.O. Box 111 Management, Inc., the Berkeley Group,
Boston, MA 02117 the adviser, John Hancock Funds, Inc.
and Signator Investors, Inc.
- --------------------------------------------------------------------------------
Robert H. Watts Executive Vice President of Signator
Director Investors, Inc.; Senior Vice President
John Hancock Place of the Insurance Company; Director of
P.O. Box 111 John Hancock Insurance Agency, Inc., the
Boston, MA 02117 Berkeley Group, the adviser and JHAI.
================================================================================
6
<PAGE>
John Hancock Advisers International Ltd.
JHAI is a wholly owned subsidiary of the adviser and currently manages more than
$400 million in assets.
The principal executive officer and the directors of JHAI are listed below,
along with their principal occupations.
================================================================================
Name and Address Principal Occupation
================================================================================
Edward J. Boudreau, Jr. Chairman and Chief Executive Officer of
Chairman the adviser, the Berkeley Group, John
101 Huntington Avenue Hancock Funds, Inc., Sovereign Asset
Boston, MA 02199 Management Corporation, NM Capital
Management, Inc., JHAI and First
Signature Bank & Trust Company; Director
of John Hancock Advisers International
(Ireland) Ltd.
- --------------------------------------------------------------------------------
John L. Wills Managing Director and Director of JHAI;
Managing Director Senior Vice President of adviser;
Duke's Court, 6th Floor Director of John Hancock Advisers
32-36 Duke Street St. James's International (Ireland) Ltd.
London SWIY6DF
- --------------------------------------------------------------------------------
Anne C. Hodsdon Director, President and Chief Operating
Director Officer of the adviser and the Berkeley
101 Huntington Avenue Group; Director and Executive Vice
Boston, MA 02199 President of John Hancock Funds, Inc.;
President and Director of NM Capital
Management, Inc. and Sovereign Asset
Management Corporation; Director of John
Hancock International (Ireland) Ltd. and
JHAI.
- --------------------------------------------------------------------------------
Jeanne M. Livermore Senior Vice President of the Insurance
Director Company; Director of the Berkeley Group,
John Hancock Place the adviser, John Hancock Funds, Inc.
P.O. Box 111 and JHAI.
Boston, MA 02117
- --------------------------------------------------------------------------------
Robert H. Watts Executive Vice President of Signator
Director Investors, Inc.; Senior Vice President
John Hancock Place of the Insurance Company; Director of
P.O. Box 111 John Hancock Insurance Agency, Inc., the
Boston, MA 02117 Berkeley Group, the adviser and JHAI.
================================================================================
7
<PAGE>
The Proposed and Existing Contracts
The following is a summary of the material terms of the proposed and existing
contracts. In describing the proposed contract, this summary is qualified by
reference to the form of proposed contract attached to this proxy statement as
Exhibit A.
Compensation. The existing contract and the proposed contract (collectively, the
"contracts") provide that JHAI or IIIS, as the case may be, is required to pay
all expenses that it incurs in connection with the performance of its duties
under the contract. The contracts also provide that the adviser, not the fund,
will pay the subadvisory fees.
The proposed contract requires the adviser to pay quarterly to IIIS a
subadvisory fee, which is accrued daily and on an annual basis is equal to 50%
of the gross management fee received by the adviser with respect to the fund's
average daily net assets.
The existing contract requires the adviser to pay JHAI a subadvisory fee, which
is accrued daily, based on a percentage of the fund's average daily net assets
as follows:
Average Daily Net Assets Percent of Average
Managed by JHAI Daily Net Assets
First $200 million 0.70%
Amount Over $200 million 0.6375%
For the fund's fiscal year ended October 31, 1998, the adviser paid JHAI
$1,208,204 in subadvisory fees.
If the proposed contract is approved by the fund's shareholders, JHAI will
voluntarily limit its subadvisory fee to 0.05% of the fund's average daily net
assets effective December 2, 1999 or such later date as determined by the
officers of the fund.
Term. If approved by shareholders of the fund, the proposed contract will take
effect as of December 1, 1999 and will remain in effect until December 1, 2001.
Thereafter, the proposed contract will continue in effect from year to year
subject to the annual approval of its continuance as described below under
"Provisions Contained in Both Contracts and in the Management Contract."
Provisions Contained in Both Contracts and in the Management Contract
Limitation of Liability. The management and the subadvisory contracts provide
that the adviser, JHAI and IIIS are not 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 the respective contract relates, except a loss resulting from
willful misfeasance, bad faith or gross negligence on the part of the applicable
adviser, JHAI or IIIS in the performance of its duties or from the reckless
disregard of its obligations and duties under the contracts.
8
<PAGE>
Termination, Continuance and Amendment. Except as described above for the
proposed contract, each contract continues from year to year subject to annual
approval of its continuance by a majority of the independent trustees, cast in
person at a meeting called for the purpose of voting on such approval, and
annual approval by either (a) your fund's trustees, or (b) a majority of your
fund's outstanding voting securities, as defined in the 1940 Act. Each contract
may be terminated at any time without penalty on 60 days' written notice by the
trustees, by a vote of a majority of the fund's outstanding voting securities,
or by the adviser, JHAI or IIIS, as the case may be. Each contract terminates
automatically in the event of its assignment or in the event that the adviser
ceases to act as the fund's investment adviser.
Use of Name "John Hancock." Under the management contract and the existing
contract, if the adviser ceases to act as the fund's investment adviser, the
fund (to the extent that it lawfully can) must cease to use the name "John
Hancock Global Fund" or any name derived from the name "John Hancock" or any
other name indicating that the fund is advised by or otherwise associated with
the adviser.
The Management Contract
Under the management contract, the adviser, subject to the direction of the
trustees, provides the fund with a continuous investment program for the
management of its assets, consistent with the fund's investment objective and
policies. The adviser furnishes the fund with advice and recommendations
consistent with the investment policies of the fund regarding the purchase,
holding and disposition of portfolio securities. The adviser:
o advises the fund in connection with policy decisions to be made by the
trustees;
o furnishes the fund with research, economic and statistical data in
connection with the fund's investments and policies;
o provides day-to-day administration;
o investigates and conducts relations with issuers of securities to be
purchased by the fund;
o provides required reports and recommendations to the trustees and
maintains the records of the fund; and
o assists 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.
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
officers and employees of the fund and pays the expenses of clerical services
related to the administration of the fund. Other than expenses specifically
assumed by the adviser, all expenses incurred in the continuing operation of the
fund are borne by the fund, including fees of the independent trustees and
9
<PAGE>
all fees of lawyers and accountants. Also, the Fund has an agreement with the
Adviser to perform necessary tax, accounting and legal services for the Fund.
The Fund pays an investment management fee to the adviser equivalent on an
annual basis to a stated percentage of the average daily net assets of the fund
as set forth below:
Net Asset Value Annual Rate
First $100 million 0.90%
Next $200 million 0.80%
Next $200 million 0.75%
Amount over $500 million 0.625%
During the fiscal year ended October 31, 1998, the fund paid the adviser
$1,489,223 in management fees.
Analysis of Proposal and Review of Trustees
The trustees have determined that the terms of the proposed contract are fair
and reasonable. In approving the proposed contract and recommending its approval
by the shareholders of the fund, the trustees, including the independent
trustees, considered the best interest of the shareholders of the fund and took
into account all factors they deemed relevant.
In evaluating the proposed contract, the trustees carefully reviewed materials
furnished by the adviser relating to IIIS and its affiliates and their
personnel, operations and financial condition. The trustees considered the
extensive international investment management expertise of IIIS as beneficial to
the fund. The trustees also deemed important the favorable history, reputation
and qualification of IIIS' parent company, Credit Agricole, and the level of
resources available to IIIS through Credit Agricole and its subsidiaries in
providing investment subadvisory services to the fund. Additionally, the
trustees considered that JHAI will voluntarily agree to limit its subadvisory
fee to 0.05% of the fund's average daily net assets effective as of December 1,
1999 or such later date as determined by the officers of the fund. Other factors
deemed important by the trustees in making their recommendation are (i) the
possibility of benefits that may be realized by the fund as a result of IIIS
serving as the fund's investment subadviser; and (ii) other factors deemed
relevant by the trustees.
The trustees also considered possible benefits to IIIS under the proposed
contract, including the ability of IIIS (a) to cause the fund to execute
securities transactions with brokers that are affiliated with Credit Agricole,
subject to compliance with the requirements of the 1940 Act and procedures
adopted by, and with the oversight of, the trustees and (b) to obtain soft
dollar brokerage and research services from brokers that are not affiliated with
Credit Agricole who effect securities transactions on behalf of the fund.
Throughout the review process the independent trustees were advised by their
independent legal counsel, who was not counsel to the trust, the adviser, JHAI
or IIIS.
10
<PAGE>
Trustees' Evaluation and Recommendation
The trustees, including all of the independent trustees, by a vote cast at a
meeting held on September 14, 1999 unanimously approved and voted to recommend
to the shareholders of the fund that they adopt the proposed contract. If the
shareholders of the fund approve the proposed contract, the proposed contract
will take effect as of December 1, 1999.
The trustees of your fund recommend that the shareholders of your fund vote
"for" the proposed contract.
PROPOSALS 2(a)-(j)
AMENDMENTS TO THE FUND'S
INVESTMENT RESTRICTIONS
The adviser and your board of trustees recommend that the following changes be
made to modernize your fund's fundamental investment restrictions. These changes
will provide your fund with a set of investment restrictions that reflect the
current legal and investment environment. Similar changes have already been made
to other John Hancock funds. We are asking you to vote on these changes because
the restrictions are fundamental and may be changed only with shareholder
approval.
The 1940 Act requires mutual funds to adopt fundamental investment
restrictions covering certain types of investment practices. However, your fund
is also subject to a number of fundamental restrictions that are not required by
the 1940 Act or any other current laws. These restrictions were adopted in the
past to reflect certain regulatory, business or industry conditions which are no
longer in effect. It is also recommended that some of the fundamental
restrictions be liberalized to the extent permitted under the 1940 Act in light
of current interpretive positions of the staff of the Securities and Exchange
Commission (the "SEC").
The adviser expects that you will benefit from these proposed changes to the
fund's fundamental investment restrictions in several ways. First, the proposed
changes to the fund's fundamental restrictions expand the range of investment
opportunities and techniques available to manage the fund's portfolio. The
adviser carefully evaluates all new investment opportunities to determine
whether any would be suitable for the fund given its investment objective,
policies and risk profile. The adviser believes that the proposed changes to the
fund's fundamental restrictions will provide the fund with additional
flexibility to respond more quickly to new developments and changing trends in
the marketplace whenever the adviser determines that a response is both
appropriate and prudent. Nevertheless, the fund has no current intention of
changing its actual investment strategies as a result of these amendments. In
addition, the fund's investment objective of long-term growth of capital remains
the same.
11
<PAGE>
Second, the proposed changes to the fund's investment restrictions will
parallel the investment restrictions of other funds managed by the adviser,
facilitating the adviser's compliance efforts. Also, modernized restrictions
will allow investors to better understand the characteristics and risks
associated with the fund.
