SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. )
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Filed by the Registrant / X /
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Filed by a Party other than the Registrant / /
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CHECK THE APPROPRIATE BOX:
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/ X / Preliminary Proxy Statement
- ----
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/ / Preliminary Additional Materials
- ----
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/ / Definitive Proxy Statement
- ----
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/ / Definitive Additional Materials
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/ / Soliciting Material Pursuant to Sec. 240.14a-11(e) or
- ---- Sec. 240.14a-12
THE PUTNAM FUND FOR GROWTH AND INCOME
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
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/ x / $125 per Exchange Act Rules 0-11(c)(1)(ii),
- ---- 14a-6(i)(1), or 14a-6(i)(2).
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/ / $500 per each party to the controversy pursuant
- ---- to Exchange Act Rule 14a-6(i)(3).
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/ / Fee computed on table below per Exchange Act Rules
- ---- 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which
transaction applies:
(2) Aggregate number of securities to which
transaction applies:
(3) Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule
0-11:
(4) Proposed maximum aggregate value of transaction:
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/ / Check box if any part of the fee is offset as provided
- ---- by Exchange Act Rule 0-11(a)(2) and identify the filing
for which the offsetting fee was paid previously.
Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its
filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed: <PAGE>
IMPORTANT INFORMATION
FOR SHAREHOLDERS IN
THE PUTNAM FUND FOR GROWTH AND INCOME
THE DOCUMENT YOU HOLD IN YOUR HANDS CONTAINS YOUR PROXY STATEMENT
AND PROXY CARD. A PROXY CARD IS, IN ESSENCE, A BALLOT. WHEN YOU
VOTE YOUR PROXY, IT TELLS US HOW TO VOTE ON YOUR BEHALF ON
IMPORTANT ISSUES RELATING TO YOUR FUND. IF YOU COMPLETE AND SIGN
THE PROXY, WE'LL VOTE IT EXACTLY AS YOU TELL US. IF YOU SIMPLY
SIGN THE PROXY, WE'LL VOTE IT IN ACCORDANCE WITH THE TRUSTEES'
RECOMMENDATIONS ON PAGES [ ] AND [ ].
WE URGE YOU TO SPEND A COUPLE OF MINUTES WITH THE PROXY
STATEMENT, FILL OUT YOUR PROXY CARD, AND RETURN IT TO US. WHEN
SHAREHOLDERS DON'T RETURN THEIR PROXIES IN SUFFICIENT NUMBERS, WE
HAVE TO INCUR THE EXPENSE OF FOLLOW-UP SOLICITATIONS, WHICH CAN
COST YOUR FUND MONEY.
WE WANT TO KNOW HOW YOU WOULD LIKE TO VOTE AND WELCOME YOUR
COMMENTS. PLEASE TAKE A FEW MOMENTS WITH THESE MATERIALS AND
RETURN YOUR PROXY TO US.
(PUTNAM LOGO APPEARS HERE)
BOSTON * LONDON * TOKYO
<PAGE>
TABLE OF CONTENTS
A Message from the Chairman. . . . . . . . . . . . . . . . . . . . . . . .1
Notice of Shareholder Meeting. . . . . . . . . . . . . . . . . . . . . . .3
Trustees' Recommendations. . . . . . . . . . . . . . . . . . . . . . . .[5]
PROXY CARD ENCLOSED
If you have any questions, please contact us at the special toll-
free number we have set up for you (1-800-225-1581) or call your
financial adviser.
<PAGE>
A MESSAGE FROM THE CHAIRMAN
(Photograph of George Putnam appears here)
Dear Shareholder:
I am writing to you to ask for your vote on important questions
that affect your investment in your fund. While you are, of
course, welcome to join us at your fund's meeting, most
shareholders cast their vote by filling out and signing the
enclosed proxy. We are asking for your vote on the following
matters:
1. ELECTING TRUSTEES TO OVERSEE YOUR FUND;
2. RATIFYING THE SELECTION BY THE TRUSTEES OF THE INDEPENDENT
AUDITORS OF YOUR FUND FOR ITS CURRENT FISCAL YEAR; AND
3. APPROVING AMENDMENTS TO CERTAIN OF YOUR FUND'S FUNDAMENTAL
INVESTMENT RESTRICTIONS.
Although we would like very much to have each shareholder attend
their fund's meeting, we realize this is not possible. Whether
or not you plan to be present, we need your vote. We urge you to
complete, sign, and return the enclosed proxy card promptly. A
postage-paid envelope is enclosed.
I'm sure that you, like most people, lead a busy life and are
tempted to put this proxy aside for another day. Please don't.
When shareholders do not return their proxies, their fund may
have to incur the expense of follow-up solicitations. All
shareholders benefit from the speedy return of proxies.
Your vote is important to us. We appreciate the time and
consideration that I am sure you will give this important matter.
If you have questions about the proposals, contact your financial
adviser or call a Putnam customer service representative at
1-800-225-1581.
Sincerely yours,
(signature of George Putnam)
George Putnam, Chairman
<PAGE>
THE PUTNAM FUND FOR GROWTH AND INCOME
NOTICE OF A MEETING OF SHAREHOLDERS
THIS IS THE FORMAL AGENDA FOR YOUR FUND'S SHAREHOLDER MEETING.
IT TELLS YOU WHAT MATTERS WILL BE VOTED ON AND THE TIME AND PLACE
OF THE MEETING, IF YOU CAN ATTEND IN PERSON.
To the Shareholders of The Putnam Fund for Growth and Income:
A Meeting of Shareholders of your fund will be held on October 3,
1996 at 2:00 p.m., Boston time, on the eighth floor of One Post
Office Square, Boston, Massachusetts, to consider the following:
1. ELECTING TRUSTEES. SEE PAGE [ ].
2. RATIFYING THE SELECTION BY THE TRUSTEES OF THE INDEPENDENT
AUDITORS OF YOUR FUND FOR ITS CURRENT FISCAL YEAR. SEE
PAGE [ ].
3.A. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST WITH RESPECT TO THE FUND'S PERMITTED
INVESTMENTS. SEE PAGE [ ].
3.B. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST WITH RESPECT TO DIVERSIFICATION. SEE
PAGE [ ].
3.C. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST WITH RESPECT TO INVESTMENTS IN ISSUERS
THAT HAVE BEEN IN OPERATION FOR LESS THAN THREE YEARS. SEE
PAGE [ ].
3.D. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST WITH RESPECT TO THE PURCHASE OF CERTAIN
ILLIQUID SECURITIES. SEE PAGE [ ].
3.E. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST WITH RESPECT TO INVESTMENTS IN
SECURITIES OF ISSUERS IN WHICH MANAGEMENT OF THE FUND OR
PUTNAM INVESTMENT MANAGEMENT, INC. OWNS SECURITIES. SEE PAGE
[ ].
3.F. APPROVING AN AMENDMENT TO THE FUND'S FUNDAMENTAL INVESTMENT
RESTRICTION WITH RESPECT TO MAKING LOANS BY PURCHASING
SECURITIES. SEE PAGE [ ].
3.G. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST WITH RESPECT TO MAKING LOANS THROUGH
REPURCHASE AGREEMENTS AND SECURITIES LOANS. SEE PAGE [ ].
3.H. Approving an amendment to the fund's Agreement and
Declaration of Trust with respect to owning 10% of the voting
securities of a single issuer. See page [ ].
3.I. Approving an amendment to the fund's fundamental investment
restrictions with respect to investments in real estate. See
page [ ].
3.J. APPROVING AN AMENDMENT TO THE FUND'S FUNDAMENTAL INVESTMENT
RESTRICTION WITH RESPECT TO CONCENTRATION OF ITS ASSETS. SEE
PAGE [ ].
3.K. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST WITH RESPECT TO PLEDGING ASSETS. SEE
PAGE [ ].
3.L. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST AND THE FUND'S FUNDAMENTAL INVESTMENT
RESTRICTION WITH RESPECT TO BORROWING. SEE PAGE [ ].
3.M. APPROVING AN AMENDMENT TO THE FUND'S FUNDAMENTAL INVESTMENT
RESTRICTION WITH RESPECT TO INVESTMENTS IN COMMODITIES. SEE
PAGE [ ].
3.N. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST WITH RESPECT TO MARGIN TRANSACTIONS.
SEE PAGE [ ].
3.O. APPROVING AN AMENDMENT TO THE FUND'S AGREEMENT AND
DECLARATION OF TRUST AND THE ELIMINATION OF THE FUND'S
FUNDAMENTAL INVESTMENT RESTRICTIONS WITH RESPECT TO SHORT
SALES. SEE PAGE [ ].
3.P. APPROVING THE ELIMINATION OF THE FUND'S FUNDAMENTAL
INVESTMENT RESTRICTION WITH RESPECT TO INVESTING TO GAIN
CONTROL OF A COMPANY'S MANAGEMENT. SEE PAGE [ ].
3.Q. APPROVING AN AMENDMENT TO THE FUND'S FUNDAMENTAL INVESTMENT
RESTRICTION WITH RESPECT TO UNDERWRITING. SEE PAGE [ ].
4. TRANSACTING OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
MEETING.
By the Trustees
George Putnam, Chairman
William F. Pounds, Vice Chairman
Jameson A. Baxter Robert E. Patterson
Hans H. Estin Donald S. Perkins
John A. Hill George Putnam, III
Ronald J. Jackson Eli Shapiro
Elizabeth T. Kennan A.J.C. Smith
Lawrence J. Lasser W. Nicholas Thorndike
WE URGE YOU TO MARK, SIGN, DATE, AND MAIL THE ENCLOSED PROXY IN
THE POSTAGE-PAID ENVELOPE PROVIDED SO YOU WILL BE REPRESENTED AT
THE MEETING.
August , 1996
<PAGE>
PROXY STATEMENT
THIS DOCUMENT WILL GIVE YOU THE INFORMATION YOU NEED TO VOTE ON
THE MATTERS LISTED ON THE PREVIOUS PAGES. MUCH OF THE INFORMATION
IN THE PROXY STATEMENT IS REQUIRED UNDER RULES OF THE SECURITIES
AND EXCHANGE COMMISSION ("SEC"); SOME OF IT IS TECHNICAL. IF
THERE IS ANYTHING YOU DON'T UNDERSTAND, PLEASE CONTACT US AT OUR
SPECIAL TOLL-FREE NUMBER, 1-800-225-1581, OR CALL YOUR FINANCIAL
ADVISER.
WHO IS ASKING FOR MY VOTE?
THE ENCLOSED PROXY IS SOLICITED BY THE TRUSTEES OF THE PUTNAM FUND
FOR GROWTH AND INCOME for use at the Meeting of Shareholders of
the fund to be held on October 3, 1996, and, if your fund's
meeting is adjourned, at any later meetings, for the purposes
stated in the Notice of Meeting (see previous pages).
HOW DO YOUR FUND'S TRUSTEES RECOMMEND THAT SHAREHOLDERS VOTE ON
THESE PROPOSALS?
The Trustees recommend that you vote
1. FOR THE ELECTION OF ALL NOMINEES;
2. FOR SELECTING PRICE WATERHOUSE LLP AS THE INDEPENDENT
AUDITORS OF YOUR FUND;
3.A. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
WITH RESPECT TO THE FUND'S PERMITTED INVESTMENTS;
3.B. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
WITH RESPECT TO DIVERSIFICATION;
3.C. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
WITH RESPECT TO INVESTMENTS IN ISSUERS THAT HAVE BEEN IN
OPERATION FOR LESS THAN THREE YEARS;
3.D. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
WITH RESPECT TO THE PURCHASE OF CERTAIN ILLIQUID SECURITIES;
3.E. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
WITH RESPECT TO INVESTMENTS IN SECURITIES OF ISSUERS IN WHICH
MANAGEMENT OF THE FUND OR PUTNAM INVESTMENT MANAGEMENT, INC.
