PUTNAM INTERMEDIATE U.S. GOVERNMENT INCOME FUND
One Post Office Square, Boston, MA 02109
Class Y Shares
INVESTMENT STRATEGY: INCOME
PROSPECTUS - APRIL 1, 1995, as revised DECEMBER 1, 1995
This Prospectus explains concisely what you should know before
investing in Class Y shares of Putnam Intermediate U.S.
Government Income Fund (the "Fund"). Please read it carefully
and keep it for future reference. You can find more detailed
information about the Fund in the April 1, 1995 Statement of
Additional Information, as amended from time to time. For a free
copy of the Statement or other information, call Putnam Investor
Services at 1-800- 752-9894 . The Statement has been filed
with the Securities and Exchange Commission and is incorporated
into this Prospectus by reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
PUTNAMINVESTMENTS
Putnam Defined
Contribution Plans
<PAGE>
ABOUT THE FUND
Expenses summary. . . . . . . . . . . . . . . . . . . . .
2
Objective . . . . . . . . . . . . . . . . . . . .
3
How objective is pursued. . . . . . . . . . . . .
3
How performance is shown. . . . . . . . . . . . .
6
How the Fund is managed . . . . . . . . . . . . .
7
Organization and history. . . . . . . . . . . . .
8
ABOUT YOUR INVESTMENT
How to buy shares . . . . . . . . . . . . . . . .
9
How to sell shares. . . . . . . . . . . . . . . .
10
How to exchange shares. . . . . . . . . . . . . .
10
How the Fund values its shares. . . . . . . . . .
11
How distributions are made; tax information . . .
11
ABOUT PUTNAM INVESTMENTS, INC.. . . . . . . . . . . . . .
12
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About the Fund
EXPENSES SUMMARY
Expenses are one of several factors to consider when investing in
the Fund. The following table summarizes estimated
expenses attributable to Class Y shares in its most recent
fiscal year. The Example shows the cumulative expenses
attributable to a hypothetical $1,000 investment in Class Y
shares of the Fund over specified periods.
Annual Fund Operating Expenses
(as a percentage of average net assets)
Management Fees .60%
Other Expenses .24%
Total Fund Operating
Expenses .84%
The table is provided to help you understand the expenses of
investing in the Fund and your share of the operating expenses
which Class Y expects to incur during its first fiscal year.
Management fees and "Other expenses " are based on the
operating expenses for the Fund's Class A shares.
Example
Your investment of $1,000 would incur the following expenses,
assuming 5% annual return and redemption at the end of each
period:
1 3 5 10
year years years years
$9 $27 $47 $104
The Example does not represent past or future expense
levels. Actual expenses may be greater or less than those shown.
Federal regulations require the Example to assume
a 5% annual return, but actual annual return has varied. The
Example does not reflect any charges or expenses
related to your employer's plan.
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OBJECTIVE
Putnam Intermediate U.S. Government Fund seeks as high a level of
current income as Putnam Investment Management, Inc. ("Putnam
Management") believes is consistent with preservation of
capital. The Fund is not intended to be a complete investment
program, and there is no assurance it will achieve its objective.
HOW OBJECTIVE IS PURSUED
Basic investment strategy
The Fund will seek its objective by investing under normal market
conditions in a portfolio of U.S. Government Securities (as
defined below) with a dollar-weighted average maturity of 3 to 10
years but may purchase individual securities with longer or
shorter maturities. For purposes of computing average portfolio
maturity, Putnam Management will use the effective maturities of
mortgage-backed securities as determined by reference to
published market statistics.
Under normal market conditions, the Fund will invest exclusively
in U.S. Government Securities, and in forward commitments and
repurchase agreements with respect to such securities. "U.S.
Government Securities" are debt securities issued or guaranteed
by the U.S. government, or by various agencies or
instrumentalities established or sponsored by the U.S.
government. Certain of these obligations, including U.S.
Treasury bills, notes and bonds, mortgage participation
certificates guaranteed by the Government National Mortgage
Association ("Ginnie Mae"), and Federal Housing Administration
debentures, are supported by the full faith and credit of the
United States. Other U.S. Government Securities issued or
guaranteed by federal agencies or government-sponsored
enterprises are not supported by the full faith and credit of the
United States. These securities include obligations supported by
the right of the issuer to borrow from the U.S. Treasury, such as
obligations of Federal Home Loan Banks, and obligations supported
only by the credit of the instrumentality, such as Federal
National Mortgage Association ("Fannie Mae") bonds.