Proposed Amendments to Investment Restrictions
The table below sets forth your fund's current fundamental restrictions in the
left hand column and the proposed fundamental restrictions in the right hand
column. The current restrictions are presented in the same order as they are
listed in the fund's statement of additional information. The amended
restrictions, if approved, will be reordered in the fund's revised statement of
additional information to parallel those of other John Hancock funds.
- --------------------------------------------------------------------------------
Current Fundamental Restriction Amended Fundamental Restriction
- --------------------------------------------------------------------------------
2(a) The fund may not purchase Amended and reclassified as a
securities on margin or sell non-fundamental restriction (not
short, except that the fund may required to be fundamental by the
obtain such short-term credits as 1940 Act): The fund may not
are necessary for the clearance purchase securities on margin or
of securities transactions. The sell short, except that the fund
deposit or payment by the fund of may obtain such short-term
initial or maintenance margin in credits as may be necessary for
connection with futures contracts the clearance of securities
or related options transactions transactions.
is not considered the purchase of
a security on margin. * * * *
Explanation: The board has
adopted a non-fundamental
restriction prohibiting the fund
from purchasing securities on
margin and short selling. The
non-fundamental restriction is
substantively identical to the
existing fundamental restriction.
- --------------------------------------------------------------------------------
2(b) The fund may not borrow money, Amended as follows: The fund may
except from banks temporarily for not borrow money, except: (i) for
extraordinary or emergency temporary or short-term purposes
purposes (not for leveraging or or for the clearance of
investment) and then in an transactions in amounts not to
aggregate amount not in excess of exceed 33 1/3% of the value of
10% of the value of the fund's the fund's total assets
total assets at the time of such (including the amount borrowed)
borrowing, taken at market value; (ii) in
connection
- --------------------------------------------------------------------------------
12
<PAGE>
- --------------------------------------------------------------------------------
Current Fundamental Restriction Amended Fundamental Restriction
- --------------------------------------------------------------------------------
2(b) provided that the fund will not with the redemption of fund
cont. purchase securities for shares or to finance failed
investment while borrowings settlements of portfolio trades
equaling 5% or more of the fund's without immediately liquidating
total assets are outstanding. portfolio securities or other
assets; (iii) in order to fulfill
commitments or plans to purchase
additional securities pending the
anticipated sale of other
portfolio securities or assets;
(iv) in connection with entering
into reverse repurchase
agreements and dollar rolls, but
only if after each such borrowing
there is asset coverage of at
least 300% as defined in the 1940
Act; and (v) as otherwise
permitted under the 1940 Act. For
purposes of this investment
restriction, the deferral of
trustees' fees and transactions
in all types of derivative
instruments are not considered to
be borrowing.
* * * *
Explanation: The amended
restriction broadens the fund's
ability to borrow to the extent
permitted under the 1940 Act and
affords the fund additional
flexibility to borrow money for
other than extraordinary or
emergency purposes if the adviser
determines such borrowing is in
the best interests of the fund
and is consistent both with the
fund's investment objective and
with the requirements of the 1940
Act.
- --------------------------------------------------------------------------------
13
<PAGE>
- --------------------------------------------------------------------------------
Current Fundamental Restriction Amended Fundamental Restriction
- --------------------------------------------------------------------------------
2(c) The fund may not act as an Amended as follows: The fund may
underwriter of securities of not act as an underwriter, except
other issuers, except to the to the extent that in connection
extent that it may be deemed to with the disposition of portfolio
act as an underwriter in certain securities, the fund may be
cases when disposing of deemed to be an underwriter for
restricted securities. purposes of the Securities Act of
1933.
* * * *
Explanation: The 1940 Act
prohibits the fund from
underwriting securities of other
issuers. The amended restriction
is substantively identical to the
current restriction, but is
rewritten to conform the
restriction to the language of
the other John Hancock funds'
restrictions.
- --------------------------------------------------------------------------------
2(d) The fund may not issue senior Amended as follows: The fund may
securities except as appropriate not issue senior securities,
to evidence indebtedness which except as permitted by paragraph
the fund is permitted to incur, 2(b) above and paragraphs 2(h)
provided that, to the extent and 2(i) below. For purposes of
applicable, (i) the purchase and this restriction, the issuance of
sale of futures contracts or shares of beneficial interest in
related options, (ii) collateral multiple classes or series, the
arrangements with respect to purchase or sale of options,
futures contracts, related futures contracts and options on
options, forward foreign currency futures contracts, forward
exchange contracts or other commitments, forward foreign
permitted investments of the fund exchange contracts and repurchase
as described in the Prospectus, agreements entered into in
including deposits of initial and accordance with the fund's
variation margin, and (iii) the investment policies, are not
establishment of separate classes considered an issuance of senior
of shares of the fund for securities.
providing alternative
distribution methods are not * * * *
- --------------------------------------------------------------------------------
14
<PAGE>
- --------------------------------------------------------------------------------
Current Fundamental Restriction Amended Fundamental Restriction
- --------------------------------------------------------------------------------
2(d) considered to be the issuance of Explanation: This restriction has
cont. senior securities for purposes of been amended for clarity, but has
this restriction. not been substantively changed.
- --------------------------------------------------------------------------------
2(e) The fund may not invest more than Eliminated (not required by the
5% of the fund's total assets in 1940 Act).
warrants, whether or not the
warrants are listed on the New * * * *
York or American Stock Exchanges,
or more than 2% of the value of Explanation: This restriction was
the fund's total assets in imposed on the fund by state
warrants which are not listed on securities regulations that no
those exchanges. Warrants longer apply to the fund.
acquired in units or attached to
securities are not included in
this restriction.
- --------------------------------------------------------------------------------
2(f) The fund may not purchase Amended and reclassified as a
securities of any one issuer, non-fundamental restriction (not
except securities issued or required to be fundamental by the
guaranteed by the U.S. 1940 Act): The fund may not
Government, its agencies or purchase securities of an issuer
instrumentalities, if immediately (other than the U.S. government,
after such purchase more than 5% its agencies or
of the value of the fund's total instrumentalities), to an extent
assets would be invested in such inconsistent with the Fund's
issuer or the fund would own or diversified status under the
hold more than 10% of the Investment Company Act of 1940.
outstanding voting securities of
such issuer; provided, however, * * * *
that with respect to the fund, up
to 25% of the value of the fund's Explanation: The diversification
total assets may be invested restriction has been rewritten to
without regard to these conform the restriction to the
limitations. language of the other John
Hancock funds' restrictions. The
amended restriction is
substantively identical to the
current restriction.
- --------------------------------------------------------------------------------
15
<PAGE>
- --------------------------------------------------------------------------------
Current Fundamental Restriction Amended Fundamental Restriction
- --------------------------------------------------------------------------------
2(g) The fund may not purchase or sell Amended as follows: The fund may
real estate although the fund may not purchase, sell or invest in
purchase and sell securities real estate, but subject to its
which are secured by real estate, other investment policies and
mortgages or interests therein, restrictions may invest in
or issued by companies which securities of companies that deal
invest in real estate or in real estate or are engaged in
interests therein; provided, the real estate business. These
however, that the fund will not companies include real estate
purchase real estate limited investment trusts and securities
partnership interests. secured by real estate or
interests in real estate. The
fund may hold and sell real
estate acquired through default,
liquidation or other
distributions of an interest in
real estate as a result of the
fund's ownership of securities.
* * * *
Explanation: This restriction has
been amended for clarity and to
conform the restriction to the
language of the other John
Hancock funds' restrictions, but
has not been substantively
changed.
- --------------------------------------------------------------------------------
2(h) The fund may not purchase or sell Amended as follows: The fund may
commodities or commodity futures not invest in commodities or
contracts or interests in oil, commodity futures contracts,
gas or other mineral exploration other than financial derivative
or development programs, except contracts. Financial derivatives
the fund may engage in such include forward currency
forward foreign currency contracts; financial futures
contracts and/or purchase or sell contracts and options on
such futures contracts and financial futures contracts;
options thereon as described in options and warrants on
the Prospectus. securities, currencies and
financial indices; and swaps,
caps, floors, collars and
swaptions; and repurchase
agreements entered into in
accordance with the fund's
investment policies.
* * * *
- --------------------------------------------------------------------------------
16
<PAGE>
- --------------------------------------------------------------------------------
Current Fundamental Restriction Amended Fundamental Restriction
- --------------------------------------------------------------------------------
2(h) Explanation: This restriction has
cont. been amended for clarity, to
conform the restriction to the
language of the other John
Hancock funds' restrictions and
to add references to additional
types of derivative instruments,
but otherwise has not been
substantively changed.
- --------------------------------------------------------------------------------
2(i) The fund may not make loans, Amended as follows: The fund may
except that the fund may purchase not make loans, except that the
or hold debt instruments and may fund may (1) lend portfolio
enter into repurchase agreements securities in accordance with the
(subject to [the fund's fund's investment policies up to
non-fundamental restrictions on 33 1/3% of the fund's total
illiquid securities]) in assets taken at market value, (2)
accordance with its investment enter into repurchase agreements
objectives and policies and make and (3) purchase all or a portion
loans of portfolio securities of an issue of publicly
provided that as a result, no distributed debt securities, bank
more than 10% of the fund's total loan participation interests,
assets, taken at current value bank certificates of deposit,
would be so loaned. bankers' acceptances, debentures
or other securities, whether or
not the purchase is made upon the
original issuance of the
securities.
* * * *
Explanation: The amended
restriction clarifies the fund's
lending policy and broadens its
ability to make loans to the
extent permitted under the 1940
Act.
- --------------------------------------------------------------------------------
17
<PAGE>
- --------------------------------------------------------------------------------
Current Fundamental Restriction Amended Fundamental Restriction
- --------------------------------------------------------------------------------
2(j) The fund may not purchase any Amended as follows: The fund may
securities which would cause more not purchase the securities of
than 25% of the market value of issuers conducting their
the fund's total assets at the principal activity in the same
time of such purchase to be industry if, immediately after
invested in the securities of one such purchase, the value of its
or more issuers having their investments in such industry
principal business activities in would equal or exceed 25% of its
the same industry, provided that total assets taken at market
there is no limitation with value at the time of such
respect to investments in purchase. This limitation does
obligations issued or guaranteed not apply to investments in
by the U.S. Government, its obligations of the U.S.
agencies or instrumentalities. Government or any of its agencies
or instrumentalities.
* * * *
Explanation: The 1940 Act
requires that the fund adopt a
fundamental restriction with
respect to concentrating its
investments in particular
industries. The amended
restriction is substantively
identical to the current
restriction, but is rewritten to
conform to the language of the
other John Hancock funds.
- --------------------------------------------------------------------------------
Board Evaluation and Recommendation
The trustees believe that the proposed amendments to the fund's restrictions
will more clearly reflect current regulatory practice and expand the investment
opportunities available to the fund. Accordingly, the trustees recommend that
you approve the proposals to change the fund's fundamental investment
restrictions described above.
Each proposal will be voted on separately, so that if the required approval of a
change to a restriction is not obtained, the existing investment restriction(s)
will continue in effect.
The trustees of your fund recommend that the shareholders of your fund vote
"for" all the proposed amendments to the fund's investment restrictions.