OWNS SECURITIES;
3.F. FOR AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION
WITH RESPECT TO MAKING LOANS BY PURCHASING SECURITIES;
3.G. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
WITH RESPECT TO MAKING LOANS THROUGH REPURCHASE AGREEMENTS
AND SECURITIES LOANS;
3.H. FOR AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION
WITH RESPECT TO OWNING 10% OF THE VOTING SECURITIES OF A
SINGLE ISSUER;
3.I FOR AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTIONS
WITH RESPECT TO INVESTMENTS IN REAL ESTATE;
3.J. FOR AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION
WITH RESPECT TO CONCENTRATION OF ITS ASSETS;
3.K. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
AND THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION WITH
RESPECT TO BORROWING;
3.L. FOR AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION
WITH RESPECT TO INVESTMENTS IN COMMODITIES;
3.M. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
WITH RESPECT TO MARGIN TRANSACTIONS;
3.N. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
AND ELIMINATING THE FUND'S FUNDAMENTAL INVESTMENT
RESTRICTIONS WITH RESPECT TO SHORT SALES; AND
3.O. FOR AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
WITH RESPECT TO PLEDGING ASSETS;
3.P. FOR ELIMINATING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION
WITH RESPECT TO INVESTING TO GAIN CONTROL OF A COMPANY'S
MANAGEMENT;
3.Q. FOR AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION
WITH RESPECT TO UNDERWRITING. SEE PAGE [ ].
WHO IS ELIGIBLE TO VOTE?
Shareholders of record at the close of business on July 5, 1996,
are entitled to be present and to vote at the meeting or any
adjourned meeting. The Notice of Meeting, the proxy, and the
Proxy Statement have been mailed to shareholders of record on or
about August , 1996.
Each share is entitled to one vote. Shares represented by duly
executed proxies will be voted in accordance with shareholders'
instructions. If you sign the proxy, but don't fill in a vote,
your shares will be voted in accordance with the Trustees'
recommendations. If any other business is brought before the
meeting, your shares will be voted at the Trustees' discretion.
<PAGE>
THE PROPOSALS
I. ELECTION OF TRUSTEES
WHO ARE THE NOMINEES FOR TRUSTEES?
The Nominating Committee of the Trustees recommends that the
number of Trustees be fixed at fourteen and that you vote for the
election of the nominees described below. Each nominee is
currently a Trustee of your fund and of the other Putnam funds.
The Nominating Committee of the Trustees consists solely of
Trustees who are not "interested persons" (as defined in the
Investment Company Act of 1940) of your fund or of Putnam
Investment Management, Inc., your fund's investment manager
("Putnam Management").
JAMESON ADKINS BAXTER
[INSERT PICTURE]
Ms. Baxter, age 52, is the President of Baxter Associates, Inc., a
management and financial consulting firm which she founded in
1986. During that time, she was also a Vice President and
Principal of the Regency Group, Inc., and a Consultant to First
Boston Corporation, both of which are investment banking firms.
From 1965 to 1986, Ms. Baxter held various positions in investment
banking and corporate finance at First Boston.
Ms. Baxter currently also serves as a Director of Banta
Corporation, Avondale Federal Savings Bank, and ASHTA Chemicals,
Inc. She is also the Chairman Emeritus of the Board of Trustees
of Mount Holyoke College, having previously served as Chairman for
five years and as a Board member for thirteen years; an Honorary
Trustee and past President of the Board of Trustees of the Emma
Willard School; and Chair of the Board of Governors of Good
Shepherd Hospital. Ms. Baxter is a graduate of Mount Holyoke
College.
HANS H. ESTIN
[INSERT PICTURE]
Mr. Estin, age 67, is a Chartered Financial Analyst and the Vice
Chairman of North American Management Corp., a registered
investment adviser serving individual clients and their families.
Mr. Estin currently also serves as a Director of The Boston
Company, Inc., a registered investment adviser which provides
administrative and investment management services to mutual funds
and other institutional investors, and Boston Safe Deposit and
Trust Company; a Corporation Member of Massachusetts General
Hospital; and a Trustee of New England Aquarium. He previously
served as the Chairman of the Board of Trustees of Boston
University and is currently active in various other civic
associations, including the Boys & Girls Clubs of Boston, Inc.
Mr. Estin is a graduate of Harvard College and holds honorary
doctorates from Merrimack College and Boston University.
JOHN A. HILL
[INSERT PICTURE]
Mr. Hill, age 54, is the Chairman and Managing Director of First
Reserve Corporation, a registered investment adviser investing in
companies in the world-wide energy industry on behalf of
institutional investors.
Prior to acquiring First Reserve in 1983, Mr. Hill held executive
positions with several investment advisory firms and held various
positions with the Federal government, including Associate
Director of the Office of Management and Budget and Deputy
Administrator of the Federal Energy Administration.
Mr. Hill currently also serves as a Director of Snyder Oil
Corporation, an exploration and production company which he
founded, Maverick Tube Corporation, a manufacturer of structural
steel, pipe and well casings, PetroCorp Incorporated, an
exploration and production company, Weatherford Enterra, Inc., an
oil field service company, various private companies controlled by
First Reserve Corporation, and various First Reserve Funds. He is
also a Member of the Board of Advisors of Fund Directions. He is
currently active in various business associations, including the
Economic Club of New York, and lectures on energy issues in the
United States and Europe. Mr. Hill is a graduate of Southern
Methodist University.
RONALD J. JACKSON
[INSERT PICTURE]
Mr. Jackson, age 52, was Chairman of the Board, President and
Chief Executive Officer of Fisher-Price, Inc., a major toy
manufacturer, from 1990 to 1993. He previously served as
President and Chief Executive Officer of Stride-Rite, Inc., a
manufacturer and distributor of footwear, from 1989 to 1990, and
as President and Chief Executive Officer of Kenner Parker Toys,
Inc., a major toy and game manufacturer, from 1985 to 1987. Prior
to that, he held various financial and marketing positions at
General Mills, Inc. from 1966 to 1985, including Vice President,
Controller and Vice President of Marketing for Parker Brothers, a
toy and game company, and President of Talbots.
Mr. Jackson currently serves as a Trustee of Salem Hospital and an
Overseer of the Peabody Essex Museum. He previously served as a
Director of a number of public companies including Fisher-Price,
Inc., Kenner Parker Toys, Inc., Stride-Rite, Inc., and Mattel,
Inc., a major toy manufacturer. Mr. Jackson is a graduate of
Michigan State University Business School.
ELIZABETH T. KENNAN
[INSERT PICTURE]
Ms. Kennan, age 58, is President Emeritus and Professor of Mount
Holyoke College. From 1978 through June 1995, she was President
of Mount Holyoke College. From 1966 to 1978, she was on the
faculty of Catholic University, where she taught history and
published numerous articles.
Ms. Kennan currently also serves as a Director of NYNEX
Corporation, a telecommunications company, Northeast Utilities,
the Kentucky Home Life Insurance Companies, and Talbots. She also
serves as a Member of The Folger Shakespeare Library Committee.
She is currently active in various educational and civic
associations, including the Committee on Economic Development and
the Council on Foreign Relations. Ms. Kennan is a graduate of
Mount Holyoke College, the University of Washington and St. Hilda
College at Oxford University and holds several honorary
doctorates.
LAWRENCE J. LASSER*
[INSERT PICTURE]
Mr. Lasser, age 53, is the Vice President of your fund and the
other Putnam funds. He has been the President, Chief Executive
Officer and a Director of Putnam Investments, Inc. and Putnam
Management since 1985, having begun his career there in 1969.
Mr. Lasser currently also serves as a Director of Marsh & McLennan
Companies, Inc., the parent company of Putnam Management, and
INROADS/Central New England, Inc., a job market internship program
for minority high school and college students. He is a Member of
the Board of Overseers of the Museum of Science, the Museum of
Fine Arts and the Isabella Stewart Gardner Museum in Boston. He
is also a Trustee of the Beth Israel Hospital and Buckingham,
Browne and Nichols School. Mr. Lasser is a graduate of Antioch
College and Harvard Business School.
<PAGE>
ROBERT E. PATTERSON
[INSERT PICTURE]
Mr. Patterson, age 51, is the Executive Vice President and
Director of Acquisitions of Cabot Partners Limited Partnership, a
registered investment adviser which manages real estate
investments for institutional investors. Prior to 1990, he was
the Executive Vice President of Cabot, Cabot & Forbes Realty
Advisors, Inc., the predecessor company of Cabot Partners. Prior
to that, he was a Senior Vice President of the Beal Companies, a
real estate management, investment and development company. He
has also worked as an attorney and held various positions in state
government, including the founding Executive Director of the
Massachusetts Industrial Finance Agency.
Mr. Patterson currently also serves as Chairman of the Joslin
Diabetes Center and as a Director of Brandywine Trust Company.
Mr. Patterson is a graduate of Harvard College and Harvard Law
School.
DONALD S. PERKINS*
[INSERT PICTURE]
Mr. Perkins, age 69, is the retired Chairman of the Board of Jewel
Companies, Inc., a diversified retailer, where among other roles
he served as President, Chief Executive Officer and Chairman of
the Board from 1965 to 1980. He currently also serves as a
Director of various other public corporations, including AON
Corp., an insurance company, Cummins Engine Company, Inc., an
engine and power generator equipment manufacturer and assembler,
Current Assets L.L.C., a corporation providing financial staffing
services, Illinova and Illinois Power Co., Inland Steel
Industries, Inc., LaSalle Street Fund, Inc., a real estate
investment trust, Lucent Technologies Inc., Springs Industries,
Inc., a textile manufacturer, and Time Warner, Inc., one of the
nation's largest media conglomerates. He previously served as a
Director of several other major public corporations, including
Corning Glass Works, Eastman Kodak Company, Firestone Tire &
Rubber Company and Kmart Corporation.
Mr. Perkins currently also serves as a Trustee and Vice Chairman
of Northwestern University and as a Trustee of the Hospital
Research and Education Trust. He is currently active in various
civic and business associations, including the Business Council
and the Civic Committee of the Commercial Club of Chicago, of
which he is the founding Chairman. Mr. Perkins is a graduate of
Yale University and Harvard Business School and holds an honorary
doctorate from Loyola University of Chicago.
<PAGE>
WILLIAM F. POUNDS
[INSERT PICTURE]
Dr. Pounds, age 68, is the Vice Chairman of your fund and of the
other Putnam funds. He has been a Professor of Management at the
Alfred P. Sloan School of Management at the Massachusetts
Institute of Technology since 1961 and served as Dean of that
School from 1966 to 1980. He previously served as Senior Advisor
to the Rockefeller Family and Associates and was a past Chairman
of Rockefeller & Co., Inc., a registered investment adviser which
manages Rockefeller family assets, and Rockefeller Trust Company.
Dr. Pounds currently also serves as a Director of IDEXX
Laboratories, Inc., EG&G, Inc., Perseptive Biosystems, Inc.,
Management Sciences For Health, Inc. and Sun Company, Inc. He is
also a Trustee of the Museum of Fine Arts in Boston; an Overseer
of WGBH Educational Foundation, and a Fellow of The American
Academy of Arts and Sciences. He previously served as a Director
of Fisher-Price, Inc. and General Mills, Inc. Dr. Pounds is a
graduate of Carnegie-Mellon University.
GEORGE PUTNAM*
[INSERT PICTURE]
Mr. Putnam, age 69, is the Chairman and President of your fund and
of the other Putnam funds. He is the Chairman and a Director of
Putnam Management and Putnam Mutual Funds Corp. and a Director of
Marsh & McLennan, their parent company. Mr. Putnam is the son of
the founder of the Putnam funds and Putnam Management and has been
employed in various capacities by Putnam Management since 1951,
including Chief Executive Officer from 1961 to 1973. He is a
former Overseer and Treasurer of Harvard University; a past
Chairman of the Harvard Management Company; and a Trustee Emeritus
of Wellesley College and Bradford College.
Mr. Putnam currently also serves as a Director of The Boston
Company, Inc., Boston Safe Deposit and Trust Company, Freeport-
McMoRan, Inc., Freeport Copper and Gold, Inc., McMoRan Oil and
Gas, Inc., mining and natural resources companies, General Mills,
Inc., Houghton Mifflin Company, a major publishing company, and
Rockefeller Group, Inc., a real estate manager. He is also a
Trustee of Massachusetts General Hospital, McLean Hospital,
Vincent Memorial Hospital, WGBH Educational Foundation and the
Museum of Fine Arts and the Museum of Science in Boston; the New
England Aquarium; an Overseer of Northeastern University; and a
Fellow of The American Academy of Arts and Sciences. Mr. Putnam
is a graduate of Harvard College and Harvard Business School and
holds honorary doctorates from Bates College and Harvard
University.