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The Fund may invest in mortgage-backed U.S. Government
Securities. Such securities represent a participation in, or are
secured by, mortgage loans. Certain mortgage-backed securities
in which the Fund may invest represent an undivided "pass
through" of the interest and principal payments generated by a
pool of mortgages. From time to time, the Fund may also invest
in other types of mortgage-backed securities known as
"collateralized mortgage obligations" ("CMOs"). CMOs generally
represent a specifically defined portion of the interest and
principal payments generated by a pool of mortgages. Certain
CMOs may be more volatile and less liquid than other types of
mortgage-backed securities.
It is the Fund's current policy to qualify as an eligible
investment for federal credit unions. Accordingly, the Fund will
limit its investments in CMOs, stripped mortgage-backed
securities, zero coupon securities, repurchase agreements and
forward commitments in accordance with the provisions of the
Federal Credit Union Act. This policy is a non-fundamental
investment policy and may be changed by the Fund's Trustees
without shareholder approval.
At times Putnam Management may judge that conditions in the
securities markets make pursuing the Fund's basic investment
strategy inconsistent with the best interests of its
shareholders. At such times Putnam Management may temporarily
use alternative strategies, primarily designed to reduce
fluctuations in the value of the Fund's assets. In implementing
these "defensive" strategies, the Fund may invest in any type of
U.S. Government Securities of any maturity and may invest
primarily in short-term U.S. Government Securities. In such
cases, the fund's dollar-weighted average portfolio maturity may
be less than 3 years. It is impossible to predict when, or for
how long, the Fund will use such alternative strategies.
Risk factors
U.S. Government Securities are considered among the safest of
fixed income securities, but their values, like those of other
debt securities, will fluctuate with changes in interest rates.
Changes in the value of portfolio securities will not affect
interest income from those securities but will be reflected in
the Fund's net asset value. Thus, a decrease in interest rates
will generally result in an increase in the value of the Fund's
shares. Conversely, during periods of rising interest rates, the
value of the Fund's shares will generally decline. The magnitude
of those fluctuations will generally be greater when the Fund's
average maturity is longer. Because of their added safety, the
yields available from U.S. Government Securities are generally
lower than the yields available from comparable corporate debt
securities.
Mortgage-backed securities (MBSs) generally have yield and
maturity characteristics corresponding to the underlying assets.
Thus, unlike traditional debt securities, which may pay a fixed
rate of interest until maturity when the entire principal amount
comes due, payments on these securities include both interest and
a partial payment of principal. In addition to scheduled loan
amortization, payments of principal may result from the voluntary
prepayments, refinancing or foreclosure of the underlying
mortgage loans. Such prepayments may significantly shorten the
effective maturities of MBSs, especially during periods of
declining interest rates.
MBSs may offer yields higher than those available from other
types of U.S. Government Securities, but because of their
prepayment aspects are less effective than other types of
securities as a means of "locking in" long-term interest rates.
Significant unscheduled prepayments resulting from declines in
mortgage interest rates, as well as scheduled prepayments, have
to be reinvested by the Fund in investments that are likely to
pay a lower interest rate. As a result, MBSs may have less
potential for capital appreciation during periods of declining
interest rates than other U.S. Government Securities of
comparable maturities, although MBSs may have a comparable risk
of decline in market value during periods of rising interest
rates.
At times, some of the MBSs in which the Fund will invest will
have higher-than-market interest rates, and will therefore be
purchased at a premium above their par value. See "Investments
in premium securities." Unscheduled prepayments, which are made
at par, will cause the Fund to suffer a loss equal to any
unamortized premium.
Under some circumstances, a substantial portion of the Fund's
investments in U.S. Government Securities will take the form of
contracts with broker-dealers for future delivery (but not beyond
120 days) of U.S. Government Securities, or "forward
commitments." Pending delivery of the securities, the Fund
maintains in a segregated account cash or high-grade debt
obligations in an amount sufficient to meet the purchase price.
The Fund may sell its interest in a forward commitment rather
than take delivery, and may reinvest the proceeds in another
forward commitment. The Fund's use of forward commitments may
increase its over-all investment exposure and involves a risk of
loss if the value of the securities declines prior to the
settlement date or if the broker-dealer fails to deliver after
the value of the securities has risen.