18
<PAGE>
VOTING RIGHTS AND REQUIRED VOTE
Each share of your fund is entitled to one vote for each proposal. Approval of
each proposal requires the affirmative vote of a majority of the shares of your
fund outstanding and entitled to vote. For this purpose, a majority of the
outstanding shares of your fund means with respect to each proposal the vote of
the lesser of
(1) 67% or more of the shares present at the meeting, if the holders of more
than 50% of the shares of the fund are present or represented by proxy,
or
(2) more than 50% of the outstanding shares of the fund.
Shares of your fund represented in person or by proxy, including shares which
abstain or do not vote with respect to a proposal, will be counted for purposes
of determining whether there is a quorum at the meeting. Accordingly, an
abstention from voting has the same effect as a vote against a proposal.
However, if a broker or nominee holding shares in "street name" indicates on the
proxy card that it does not have discretionary authority to vote on a proposal,
those shares will not be considered present and entitled to vote on that
proposal. Thus, a "broker non-vote" has no effect on the voting in determining
whether a proposal has been adopted in accordance with clause (1) above, if more
than 50% of the outstanding shares (excluding the "broker non-votes") are
present or represented. However, for purposes of determining whether a proposal
has been adopted in accordance with clause (2) above, a "broker non-vote" has
the same effect as a vote against that proposal because shares represented by a
"broker non-vote" are considered to be outstanding shares.
INFORMATION CONCERNING THE MEETING
Solicitation of Proxies
In addition to the mailing of these proxy materials, proxies may be solicited by
telephone, by fax or in person by the trustees, officers and employees of your
fund; by personnel of the adviser, the fund's principal distributor, John
Hancock Funds, Inc., and the fund's transfer agent, John Hancock Signature
Services, Inc., or by broker-dealer firms. Signature Services, together with a
third party solicitation firm, has agreed to provide proxy solicitation services
at a cost of approximately $8,000. The adviser will pay 20% of this cost.
The mailing address of the fund, the adviser and the underwriter, John Hancock
Funds, Inc. is 101 Huntington Avenue, Boston, Massachusetts 02199.
19
<PAGE>
Revoking Proxies
A shareholder signing and returning a proxy has the power to revoke it at any
time before it is exercised:
o By filing a written notice of revocation with your fund's transfer agent,
John Hancock Signature Services, Inc., 1 John Hancock Way, Suite 1000,
Boston, Massachusetts 02217-1000,
o By returning a duly executed proxy with a later date before the time of
the meeting, or
o If a shareholder has executed a proxy but is present at the meeting and
wants to vote in person, by notifying the secretary of the fund (without
complying with any formalities) at any time before it is voted.
Being present at the meeting alone does not revoke a previously executed and
returned proxy.
Outstanding Shares and Quorum
As of September 14, 1999, 7,961,723 Class A, 3,840,325 Class B and 8,460 Class C
shares of beneficial interest of the fund were outstanding. Only shareholders of
record on September 14, 1999 (record date) are entitled to notice of and to vote
at the meeting. A majority of the outstanding shares of the fund that are
entitled to vote will be considered a quorum for the transaction of business.
Other Business
The fund's board of trustees knows of no business to be presented for
consideration at the meeting other than the proposal. If other business is
properly brought before the meeting, proxies will be voted according to the best
judgment of the persons named as proxies.
Adjournments
If a quorum is not present in person or by proxy at the time any session of the
meeting is called to order, the persons named as proxies may vote those proxies
that have been received to adjourn the meeting to a later date. If a quorum is
present but there are not sufficient votes in favor of the proposal, the persons
named as proxies may propose one or more adjournments of the meeting to permit
further solicitation of proxies concerning the proposal. Any adjournment will
require the affirmative vote of a majority of the fund's shares at the session
of the meeting to be adjourned. If an adjournment of the meeting is proposed
because there are not sufficient votes in favor of the proposal, the persons
named as proxies will vote those proxies favoring the proposal in favor of
adjournment, and will vote those proxies against the proposal against
adjournment.
20
<PAGE>
Telephone Voting
In addition to soliciting proxies by mail, by fax or in person, the fund may
also arrange to have votes recorded by telephone by officers and employees of
the fund or by personnel of the adviser or transfer agent. The telephone voting
procedure is designed to verify a shareholder's identity, to allow a shareholder
to authorize the voting of shares in accordance with the shareholder's
instructions and to confirm that the voting instructions have been properly
recorded. If these procedures were subject to a successful legal challenge,
these telephone votes would not be counted at the meeting. The fund has not
obtained an opinion of counsel about telephone voting, but is currently not
aware of any challenge.
o A shareholder will be called on a recorded line at the telephone number in
the fund's account records and will be asked to provide the shareholder's
social security number or other identifying information.
o The shareholder will then be given an opportunity to authorize proxies to
vote his or her shares at the meeting in accordance with the shareholder's
instructions.
o To ensure that the shareholder's instructions have been recorded
correctly, the shareholder will also receive a confirmation of the voting
instructions by mail.
o A toll-free number will be available in case the voting information
contained in the confirmation is incorrect.
o If the shareholder decides after voting by telephone to attend the
meeting, the shareholder can revoke the proxy at that time and vote the
shares at the meeting.
OWNERSHIP OF SHARES IN THE FUNDS
To the knowledge of the fund, as of September 14, 1999, the following persons
beneficially owned 5% or more of the outstanding shares of a class of your fund.
Class of Number of
Name and Address Shares Shares Owned
- ---------------- ------ ------------
Central Collision Center Class C 19.00%
216 South Harlem
Peotone, IL 60468
Lyon Electric Company, Inc. Class C 17.56%
1690 A Brandywine Avenue
Chula Vista, CA 91911
21
<PAGE>
Class of Number of
Name and Address Shares Shares Owned
- ---------------- ------ ------------
John Hancock Mutual Class C 14.57%
Life Insurance Company
Custodian for the
Rollover IRA of
Michael Y. O. Lee
49 Uilani Street
Kihie, HI 96753-8022
Salomon Smith Barney Inc. Class C 8.72%
00137961445
333 West 34th Street-3rd Floor
New York, NY 10001-2483
NFSC FEBO #OKS-103993 Class C 7.89%
Richard A. Cisowski
Ruth A. Cisowski
256 Windtree Avenue
Thousand Oaks, CA 91320-4130
Prudential Securities, Inc. FBO Class C 5.69%
Fuad Haddad Roth IRA
R/O IRA DTD 05/05/98
29 Sahara Drive
Rochester, NY 14624-2252
As of September 14, 1999, the trustees and officers of the fund owned in the
aggregate less than 1% of the outstanding shares of the fund.
22
<PAGE>
EXHIBIT A
JOHN HANCOCK INVESTMENT TRUST III
John Hancock Global Fund
Sub-Investment Management Contract
Dated December 1, 1999
JOHN HANCOCK ADVISERS, INC.
101 Huntington Avenue
Boston, Massachusetts 02199
JOHN HANCOCK INVESTMENT TRUST III
John Hancock Global Fund
101 Huntington Avenue
Boston, Massachusetts 02199
INDOCAM INTERNATIONAL INVESTMENT SERVICES
90 Boulevard Pasteur
Paris, FRANCE 75015
Sub-Investment Management Contract
Ladies and Gentlemen:
John Hancock Investment Trust III (the "Trust") 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 Trust'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 Trust. As
of the date hereof, the Trust has four series of shares, representing interests
in John Hancock Global Fund, John Hancock Large Cap Growth Fund, John Hancock
International Fund and John Hancock Mid Cap Growth Fund.
The Board of Trustees of the Trust (the "Trustees") has selected John
Hancock Advisers, Inc. (the "Adviser") to provide overall investment advice and
management for the John Hancock Global Fund (the "Fund"), and to provide certain
other services, under the terms and conditions provided in the Investment
Management Contract, dated July 1, 1996, between the Trust, the Fund and the
Adviser (the "Investment Management Contract").
The Adviser and the Trustees have selected Indocam International Investment
Services (the "Sub-Adviser") to provide the Adviser and the Fund with the advice
and services set forth below, and the Sub-Adviser is willing to provide such
advice and services, subject to the review of the Trustees and overall
supervision of the Adviser, under the terms and conditions hereinafter set
forth. The Sub-Adviser hereby represents and warrants that it is registered as
an investment adviser under the Investment Advisers Act of 1940, as amend-
23
<PAGE>
ed. Accordingly, the Trust, on behalf of the Fund, and the Adviser agree with
the Sub-Adviser as follows:
1. Delivery of Documents. The Trust has furnished the Sub-Adviser with copies,
properly certified or otherwise authenticated, of each of the following:
(a) Amended and Restated Declaration of Trust of the Trust, dated July 1,
1996, as amended from time to time (the "Declaration of Trust");
(b) By-Laws of the Trust as in effect on the date hereof;
(c) Resolutions of the Trustees approving the form of this Agreement by
and among the Adviser, the Sub-Adviser and the Trust, on behalf of the Fund;
(d) Resolutions of the Trustees selecting the Adviser as investment
adviser for the Fund and approving the form of the Investment Management
Contract;
(e) the Investment Management Contract;
(f) the Fund's portfolio compliance checklists;
(g) the Fund's current Registration Statement, including the Fund's
Prospectus and Statement of Additional Information; and
(h) the Fund's Code of Ethics.
The Trust will furnish to the Sub-Adviser from time to time copies, properly
certified or otherwise authenticated, of all amendments of or supplements to the
foregoing, if any.
2. Investment Services. The Sub-Adviser will use its best efforts to provide to
the Fund continuing and suitable investment advice with respect to investments,
consistent with the investment policies, objectives and restrictions of the Fund
as set forth in the Fund's Prospectus and Statement of Additional Information.
In the performance of the Sub-Adviser's duties hereunder, subject always (x) to
the provisions contained in the documents delivered to the Sub-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 Trust, on behalf 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 Sub-Adviser will have investment discretion with
respect to the Fund and will, at its own expense:
(a) furnish the Adviser and the Fund with advice and recommendations,
consistent with the investment policies, objectives and restrictions of the Fund
as set forth in the Fund's Prospectus and Statement of Additional Information,
with respect to the purchase, holding and disposition of portfolio securities
including the purchase and sale of options;
(b) furnish the Adviser and the Fund with advice as to the manner in which
voting rights, subscription rights, rights to consent to corporate action and
any other rights pertaining to the Fund's assets shall be exercised, the Fund
having the responsibility to exercise such voting and other rights;
24
<PAGE>
(c) furnish the Adviser and 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) subject to prior consultation with the Adviser, engage in negotiations
relating to the Fund's investments with issuers, investment banking firms,
securities brokers or dealers and other institutions or investors;
(f) consistent with 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 or the Sub-Adviser, provided that in
connection with the placing of such orders and the selection of such brokers or
dealers the Sub-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 and furnished to
the Sub-Adviser from time to time;
(g) from time to time or at any time requested by the Adviser or the
Trustees, make reports to the Adviser or the Trust of the Sub-Adviser's
performance of the foregoing services;
(h) subject to the supervision of the Adviser, maintain all books and
records with respect to the Fund's securities transactions required by the 1940
Act, and preserve such records for the periods prescribed therefor by the 1940
Act (the Sub-Adviser agrees that such records are the property of the Trust and
copies will be surrendered to the Trust promptly upon request therefor);
(i) 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 advise the Adviser on the same day such instructions
are given; and
(j) cooperate generally with the Fund and the Adviser to provide
information necessary for the preparation of registration statements and
periodic reports to be filed with the Securities and Exchange Commission,
including Form N-1A, periodic statements, shareholder communications and proxy
materials furnished to holders of shares of the Fund, filings with state "blue
sky" authorities and with United States agencies responsible for tax matters,
and other reports and filings of like nature.