GEORGE PUTNAM, III*
[INSERT PICTURE]
Mr. Putnam, age 44, is the President of New Generation Research,
Inc., a publisher of financial advisory and other research
services relating to bankrupt and distressed companies, and New
Generation Advisers, Inc., a registered investment adviser which
provides advice to private funds specializing in investments in
such companies. Prior to founding New Generation in 1985, Mr.
Putnam was an attorney with the Philadelphia law firm Dechert
Price & Rhoads.
Mr. Putnam currently also serves as a Director of the
Massachusetts Audubon Society. He is also a Trustee of the Sea
Education Association and St. Mark's School and an Overseer of the
New England Medical Center. Mr. Putnam is a graduate of Harvard
College, Harvard Business School and Harvard Law School.
ELI SHAPIRO
[INSERT PICTURE]
Dr. Shapiro, age 79, is the Alfred P. Sloan Professor of
Management, Emeritus at the Alfred P. Sloan School of Management
at the Massachusetts Institute of Technology, having served on the
faculty of the Sloan School for eighteen years. He previously was
also on the faculty of Harvard Business School, The University of
Chicago School of Business and Brooklyn College. During his
academic career, Dr. Shapiro authored numerous publications
concerning finance and related topics. He previously served as
the President and Chief Executive Officer of the National Bureau
of Economic Research and also provided economic and financial
consulting services to various clients.
Dr. Shapiro is a past Director of many companies, including Nomura
Dividend Income Fund, Inc., a privately held registered investment
company managed by Putnam Management, Reece Corporation, a sewing
machine manufacturer, Commonwealth Mortgage, Dexter Corporation, a
manufacturer of plastics and related products, Avis Corporation, a
car rental company, Connecticut Bank and Trust Company,
Connecticut National Gas Corporation, the Federal Home Loan Bank
of Boston, where he served as Chairman from 1977 to 1989,
Travelers' Corporation, an insurance company, and Norlin
Corporation, a musical instrument manufacturer; and a past Trustee
of Mount Holyoke College and the Putnam funds (from 1984 to 1989).
Dr. Shapiro is a Fellow of The American Academy of Arts and
Sciences and is active in various professional and civic
associations, including the American Economic Association, the
American Finance Association and the Council on Foreign Relations.
Dr. Shapiro is a graduate of Brooklyn College and Columbia
University.
A.J.C. SMITH*
[INSERT PICTURE]
Mr. Smith, age 62, is the Chairman and Chief Executive Officer of
Marsh & McLennan Companies, Inc. He has been employed by Marsh &
McLennan and related companies in various capacities since 1961.
Mr. Smith is a Director of the Trident Corp., and he also serves
as a Trustee of the Carnegie Hall Society, the Central Park
Conservancy, The American Institute for Chartered Property
Underwriters, and is a Founder of the Museum of Scotland Society.
He was educated in Scotland and is a Fellow of the Faculty of
Actuaries in Edinburgh, a Fellow of the Canadian Institute of
Actuaries, a Fellow of the Conference of Actuaries in Public
Practice, an Associate of the Society of Actuaries, a Member of
the American Academy of Actuaries, the International Actuarial
Association and the International Association of Consulting
Actuaries.
W. NICHOLAS THORNDIKE**
[INSERT PICTURE]
Mr. Thorndike, age 63, serves as a Director of various
corporations and charitable organizations, including Data General
Corporation, a computer and high technology company, Bradley Real
Estate, Inc., a real estate investment firm, Providence Journal
Co., a newspaper publisher and owner of television stations, and
Courier Corporation, a book binding and printing company. He is
also a Trustee of Eastern Utilities Associates, Massachusetts
General Hospital, where he previously served as chairman and
president, and Northeastern University.
Prior to December 1988, he was the Chairman of the Board and
Managing Partner of Wellington Management Company/Thorndike,
Doran, Paine & Lewis, a registered investment adviser which
manages mutual funds and institutional assets. He also previously
served as a Trustee of the Wellington Group of Funds (now The
Vanguard Group) and was the Chairman and a Director of Ivest Fund,
Inc. Mr. Thorndike is a graduate of Harvard College.
- ----------------------------
* Nominees who are or may be deemed to be "interested persons"
(as defined in the Investment Company Act of 1940) of your
fund, Putnam Management, and Putnam Mutual Funds Corp.
("Putnam Mutual Funds"), the principal underwriter for all
the open-end Putnam funds and an affiliate of Putnam
Management. Messrs. Putnam, Lasser, and Smith are deemed
"interested persons" by virtue of their positions as officers
or shareholders of your fund, or directors of Putnam
Management, Putnam Mutual Funds, or Marsh & McLennan
Companies, Inc., the parent company of Putnam Management and
Putnam Mutual Funds. Mr. George Putnam, III, Mr. Putnam's
son, is also an "interested person" of your fund, Putnam
Management, and Putnam Mutual Funds. Mr. Perkins may be
deemed to be an "interested person" of your fund because of
his service as a director of a certain publicly held company
that includes registered broker-dealer firms among its
subsidiaries. Neither your fund nor any of the other Putnam
funds currently engages in any transactions with such firms
except that certain of such firms act as dealers in the
retail sale of shares of certain Putnam funds in the ordinary
course of their business. The balance of the nominees are
not "interested persons."
** In February 1994 Mr. Thorndike accepted appointment as a
successor trustee of certain private trusts in which he has
no beneficial interest. At that time he also became Chairman
of the Board of two privately owned corporations controlled
by such trusts, serving in that capacity until October 1994.
These corporations filed voluntary petitions for relief under
Chapter 11 of the U.S. Bankruptcy Code in August 1994.
Except as indicated above, the principal occupations and business
experience of the nominees for the last five years have been with
the employers indicated, although in some cases they have held
different positions with those employers. Except for Dr. Shapiro
and Mr. Jackson, all the nominees were elected by the shareholders
in July 1994. Dr. Shapiro and Mr. Jackson were elected by the
other Trustees in April 1995 and May 1996, respectively. As
indicated above, Dr. Shapiro also previously served as a Trustee
of the Putnam funds from 1984 to 1989. The 14 nominees for
election as Trustees at the shareholder meeting of your fund who
receive the greatest number of votes will be elected Trustees of
your fund. The Trustees serve until their successors are elected
and qualified. Each of the nominees has agreed to serve as a
Trustee if elected. If any of the nominees is unavailable for
election at the time of the meeting, which is not anticipated, the
Trustees may vote for other nominees at their discretion, or the
Trustees may recommend that the shareholders fix the number of
Trustees at less than 14 for your fund.
WHAT ARE THE TRUSTEES' RESPONSIBILITIES?
Your fund's Trustees are responsible for the general oversight of
your fund's business and for assuring that your fund is managed in
the best interests of its shareholders. The Trustees periodically
review your fund's investment performance as well as the quality
of other services provided to your fund and its shareholders by
Putnam Management and its affiliates, including administration,
custody, distribution and investor servicing. At least annually,
the Trustees review the fees paid to Putnam Management and its
affiliates for these services and the overall level of your fund's
operating expenses. In carrying out these responsibilities, the
Trustees are assisted by an independent administrative staff and
by your fund's auditors and legal counsel, which are selected by
the Trustees and are independent of Putnam Management and its
affiliates.
DO THE TRUSTEES HAVE A STAKE IN YOUR FUND?
The Trustees believe it is important that each Trustee have a
significant investment in the Putnam funds. The Trustees allocate
their investments among the more than 99 Putnam funds based on
their own investment needs. The Trustees' aggregate investments
in the Putnam funds total over $46 million. The table below lists
each Trustee's current investments in the fund and in the Putnam
funds as a group.<PAGE>
SHARE OWNERSHIP BY TRUSTEES+
YEAR FIRST NUMBER OF
ELECTED AS NUMBER OF SHARES OF
TRUSTEE OF SHARES OF THE ALL PUTNAM
THE PUTNAM FUND OWNED FUNDS OWNED
TRUSTEES FUNDS AS OF 6/28/96* AS OF 6/28/96**
- --------------------------------------------------------------------------------
Jameson A. Baxter 1994
Hans H. Estin 1972
John A. Hill 1985
Ronald J. Jackson 1996
Elizabeth T. Kennan 1992
Lawrence J. Lasser 1992
Robert E. Patterson 1984
Donald S. Perkins 1982
William F. Pounds 1971
George Putnam 1957
George Putnam, III 1984
Eli Shapiro 1995***
A.J.C. Smith 1986
W. Nicholas Thorndike 1992
- --------------------------------------------------------------------------------
* Except as noted below, each Trustee has sole investment power and sole
voting power with respect to his or her shares of the fund.
** These holdings do not include shares of Putnam money market funds.
*** Dr. Shapiro previously served as a Trustee of the Putnam funds from 1984
to 1989.
<PAGE>
As of June 28, 1996, the Trustees and officers of the fund owned a
total of shares of the fund, comprising less than 1% of its
outstanding shares on that date. A total of of these shares
are held by certain "interested" Trustees and officers of your
fund and Putnam Management in their Putnam Investments, Inc.
Profit Sharing Retirement Plan accounts. Each individual
accountholder has sole investment power and shared voting power
with respect to his/her account.
WHAT ARE SOME OF THE WAYS IN WHICH THE TRUSTEES REPRESENT
SHAREHOLDER INTERESTS?
The Trustees believe that, as substantial investors in the Putnam
funds, their interests are closely aligned with those of
individual shareholders. Among other ways, the Trustees seek to
represent shareholder interests:
by carefully reviewing your fund's investment
performance on an individual basis with your fund's
managers;
by also carefully reviewing the quality of the various
other services provided to the funds and their
shareholders by Putnam Management and its affiliates;
by discussing with senior management of Putnam
Management steps being taken to address any performance
deficiencies;
by reviewing the fees paid to Putnam Management to
ensure that such fees remain reasonable and competitive
with those of other mutual funds, while at the same time
providing Putnam Management sufficient resources to
continue to provide high quality services in the future;
by monitoring potential conflicts between the funds and
Putnam Management and its affiliates to ensure that the
funds continue to be managed in the best interests of
their shareholders;
by also monitoring potential conflicts among funds to
ensure that shareholders continue to realize the
benefits of participation in a large and diverse family
of funds.
HOW OFTEN DO THE TRUSTEES MEET?
The Trustees meet each month (except August) over a two-day period
to review the operations of your fund and of the other Putnam
funds. A portion of these meetings is devoted to meetings of
various Committees of the board which focus on particular matters.
These include: the Contract Committee, which reviews all
contractual arrangements with Putnam Management and its
affiliates; the Communication and Service Committee, which reviews
the quality of services provided by your fund's investor servicing
agent, custodian and distributor; the Pricing, Brokerage and
Special Investments Committee, which reviews matters relating to
valuation of securities, best execution, brokerage costs and
allocations and new investment techniques; the Audit Committee,
which reviews accounting policies and the adequacy of internal
controls and supervises the engagement of the funds' auditors; the
Compensation, Administration and Legal Affairs Committee, which
reviews the compensation of the Trustees and their administrative
staff and supervises the engagement of the funds' independent
counsel; and the Nominating Committee, which is responsible for
selecting nominees for election as Trustees.
Each Trustee generally attends at least two formal committee
meetings during such monthly meeting of the Trustees. During
1995, the average Trustee participated in approximately 40
committee and board meetings. In addition, the Trustees meet in
small groups with Chief Investment Officers and Portfolio Managers
to review recent performance and the current investment climate
for selected funds. These meetings ensure that each fund's
performance is reviewed in detail at least twice a year. The
Contract Committee typically meets on several additional occasions
during the year to carry out its responsibilities. Other
Committees, including an Executive Committee, may also meet on
special occasions as the need arises.
WHAT ARE THE TRUSTEES PAID FOR THEIR SERVICES?