<PAGE>
Investments in premium securities
The Fund may at times invest in securities bearing coupon rates
higher than prevailing market rates. Such "premium" securities
are typically purchased at prices greater than the principal
amounts payable on maturity. The Fund does not amortize the
premium paid for such securities in calculating its net
investment income. As a result, the purchase of such securities
provides the Fund a higher level of investment income
distributable to shareholders on a current basis than if the Fund
had purchased securities bearing current market rates of
interest. Because the value of premium securities tends to
approach the principal amount as they approach maturity (or call
price in the case of securities approaching their first call
date), the purchase of such securities may increase the Fund's
risk of capital loss if such securities are held to maturity (or
first call date).
During a period of declining interest rates, many of the Fund's
portfolio investments will likely bear coupon rates which are
higher than the current market rates, regardless of whether such
securities were originally purchased at a premium. Such
securities would generally carry premium market values which
would be reflected in the net asset value of the Fund's shares.
As a result, an investor who purchases shares of the Fund during
such periods would initially receive higher taxable monthly
distributions (derived from the higher coupon rates payable on
the Fund's investments) than might be available from alternative
investments bearing current market interest rates, but may face
an increased risk of capital loss as these higher coupon
securities approach maturity (or first call date). In evaluating
the potential performance of an investment in the Fund, investors
may find it useful to compare the Fund's current dividend rate
with the Fund's "yield," which is computed on a yield-to-maturity
basis in accordance with SEC regulations and which reflects
amortization of market premiums. See "How performance is shown."
Portfolio turnover
The length of time the Fund has held a particular security is not
generally a consideration in investment decisions. A change in
the securities held by the Fund is known as "portfolio turnover."
As a result of the Fund's investment policies, under certain
market conditions the Fund's portfolio turnover rate may be
higher than that of other mutual funds. Portfolio turnover
generally involves some expense to the Fund, including brokerage
commissions or dealer mark-ups and other transaction costs on the
sale of securities and reinvestment in other securities. Such
transactions may result in realization of taxable capital gains.
The portfolio turnover rates for fiscal 1994 and 1993
were 351.62% and 309.80%, respectively.
Other investment practices
The Fund may also engage to a limited extent in the following
investment practices, each of which involves certain special
risks. The Statement of Additional Information contains more
detailed information about these practices, including limitations
designed to reduce these risks.
Securities loans and repurchase agreements. The Fund may lend
portfolio securities amounting to not more than 25% of its assets
to broker-dealers and may enter into repurchase agreements on up
to 25% of its total assets. These transactions must be fully
collateralized at all times. These transactions involve some
risk to the Fund if the other party should default on its
obligation and the Fund is delayed or prevented from recovering
the collateral.
Except for investment policies designated as fundamental in this
Prospectus or the Statement of Additional Information, the
investment policies described in this Prospectus and in the
Statement are not fundamental policies. The Trustees may change
any non-fundamental investment policies without shareholder
approval. As a matter of policy, the Trustees would not
materially change the Fund's investment objective without
shareholder approval.
HOW PERFORMANCE IS SHOWN
Investment performance may from time to time be included
in advertisements about Class Y shares . "Yield" for each
class of shares is calculated by dividing the annualized
net investment income per share during a recent 30-day period by
the maximum public offering price per share of such class on the
last day of that period. For purposes of calculating
yield , net investment income is calculated in accordance with
SEC regulations and may differ from net investment income
as determined for financial reporting purposes. SEC regulations
require that net investment income be calculated on a "yield-to-
maturity" basis, which has the effect of amortizing any premiums
or discounts in the current market value of fixed income
securities. The current dividend rate is based on net investment
income as determined for tax purposes, which may not reflect
amortization in the same manner. See "How objective is pursued -
- - Investments in premium securities."
"Total return" for the one-, five- and ten-year periods (or for
the life of the Class Y shares , if shorter) through the
most recent calendar quarter represents the average annual
compounded rate of return on an investment of $1,000 in the Fund
. Total return may also be presented for other periods
.
<PAGE>
All data are based on past investment results and
do not predict future performance. Investment
performance, which will vary, is based on many factors, including
market conditions, the composition of the Fund's portfolio,
and the Fund's operating expenses and which class of
shares the investor purchases . Investment performance
also often reflects the risks associated with the Fund's
investment objective and policies. These factors should be
considered when comparing the Fund's investment results
with those of other mutual funds and other investment
vehicles. Quotations of investment performance for any
period when an expense limitation was in effect will be greater
than if the limitation had not been in effect. The Fund's
performance may be compared to that of various
indexes . See the Statement of Additional Information.
