Vote-By-Phone Solicitation Script for
Putnam California Tax Exempt Money Market Fund
This script provides information to the shareholder and solicits
their vote by phone, to be confirmed by written confirmation.
Good Morning/Afternoon/Evening. May I please speak with (name of
shareholder)? I am representing Putnam Investments in Boston.
To verify that I am speaking with the shareholder of record, may
I confirm that you are (name of shareholder of record) and that
your address of record is (address of record)?
(If the person is unwilling to confirm this information, thank
them for their time and terminate the call.)
We noted that we have not yet received your vote on the proposal
to approve the Agreement and Plan of Reorganization between your
Fund and Putnam Tax Exempt Money Market Fund. Do you have any
questions regarding this proposal I can clarify for you?
(If there are questions, please refer to the Q & A attached.)
Would you like to vote by phone?
(If not, ask the shareholder if he would like another ballot,
thank them for their time and terminate the call. If so, proceed
as follows:)
We previously sent you a letter describing our procedures for
voting your proxy ballot by telephone.
I will now read the information on the proxy card so that you can
provide us with your voting instructions.
Putnam California Tax Exempt Money Market Fund
Proxy for a meeting of shareholders, August 1, 1994.
This proxy is solicited on behalf the Trustees of the Fund.
The shareholder hereby appoints George Putnam, Hans H. Estin and
William F. Pounds, and each of them separately, proxies, with
power of substitution, and hereby authorizes them to represent
and vote, as designated hereafter, at the adjourned meeting of
shareholders of Putnam California Tax Exempt Money Market Fund,
on August 1, 1994, at 12:30 p.m., Boston time, and at any
adjournments thereof, all of the shares of the Fund which the
shareholder would be entitled to vote if personally present.
This proxy when properly authorized will be voted in the manner
directed herein by the shareholder. In their discretion, the
proxies are authorized to vote upon such other matters as may
properly come before the meeting. The Trustees recommend a vote
FOR the following proposal:
Proposal: Approve the Agreement and Plan of Reorganization
providing for the transfer of all of the assets of your Fund to
Putnam Tax Exempt Money Market Fund in exchange for shares of
Putnam Tax Exempt Money Market Fund and the assumption by Putnam
Tax Exempt Money Market Fund of all of the liabilities of your
Fund, and the distribution of such shares to the shareholders of
your Fund in liquidation of your Fund.
How would you like to vote on this proposal?
For, Against or Abstain?
Thank you. Do you wish to send the entire message?
To repeat your instructions:
You voted (for/against/abstain). Is this correct?
Thank you. We will be sending you a written confirmation of your
vote. Please call us if the information on the confirmation is
incorrect.
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Q & A for California Money Market Fund Reorganization
On April 20, a proxy statement was sent to shareholders of
California Tax Exempt Money Market Fund. The proxies propose a
reorganization of the California Fund with the Putnam Tax Exempt
Money Market Fund. Listed below are the questions and concerns
of shareholders regarding this proposal followed by answers and
information regarding each issue.
1. Why is the Putnam California Money Market Fund being
reorganized with Putnam Tax Exempt Money Market Fund?
Putnam Management believes that combining your Fund with the
Putnam Tax Exempt Money Market Fund offers you an opportunity to
pursue a similar objective with greater economies of scale that,
over the longer term, will result in lower per share operating
expenses. Further, Putnam Management is concerned that if
current trends in your Fund's net asset levels continue, your
Fund might soon be burdened with too high an expense ratio
because of the Fund's size.
2. What exactly is being reorganized?
The Trustees of your Fund are recommending that shareholders
approve a reorganization of your Fund in which your shares would,
in effect, be exchanged at net asset value for shares of Putnam
Tax Exempt Money Market Fund (which we will refer to as the
"other fund"). Under this proposal, your Fund will transfer all
of its assets to the other fund in return for shares of the other
fund and the assumption by the other fund of all of the
liabilities of your Fund. After the transfer, the shares of the
other fund will be distributed to the holders of your Fund,
thereby liquidating your Fund. Both funds are managed by Putnam
Investment Management, Inc. and have the same Trustees.
3. When will Putnam California Money Market Fund be reorganized
with Putnam Tax Exempt Money Market Fund?
If the reorganization is approved by your Fund's shareholders, it
would become effective shortly after the shareholder meeting.
4. Is the same investment philosophy used with the Putnam Tax
Exempt Money Market Fund?
Both your Fund and the other fund seek as high a level of current
income exempt from federal income tax and, in the case of your
Fund, exempt from California income tax as Putnam Management
believes is consistent with maintenance of liquidity and
stability of principal. The principle difference between the
funds is that your Fund normally concentrates its investments in
tax-exempt securities of California issuers, while the other fund
normally invests in tax-exempt securities of issuers located in
various states. Because of the similarities between the Funds,
the proposed reorganization will not affect the general strategy
or style in which the portfolio manager will manage your
investment.
5. Will there be any tax consequences due to the
reorganization?
Yes. Shareholders should realize that income distributions
received by them on shares of Putnam Tax Exempt Money Market Fund
following the reorganization will not be exempt from California
income tax.
The reorganization is expected to be a taxable transaction for
the Fund and its shareholders. As a result, your Fund's
shareholders acquiring Money Market Fund shares in the
transaction may realize a small amount of taxable gain or loss,
which will be reflected in their last distribution from the
California fund.
6. Will confirmation of the reorganization be mailed to
shareholders?
Yes. Shareholders will receive a confirmation after the
reorganization is completed, indicating your new account number.
Please retain this confirmation for your records.
7. Will the reorganization affect performance?
Notwithstanding the current tax-equivalent yield advantage of
your Fund, as compared to the other fund, Putnam Management
believes that Putnam Tax-Exempt Money Market Fund could realize
performance advantages over your Fund over the long-term due to
the potential economies of scale of a larger fund.
8. Will the number of shares I own change?
No. As a result of the reorganization, you would receive,
subject to any applicable state and federal taxes, a number of
shares of Putnam Tax Exempt Money Market Fund equal in value at
the date of the exchange to the total value of your current
shares. If the shares of the two money market funds are valued
at $1.00 per share, there should be no change in the number of
shares exchanged.