Your fund pays each Trustee a fee for his or her services. Each
Trustee also receives fees for serving as Trustee of the other
Putnam funds. The Trustees periodically review their fees to
assure that such fees continue to be appropriate in light of their
responsibilities as well as in relation to fees paid to trustees
of other mutual fund complexes. The fees paid to each Trustee by
your fund and by all of the Putnam funds are shown below:
<PAGE>
COMPENSATION TABLE+
Total
Aggregate compensation
compensation from all
Trustees from the fund* Putnam funds**
- --------------------------------------------------------------
Jameson A. Baxter/1994 $11,017 $150,854
Hans H. Estin/1972 11,097 150,854
John A. Hill/1985*** 10,870 149,854
Elizabeth T. Kennan/1992 10,947 148,854
Lawrence J. Lasser/1992 11,097 150,854
Robert E. Patterson/1984 11,247 152,854
Donald S. Perkins/1982 11,097 150,854
William F. Pounds/1971 10,807 149,854
George Putnam/1957 11,097 150,854
George Putnam, III/1984 11,097 150,854
Eli Shapiro/1995**** 5,229 95,372
A.J.C. Smith/1986 10,978 149,854
W. Nicholas Thorndike/1992 11,247 152,854
+ Ronald J. Jackson became a Trustee of the fund effective May
3, 1996 and received no compensation from the fund or the
other Putnam funds in 1995.
* Includes an annual retainer and an attendance fee for each
meeting attended.
** Reflects total payments received from all Putnam funds in
the most recent calendar year. As of December 31, 1995,
there were 99 funds in the Putnam family.
*** Includes compensation deferred pursuant to a Trustee
Compensation Deferral Plan. The total amount of deferred
compensation payable to Mr. Hill by all Putnam funds as of
December 31, 1995 was $51,141, including income earned on such amounts.
****Elected as a Trustee in April 1995.
Your fund's Trustees have approved Retirement Guidelines for
Trustees of the Putnam funds. These guidelines provide generally
that a Trustee who retires after reaching age 72 and who has at
least 10 years of continuous service will be eligible to receive
a retirement benefit from each Putnam fund for which he or she
served as a Trustee. The amount and form of such benefit is
subject to determination annually by the Trustees and, unless
otherwise determined by the Trustees, will be an annual cash
benefit payable for life equal to one-half of the Trustee
retainer fees paid by each fund at the time of retirement.
Several retired Trustees are currently receiving benefits
pursuant to the Guidelines and it is anticipated that the current
Trustees will receive similar benefits upon their retirement. A
Trustee who retired in calendar 1995 and was eligible to receive
benefits under these Guidelines would have received an annual
benefit of $66,749, based upon the aggregate retainer fees paid
by the Putnam funds for such year. The Trustees reserve the
right to amend or terminate such Guidelines and the related
payments at any time, and may modify or waive the foregoing
eligibility requirements when deemed appropriate.
For additional information about your fund, including further
information about its Trustees and officers, please see "Further
Information About Your Fund," on page [ ].
PUTNAM INVESTMENTS
Putnam Investment Management, Inc. and its affiliates, Putnam
Mutual Funds, the principal underwriter for shares of your fund
and Putnam Fiduciary Trust Company, your fund's investor
servicing agent and custodian, are wholly owned by Putnam
Investments, Inc., One Post Office Square, Boston, Massachusetts
02109, a holding company that is in turn wholly owned by Marsh &
McLennan Companies, Inc., which has executive offices at 1166
Avenue of the Americas, New York, New York 10036. Marsh &
McLennan Companies, Inc. and its operating subsidiaries are
professional services firms with insurance and reinsurance
brokering, consulting, and investment management businesses.
2. SELECTION OF INDEPENDENT AUDITORS
Price Waterhouse LLP, 160 Federal Street, Boston, Massachusetts,
independent accountants, has been selected by the Trustees as the
auditor of your fund for the current fiscal year. Among the
country's preeminent accounting firms, this firm also serves as
the auditor for approximately half of the other funds in the
Putnam family. It was selected primarily on the basis of its
expertise as auditors of investment companies, the quality of its
audit services, and the competitiveness of the fees charged for
these services.
A majority of the votes on the matter is necessary to ratify the
selection of auditors. A representative of the independent
auditors is expected to be present at the meeting to make
statements and to respond to appropriate questions.
3. PROPOSALS A-Q.
As described in the following proposals, the Trustees are
recommending that shareholders approve a number of changes to the
fund's fundamental investment restrictions, including the
elimination of certain of these restrictions. The purpose of
these changes is to standardize the investment restrictions of
all of the Putnam funds, including your fund and, in certain
cases, to increase the fund's investment flexibility. By having
standard investment restrictions for all Putnam funds, Putnam
Management will be able to more easily monitor each fund's
compliance with its investment policies. Some of these changes
will have little immediate effect on the way your fund is managed
given the fund's current investment objective and policies.
Several of the proposals request that certain fundamental
restrictions be made non-fundamental, so that the fund would have
the ability to modify or eliminate these restrictions without
shareholder approval. Many of the restrictions that are proposed
to be changed are incorporated in the fund's Agreement and
Declaration of Trust (the "Declaration of Trust") and, as a
result, may only be modified by vote of a majority of the fund's
outstanding shares. This voting requirement is stricter than
that imposed by the Investment Company Act of 1940, as amended
(the "1940 Act"). The higher voting threshold required by the
Declaration of the Trust may impose greater proxy solicitation
costs on the fund in the event that it becomes necessary or
desirable to revise these restrictions in the future. As a
result, as indicated below, the Trustees are also recommending
that all of these restrictions be removed from the Declaration of
Trust. As of the date of the mailing of this proxy statement,
there is legislation pending before the U.S. Congress which seeks
to end all state-imposed investment limitations on investment
companies like the fund. Since many of these restrictions are
the result of state securities law requirements, this
legislation, if successful, would most likely lead to the removal
of many of these non-fundamental restrictions.
The adoption of any of these proposals is not contingent on the
adoption of any other proposal.
3.A. AMENDING THE AGREEMENT AND DECLARATION OF TRUST WITH RESPECT
TO THE FUND'S PERMITTED INVESTMENTS
The Trustees are recommending that the Declaration of Trust be
amended to give the fund broader authority to make investments.
The proposed changes would bring the fund's Declaration of Trust
more in line with that of most other Putnam funds.
The proposed amended paragraph of Article V of the Declaration of
Trust is set forth below. Additions are shown in BOLDFACE and
deletions are shown in [italics]. The section of the paragraph
regarding repurchase agreements and securities loans is proposed
to be eliminated by proposal 3.G. below, and will only be
eliminated if that proposal is approved. The fund's ability to
pledge its assets and to borrow are proposed to be modified by
proposals 3.K. and 3.L., respectively.
Section 4. The Trustees shall have full power and
authority TO INVEST IN, PURCHASE, SELL, AND OTHERWISE
ENGAGE IN TRANSACTIONS WITH RESPECT TO, SECURITIES,
DEBT INSTRUMENTS AND OTHER PROPERTY, INSTRUMENTS AND
RIGHTS OF A FINANCIAL CHARACTER, AND TO ENGAGE IN
BORROWINGS AND TO PLEDGE OR OTHERWISE ENCUMBER THE
ASSETS OF THE TRUST. THE TRUSTEES ALSO SHALL HAVE FULL
POWER AND AUTHORITY TO EXERCISE ANY RIGHTS OF OWNERSHIP
WITH RESPECT TO ANY OF THE FOREGOING [to buy and invest
the funds in their hands in bonds, stocks, voting trust
certificates, notes, certificates of indebtedness,
acceptances, certificateq of interest, call loans,
commercial paper, repurchase agreements with respect to
not more than 25% of the Trust's total assets,
financial futures contacts, options on financial
futures contracts and on securities indices, and any
negotiable instruments however named or described,
except as specifically limited in this Section 4, and
to make loans of its portfolio securities with respect
to not more than 25% of the Trust's total assets. The
Trustees shall have full power and authority to write
call options traded on a national securities exchange
on securities which the Trust owns and may purchase
options to close out call options written by the
Trust.] The Trustees shall not in any WAY [wise] be
bound or limited by any present or future law or custom
in regard to trust investments but shall have full
authority and power to make any and all investments
[within the above limitations] which they in their
uncontrolled discretion may deem proper to accomplish
the purposes of the Trust.
Putnam Management recommended the proposed changes to provide the
fund with maximum investment flexibility. For example, the
amendments would clarify that the fund may purchase and sell
options to the fullest extent permitted by law. If the
amendments are approved, the fund will, of course, continue to be
limited in its investments by its investment objective and
policies, the 1940 Act and applicable state securities laws.
REQUIRED VOTE. Approval of the proposal requires the affirmative
vote of the majority of the outstanding shares of the fund.
3.B. AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST WITH
RESPECT TO DIVERSIFICATION
The Trustees are recommending that the Declaration of Trust be
amended to delete the restriction with respect to diversification
and in connection therewith, the fund's fundamental investment
restriction with respect to diversification be revised to grant
the fund the maximum investment flexibility permitted by the
Investment Company Act of 1940 ("1940 Act"). Under the 1940 Act,
the fund, as a diversified fund, generally may not, with respect
to 75% of its total assets, invest more than 5% of its total
assets in the securities of any one issuer (except U.S.
government securities). The remaining 25% of the fund's total
assets is not subject to this restriction.
The fund's current restriction is more restrictive, and states
that:
"The Trustees shall be limited in the purchase of
securities or obligations (other than securities issued or
guaranteed as to principal or interest by the United
States, or by a person controlled or supervised by and
acting as an instrumentality of the Government of the
United States pursuant to authority granted by the
Congress of the United States, or any certificate of
deposit therefor) to an investment which shall not exceed
in value five percent (5%) of the net asset value of the
Trust Property at the time of such investment."
The proposed amended fundamental investment restriction is set
forth below.
"The fund may not ...
With respect to 75% of its total assets, invest in
the securities of any issuer if, immediately after
such investment, more than 5% of the total assets of
the fund (taken at current value) would be invested
in the securities of such issuer; provided that this
limitation does not apply to obligations issued or
guaranteed as to interest or principal by the U.S.
government or its agencies or instrumentalities."
If the proposed change is approved, the fund will be able to
invest up to 25% of its total assets in the securities of any
one issuer. The amended restriction would continue to exclude
from its limitations U.S. government securities, and would
clarify, consistent with the 1940 Act, that U.S. government
securities include those securities guaranteed as to principal
or interest by the U.S. government or its agencies or
instrumentalities. Following the amendment, the fund would
continue to be a diversified investment company for purposes of
the 1940 Act.
Putnam Management believes that this enhanced flexibility will
assist the fund in achieving its investment objective. However,
during times when Putnam Management invests a higher percentage
of the fund's assets in one or more issuers, the value of the
fund's shares may fluctuate more widely than the value of
shares of a portfolio investing in a larger number of issuers.
Currently, the affirmative vote of a majority of the fund's
outstanding shares is required to change this investment
restriction because it is contained in the fund's Declaration
of Trust. Once removed from the Declaration of Trust, the
restriction may be modified or eliminated by the fund with the
affirmative vote of the lesser of (1) more than 50% of the
outstanding shares of the fund, or (2) 67% or more of the
shares of the fund present at the meeting if more than 50% of
the outstanding shares of the fund are present at the meeting
in person or by proxy.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.C. AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST
WITH RESPECT TO INVESTMENTS IN ISSUERS THAT HAVE BEEN IN
OPERATION FOR LESS THAN THREE YEARS
The Trustees are recommending that the Declaration of Trust be
amended to eliminate the fund's fundamental investment
restriction which limits the fund's investments in issuers with
limited operating histories, which are sometimes referred to as
"unseasoned issuers." The current restriction states as
follows:
"nor shall the Trustees invest more than five percent (5%)
of the net asset value of the Trust in the securities of
any issuer that together with any predecessor thereof has
been in continuous operation for less than three (3) years
[, and in equity securities of issuers for which market
quotations are not readily available (but excluding from
such 5% securities the disposition of which is restricted
by federal security laws)...."]
The section of the restriction in brackets is proposed to be
eliminated by proposal 3.D. below.