3. Expenses Paid by the Sub-Adviser. The Sub-Adviser will pay the cost of
maintaining the staff and personnel necessary for it to perform its obligations
under this Agreement, the expenses of office rent, telephone, telecommunications
and other facilities it is obligated to provide in order to perform the services
specified in Section 2, and any other expenses incurred by it in connection with
the performance of its duties hereunder.
4. Expenses of the Fund Not Paid by the Sub-Adviser. The Sub-Adviser will not be
required to pay any expenses which this Agreement does not expressly make
payable by the Sub-Adviser. In particular, and without limiting the generali-
25
<PAGE>
ty of the foregoing but subject to the provisions of Section 3, the Sub-Adviser
will not be required to pay under this Agreement:
(a) the compensation and expenses of Trustees and of independent advisers,
independent contractors, consultants, managers and other agents employed by the
Trust or the Fund other than through the Sub-Adviser;
(b) legal, accounting and auditing fees and expenses of the Trust or the
Fund;
(c) the fees and disbursements of custodians and depositories of the Trust
or the Fund's assets, transfer agents, disbursing agents, plan agents and
registrars;
(d) taxes and governmental fees assessed against the Trust or the Fund's
assets and payable by the Trust or the Fund;
(e) the cost of preparing and mailing dividends, distributions, reports,
notices and proxy materials to shareholders of the Trust or the Fund except that
the Sub-Adviser shall bear the costs of providing the information referred to in
Section 2(j) to the Adviser;
(f) brokers' commissions and underwriting fees; and
(g) the expense of periodic calculations of the net asset value of the
shares of the Fund.
5. Compensation of the Sub-Adviser. For all services to be rendered, facilities
furnished and expenses paid or assumed by the Sub-Adviser as herein provided for
the Fund, the Adviser will pay the Sub-Adviser quarterly, in arrears, a fee at
the annual rate of 50% of the investment advisory fee received by the Adviser.
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 Sub-Adviser will receive a
pro rata portion of such fee for any periods in which the Sub-Adviser advises
the Fund less than a full quarter. The Fund shall not be liable to the
Sub-Adviser for the Sub-Adviser's compensation hereunder. Calculations of the
Sub-Adviser's fee will be based on average net asset values as provided by the
Adviser.
In addition to the foregoing, the Sub-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 it. Any such fee reduction or
undertaking may be discontinued or modified by the Sub-Adviser at any time.
6. Other Activities of the Sub-Adviser and Its Affiliates. Nothing herein
contained shall prevent the Sub-Adviser or any associate of the Sub-Adviser from
engaging in any other business or from acting as investment adviser or
investment manager for any other person or entity, understood that officers,
direc-
26
<PAGE>
tors and employees of the Sub-Adviser or its 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 Sub-Adviser or 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 Sub-Adviser nor
any of its investment management subsidiaries nor any of 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. The Sub-Adviser shall not
knowingly recommend that the Fund purchase, sell or retain securities of any
issuer in which the Sub-Adviser has a financial interest without obtaining prior
approval of the Adviser prior to the execution of any such transaction.
Nothing herein contained shall limit or restrict the Sub-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 Trust and Fund
acknowledge the Sub-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 Sub-Adviser shall have no obligation to acquire with respect
to the Fund, a position in any investment which the Sub-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 Sub-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 Sub-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 Trust, the Fund, the Adviser and the
Sub-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.
9. Name of the Trust and the Fund. The Trust and the Fund may use the name "John
Hancock" or any name or names derived from or similar to the names "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 Trust and the Fund will (to the extent that they
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 Global 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
nonexclusive right to use the name "John Hancock" or any similar name or names
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.
27
<PAGE>
10. Limitation of Liability of Sub-Adviser. The Sub-Adviser shall not be liable
for any error of judgment or mistake of law or for any loss suffered by the
Trust or the Fund or the Adviser in connection with the matters to which this
Agreement relates, except a loss resulting from willful misfeasance, bad faith
or gross negligence on the Sub-Adviser's part 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 Sub-Adviser, who may be
or become an employee of and paid by the Trust or the Fund shall be deemed, when
acting within the scope of his employment by the Trust or the Fund, to be acting
in such employment solely for the Trust or the Fund and not as the Sub-Adviser's
employee or agent.
11. Duration and Termination of this Agreement. This Agreement shall remain in
force until June 30, 2001, 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, the Sub-Adviser, or
(other than as Board members) of the Trust or 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 Trust or the Fund by vote of a
majority of the outstanding voting securities of the Fund, by the Trustees, the
Adviser or the Sub-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 Sub-Adviser and any other series of the Trust. This
Agreement shall automatically terminate in the event of its assignment or upon
termination of the Investment Management Contract. 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, the Sub-Adviser, or (other than as Board members) of the
Trust or 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.
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.
28
<PAGE>
15. Miscellaneous. (a) 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 Investment Trust III is the
designation of the Trustees under the Amended and Restated Declaration of Trust
dated July 1, 1996, as amended from time to time. The Declaration of Trust has
been filed with the Secretary of The Commonwealth of Massachusetts. The
obligations of the Trust and 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 Trust or the Fund shall not be liable for the obligations of any
other series of the Trust. (b) Any information supplied by the Sub-Adviser,
which is not otherwise in the public domain, in connection with the performance
of its duties hereunder is to be regarded as confidential and for use only by
the Fund and/or its agents, and only in connection with the Fund and its
investments.
Yours very truly,
JOHN HANCOCK INVESTMENT TRUST III
on behalf of John Hancock Global Fund
By: ______________________________________
President
The foregoing contract is hereby agreed to as of the date hereof.
JOHN HANCOCK ADVISERS, INC.
By: ______________________________________
President
INDOCAM INTERNATIONAL INVESTMENT SERVICES
By: ____________________________
Name:
Title:
29
<PAGE>
===================
Thank
You
for mailing
your proxy card
promptly!
===================
[LOGO] JOHN HANCOCK FUNDS
A Global Investment Management Firm
John Hancock Funds, Inc., Member NASD
101 Huntington Avenue, Boston, MA 02199-7603
1-800-225-5291 1-800-554-6713 (TDD)
John Hancock(R)
030PX 10/99
<PAGE>
[LOGO] JOHN HANCOCK FUNDS
A Global Investment Management Firm
VOTE THIS PROXY CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE YOUR FUND
THE EXPENSE OF ADDITIONAL MAILINGS
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES
JOHN HANCOCK INTERNATIONAL FUND
A SERIES OF JOHN HANCOCK INVESTMENT TRUST III
SPECIAL MEETING OF SHAREHOLDERS- DECEMBER 1, 1999
The undersigned, revoking previous proxies, hereby appoint(s) Edward J.
Boudreau, Jr., Anne C. Hodsdon, Susan S. Newton and James J. Stokowski, with
full power of substitution in each, to vote all the shares of beneficial
interest of John Hancock International Fund ("International Fund") which the
undersigned is (are) entitled to vote at the Special Meeting of Shareholders
(the "Meeting") of International Fund to be held at 101 Huntington Avenue,
Boston, Massachusetts 02199, on December 1, 1999 at 9:00 a.m., eastern time, and
any adjournment(s) of the Meeting. All powers may be exercised by a majority of
all proxy holders or substitutes voting or acting, or, if only one votes and
acts, then by that one. Receipt of the Proxy Statement dated October 7, 1999 is
hereby acknowledged. If not revoked, this proxy shall be voted for the
proposal.
Date___________________________________, 1999
o Please complete, sign, date and return this proxy in the enclosed
envelope as soon as possible.
o Please sign exactly as your name or names appear left. When signing as
attorney, executor, administrator, trustee or guardian, please give your
full title as such.
o If a Corporation, please sign in full corporate name by president or
other authorized officer.
o If a partnership, please sign in partnership name by authorized person
- ----------------------------------------
Signature(s)
<PAGE>
[LOGO] JOHN HANCOCK FUNDS
A Global Investment Management Firm
VOTE THIS PROXY CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE YOUR FUND
THE EXPENSE OF ADDITIONAL MAILINGS
Specify your desired action by a check mark in the appropriate space. This proxy
will be voted as specified. If no specification is made, the proxy will be voted
in favor of Item 1. The persons named as proxies have discretionary authority
which they intend to exercise in favor of the proposal referred to and according
to their best judgment as to any other matters which properly come before the
meeting.
Please vote by filling in the appropriate box below.
1 To approve a new sub-investment management contract between John
Hancock Advisers, Inc. and Indocam International Investment Services.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
PLEASE DO NOT FORGET TO SIGN THE REVERSE SIDE OF THIS CARD
<PAGE>
- --------------------------------------------------------------------------------
Important Information
- --------------------------------------------------------------------------------
[LOGO] JOHN HANCOCK FUNDS
A Global Investment Management Firm
October 7, 1999
Dear Fellow Shareholder:
I am writing to ask for your vote on an important matter concerning your
investment in the John Hancock International Fund.
As you know, John Hancock Advisers, Inc. serves as your fund's investment
adviser. John Hancock Advisers International Limited serves as a subadviser to
your fund, providing the fund with investment advice. To provide the fund with
additional international advisory expertise, your fund's Trustees are asking you
to approve a new subadvisory contract between the adviser and Indocam
International Investment Services.
No Cost to Your Fund or Change in Investment Objective
Though this proposal requires your vote, please be assured that your fund will
not bear the cost for either the voting process or making the changes. In
addition, this proposal does not in any way signal a change in your fund's
investment objective. Your fund's portfolio management team will continue to
seek long-term growth of capital by investing primarily in stocks of companies
outside the United States.
This proposal has been unanimously approved by your fund's Board of Trustees,
who believe it will benefit you and your fellow shareholders. It is detailed in
the enclosed proxy statement and summarized in the questions and answers on the
following pages. I suggest you read both thoroughly before voting.
Your Vote Makes a Difference!
No matter what size your investment may be, your vote is critical. I urge you to
review the enclosed materials and to complete, sign and return the enclosed
proxy ballot to us immediately. Your prompt response will help avoid the need
for additional mailings. For your convenience, we have provided a postage-paid
envelope.
If you have any questions or need additional information, please contact your
investment professional or call your Customer Service Representative at
1-800-225-5291, Monday through Friday between 8:00 A.M. and 8:00 P.M. Eastern
Time. I thank you for your prompt vote on this matter.
Sincerely,
/s/ Edward J. Boudreau, Jr.
---------------------------
Edward J. Boudreau, Jr.
Chairman and CEO
<PAGE>
Q&A
Q: Who is Indocam International Investment Services?
A: Indocam International Investment Services (IIIS) is a wholly owned
subsidiary of Indocam, the asset management affiliate of Credit Agricole,
a French banking group. Indocam is an indirect subsidiary of certain
holding companies of Caisse Nationale de Credit Agricole, one of the
largest financial and industrial groups in Europe. As of December 31,
1998, the Indocam group had over $150 billion in assets worldwide.