Certain state securities laws impose limitations on the fund's
ability to invest in unseasoned issuers, but these limitations
are less restrictive than the fund's current restriction, and
are not required to be contained in a fundamental policy. For
these reasons, Putnam Management believes that the fund's
current restriction is unnecessarily restrictive and should be
eliminated. If this proposal is approved, the Trustees intend
to replace this restriction with the following non-fundamental
investment restriction, which is the standard restriction
expected to be used by other Putnam funds, to comply with
current state requirements:
"The fund may not ...
Invest in securities of an issuer which, together with any
predecessors, controlling persons, general partners and
guarantors, have a record of less than three years'
continuous business operation or relevant business
experience, if, as a result, the aggregate of such
investments would exceed 5% of the value of the fund's net
assets; provided, however, that this restriction shall not
apply to any obligations of the U.S. government or its
instrumentalities or agencies."
If the proposal is approved, the fund will have the ability to
invest up to 5% of its assets in the securities of unseasoned
issuers. The new restriction also will exempt U.S. government
securities from its limitations to provide the fund with maximum
investment flexibility. Putnam Management believes that this
enhanced flexibility could assist the fund in achieving its
investment objective.
By making this policy non-fundamental, the fund will be able to
modify or eliminate the policy to increase investment
flexibility without the need for shareholder approval.
Companies which have been in operation for less than three years
could have relatively small equity market capitalizations (e.g.,
under $1 billion). Although these companies may provide greater
opportunities for increased investment return, they also involve
greater risk. These companies often have limited product lines,
markets or financial resources. The securities of these
companies may trade less frequently and in limited volume, and
only in the over-the-counter market or on a regional securities
exchange. As a result, these securities may fluctuate in value
more than those of larger, more established companies.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.D. AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST WITH
RESPECT TO THE PURCHASE OF CERTAIN ILLIQUID SECURITIES
The Trustees are recommending that the Declaration of Trust be
amended to eliminate the fundamental investment restriction
which limits the fund's investments in equity securities for
which market quotations are not readily available. The current
restriction states as follows:
"nor shall the Trustees invest more than five percent (5%)
of the net asset value of the Trust [in the securities of
any issuer that together with any predecessor thereof has
been in continuous operation for less than three (3) years,
and] in equity securities of issuers for which market
quotations are not readily available (but excluding from
such 5% securities the disposition of which is restricted
by federal security laws)...."
The section of the restriction in brackets is proposed to be
eliminated by proposal 3.C. above.
In connection with this proposal, the Trustees are also
recommending that the fund's fundamental investment restriction
with respect to restricted securities be eliminated. That
restriction states that the fund may not
"Purchase any security the disposition of which is
restricted under federal securities laws if as a result
more than 15% of the fund's net assets, taken at current
value, would be invested in such securities, excluding
restricted securities that have been determined by the
Trustees of the fund (or the person designated by them to
make such determinations) to be readily marketable."
Putnam Management believes the above restrictions are no longer
necessary in light of current regulatory requirements and the
fund's current investment policies. The Staff of the SEC
currently takes the position that an illiquid security is a
security which is not readily marketable, rather than a security
for which market quotations are not readily available. This SEC
position is expressed in the fund's current non-fundamental
investment restriction which prohibits the fund from investing
more than 15% of its net assets in any combination of (a)
securities which are not readily marketable, (b) securities
restricted as to resale (excluding securities determined by the
Trustees of the fund (or the person designated by the Trustees
of the fund to make such determinations) to be readily
marketable), and (c) repurchase agreements maturing in more than
seven days. Unlike the current fundamental investment
restrictions set for the above, this non-fundamental investment
restriction applies to all types of illiquid securities, not
just securities, as well as to certain repurchase agreements.
If the proposal is approved, the fund will be able to invest
more than 5% of its net assets in equity securities for which
market quotations are not readily available.
Putnam Management believes that the fund may benefit from the
added flexibility of having the fund's policy with respect to
illiquid investments, including restricted securities, contained
in a single non-fundamental investment restriction. In the
future, the fund will be able to respond more quickly to legal,
regulatory and market developments regarding illiquid
investments (which might result in the removal of the
restriction) because further shareholder approval will not be
required to bring the policy in line with these developments.
If the proposed change is approved, the fund, to the extent
consistent with its current non-fundamental restriction, will be
able to invest a greater percentage of its assets in equity
securities for which market quotations are not readily
available. Investments in these and other illiquid securities
may make it more difficult for the fund to determine the fair
value of such securities for purposes of computing the fund's
net asset value.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.E. AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST WITH
RESPECT TO INVESTMENTS IN SECURITIES OF ISSUERS IN WHICH
MANAGEMENT OF THE FUND OR PUTNAM MANAGEMENT OWNS SECURITIES
The Trustees are recommending that the Declaration of Trust be
amended to eliminate the fundamental investment restriction
which prevents the fund from investing in the securities of
issuers in which management of the fund or Putnam Management
owns a certain percentage of securities. The current
restriction states that:
"The Trustees shall not invest in or retain in the
portfolio of the Trust the securities of any issuer if
officers and Trustees of the Trust and officers and
directors of the Managers ... who beneficially own more
than one-half of one percent (1/2 of 1%) of the shares or
securities of that issuer together own more than five
percent (5%)...."
The fund originally adopted this restriction to comply with
certain state securities law requirements and while the
restriction is currently required by one state, it is not
required to be a fundamental policy. If this proposal is
approved, the Trustees intend to replace this fundamental
restriction with the following non-fundamental investment
restriction, which is the standard restriction expected to be
used by other Putnam funds, to comply with the remaining state
requirement:
"The fund may not. . .
Invest in the securities of any issuer, if, to the
knowledge of the fund, officers and Trustees of the fund
and officers and directors of Putnam Management who
beneficially own more than 0.5% of the securities of that
issuer together own more than 5% of such securities."
By making this policy non-fundamental, the fund will have the
ability to modify or eliminate the restriction to increase
investment flexibility without the need for shareholder
approval.
If the restriction were to be eliminated, the fund would be able
to invest in the securities of any issuer without regard to
ownership in such issuer by management of the fund or Putnam
Management, except to the extent prohibited by the fund's
investment policies or the 1940 Act.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.F. AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION WITH
RESPECT TO MAKING LOANS BY PURCHASING SECURITIES
The Trustees are recommending that the fund's fundamental
investment restriction relating to making loans through the
purchase of certain securities be revised to reflect the
standard restriction expected to be used by other Putnam funds
and to permit the fund to purchase debt obligations as long as
such investment is consistent with the fund's investment
objective and policies. The proposed amendment would replace
the current exception contained in the restriction which states
that the fund may not "make loans, except by purchases of
securities of corporations or associations and certain
government securities...."
The proposed amended fundamental investment restriction is set
forth below. The section of the restriction in brackets is
shown as proposed to be amended by proposal 3.G. below.
"The fund may not ...
Make loans, except by purchase of debt obligations in which
the fund may invest consistent with its investment
policies, [by entering into repurchase agreements, or by
lending its portfolio securities.]"
Putnam Management believes that the increased investment
flexibility will assist the fund in achieving its investment
objective. Putnam Management believes that the current policy
is overly broad and unnecessarily restrictive and could, for
example, be read to prevent the fund from purchasing certain
government securities. Following the amendment, the fund could
invest in any type of debt obligation issued by any type of
issuer, including those issued by corporations, partnerships,
and government issuers, as long as such investment was
consistent with the fund's investment objective and policies.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.G. AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST WITH RESPECT TO
MAKING LOANS THROUGH REPURCHASE AGREEMENTS AND SECURITIES LOANS
The Trustees are recommending that the fund's fundamental
investment restrictions with respect to making loans through
repurchase agreements and securities loans be revised to reflect
the standard restriction expected to be used by other Putnam
funds and to remove any asset limitations on the fund's ability
to enter into such transactions. The current restrictions state
that:
"The Trustees shall have full power and authority to buy
and invest the funds in their hands in.... repurchase
agreements with respect to not more than 25% of the Trust's
total assets.... and to make loans of its portfolio
securities with respect to not more than 25% of the Trust's
total assets."
The proposed amended fundamental investment restriction is set
forth below. The section of the restriction in brackets is
shown as proposed to be amended by proposal 3.F. above.
"The fund may not ...
Make loans, except [by purchase of debt obligations in
which the fund may invest consistent with its
investment policies,] by entering into repurchase
agreements, or by lending its portfolio securities."
Following the amendment, the fund may, consistent with its
investment objective and policies, enter into repurchase
agreements and securities loans without limit consistent with
its investment policies and applicable law. Putnam Management
believes that the increased investment flexibility could assist
the fund in achieving its investment objective.
When the fund enters into a REPURCHASE AGREEMENT, it typically
purchases a security for a relatively short period (usually not
more than one week), which the seller agrees to repurchase at a
fixed time and price, representing the fund's cost plus
interest. When the fund enters into a SECURITIES LOAN, it lends
certain of its portfolio securities to broker-dealers or other
parties and typically receives an interest payment in return.
These transactions must be fully collateralized at all times,
but involve some risk to the fund if the other party should
default on its obligation. If the other party in these
transactions should become involved in bankruptcy or insolvency
proceedings, it is possible that the fund may be treated as an
unsecured creditor and be required to return the underlying
collateral to the other party's estate.
In connection with these proposed changes, the Trustees are also
recommending that the Declaration of Trust be amended to remove
these restrictions. Currently, the affirmative vote of a
majority of the fund's outstanding shares is required to change
these restrictions. Once removed from the Declaration of Trust,
the restrictions may be modified or eliminated by the fund with
the affirmative vote of the lesser of (1) more than 50% of the
outstanding shares of the fund, or (2) 67% or more of the shares
of the fund present at a meeting if more than 50% of the
outstanding shares of the fund are present at the meeting in
person or by proxy.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.H. AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION WITH
RESPECT TO INVESTMENTS IN THE VOTING SECURITIES OF A SINGLE ISSUER
The Trustees are recommending that the fund's fundamental
investment restriction with respect to investments in the
securities of a single issuer be revised to reflect the standard
restriction expected to be used by other Putnam funds and to
grant the fund the maximum flexibility permitted under the 1940
Act. The 1940 Act prohibits a diversified fund such as the fund
from investing, with respect to 75% of its total assets, in the
securities of an issuer if as a result it would own more than
10% of the outstanding voting securities of that issuer. The
fund's current investment restriction, which is more restrictive
than the 1940 Act, states that the fund may not:
"Purchase any security if the fund would then own more than
10% of the outstanding voting securities of any one
issuer."
The proposed amended fundamental investment restriction is set
forth below.
"The fund may not ...
With respect to 75% of its total assets, acquire more
than 10% of the outstanding voting securities of any
issuer."
Putnam Management believes that limiting this restriction to
voting securities and 75% of the fund's total assets will
enhance the fund's investment flexibility. Putnam Management
has advised the Trustees that the current restriction could
prevent the fund from investing in certain opportunities to the
fullest extent that Putnam Management believes would best serve
the fund's investment objective.
The amendment enables the fund to purchase more than 10% of the
voting securities of an issuer with respect to 25% of the fund's
total assets. To the extent the fund individually or with other
funds and accounts managed by Putnam Management or its
affiliates owns all or a major portion of the outstanding
securities of a particular issuer, under adverse market or
economic conditions or in the event of adverse changes in the
financial condition of the issuer the fund could find it more
difficult to sell these securities when Putnam Management
believes it advisable to do so, or may be able to sell the
securities only at prices significantly lower than if they were
more widely held. In addition, certain of the companies in
which the fund may invest a greater portion of its assets
following the amendment could have relatively small equity
market capitalizations (e.g., under $1 billion). Such companies
often have limited product lines, markets or financial
resources. The securities of these companies may trade less
frequently and in limited volume, and only in the over-the-
counter market or on a regional securities exchange. As a
result, these securities may fluctuate in value more than those
of larger, more established companies. Under such
circumstances, it may also be more difficult to determine the
fair value of such securities for purposes of computing the
fund's net asset value.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.I. AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION WITH
RESPECT TO INVESTMENTS IN REAL ESTATE
The Trustees are recommending that the fund's fundamental
investment restriction with respect to investments in real
estate be revised to reflect the standard restriction expected
to be used by other Putnam funds, and to grant the fund the
maximum flexibility in light of current regulatory requirements.
Although the fund is required to have a fundamental policy with
respect to investments in real estate, the fund's current
restriction is more restrictive than current state securities
law requirements. For this reason, Putnam Management believes
that the restriction should be amended to increase the fund's
investment flexibility. The current restriction states that the
fund may not:
"Invest in real estate, [commodities, or commodity
contracts except that it may purchase or sell
financial futures contracts and options thereon.]"
The section of the restriction in brackets is proposed to be
amended by proposal 3.M.
The proposed amended fundamental investment restriction is set
forth below.
"The fund may not ...
Purchase or sell real estate, although it may purchase
securities of issuers which deal in real estate,
securities which are secured by interests in real
estate, and securities which represent interests in
real estate, and it may acquire and dispose of real
estate or interests in real estate acquired through
the exercise of its rights as a holder of debt
obligations secured by real estate or interests
therein."
The proposed amendment enables the fund to invest in a wide
range of real estate-related investments, including investments
in companies which deal in real estate, securities which
represent interests in real estate and securities secured by
real estate. In addition, the fund would be able to own real
estate directly as a result of the exercise of its rights in
connection with debt obligations it owns. In such cases, the
ability to acquire and dispose of real estate may serve to
protect the fund during times where an issuer of debt securities
is unable to meet its obligations. Putnam Management believes
that the enhanced flexibility could assist the fund in achieving
its investment objective.
To the extent the fund holds real estate-related securities, it
will be subject to the risks associated with the real estate
market. These risks may include declines in the value of real
estate, changes in general or local economic conditions,
overbuilding, difficulty in completing construction, increased
competition, changes in zoning laws, increases in property taxes
and operating expenses, and variations in rental income.
Generally, increases in interest rates will increase the costs
of obtaining financing, which may result in a decrease in the
value of such investments. In addition, in order to enforce its
rights in the event of a default of these securities, the fund
may be required to participate in various legal proceedings or
take possession of and manage assets securing the issuer's
obligations. This could increase the fund's operating expenses
and adversely affect the fund's net asset value.
REQUIRED VOTE. Approval of this proposal requires the
affirmative vote of the lesser of (1) more than 50% of the
outstanding shares of the fund, or (2) 67% or more of the shares
of the fund present at the meeting if more than 50% of the
outstanding shares of the fund are present at the meeting in
person or by proxy.
3.J. AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION WITH
RESPECT TO CONCENTRATION OF ITS ASSETS
The Trustees are recommending that the fund's fundamental
investment restriction regarding concentration be revised to
reflect the standard restriction expected to be used by other
Putnam funds and to make it clear that the fund may invest more
than 25% of its assets in the securities of the U.S. government,
its agencies or instrumentalities. The current restriction
states that the fund may not:
"Concentrate more than 25% of the fund's assets in any one
industry."
The proposed amended fundamental restriction is set forth below.
"The fund may not ...
Purchase securities (other than securities of the U.S.
government, its agencies or instrumentalities) if, as
a result of such purchase, more than 25% of the fund's
total assets would be invested in any one industry."
Putnam Management believes that this amendment will make it
clear that the fund may invest in U.S. government securities
without regard to the 25% limit. Putnam Management believes
that the current restriction does not prevent the fund from
investing in such securities without limit, because the SEC
takes the position that U.S. government issuers, including
agencies and instrumentalities of the U.S. government, are not
members of any industry. However, to avoid any possible
ambiguity in the future, Putnam Management believes that this
clarification should be made at this time.
REQUIRED VOTE. Approval of this proposal requires the
affirmative vote of the lesser of (1) more than 50% of the
outstanding shares of the fund, or (2) 67% or more of the shares
of the fund present at the meeting if more than 50% of the
outstanding shares of the fund are present at the meeting in
person or by proxy.
3.K. AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST WITH
RESPECT TO PLEDGING ASSETS
The Trustees are recommending that the Declaration of Trust be
amended to eliminate the fundamental investment restriction
which limits the fund's ability to pledge its assets. The
current restriction states that the Trustees shall have full
power and authority:
"[To borrow money for the purposes of this Trust but only
if, in the opinion of the Trustees, such borrowing is made
temporarily for extraordinary or emergency reasons and not
for investment purposes; provided, however, that no loan
shall be made which, when added to the amount of the then
outstanding loans, except those to be paid or refunded
therefrom, shall cause the aggregate amount of such loans
to exceed ten percent (10%) of the net assets of the Trust
taken at current value at the time of the loan;] and the
Trustees shall not voluntarily pledge, mortgage, charge or
hypothecate or otherwise encumber the assets of the Trust
in excess of 10% of its net assets in connection with
borrowings permitted by this paragraph....."
The section of the restriction in brackets is proposed to be
eliminated by proposal 3.L. below.
Certain state securities laws impose restrictions on the fund's
ability to pledge its assets, but these limitations are less
restrictive than the fund's current restriction and are not
required to be contained in a fundamental policy. For these
reasons, Putnam Management believes that the current restriction
is unnecessarily restrictive and should be eliminated. If the
proposal is approved, the Trustees intend to replace this
restriction with the following non-fundamental investment
restriction, which reflects the standard restriction expected to
be used by other Putnam funds, to comply with current state
requirements:
"The fund may not ...
Pledge, hypothecate, mortgage or otherwise encumber
its assets in excess of 33 1/3% of its total assets
(taken at cost) in connection with permitted
borrowings."
This proposal would enable the fund to pledge up to one-third of
its total assets in connection with fund borrowings; other
activities which could be deemed to be pledges or other
encumbrances, such as collateral arrangements with respect to
certain forward commitments, futures contracts and options
transactions will not be restricted.
Putnam Management believes that the enhanced flexibility could
assist the fund in achieving its investment objective. Further,
Putnam Management believes that the fund's current limits on
pledging may conflict with the fund's ability to borrow money to
meet redemption requests or for extraordinary or emergency
purposes. This conflict arises because banks may require
borrowers such as the fund to pledge assets in order to
collateralize the amount borrowed. These collateral
requirements are typically for amounts at least equal to, and
often larger than, the principal amount of the loan. If the
fund needed to borrow the maximum amount permitted by its
policies (currently 10% of its total assets), it might be
possible that a bank would require collateral in excess of 10%
of the fund's total assets. Thus, the current restriction could
have the effect of reducing the amount that the fund may borrow
in these situations.
By making this policy non-fundamental, the fund will have the
ability to modify or eliminate the restriction to increase
investment flexibility without the need for shareholder
approval.
Pledging assets does entail certain risks. To the extent that
the fund pledges its assets, the fund may have less flexibility
in liquidating its assets. If a large portion of the fund's
assets were involved, the fund's ability to meet redemption
requests or other obligations could be delayed.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.L. AMENDING THE AGREEMENT AND DECLARATION OF TRUST AND THE
FUND'S FUNDAMENTAL INVESTMENT RESTRICTION WITH RESPECT TO BORROWING
The Trustees are recommending that the Declaration of Trust be
amended to eliminate the restriction with respect to borrowing.
The current restriction states that the Trustees shall have full
power and authority:
"To borrow money for the purposes of this Trust but
only if, in the opinion of the Trustees, such
borrowing is made temporarily for extraordinary or
emergency reasons and not for investment purposes;
provided, however, that no loan shall be made which,
when added to the amount of the then outstanding
loans, except those to be paid or refunded therefrom,
shall cause the aggregate amount of such loans to
exceed ten percent (10%) of the net assets of the
Trust taken at current value at the time of the loan;
[and the Trustees shall not voluntarily pledge,
mortgage, charge or hypothecate or otherwise encumber
the assets of the Trust in excess of 10% of its net
assets in connection with borrowings permitted by this
paragraph.....]"
The section of the restriction in brackets is proposed to be
eliminated by proposal 3.K. above.
In connection with this proposal, the Trustees also are
recommending amending the fund's fundamental investment
restriction with respect to borrowing contained in its Statement
of Additional Information. The current restriction states that
the fund may not:
"Borrow money in excess of 10% of its net assets
(taken at current value) and then only as a temporary
measure for extraordinary or emergency reasons and not
for investment purposes. (The fund may borrow only
from banks and immediately after any such borrowing
there must be an asset coverage (total assets of the
fund including the amount borrowed less liabilities
other than such borrowings) of at least 300% of the
amount of all borrowings. In the event that, due to
market decline or other reasons, such asset coverage
should at any time fall below 300%, the fund is
required within three days not including Sundays and
holidays to reduce the amount of its borrowings to the
extent necessary to cause the asset coverage of such
borrowings to be at least 300%. If this should
happen, the fund may have to sell securities at a time
when it would be disadvantageous to do so.)"
If this proposal is approved, the Trustees intend to replace
these two restrictions with the following fundamental investment
restriction:
"The fund may not . . .
Borrow money in excess of 10% of the value (taken at
the lower of cost or current value) of its total
assets (not including the amount borrowed) at the time
the borrowing is made, and then only from banks as a
temporary measure to facilitate the meeting of
redemption requests (not for leverage) which might
otherwise require the untimely disposition of
portfolio investments or for extraordinary or
emergency purposes. Such borrowings will be repaid
before any additional investments are purchased."
If the proposal is approved, the fund would be able to borrow
only from banks with respect to up to 10% of its total assets.
The new restriction enables the fund to borrow to meet
redemption requests and for extraordinary or emergency purposes.
Although the restriction will no longer contain an asset
coverage requirement, the fund will still be obligated to meet
the asset coverage requirements of the 1940 Act. Putnam
Management believes that by removing the asset coverage
requirement from the restriction, the fund will be able to
respond more quickly to legal or regulatory developments
regarding asset coverage because further shareholder approval
would not be required to bring the policy in line with these
developments.
Currently, the affirmative vote of a majority of the fund's
outstanding shares is required to amend the Declaration of Trust
and to change this investment restriction. Once this
restriction is removed from the Declaration of Trust, it may be
modified or eliminated by the fund with the affirmative vote of
the lesser of (1) more than 50% of the outstanding shares of the
fund, or (2) 67% or more of the shares of the fund present at
the meeting if more than 50% of the outstanding shares of the
fund are present at the meeting in person or by proxy.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.M. AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION WITH
RESPECT TO INVESTMENTS IN COMMODITIES OR COMMODITY CONTRACTS
The Trustees are recommending that the fund's fundamental
investment restriction with respect to investments in
commodities or commodity contracts be revised to reflect the
standard restriction expected to be used by other Putnam funds.
The current restriction states that the fund may not:
"Invest in [real estate,] commodities, or commodity
contracts except that it may purchase or sell financial
futures contracts and options thereon."
The section of the restriction in brackets is proposed to be
amended by proposal 3.I. above.
The proposed amended fundamental restriction is set forth below.
"The fund may not ...
Purchase or sell commodities or commodity contracts,
except that the fund may purchase and sell financial
futures contracts and options and may enter into
foreign exchange contracts and other financial
transactions not involving physical commodities."
Under the revised restriction, the fund will be able to engage
in a variety of transactions involving the use of financial
futures and options and foreign currencies, as well as various
other financial transactions which do not involve physical
commodities. Although the fund may already engage in many of
these activities, Putnam Management believes that the revised
language more clearly sets forth the fund's policy. Putnam
Management believes this investment flexibility could assist the
fund in achieving its investment objective, in part because such
strategies often offer opportunities for hedging and increased
investment return. The addition of financial transactions not
involving physical commodities is intended to give the fund
maximum flexibility to invest in a variety of financial
instruments that could technically be considered commodities,
but which do not involve the direct purchase and sale of
physical commodities, which is the intended focus of the
restriction.
REQUIRED VOTE. Approval of this proposal requires the
affirmative vote of the lesser of (1) more than 50% of the
outstanding shares of the fund, or (2) 67% or more of the shares
of the fund present at the meeting if more than 50% of the
outstanding shares of the fund are present at the meeting in
person or by proxy.