Indocam is a global investment firm, with a presence in financial centers
around the world, including Paris, London, Frankfurt, Hong Kong, Tokyo,
Singapore, New York and Boston. Based in Paris, Indocam is an asset
management firm maintaining established relationships with institutional,
corporate and individual investors around the world.
In addition to other management responsibilities, Indocam International
Investment Services serves as a subadviser to the John Hancock European
Equity Fund. Indocam Asia Advisers Limited, an affiliate of IIIS and
subsidiary of Indocam, serves as a subadviser to the John Hancock Pacific
Basin Equities Fund.
Q: How can the addition of Indocam International Investment Services to the
portfolio management team benefit me?
A: Upon approval of the proposed new subadvisory contract, the fund's
day-to-day portfolio management responsibilities will be assumed by
Indocam International Investment Services. Based in Paris, a team of
portfolio managers at IIIS will be able to draw on the vast investment
experience of strategists, analysts and portfolio managers in Indocam's
offices around the world. Your fund's Trustees believe that the investment
advice and local insight IIIS will be able to provide into European and
other international financial markets should benefit you and your fund.
Q: Does this change in portfolio management signify a change in the fund's
investment objective and strategy?
A: No, this proposal does not in any way signal a change in your fund's
investment objective or strategy. Your fund will continue to seek
long-term growth of capital by investing primarily in stocks of companies
outside the United States. To pursue this objective, your fund's portfolio
management team will continue to identify investment opportunities by
focusing on country allocation and stock selection.
<PAGE>
Q: Will the addition of Indocam International Investment Services to the
portfolio management team cause an increase in my fund's management fee?
A: No, there will be no change to your fund's management fee.
Q: How do I vote?
A: Most shareholders typically vote by completing, signing and returning the
enclosed proxy card using the postage-paid envelope provided. If you
prefer to vote in person, you are cordially invited to attend a meeting of
shareholders of your fund, which will be held at 9:00 A.M. on December 1,
1999 at our 101 Huntington Avenue headquarters in Boston, Massachusetts.
If you vote now, you will help avoid further solicitations.
<PAGE>
JOHN HANCOCK INTERNATIONAL FUND
(a series of John Hancock Investment Trust III)
101 Huntington Avenue
Boston, MA 02199
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 1, 1999
This is the formal agenda for your fund's special meeting. It tells you what
matters will be voted on and the time and place of the meeting, in case you want
to attend in person.
To the shareholders of John Hancock International Fund:
A special meeting of shareholders of your fund will be held at 101 Huntington
Avenue, Boston, Massachusetts on Wednesday, December 1, 1999 at 9:00 A.M.,
Eastern Time, to consider the following:
1. A proposal to approve a new sub-investment management contract between
John Hancock Advisers, Inc. and Indocam International Investment Services.
Your board of trustees recommends that you vote FOR this proposal.
2. Any other business that may properly come before the meeting.
Shareholders of record as of the close of business on September 14, 1999 are
entitled to vote at the meeting and any related follow-up meetings.
Whether or not you expect to attend the meeting, please complete and return the
enclosed proxy card. Please take a few minutes to vote now.
By order of the board of trustees,
/s/Susan S. Newton
------------------
Secretary
October 7, 1999
400PX 10/99
<PAGE>
PROXY STATEMENT OF
JOHN HANCOCK INTERNATIONAL FUND
(a series of John Hancock Investment Trust III)
This proxy statement contains the information you should know before voting on
the proposals as summarized below.
Your fund will furnish without charge a copy of its most recent annual report to
any shareholder upon request. Shareholders who want to obtain a copy of the
fund's semiannual and annual report should direct all written requests to the
attention of the fund, 101 Huntington Avenue, Boston, Massachusetts 02199 or
call John Hancock Funds at 1-800-225-5291.
INTRODUCTION
This proxy statement is being used by the board of trustees of your fund to
solicit proxies to be voted at a special meeting of shareholders of your fund.
This meeting will be held at the principal executive offices of the fund, 101
Huntington Avenue, Boston, Massachusetts on Wednesday, December 1, 1999 at 9:00
A.M., Eastern Time. The purpose of the meeting is to consider:
1. A proposal to approve a new sub-investment management contract between
John Hancock Advisers, Inc. and Indocam International Investment Services.
2. Any other business that may properly come before the meeting.
This proxy statement and the proxy card are being mailed to fund shareholders on
or about October 7, 1999.
Who is Eligible to Vote?
Shareholders of record on September 14, 1999 are entitled to attend and vote on
each proposal at the meeting or any adjourned meeting. Each share is entitled to
one vote. Shares represented by properly executed proxies, unless revoked before
or at the meeting, will be voted according to shareholder instructions. If you
sign a proxy, but do not fill in a vote, your shares will be voted "for" the
proposals. If any other business comes before the meeting, your shares will be
voted at the discretion of the persons named as proxies.
<PAGE>
PROPOSAL 1
APPROVAL OF A NEW
SUB-INVESTMENT MANAGEMENT CONTRACT
John Hancock Advisers, Inc. (the "adviser") serves as your fund's investment
adviser and is responsible for providing the fund with a continuous investment
program under an investment management contract dated January 1, 1994
(the"management contract"). The management contract was most recently approved
by the shareholders of the fund at a meeting for that purpose held on June 26,
1996.
The adviser hired John Hancock Advisers International Limited ("JHAI") to serve
as a sub-investment adviser to the fund under a sub-investment management
contract dated January 1, 1994 (the "existing contract"). JHAI, subject to the
review of the fund's trustees and the overall supervision of the adviser,
provides the fund with investment advice. The existing contract was approved by
the shareholders of the fund on January 1, 1994.
At a meeting of your fund's trustees held on September 14, 1999, the trustees,
including all of the independent trustees (those who are not "interested
persons" as defined in the Investment Company Act of 1940, as amended (the "1940
Act")), unanimously approved and voted to recommend that shareholders of your
fund approve a new subadvisory contract (the "proposed contract") between the
adviser and Indocam International Investment Services ("IIIS"). The form of
proposed contract is attached to this proxy statement as Exhibit A.
Pursuant to the proposed contract, IIIS will serve as a co-subadviser to the
fund, together with JHAI, in order to provide the fund with additional
international advisory expertise. IIIS, with its principal office in Paris,
France, will be able to provide the fund with investment advice and local
insight into European and other international financial markets.
Approval of the proposed contract will not result in any increase in fees
payable by the fund. As with JHAI under the existing contract, the adviser will
be solely responsible for paying the subadvisory fee to IIIS under the proposed
contract.
Under the proposed contract, IIIS will provide the fund with advice and
recommendations regarding the fund's investments. IIIS will also provide the
fund on a continuous basis with economic, financial and political information,
research and assistance concerning international markets.
Indocam International Investment Services
IIIS is organized under the laws of France and is a wholly owned subsidiary of
Indocam, the asset management affiliate of Credit Agricole, a French banking
group. Indocam is an indirect subsidiary of certain holding companies of Caisse
Nationale de Credit Agricole ("CNCA"), 91-93 Boulevard Pasteur, Paris, France,
75015, one of the largest financial and industrial groups in Europe. As of
December 31, 1998, the Indocam group had over $150 billion in assets worldwide.
2
<PAGE>
IIIS currently serves as investment adviser to The France Growth Fund, Inc., a
registered closed-end investment company. In addition, IIIS serves as subadviser
to three open-end investment companies (mutual funds): BNY Hamilton
International Equity Fund, Victory International Growth Fund and John Hancock
European Equity Fund. For each fund managed or subadvised by IIIS with a similar
investment objective, the asset size and the fee rate payable to them are as
follows:
Fund Fund Assets* Fee Rate
- --------------------------------------------------------------------------------
BNY Hamilton International Equity Fund $7.7 million 0.425%
(Sub-investment
management fee)
Victory International Growth Fund $133 million 0.550%
(Sub-investment
management fee)
*As of June 30, 1999.
Although IIIS operates on a fully independent basis and makes its own investment
decisions in rendering investment advice, it has access to the extensive
research and other resources of CNCA's group of affiliated entities. The
investment personnel of IIIS also are employed by and act as investment
personnel for Indocam and/or Indocam Hong Kong Limited, an affiliate of IIIS
that serves as adviser to certain Asian country funds. The address of IIIS is 90
Boulevard Pasteur, Paris, France 75015.
The principal executive officer and the directors of IIIS are listed below,
along with their principal occupations
================================================================================
Name* Principal Occupation
================================================================================
Jean-Claude Kaltenbach Chairman and Chief Executive Officer of IIIS.
Principal Executive Officer,
Chairman
- --------------------------------------------------------------------------------
Ian Gerald McEvatt Managing Director and Chief Investment
Director Officer of Indocam Hong Kong Ltd.
- --------------------------------------------------------------------------------
Claude Rene Doumic Chairman of Societe de Port de Tanger
Director (closed-end fund).
- --------------------------------------------------------------------------------
Didier Guyot de la Pommeraye International Development for Indosuez
Director Asset Management.
- --------------------------------------------------------------------------------
Charles Denis Jules Vergnot Chairman of Danubexsa.
Director
- --------------------------------------------------------------------------------
Eric Harrison Jostrom Chief Executive Officer and Chief
Director Investment Officer of Constitution
Management Company, Inc.
================================================================================
* The business address of each person listed is 90 Boulevard Pasteur, Paris,
France 75015.
3
<PAGE>
The Adviser
The adviser is a wholly owned subsidiary of The Berkeley Financial Group, Inc.
(the "Berkeley Group"), which is a wholly owned subsidiary of John Hancock
Subsidiaries, Inc., which is a wholly owned subsidiary of John Hancock Mutual
Life Insurance Company (the "Insurance Company"), John Hancock Place, P.O. Box
111, Boston, MA 02117. The adviser currently has more than $30 billion assets
under management in its capacity as investment adviser to the fund and other
funds in the John Hancock Group of Funds as well as other institutional
accounts.
The principal executive officer and the directors of the adviser are listed
below, along with their principal occupations.
================================================================================
Name and Address Principal Occupation
================================================================================
Edward J. Boudreau, Jr. Chairman and Chief Executive Officer of
Principal Executive Officer, the adviser, the Berkeley Group, John
Chairman Hancock Funds, Inc., Sovereign Asset
101 Huntington Avenue Management Corporation, NM Capital
Boston, MA 02199 Management, Inc., JHAI and First
Signature Bank & Trust Company; Director
of John Hancock Advisers International
(Ireland) Ltd.
- --------------------------------------------------------------------------------
Foster L. Aborn Vice Chairman and Chief Investment
Director Officer, the Insurance Company; Director
John Hancock Place of John Hancock Capital Growth
P.O. Box 111 Management, Inc., the Berkeley Group,
Boston, MA 02117 the adviser, John Hancock Funds, Inc.,
Independence Investment Associates,
Inc., John Hancock Capital Corporation
and John Hancock Subsidiaries, Inc.
- --------------------------------------------------------------------------------
Stephen L. Brown Chairman and Chief Executive Officer of
Director the Insurance Company; Director of the
John Hancock Place Berkeley Group, the adviser, John
P.O. Box 111 Hancock Funds, Inc. and John Hancock
Boston, MA 02117 Subsidiaries, Inc.