3.N. AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST WITH
RESPECT TO MARGIN TRANSACTIONS
The Trustees are recommending that the Declaration of Trust be
amended to eliminate the fundamental investment restriction with
respect to margin transactions and to replace it with the
standard non-fundamental restriction expected to be used by
other Putnam funds. "Margin transactions" involve the purchase
of securities with money borrowed from a broker, with cash or
eligible securities being used as collateral against the loan.
The current restriction states as follows:
"nor shall the Trustees engage in any operations for the
account of the Trust generally or technically known as...
or marginal transactions... provided further, that the
Trust may make margin payments in connection with
transactions in financial futures contracts or related
options."
The fund originally adopted this restriction to comply with
certain state securities law requirements, and while the
restriction is currently required by one state, it is not
required to be a fundamental policy. If the proposal is
approved, the Trustees intend to replace this fundamental
restriction with the following non-fundamental investment
restriction to comply with the remaining state requirement:
"The fund may not. . .
Purchase securities on margin, except such short-term
credits as may be necessary for the clearance of purchases
and sales of securities, and except that it may make margin
payments in connection with financial contracts or
options."
By making this policy non-fundamental, the fund will have the
ability to modify or eliminate the restriction to increase
investment flexibility without the need for shareholder
approval.
The fund's potential use of margin transactions beyond
transactions in financial futures and options and for the
clearance of purchases and sales of securities, including the
use of margin in ordinary securities transactions, is generally
limited by the SEC position that margin transactions are
prohibited under Section 18 of the 1940 Act because they create
senior securities. The fund's ability to engage in margin
transactions is also limited by its investment policies, which
generally permit the fund to borrow money only in limited
circumstances.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.O. AMENDING THE FUND'S AGREEMENT AND DECLARATION OF TRUST AND
ELIMINATING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTIONS
WITH RESPECT TO SHORT SALES
The Trustees are recommending that the Declaration of Trust be
amended to eliminate the fundamental investment restriction with
respect to short sales. The current restriction states as
follows:
"nor shall the Trustees engage in any operations for the
account of the Trust generally or technically known as
short sales... provided that such limitation shall not
prevent any sale of securities by the Trust where the Trust
owns at the time of such sale securities equivalent in kind
and amount to those sold or where the Trust owns at the
time of such sale, securities convertible into securities
equivalent in kind and amount to those sold...."
The fund's Statement of Additional Information also contains a
fundamental investment restriction which does not allow the fund
to engage in short sales, which the Trustees are also
recommending be eliminated as part of this proposal.
The fund originally adopted the restrictions to comply with
certain state securities laws requirements, and while the
restrictions are currently required by one state, it is not
required to be a fundamental policy. If this proposal is
approved, the Trustees intend to replace these two restrictions
with the following substantially similar non-fundamental
restriction, which reflects the standard restriction expected to
be used by other Putnam funds, to comply with the remaining
state requirement:
"The fund may not ...
Make short sales of securities or maintain a short
position for the account of the fund unless at all
times when a short position is open it owns an equal
amount of such securities or owns securities which,
without payment of any further consideration, are
convertible into or exchangeable for securities of the
same issue as, and in equal amount to, the securities
sold short."
By making this policy non-fundamental, the fund will have the
ability to modify or eliminate the restriction to increase
investment flexibility without the need for shareholder
approval.
In a typical short sale, the fund borrows securities from a
broker that it anticipates will decline in value in order to
sell to a third party. The fund becomes obligated to return
securities of the same issue and quantity at some future date,
and it realizes a loss to the extent the securities increase in
value and a profit to the extent the securities decline in value
(after including any associated costs). Since the value of a
particular security can increase without limit, the fund could
potentially realize losses with respect to short sales where the
fund owns or has the right to acquire at no added cost
securities identical to those sold short that are significantly
greater than the value of the securities at the time they are
sold short.
REQUIRED VOTE. Approval of the proposal requires the
affirmative vote of the majority of the outstanding shares of
the fund.
3.P. ELIMINATING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION
WITH RESPECT TO INVESTING TO GAIN CONTROL OF A COMPANY'S
MANAGEMENT
The Trustees are recommending that the fund's fundamental
investment restriction which states that the fund may not
"[invest for the purpose of exercising control or management" be
eliminated. Eliminating the restriction would make it clear
that the fund can freely exercise its rights as a shareholder of
the various companies in which it invests. These rights may
include the right to actively oppose or support the management
of such companies.
Putnam Management believes that eliminating this restriction
will allow the fund maximum flexibility to protect the value of
its investments through influencing management of companies in
which it invests. Putnam Management believes that the fund
should be allowed to freely communicate its views as a
shareholder on matters of policy to management, the board of
directors, and other shareholders when a policy may affect the
value of the fund's investment. Activities in which the fund
may engage might include the fund, either individually or with
others, seeking changes in a company's goals, management, or
board of directors, seeking the sale of some or all of a
company's assets, or voting to participate in or oppose a
takeover effort with respect to a company. Although Putnam
Management believes that the fund currently may engage in many
if not all of these activities without necessarily violating
this restriction, it believes that eliminating the restriction
will eliminate any potential obstacle to the fund in protecting
its interests as a shareholder.
This area of corporate activity is highly prone to litigation,
and whether or not the restriction is eliminated, the fund could
be drawn into lawsuits related to these activities. The fund
will direct its efforts toward those instances where Putnam
Management believes the potential for benefit to the fund
outweighs potential litigation risks.
REQUIRED VOTE. Approval of this proposal requires the
affirmative vote of the lesser of (1) more than 50% of the
outstanding shares of the fund, or (2) 67% or more of the shares
of the fund present at the meeting if more than 50% of the
outstanding shares of the fund are present at the meeting in
person or by proxy.
3.Q. AMENDING THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION WITH
RESPECT TO UNDERWRITING
The Trustees are recommending that the fund's fundamental
investment restriction with respect to underwriting be revised
to reflect standard restriction expected to be used by other
Putnam funds. The fund's current restriction states that the
fund may not
"Act as an underwriter except to the extent that, in
connection with the disposition of its portfolio
securities, it may be deemed to be an underwriter under
certain federal securities laws."
The proposed amended fundamental investment restriction states
that the fund may not
"Underwrite securities issued by other persons except to
the extent that, in connection
with the disposition of its portfolio investments, it may
be deemed to be an underwriter
under certain federal securities laws."
The proposed amended restriction only limits the fund's ability
to underwrite the securities of other issuers; the fund would be
able to act as an underwriter with respect to its own securities
consistent with the 1940 Act and SEC rules. The restriction
would continue to contain an exception for the sale by the fund
of its portfolio securities.
REQUIRED VOTE. Approval of this proposal requires the
affirmative vote of the lesser of (1) more than 50% of the
outstanding shares of the fund, or (2) 67% or more of the shares
of the fund present at the meeting if more than 50% of the
outstanding shares of the fund are present at the meeting in
person or by proxy.
FURTHER INFORMATION ABOUT VOTING AND THE SHAREHOLDER MEETING
QUORUM AND METHODS OF TABULATION. Thirty percent of the shares
entitled to vote -- present in person or represented by proxy --
constitutes a quorum for the transaction of business with
respect to any proposal at the meeting (unless otherwise noted
in the proxy statement). Shares represented by proxies that
reflect abstentions and "broker non-votes" (i.e., shares held by
brokers or nominees as to which (i) instructions have not been
received from the beneficial owners or the persons entitled to
vote and (ii) the broker or nominee does not have the
discretionary voting power on a particular matter) will be
counted as shares that are present and entitled to vote on the
matter for purposes of determining the presence of a quorum.
Votes cast by proxy or in person at the meeting will be counted
by persons appointed by your fund as tellers for the meeting.
The tellers will count the total number of votes cast "for"
approval of the proposals for purposes of determining whether
sufficient affirmative votes have been cast. With respect to
the election of Trustees and selection of auditors, neither
abstentions nor broker non-votes have any effect on the outcome
of the proposal. With respect to any other proposals,
abstentions and broker non-votes have the effect of a negative
vote on the proposal.
OTHER BUSINESS. The Trustees know of no other business to be
brought before the meeting. However, if any other matters
properly come before the meeting, it is their intention that
proxies that do not contain specific restrictions to the
contrary will be voted on such matters in accordance with the
judgment of the persons named as proxies in the enclosed form of
proxy.
SIMULTANEOUS MEETINGS. The meeting of shareholders of your fund
is called to be held at the same time as the meetings of
shareholders of certain of the other Putnam funds. It is
anticipated that all meetings will be held simultaneously. If
any shareholder at the meeting objects to the holding of a
simultaneous meeting and moves for an adjournment of the meeting
to a time promptly after the simultaneous meetings, the persons
named as proxies will vote in favor of such adjournment.
SOLICITATION OF PROXIES. In addition to soliciting proxies by
mail, Trustees of your fund and employees of Putnam Management,
Putnam Fiduciary Trust Company, and Putnam Mutual Funds may
solicit proxies in person or by telephone. Your fund may also
arrange to have votes recorded by telephone. The telephone
voting procedure is designed to authenticate shareholders'
identities, to allow shareholders to authorize the voting of
their shares in accordance with their instructions and to
confirm that their instructions have been properly recorded.
Your fund has been advised by counsel that these procedures are
consistent with the requirements of applicable law. If these
procedures were subject to a successful legal challenge, such
votes would not be counted at the meeting. Your fund is unaware
of any such challenge at this time. Shareholders would be
called at the phone number Putnam Investments has in its records
for their accounts, and would be asked for their Social Security
number or other identifying information. The shareholders would
then be given an opportunity to authorize proxies to vote their
shares at the meeting in accordance with their instructions. To
ensure that the shareholders' instructions have been recorded
correctly, they will also receive a confirmation of their
instructions in the mail. A special toll-free number will be
available in case the information contained in the confirmation
is incorrect.
Your fund's Trustees have adopted a general policy of
maintaining confidentiality in the voting of proxies.
Consistent with this policy, your fund may solicit proxies from
shareholders who have not voted their shares or who have
abstained from voting.
Persons holding shares as nominees will upon request be
reimbursed for their reasonable expenses in soliciting
instructions from their principals. Your fund has retained
Tritech Services, Four Corporate Place, Corporate Park 287,
Piscataway, New Jersey 08854, to aid in the solicitation of
beneficial accounts for a fee not to exceed $15,000 plus
reasonable out-of-pocket expenses. Your fund has also retained
at its expense D. F. King & Co., Inc., 77 Water Street, New
York, New York 10005, to aid in the solicitation of instructions
for beneficial and registered accounts for a fee not to exceed
$25,000 plus reasonable out-of-pocket expenses for mailing and
phone costs.
REVOCATION OF PROXIES. Proxies, including proxies given by
telephone, may be revoked at any time before they are voted by a
written revocation received by the Clerk of your fund, by
properly executing a later-dated proxy or by attending the
meeting and voting in person.
DATE FOR RECEIPT OF SHAREHOLDERS' PROPOSALS FOR SUBSEQUENT
MEETINGS OF SHAREHOLDERS. Your fund's Agreement and Declaration
of Trust does not provide for annual meetings of shareholders,
and your fund does not currently intend to hold such a meeting
in 1997. Shareholder proposals for inclusion in the proxy
statement for any subsequent meeting must be received by your
fund within a reasonable period of time prior to any such
meeting.
ADJOURNMENT. If sufficient votes in favor of any of the
proposals set forth in the Notice of the Meeting are not
received by the time scheduled for the meeting, the persons
named as proxies may propose adjournments of the meeting for a
period or periods of not more than 60 days in the aggregate to
permit further solicitation of proxies with respect to any of
such proposals. Any adjournment will require the affirmative
vote of a majority of the votes cast on the question in person
or by proxy at the session of the meeting to be adjourned. The
persons named as proxies will vote in favor of such adjournment
those proxies which they are entitled to vote in favor of such
proposals. They will vote against such adjournment those
proxies required to be voted against such proposals. Your fund
pays the costs of any additional solicitation and of any
adjourned session. Any proposals for which sufficient favorable
votes have been received by the time of the meeting may be acted
upon and considered final regardless of whether the meeting is
adjourned to permit additional solicitation with respect to any
other proposal.