- --------------------------------------------------------------------------------
David F. D'Alessandro Director of John Hancock Insurance
Director Agency, Inc., the adviser, the Berkeley
John Hancock Place Group, John Hancock Funds, Inc. and John
P.O. Box 111 Hancock Subsidiaries, Inc.; Chairman and
Boston, MA 02117 Director, John Hancock Variable Life
Insurance Company and John Hancock
Mutual Life Insurance Company of
America; Director, President and Chief
Operating Officer of the Insurance
Company.
================================================================================
4
<PAGE>
================================================================================
Name and Address Principal Occupation
================================================================================
John M. DeCiccio Senior Vice President, the Insurance
Director Company; Director of the Berkeley Group,
John Hancock Place the adviser and John Hancock Funds, Inc.
P.O. Box 111
Boston, MA 02117
- --------------------------------------------------------------------------------
William C. Fletcher President and Director of Independence
Director Investment Associates, Inc.; Director of
John Hancock Place Independence International Associates,
P.O. Box 111 Inc., the Berkeley Group, the adviser,
Boston, MA 02117 John Hancock Funds, Inc., Hancock
Natural Resource Group, Inc. and Hancock
Energy Resources Management, Inc.;
Chairman and Director of JHM Capital
Management, Inc.
- --------------------------------------------------------------------------------
Maureen R. Ford President of broker/dealer distribution
Director of the Insurance Company; Director of
101 Huntington Avenue the adviser, the Berkeley Group, John
Boston, MA 02199 Hancock Funds, Inc.; President and
Director of John Hancock Insurance
Agency, Inc.
- --------------------------------------------------------------------------------
Anne C. Hodsdon Director, President and Chief Operating
Director, President, Chief Officer of the adviser and the Berkeley
Operating Officer and Group; Director and Executive Vice
Chief Investment Officer President of John Hancock Funds, Inc.;
101 Huntington Avenue President and Director of NM Capital
Boston, MA 02199 Management, Inc. and Sovereign Asset
Management Corporation; Director of John
Hancock International (Ireland) Ltd. and
JHAI.
- --------------------------------------------------------------------------------
David A. King Chief Executive Officer, President and
Director Director of John Hancock Signature
John Hancock Place Services, Inc.; Chairman of Networking
P.O. Box 111 Insurance Agency; Vice Chairman of First
Boston, MA 02117 Signature Bank & Trust; Director of the
adviser, the Berkeley Group and John
Hancock Funds, Inc.; Senior Vice
President of the Insurance Company.
================================================================================
5
<PAGE>
================================================================================
Name and Address Principal Occupation
================================================================================
Jeanne M. Livermore Senior Vice President of the Insurance
Director Company; Director of the Berkeley Group,
John Hancock Place the adviser, John Hancock Funds, Inc.
P.O. Box 111 and JHAI.
Boston, MA 02117
- --------------------------------------------------------------------------------
Thomas E. Moloney Chief Financial Officer of the Insurance
Director Company; Director of the adviser, the
John Hancock Place Berkeley Group, John Hancock Funds,
P.O. Box 111 Inc., John Hancock Realty Services and
Boston, MA 02117 John Hancock Capital Corporation;
Chairman of John Hancock Property &
Casualty; Director and Chief Financial
Officer of John Hancock Subsidiaries,
Inc.; Director and Chairman of John
Hancock Signature Services, Inc.
- --------------------------------------------------------------------------------
Richard S. Scipione General Counsel of the Insurance
Director Company; Director of Sovereign Asset
John Hancock Place Management Corporation, NM Capital
P.O. Box 111 Management, Inc., the Berkeley Group,
Boston, MA 02117 the adviser, John Hancock Funds, Inc.
and Signator Investors, Inc.
- --------------------------------------------------------------------------------
Robert H. Watts Executive Vice President of Signator
Director Investors, Inc.; Senior Vice President
John Hancock Place of the Insurance Company; Director of
P.O. Box 111 John Hancock Insurance Agency, Inc., the
Boston, MA 02117 Berkeley Group, the adviser and JHAI.
================================================================================
6
<PAGE>
John Hancock Advisers International Ltd.
JHAI is a wholly owned subsidiary of the adviser and currently manages more than
$400 million in assets.
The principal executive officer and the directors of JHAI are listed below,
along with their principal occupations.
================================================================================
Name and Address Principal Occupation
================================================================================
Edward J. Boudreau, Jr. Chairman and Chief Executive Officer of
Chairman the adviser, the Berkeley Group, John
101 Huntington Avenue Hancock Funds, Inc., Sovereign Asset
Boston, MA 02199 Management Corporation, NM Capital
Management, Inc., JHAI and First
Signature Bank & Trust Company; Director
of John Hancock Advisers International
(Ireland) Ltd.
- --------------------------------------------------------------------------------
John L. Wills Managing Director and Director of JHAI;
Managing Director Senior Vice President of adviser;
Duke's Court, 6th Floor Director of John Hancock Advisers
32-36 Duke Street St. James's International (Ireland) Ltd.
London SWIY6DF
- --------------------------------------------------------------------------------
Anne C. Hodsdon Director, President and Chief Operating
Director Officer of the adviser and the Berkeley
101 Huntington Avenue Group; Director and Executive Vice
Boston, MA 02199 President of John Hancock Funds, Inc.;
President and Director of NM Capital
Management, Inc. and Sovereign Asset
Management Corporation; Director of John
Hancock International (Ireland) Ltd. and
JHAI.
- --------------------------------------------------------------------------------
Jeanne M. Livermore Senior Vice President of the Insurance
Director Company; Director of the Berkeley Group,
John Hancock Place the adviser, John Hancock Funds, Inc.
P.O. Box 111 and JHAI.
Boston, MA 02117
- --------------------------------------------------------------------------------
Robert H. Watts Executive Vice President of Signator
Director Investors, Inc.; Senior Vice President
John Hancock Place of the Insurance Company; Director of
P.O. Box 111 John Hancock Insurance Agency, Inc., the
Boston, MA 02117 Berkeley Group, the adviser and JHAI.
================================================================================
7
<PAGE>
The Proposed and Existing Contracts
The following is a summary of the material terms of the proposed and existing
contracts. In describing the proposed contract, this summary is qualified by
reference to the form of proposed contract attached to this proxy statement as
Exhibit A.
Compensation. The existing contract and the proposed contract (collectively, the
"contracts") provide that JHAI or IIIS, as the case may be, is required to pay
all expenses that it incurs in connection with the performance of its duties
under the contract. The contracts also provide that the adviser, not the fund,
will pay the subadvisory fees.
The proposed contract requires the adviser to pay quarterly to IIIS a
subadvisory fee, which is accrued daily and on an annual basis is equal to 55%
of the gross management fee received by the adviser with respect to the fund's
average daily net assets.
The existing contract requires the adviser to pay JHAI a subadvisory fee, which
is accrued daily, based on a percentage of the fund's average daily net assets
as follows:
Average Daily Net Assets Percent of Average
Managed by JHAI Daily Net Assets
First $200 million 0.70%
Amount over $200 million 0.6375%
For the fund's fiscal year ended October 31, 1998, the adviser paid JHAI
$107,099 in subadvisory fees.
If the proposed contract is approved by the fund's shareholders, JHAI will
voluntarily limit its subadvisory fee to 0.05% of the fund's average daily net
assets effective December 2, 1999 or such later date as determined by the
officers of the fund.
Term. If approved by shareholders of the fund, the proposed contract will take
effect as of December 1, 1999 and will remain in effect until December 1, 2001.
Thereafter, the proposed contract will continue in effect from year to year
subject to the annual approval of its continuance as described below under
"Provisions Contained in Both Contracts and in the Management Contract."
Provisions Contained in Both Contracts and in the Management Contract
Limitation of Liability. The management and the subadvisory contracts provide
that the adviser, JHAI and IIIS are not 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 the respective contract relates, except a loss resulting from
willful misfeasance, bad faith or gross negligence on the part of the applicable
adviser, JHAI or IIIS in the performance of its duties or from the reckless
disregard of its obligations and duties under the contracts.
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Termination, Continuance and Amendment. Except as described above for the
proposed contract, each contract continues from year to year subject to annual
approval of its continuance by a majority of the independent trustees, cast in
person at a meeting called for the purpose of voting on such approval, and
annual approval by either (a) your fund's trustees, or (b) a majority of your
fund's outstanding voting securities, as defined in the 1940 Act. Each contract
may be terminated at any time without penalty on 60 days' written notice by the
trustees, by a vote of a majority of the fund's outstanding voting securities,
or by the adviser, JHAI or IIIS, as the case may be. Each contract terminates
automatically in the event of its assignment or in the event that the adviser
ceases to act as the fund's investment adviser.
Use of Name "John Hancock." Under the management contract and the existing
contract, if the adviser ceases to act as the fund's investments adviser, the
fund (to the extent that it lawfully can) must cease to use the name "John
Hancock International Fund" or any name derived from the name "John Hancock" or
any other name indicating that the fund is advised by or otherwise associated
with the adviser.
The Management Contract
Under the management contract, the adviser, subject to the direction of the
trustees, provides the fund with a continuous investment program for the
management of its assets, consistent with the fund's investment objective and
policies. The adviser furnishes the fund with advice and recommendations
consistent with the investment policies of the fund regarding the purchase,
holding and disposition of portfolio securities. The adviser:
o advises the fund in connection with policy decisions to be made by the
trustees;
o furnishes the fund with research, economic and statistical data in
connection with the fund's investments and policies;
o provides day-to-day administration;
o investigates and conducts relations with issuers of securities to be
purchased by the fund;
o provides required reports and recommendations to the trustees and
maintains the records of the fund; and
o assists 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.
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
officers and employees of the fund and pays the expenses of clerical services
related to the administration of the fund. Other than expenses specifically
assumed by the adviser, all expenses incurred in the continuing operation of the
fund are borne by the fund, including fees of the independent trustees and
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all fees of lawyers and accountants. Also, the Fund has an agreement with the
Adviser to perform necessary tax, accounting and legal services for the Fund.
The Fund pays an investment management fee to the adviser equivalent on an
annual basis to a stated percentage of the average daily net assets of the fund
as set forth below:
Net Asset Value Annual Rate
First $250 million 1.00%
Next $250 million 0.80%
Next $250 million 0.75%
Amount over $750 million 0.625%
The adviser has voluntarily agreed to reduce management fees and other expenses
payable, excluding transfer agent and 12b-1 expenses, to 0.90% of the fund's
average daily net assets. This agreement may be modified or discontinued by the
adviser at any time. During the fiscal year ended October 31, 1998, the adviser
did not receive any management fees from the fund.
Analysis of Proposal and Review of Trustees
The trustees have determined that the terms of the proposed contract are fair
and reasonable. In approving the proposed contract and recommending its approval
by the shareholders of the fund, the trustees, including the independent
trustees, considered the best interest of the shareholders of the fund and took
into account all factors they deemed relevant.
In evaluating the proposed contract, the trustees carefully reviewed materials
furnished by the adviser relating to IIIS and its affiliates and their
personnel, operations and financial condition. The trustees considered the
extensive international investment management expertise of IIIS as beneficial to
the fund.. The trustees also deemed important the favorable history, reputation
and qualification of IIIS' parent company, Credit Agricole, and the level of
resources available to IIIS through Credit Agricole and its subsidiaries in
providing investment subadvisory services to the fund. Additionally, the
trustees considered that JHAI will voluntarily agree to limit its subadvisory
fee to 0.05% of the fund's average daily net assets effective as of December 1,
1999 or such later date as determined by the officers of the fund. Other factors
deemed important by the trustees in making their recommendation are (i) the
possibility of benefits that may be realized by the fund as a result of IIIS
serving as the fund's investment subadviser; and (ii) other factors deemed
relevant by the trustees.
The trustees also considered possible benefits to IIIS under the proposed
contract, including the ability of IIIS (a) to cause the fund to execute
securities transactions with brokers that are affiliated with Credit Agricole,
subject to compliance with the requirements of the 1940 Act and procedures
adopted by, and with the oversight of, the trustees and (b) to obtain soft
dollar brokerage and research services from brokers that are not affiliated with
Credit Agricole who effect securities transactions on behalf of the fund.
Throughout the review
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process the independent trustees were advised by their independent legal
counsel, who was not counsel to the trust, the adviser, JHAI or IIIS.
Trustees' Evaluation and Recommendation
The trustees, including all of the independent trustees, by a vote cast at a
meeting held on September 14, 1999 unanimously approved and voted to recommend
to the shareholders of the fund that they adopt the proposed contract. If the
shareholders of the fund approve the proposed contract, the proposed contract
will take effect as of December 1, 1999.
The trustees of your fund recommend that the shareholders of your fund vote
"for" the proposed contract.
VOTING RIGHTS AND REQUIRED VOTE
Each share of your fund is entitled to one vote for each proposal. Approval of
each proposal requires the affirmative vote of a majority of the shares of your
fund outstanding and entitled to vote. For this purpose, a majority of the
outstanding shares of your fund means with respect to each proposal the vote of
the lesser of:
(1) 67% or more of the shares present at the meeting, if the holders of more
than 50% of the shares of the fund are present or represented by proxy,
or
(2) more than 50% of the outstanding shares of the fund.
Shares of your fund represented in person or by proxy, including shares which
abstain or do not vote with respect to a proposal, will be counted for purposes
of determining whether there is a quorum at the meeting. Accordingly, an
abstention from voting has the same effect as a vote against a proposal.
However, if a broker or nominee holding shares in "street name" indicates on the
proxy card that it does not have discretionary authority to vote on a proposal,
those shares will not be considered present and entitled to vote on that
proposal. Thus, a "broker non-vote" has no effect on the voting in determining
whether a proposal has been adopted in accordance with clause (1) above, if more
than 50% of the outstanding shares (excluding the "broker non-votes") are
present or represented. However, for purposes of determining whether a proposal
has been adopted in accordance with clause (2) above, a "broker non-vote" has
the same effect as a vote against that proposal because shares represented by a
"broker non-vote" are considered to be outstanding shares.
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INFORMATION CONCERNING THE MEETING
Solicitation of Proxies
In addition to the mailing of these proxy materials, proxies may be solicited by
telephone, by fax or in person by the trustees, officers and employees of your
fund; by personnel of the adviser, the fund's principal distributor, John
Hancock Funds, Inc., and the fund's transfer agent, John Hancock Signature
Services, Inc., or by broker-dealer firms. Signature Services, together with a
third party solicitation firm, has agreed to provide proxy solicitation services
at a cost of approximately $1,184, which will be paid by the adviser.
The mailing address of the fund, the adviser and the underwriter, John Hancock
Funds, Inc. is 101 Huntington Avenue, Boston, Massachusetts 02199.
Revoking Proxies
A shareholder signing and returning a proxy has the power to revoke it at any
time before it is exercised:
o By filing a written notice of revocation with your fund's transfer agent,
John Hancock Signature Services, Inc., 1 John Hancock Way, Suite 1000,
Boston, Massachusetts 02217-1000,
o By returning a duly executed proxy with a later date before the time of
the meeting, or
o If a shareholder has executed a proxy but is present at the meeting and
wants to vote in person, by notifying the secretary of the fund (without
complying with any formalities) at any time before it is voted.
Being present at the meeting alone does not revoke a previously executed and
returned proxy.
Outstanding Shares and Quorum
As of September 14, 1999, 643,496 Class A, 934,174 Class B and 16,378 Class C
shares of beneficial interest of the fund were outstanding. Only shareholders of
record on September 14, 1999 (record date) are entitled to notice of and to vote
at the meeting. A majority of the outstanding shares of the fund that are
entitled to vote will be considered a quorum for the transaction of business.
Other Business
The fund's board of trustees knows of no business to be presented for
consideration at the meeting other than the proposal. If other business is
properly brought before the meeting, proxies will be voted according to the best
judgment of the persons named as proxies.
Adjournments
If a quorum is not present in person or by proxy at the time any session of the
meeting is called to order, the persons named as proxies may vote those
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proxies that have been received to adjourn the meeting to a later date. If a
quorum is present but there are not sufficient votes in favor of the proposal,
the persons named as proxies may propose one or more adjournments of the meeting
to permit further solicitation of proxies concerning the proposal. Any
adjournment will require the affirmative vote of a majority of the fund's shares
at the session of the meeting to be adjourned. If an adjournment of the meeting
is proposed because there are not sufficient votes in favor of the proposal, the
persons named as proxies will vote those proxies favoring the proposal in favor
of adjournment, and will vote those proxies against the proposal against
adjournment.
Telephone Voting
In addition to soliciting proxies by mail, by fax or in person, the fund may
also arrange to have votes recorded by telephone by officers and employees of
the fund or by personnel of the adviser or transfer agent. The telephone voting
procedure is designed to verify a shareholder's identity, to allow a shareholder
to authorize the voting of shares in accordance with the shareholder's
instructions and to confirm that the voting instructions have been properly
recorded. If these procedures were subject to a successful legal challenge,
these telephone votes would not be counted at the meeting. The fund has not
obtained an opinion of counsel about telephone voting, but is currently not
aware of any challenge.
o A shareholder will be called on a recorded line at the telephone number in
the fund's account records and will be asked to provide the shareholder's
social security number or other identifying information.
o The shareholder will then be given an opportunity to authorize proxies to
vote his or her shares at the meeting in accordance with the shareholder's
instructions.
o To ensure that the shareholder's instructions have been recorded
correctly, the shareholder will also receive a confirmation of the voting
instructions by mail.
o A toll-free number will be available in case the voting information
contained in the confirmation is incorrect.
o If the shareholder decides after voting by telephone to attend the
meeting, the shareholder can revoke the proxy at that time and vote the
shares at the meeting.
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OWNERSHIP OF SHARES IN THE FUNDS
To the knowledge of the fund, as of September 14, 1999, the following persons
beneficially owned 5% or more of the outstanding shares of a class of your fund.
Class of Number of
Name and Address Shares Shares Owned
- ---------------- ------ ------------
Ernie Williams LTD Class A 5.33%
2613 HWY 18 East
P.O. Box 737
Algona, IA 50511
Int'l. Development Resources Inc. Class C 18.84%
101 Huntington Avenue, 5th Floor
Boston, MA 02199-7603
West Grand Medical Retirement Plan Class C 13.92%
Robert H Major, M.D.
1931 Summerhill Drive
Winterset, IA 50273-8148
Quinstar Technology, Inc. Class C 11.63%
24085 Garnier Street
Torrance, CA 90505
Copa Casino Class C 10.24%
777 Copa Casino Blvd.
Gulfport, MS 39502
Jim Peach Motors, Inc. Class C 7.13%
518 South Blvd.
Brewton, AL 36426
Eli Pekel Class C 8.75%
22990 Cricket Hill Road
Cupertino, CA 95014-2639
Salomon Smith Barney Inc. Class C 6.56%
333 West 34th Street-3rd Floor
New York, NY 10001-2483
As of September 14, 1999, the trustees and officers of the fund owned in the
aggregate less than 1% of the outstanding shares of the fund.
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EXHIBIT A
JOHN HANCOCK INVESTMENT TRUST III
John Hancock International Fund
Sub-Investment Management Contract
Dated December 1, 1999
JOHN HANCOCK ADVISERS, INC.
101 Huntington Avenue
Boston, Massachusetts 02199
JOHN HANCOCK INVESTMENT TRUST III
John Hancock International Fund
101 Huntington Avenue
Boston, Massachusetts 02199
INDOCAM INTERNATIONAL INVESTMENT SERVICES
90 Boulevard Pasteur
Paris, FRANCE 75015
Sub-Investment Management Contract
Ladies and Gentlemen:
John Hancock Investment Trust III (the "Trust") 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 Trust'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 Trust. As
of the date hereof, the Trust has four series of shares, representing interests
in John Hancock Global Fund, John Hancock Large Cap Growth Fund, John Hancock
International Fund, and John Hancock Mid Cap Growth Fund.
The Board of Trustees of the Trust (the "Trustees") has selected John Hancock
Advisers, Inc. (the "Adviser") to provide overall investment advice and
management for the John Hancock International Fund (the "Fund"), and to provide
certain other services, under the terms and conditions provided in the
Investment Management Contract, dated July 1, 1996, between the Trust, the Fund
and the Adviser (the "Investment Management Contract").
The Adviser and the Trustees have selected Indocam International Investment
Services (the "Sub-Adviser") to provide the Adviser and the Fund with the advice
and services set forth below, and the Sub-Adviser is willing to provide such
advice and services, subject to the review of the Trustees and overall
supervision of the Adviser, under the terms and conditions hereinafter set
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forth. The Sub-Adviser hereby represents and warrants that it is registered as
an investment adviser under the Investment Advisers Act of 1940, as amended.
Accordingly, the Trust, on behalf of the Fund, and the Adviser agree with the
Sub-Adviser as follows:
1. Delivery of Documents. The Trust has furnished the Sub-Adviser with
copies, properly certified or otherwise authenticated, of each of the
following:
(a) Amended and Restated Declaration of Trust of the Trust, dated July 1,
1996, as amended from time to time (the "Declaration of Trust");
(b) By-Laws of the Trust as in effect on the date hereof;
(c) Resolutions of the Trustees approving the form of this Agreement by and
among the Adviser, the Sub-Adviser and the Trust, on behalf of the Fund;
(d) Resolutions of the Trustees selecting the Adviser as investment adviser
for the Fund and approving the form of the Investment Management Contract;
(e) the Investment Management Contract;
(f) the Fund's portfolio compliance checklists;
(g) the Fund's current Registration Statement, including the Fund's Prospectus
and Statement of Additional Information; and
(h) the Fund's Code of Ethics.
The Trust will furnish to the Sub-Adviser from time to time copies, properly
certified or otherwise authenticated, of all amendments of or supplements to the
foregoing, if any.
2. Investment Services. The Sub-Adviser will use its best efforts to provide to
the Fund continuing and suitable investment advice with respect to investments,
consistent with the investment policies, objectives and restrictions of the Fund
as set forth in the Fund's Prospectus and Statement of Additional Information.