FINANCIAL INFORMATION. YOUR FUND WILL FURNISH, WITHOUT CHARGE,
TO YOU UPON REQUEST A COPY OF THE FUND'S ANNUAL REPORT FOR ITS
MOST RECENT FISCAL YEAR, AND A COPY OF ITS SEMIANNUAL REPORT FOR
ANY SUBSEQUENT SEMIANNUAL PERIOD. SUCH REQUESTS MAY BE DIRECTED
TO PUTNAM INVESTOR SERVICES, P.O. BOX 41203, PROVIDENCE, RI
02940-1203 OR 1-800-225-1581.
FURTHER INFORMATION ABOUT YOUR FUND
LIMITATION OF TRUSTEE LIABILITY. The Agreement and Declaration
of Trust of your fund provides that the fund will indemnify its
Trustees and officers against liabilities and expenses incurred
in connection with litigation in which they may be involved
because of their offices with the fund, except if it is
determined in the manner specified in the Agreement and
Declaration of Trust that they have not acted in good faith in
the reasonable belief that their actions were in the best
interests of the fund or that such indemnification would relieve
any officer or Trustee of any liability to the fund or its
shareholders arising by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of his or her
duties. Your fund, at its expense, provides liability insurance
for the benefit of its Trustees and officers.
AUDIT AND NOMINATING COMMITTEES. The voting members of the
Audit Committee of your fund include only Trustees who are not
"interested persons" of the fund by reason of any affiliation
with Putnam Investments and its affiliates. The Audit Committee
currently consists of Messrs. Estin (Chairman), Perkins (without
vote), Putnam, III (without vote), Shapiro, Smith (without
vote), and Ms. Kennan. The Nominating Committee consists only
of Trustees who are not "interested persons" of your fund or
Putnam Management. The Nominating Committee currently consists
of Dr. Pounds and Ms. Kennan (Co-chairpersons), Ms. Baxter, and
Messrs. Estin, Hill, Jackson, Patterson, Shapiro, and Thorndike.
<PAGE>
OFFICERS AND OTHER INFORMATION. In addition to George Putnam
and Lawrence J. Lasser, the officers of your fund are as
follows:
Year first
elected to
Name (age) Office office
- ----------------------------------------------------------------
Charles E. Porter (57) Executive Vice President 1989
Patricia C. Flaherty (49) Senior Vice President 1993
John D. Hughes (61) Senior Vice President
& Treasurer 1987
Gordon H. Silver (49) Vice President 1990
Peter Carman (55) Vice President 1993
Brett C. Browchuk (33) Vice President 1994
Thomas V. Reilly (49) Vice President 1986
Anthony I. Kreisel* (51) Vice President 1993
David L. King* (40) Vice President 1993
William N. Shiebler** (54) Vice President 1991
John R. Verani (57) Vice President 1987
Paul M. O'Neil (42) Vice President 1992
Beverly Marcus (52) Clerk 1981
- ----------------------------------------------------------------
* One of the fund's portfolio managers
** President of Putnam Mutual Funds
All of the officers of your fund are employees of Putnam
Management or its affiliates. Because of their positions with
Putnam Management or its affiliates or their ownership of stock
of Marsh & McLennan Companies, Inc., the parent corporation of
Putnam Management and Putnam Mutual Funds, Messrs. Putnam,
George Putnam, III, Lasser and Smith (nominees for Trustees of
your fund), as well as the officers of your fund, will benefit
from the management fees, distribution fees, underwriting
commissions, custodian fees, and investor servicing fees paid or
allowed by the fund.
<PAGE>
ASSETS AND SHARES OUTSTANDING OF YOUR FUND
AS OF JULY 5, 1996
Net assets $
Class A shares outstanding
and authorized to vote shares
Class B shares outstanding
and authorized to vote shares
Class M shares outstanding
and authorized to vote shares
Class Y shares outstanding
and authorized to vote shares
5% BENEFICIAL OWNERSHIP OF YOUR FUND AS OF JUNE 28, 1996
Persons beneficially owning more than 5%
of the fund's class A shares
Persons beneficially owning more than 5%
of the fund's class B shares
Persons beneficially owning more than 5%
of the fund's class M shares
Persons beneficially owning more than 5%
of the fund's class Y shares
<PAGE>
PUTNAMINVESTMENTS
THE PUTNAM FUNDS
One Post Office Square
Boston, Massachusetts 02109
Toll-free 1-800-225-1581<PAGE>
PUTNAMINVESTMENTS
THIS IS YOUR PROXY CARD.
PLEASE VOTE THIS PROXY, SIGN IT BELOW, AND RETURN IT PROMPTLY IN
THE ENVELOPE PROVIDED. YOUR VOTE IS IMPORTANT.
HAS YOUR ADDRESS CHANGED?
Please use this form to notify us of any change in address or
telephone number or to provide us with your comments. Detach
this form from the proxy ballot and return it with your signed
proxy in the enclosed envelope.
Street
- ----------------------------------------------------------------
City State Zip
- ----------------------------------------------------------------
Telephone
- ----------------------------------------------------------------
DO YOU HAVE ANY COMMENTS?
- ----------------------------------------------------------------
- ----------------------------------------------------------------
- ----------------------------------------------------------------
DEAR SHAREHOLDER:
Your vote is important. Please help us to eliminate the expense
of follow-up mailings by signing and returning this proxy as
soon as possible. A postage-paid envelope is enclosed for your
convenience.
THANK YOU!
- ----------------------------------------------------------------
Please fold at perforation before detaching
<PAGE>
Proxy for a meeting of shareholders, October 3, 1996, for THE
PUTNAM FUND FOR GROWTH AND INCOME.
THIS PROXY IS SOLICITED ON BEHALF OF THE TRUSTEES OF THE FUND.
The undersigned shareholder hereby appoints George Putnam, Hans
H. Estin, and Robert E. Patterson, and each of them separately,
proxies, with power of substitution, and hereby authorizes them
to represent and to vote, as designated below, at the meeting of
shareholders of The Putnam Fund For Growth and Income on October
3, 1996, at 2:00 p.m., Boston time, and at any adjournments
thereof, all of the shares of the fund that the undersigned
shareholder would be entitled to vote if personally present.
IF YOU COMPLETE AND SIGN THE PROXY, WE'LL VOTE IT EXACTLY AS YOU
TELL US. IF YOU SIMPLY SIGN THE PROXY, IT WILL BE VOTED FOR
ELECTING TRUSTEES AS SET FORTH IN PROPOSAL 1 AND FOR PROPOSALS 2
AND 3.A.-Q. IN THEIR DISCRETION, THE PROXIES WILL ALSO BE
AUTHORIZED TO VOTE UPON SUCH OTHER MATTERS THAT MAY PROPERLY
COME BEFORE THE MEETING.
Note: If you have questions on any of the proposals, please
call 1-800-225-1581.
PLEASE BE SURE TO SIGN AND DATE THIS PROXY.
Please sign your name exactly as it appears on this card. If
you are a joint owner, each of you should sign. When signing as
executor, administrator, attorney, trustee, or guardian, or as
custodian for a minor, please give your full title as such. If
you are signing for a corporation, please sign the full
corporate name and indicate the signer's office. If you are a
partner, sign in the partnership name.
- ----------------------------------------------------------------
Shareholder sign here Date
- ----------------------------------------------------------------
Co-owner sign here Date
<PAGE>
THE TRUSTEES RECOMMEND A VOTE FOR ELECTING ALL OF THE NOMINEES
FOR TRUSTEES AND FOR THE PROPOSALS LISTED BELOW:
PLEASE MARK YOUR CHOICES / X / IN BLUE OR BLACK INK.
1. PROPOSAL TO ELECT TRUSTEES
The nominees for Trustees are: J.A. Baxter, H.H. Estin,
J.A. Hill, R.J. Jackson, E.T. Kennan, L.J. Lasser, R.E.
Patterson, D.S. Perkins, W.F. Pounds, G. Putnam, G.
Putnam, III, E. Shapiro, A.J.C. Smith, W.N. Thorndike.
/ / FOR electing all the nominees
(EXCEPT AS MARKED TO THE CONTRARY BELOW.)
/ / WITHHOLD authority to vote for all nominees
TO WITHHOLD AUTHORITY TO VOTE FOR ONE OR MORE OF THE NOMINEES,
WRITE THOSE NOMINEES' NAMES BELOW:
- -------------------------------------------------------------
PROPOSAL TO:
2. RATIFY THE SELECTION FOR AGAINST ABSTAIN
OF PRICE WATERHOUSE LLP
AS AUDITORS. / / / / / /
3.A. AMEND THE FUND'S / / / / / /
AGREEMENT AND
DECLARATION OF TRUST
WITH RESPECT TO THE
FUND'S PERMITTED
INVESTMENTS.
3.B. AMEND THE FUND'S / / / / / /
AGREEMENT AND
DECLARATION OF TRUST
WITH RESPECT TO
DIVERSIFICATION OF
INVESTMENTS.
3.C. AMEND THE FUND'S / / / / / /
AGREEMENT AND
DECLARATION OF TRUST
WITH RESPECT TO
INVESTMENTS IN ISSUERS
THAT HAVE BEEN IN
OPERATION FOR LESS THAN
THREE YEARS.
<PAGE>
3.D. AMEND THE FUND'S FOR AGAINST ABSTAIN
AGREEMENT AND/ / / / / /
DECLARATION OF TRUST
WITH RESPECT TO THE
PURCHASE OF CERTAIN
ILLIQUID SECURITIES.
3.E. AMEND THE FUND'S
AGREEMENT AND / / / / / /
DECLARATION OF TRUST
WITH RESPECT TO
INVESTMENTS IN
SECURITIES OF ISSUERS
IN WHICH MANAGEMENT OF
THE FUND OR PUTNAM
INVESTMENT MANAGEMENT, INC.
OWNS SECURITIES.
3.F. AMEND THE FUND'S / / / / / /
FUNDAMENTAL INVESTMENT
RESTRICTION WITH RESPECT
TO MAKING LOANS BY
PURCHASING SECURITIES.
3.G. AMEND THE FUND'S / / / / / /
AGREEMENT AND
DECLARATION OF TRUST
WITH RESPECT TO MAKING
LOANS THROUGH REPURCHASE
AGREEMENTS AND SECURITIES
LOANS.
3.H. AMEND THE FUND'S / / / / / /
FUNDAMENTAL INVESTMENT
RESTRICTION
WITH RESPECT TO OWNING
10% OF THE VOTING SECURITIES
OF A SINGLE ISSUER.
3.I. AMEND THE FUND'S / / / / / /
FUNDAMENTAL
INVESTMENT RESTRICTIONS
WITH RESPECT TO
INVESTMENTS IN REAL
ESTATE.
3.J. AMEND THE FUND'S / / / / / /
FUNDAMENTAL INVESTMENT
RESTRICTION WITH RESPECT
TO CONCENTRATION OF ASSETS.
<PAGE>
3.K. AMEND THE FUND'S / / / / / /
AGREEMENT AND DECLARATION
OF TRUST WITH RESPECT TO
PLEDGING ASSETS.
3.L. AMEND THE FUND'S / / / / / /
AGREEMENT AND DECLARATION
OF TRUST AND THE FUND'S
FUNDAMENTAL INVESTMENT
RESTRICTION WITH RESPECT
TO BORROWING.
3.G. AMEND THE FUND'S / / / / / /
FUNDAMENTAL INVESTMENT
RESTRICTION WITH RESPECT
TO INVESTMENTS IN
COMMODITIES OR COMMODITY
CONTRACTS.
3.N. AMEND THE FUND'S / / / / / /
AGREEMENT AND
DECLARATION OF TRUST
WITH RESPECT TO MARGIN
TRANSACTIONS.
3.O. AMEND THE FUND'S / / / / / /
AGREEMENT AND DECLARATION
OF TRUST AND ELIMINATE
THE FUNDS'S FUNDAMENTAL
INVESTMENT RESTRICTIONS
WITH RESPECT TO SHORT SALES.
3.P. ELIMINATE THE / / / / / /
FUND'S FUNDAMENTAL
INVESTMENT RESTRICTION
with respect to investing
to gain control of a
company's management.
3.Q. Amend the fund's / / / / / /
fundamental investment
restriction with respect
to underwriting.