In the performance of the Sub-Adviser's duties hereunder, subject always (x) to
the provisions contained in the documents delivered to the Sub-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 Trust, on behalf 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 Sub-Adviser will have investment discretion with
respect to the Fund and will at its own expense:
(a) furnish the Adviser and the Fund with advice and recommendations,
consistent with the investment policies, objectives and restrictions of
the Fund as set forth in the Fund's Prospectus and Statement of Additional
Information, with respect to the purchase, holding and disposition of
portfolio securities including the purchase and sale of options;
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(b) furnish the Adviser and the Fund with advice as to the manner in which
voting rights, subscription rights, rights to consent to corporate action
and any other rights pertaining to the Fund's assets shall be exercised,
the Fund having the responsibility to exercise such voting and other
rights;
(c) furnish the Adviser and 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) subject to prior consultation with the Adviser, engage in negotiations
relating to the Fund's investments with issuers, investment banking firms,
securities brokers or dealers and other institutions or investors;
(f) consistent with 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 or the Sub-Adviser, provided that in
connection with the placing of such orders and the selection of such
brokers or dealers the Sub-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 and furnished to the Sub-Adviser from time to time;
(g) from time to time or at any time requested by the Adviser or the Trustees,
make reports to the Adviser or the Trust of the Sub-Adviser's performance
of the foregoing services;
(h) subject to the supervision of the Adviser, maintain all books and records
with respect to the Fund's securities transactions required by the 1940
Act, and preserve such records for the periods prescribed therefor by the
1940 Act (the Sub-Adviser agrees that such records are the property of the
Trust and copies will be surrendered to the Trust promptly upon request
therefor);
(i) 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 advise the Adviser on the same day such instructions are
given; and
(j) cooperate generally with the Fund and the Adviser to provide information
necessary for the preparation of registration statements and periodic
reports to be filed with the Securities and Exchange Commission, including
Form N-1A, periodic statements, shareholder communications and proxy
materials furnished to holders of shares of the Fund, filings with state
"blue sky" authorities and with United States agencies responsible for tax
matters, and other reports and filings of like nature.
3. Expenses Paid by the Sub-Adviser. The Sub-Adviser will pay the cost of
maintaining the staff and personnel necessary for it to perform its obligations
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under this Agreement, the expenses of office rent, telephone, telecommunications
and other facilities it is obligated to provide in order to perform the services
specified in Section 2, and any other expenses incurred by it in connection with
the performance of its duties hereunder.
4. Expenses of the Fund Not Paid by the Sub-Adviser. The Sub-Adviser will not be
required to pay any expenses which this Agreement does not expressly make
payable by the Sub-Adviser. In particular, and without limiting the generality
of the foregoing but subject to the provisions of Section 3, the Sub-Adviser
will not be required to pay under this Agreement:
(a) the compensation and expenses of Trustees and of independent advisers,
independent contractors, consultants, managers and other agents employed
by the Trust or the Fund other than through the Sub-Adviser;
(b) legal, accounting and auditing fees and expenses of the Trust or the Fund;
(c) fees and disbursements of custodians and depositories of the Trust or the
Fund's assets, transfer agents, disbursing agents, plan agents and
registrars;
(d) taxes and governmental fees assessed against the Trust or the Fund's
assets and payable by the Trust or the Fund;
(e) the cost of preparing and mailing dividends, distributions, reports,
notices and proxy materials to shareholders of the Trust or the Fund
except that the Sub-Adviser shall bear the costs of providing the
information referred to in Section 2(j) to the Adviser;
(f) brokers' commissions and underwriting fees; and
(g) the expense of periodic calculations of the net asset value of the shares
of the Fund.
5. Compensation of the Sub-Adviser. For all services to be rendered, facilities
furnished and expenses paid or assumed by the Sub-Adviser as herein provided for
the Fund, the Adviser will pay the Sub-Adviser quarterly, in arrears, a fee at
the annual rate of 55% of the investment advisory fee received by the Adviser.
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 Sub-Adviser will receive a
pro rata portion of such fee for any periods in which the Sub-Adviser advises
the Fund less than a full quarter. Fund shall not be liable to the Sub-Adviser
for the Sub-Adviser's compensation hereunder. Calculations of the Sub-Adviser's
fee will be based on average net asset values as provided by the Adviser.
In addition to the foregoing, the Sub-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 it. Any such fee
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reduction or undertaking may be discontinued or modified by the Sub-Adviser at
any time.
6. Other Activities of the Sub-Adviser and Its Affiliates. Nothing herein
contained shall prevent the Sub-Adviser or any associate of the Sub-Adviser from
engaging in any other business or from acting as investment adviser or
investment manager for any other person or entity, understood that officers,
directors and employees of the Sub-Adviser or its 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 Sub-Adviser or 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 Sub-Adviser nor
any of its investment management subsidiaries nor any of 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. The Sub-Adviser shall not
knowingly recommend that the Fund purchase, sell or retain securities of any
issuer in which the Sub-Adviser has a financial interest without obtaining prior
approval of the Adviser prior to the execution of any such transaction.
Nothing herein contained shall limit or restrict the Sub-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 Trust and Fund
acknowledge the Sub-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 Sub-Adviser shall have no obligation to acquire with respect
to the Fund, a position in any investment which the Sub-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 Sub-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 Sub-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 Trust, the Fund, the Adviser and the
Sub-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.
9. Name of the Trust and the Fund. The Trust and the Fund may use the name "John
Hancock" or any name or names derived from or similar to the names "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 Trust and the Fund will (to the extent that they
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 International Fund
through permission of John Hancock Mutual Life Insurance
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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 nonexclusive right to use the name "John Hancock" or any
similar name or names 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 Sub-Adviser. The Sub-Adviser shall not be liable
for any error of judgment or mistake of law or for any loss suffered by the
Trust or the Fund or the Adviser in connection with the matters to which this
Agreement relates, except a loss resulting from willful misfeasance, bad faith
or gross negligence on the Sub-Adviser's part 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 Sub-Adviser, who may be
or become an employee of and paid by the Trust or the Fund shall be deemed, when
acting within the scope of his employment by the Trust or the Fund, to be acting
in such employment solely for the Trust or the Fund and not as the Sub-Adviser's
employee or agent.
11. Duration and Termination of this Agreement. This Agreement shall remain in
force until June 30, 2001, 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, the Sub-Adviser, or
(other than as Board members) of the Trust or 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 Trust or the Fund by vote of a
majority of the outstanding voting securities of the Fund, by the Trustees, the
Adviser or the Sub-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 Sub-Adviser and any other series of the Trust. This
Agreement shall automatically terminate in the event of its assignment or upon
termination of the Investment Management Contract. 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, the Sub-Adviser, or (other than as Board members) of the
Trust or 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.
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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. (a) 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 Investment Trust III is the
designation of the Trustees under the Amended and Restated Declaration of Trust
dated July 1, 1996, as amended from time to time. The Declaration of Trust has
been filed with the Secretary of The Commonwealth of Massachusetts. The
obligations of the Trust and 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 Trust or the Fund shall not be liable for the obligations of any
other series of the Trust. (b) Any information supplied by the Sub-Adviser,
which is not otherwise in the public domain, in connection with the performance
of its duties hereunder is to be regarded as confidential and for use only by
the Fund and/or its agents, and only in connection with the Fund and its
investments.
Yours very truly,
JOHN HANCOCK INVESTMENT TRUST III
on behalf of John Hancock International Fund
By:_______________________________________
President
The foregoing contract is hereby agreed to as of the date hereof.
JOHN HANCOCK ADVISERS, INC.
By: ______________________________________
President
INDOCAM INTERNATIONAL INVESTMENT SERVICES
By: ______________________________________
Name:
Title:
21
<PAGE>
===================
Thank
You
for mailing
your proxy card
promptly!
===================
[LOGO] JOHN HANCOCK FUNDS
A Global Investment Management Firm
John Hancock Funds, Inc., Member NASD
101 Huntington Avenue, Boston, MA 02199-7603
1-800-225-5291 1-800-554-6713 (TDD)
John Hancock(R)
400PX 10/99
<PAGE>
[LOGO] JOHN HANCOCK FUNDS
A Global Investment Management Firm
VOTE THIS PROXY CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE YOUR FUND
THE EXPENSE OF ADDITIONAL MAILINGS
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES
JOHN HANCOCK GLOBAL FUND
A SERIES OF JOHN HANCOCK INVESTMENT TRUST III
SPECIAL MEETING OF SHAREHOLDERS- DECEMBER 1, 1999
The undersigned, revoking previous proxies, hereby appoint(s) Edward J.
Boudreau, Jr., Anne C. Hodsdon, Susan S. Newton and James J. Stokowski, with
full power of substitution in each, to vote all the shares of beneficial
interest of John Hancock Global Fund ("Global Fund") which the undersigned is
(are) entitled to vote at the Special Meeting of Shareholders (the "Meeting") of
Global Fund to be held at 101 Huntington Avenue, Boston, Massachusetts 02199, on
December 1, 1999 at 9:00 a.m., eastern time, and any adjournment(s) of the
Meeting. All powers may be exercised by a majority of all proxy holders or
substitutes voting or acting, or, if only one votes and acts, then by that one.
Receipt of the Proxy Statement dated October 7, 1999 is hereby acknowledged. If
not revoked, this proxy shall be voted for the proposals.
Date___________________________________, 1999
o Please complete, sign, date and return this proxy in the enclosed
envelope as soon as possible.
o Please sign exactly as your name or names appear left. When signing as
attorney, executor, administrator, trustee or guardian, please give your
full title as such.
o If a Corporation, please sign in full corporate name by president or
other authorized officer.
o If a partnership, please sign in partnership name by authorized
person
- ----------------------------------------
Signature(s)
<PAGE>
[LOGO] JOHN HANCOCK FUNDS
A Global Investment Management Firm
VOTE THIS PROXY CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE YOUR FUND
THE EXPENSE OF ADDITIONAL MAILINGS
Specify your desired action by a check mark in the appropriate space. This proxy
will be voted as specified. If no specification is made, the proxy will be voted
in favor of each item. The persons named as proxies have discretionary authority
which they intend to exercise in favor of the proposals referred to and
according to their best judgment as to any other matters which properly come
before the meeting.
<TABLE>
<CAPTION>
Please vote by filling in the appropriate box(es) below.
<S> <C> <C> <C> <C>
1 To approve a new sub-investment management FOR AGAINST ABSTAIN
contract between John Hancock Advisers, Inc. and
Indocam International Investment Services. ___ ___ ___
2(a) To amend and reclassify the fund's investment
restriction on margin and short sales. ___ ___ ___
2(b) To amend the fund's investment
restrictions on borrowing money. ___ ___ ___
2(c) To amend the fund's investment restrictions
on underwriting securities. ___ ___ ___
2(d) To amend the fund's investment restriction
on issuing senior securities. ___ ___ ___
2(e) To eliminate the fund's investment restriction
on warrants. ___ ___ ___
2(f) To amend and reclassify the fund's investment
restriction on diversification with respect to
investments in any one issuer. ___ ___ ___
2(g) To amend the fund's investment restriction on
purchasing real estate. ___ ___ ___
2(h) To amend the fund's investment restriction on
purchasing commodities. ___ ___ ___
2(i) To amend the fund's investment restriction on
on making loans. ___ ___ ___
2(j) To amend the fund's investment restriction on
on concentration with respect to investments in
any one industry. ___ ___ ___
</TABLE>
PLEASE DO NOT FORGET TO SIGN THE REVERSE SIDE OF THIS CARD