HOW THE FUND IS MANAGED
The Trustees of the Fund are responsible for generally overseeing
the conduct of the Fund's business. Subject to such policies as
the Trustees may determine, Putnam Management furnishes a
continuing investment program for the Fund and makes investment
decisions on its behalf. Subject to the control of the Trustees,
Putnam Management also manages the Fund's other affairs and
business. Michael Martino, Senior Vice President of Putnam
Management and Vice President of the Fund, has had primary
responsibility for the day-to-day management of the Fund's
portfolio since July, 1994. Mr. Martino was employed by Back Bay
Advisors in the positions of Executive Vice President and Chief
Investment Officer from 1992 to 1994 and Senior Vice President
and Senior Portfolio Manager from 1990 to 1992.
The Fund pays all expenses not assumed by Putnam Management,
including Trustees' fees, auditing, legal, custodial, investor
servicing, and shareholder reporting expenses, and payments under
its Distribution Plans (which are in turn allocated to the
relevant class of shares). The Fund also reimburses Putnam
Management for the compensation and related expenses of certain
officers of the Fund and their staff who provide administrative
services to the Fund. The total reimbursement is determined
annually by the Trustees.
Putnam Management places all orders for purchases and sales of
the Fund's securities. In selecting broker-dealers, Putnam
Management may consider research and brokerage services furnished
to it and its affiliates. Subject to seeking the most favorable
price and execution available, Putnam Management may consider
sales of shares of the Fund (and, if permitted by law, of the
other Putnam funds) as a factor in the selection of broker-
dealers.
ORGANIZATION AND HISTORY
Putnam Intermediate U.S. Government Income Fund is a
Massachusetts business trust organized under an Agreement and
Declaration of Trust dated November 20, 1990. A copy of the
Agreement and Declaration of Trust, which is governed by
Massachusetts law, is on file with the Secretary of State of The
Commonwealth of Massachusetts. Before April 10, 1995, the Fund
was known as Putnam Balanced Government Fund.
The Fund is an open-end, diversified management investment
company with an unlimited number of authorized shares of
beneficial interest. Shares of the Fund may, without shareholder
approval, be divided into two or more series of shares
representing separate investment portfolios. Any such series of
shares may be divided without shareholder approval into two or
more classes of shares having such preferences and special or
relative rights and privileges as the Trustees determine. The
Fund's shares are currently divided into four classes --Class
A, Class B, Class M and Class Y .
Only the Fund's Class Y shares are offered by this Prospectus.
The Fund also offers Class A, Class B and Class M shares through
participating dealers pursuant to a separate prospectus. Class
A, Class B and Class M shares bear the same expenses as Class Y
shares and, in addition, are subject to 12b-1 fees. Class A
shares and Class M shares are subject to a front-end sales charge
and Class B shares are subject to a contingent deferred sales
charges. Due to 12b-1 fees and sales charges, the investment
performance of Class A, Class B, and Class M shares will be lower
than the investment performance of Class Y shares.
Each share has one vote, with fractional shares voting
proportionally. Shares of each class will vote together as a
single class except when required by law or as determined by the
Trustees. Shares are freely transferable, are entitled to
dividends as declared by the Trustees, and, if the Fund were
liquidated, would receive the net assets of the Fund. The Fund
may suspend the sale of shares at any time and may refuse any
order to purchase shares. Although the Fund is not required to
hold annual meetings of its shareholders, shareholders holding at
least 10% of the outstanding shares entitled to vote have the
right to call a meeting to elect or remove Trustees, or to take
other actions as provided in the Agreement and Declaration of
Trust.
If you own fewer shares than a minimum amount set by the Trustees
(presently 20 shares), the Fund may choose to redeem your shares
and pay you for them. You will receive at least 30 days' written
notice before the Fund redeems your shares, and you may purchase
additional shares at any time to avoid a redemption. The Fund
may also redeem shares if you own shares above a maximum amount
set by the Trustees. There is presently no maximum, but the
Trustees may establish one at any time, which could apply to both
present and future shareholders.
The Fund's Trustees: George Putnam,* Chairman. President of the
Putnam funds. Chairman and Director of Putnam Management and
Putnam Mutual Funds Corp. ("Putnam Mutual Funds"). Director,
Marsh & McLennan Companies, Inc.; William F. Pounds, Vice
Chairman. Professor of Management, Alfred P. Sloan School of
Management, Massachusetts Institute of Technology ; Jameson
Adkins Baxter, President, Baxter Associates, Inc.; Hans H. Estin,
Vice Chairman, North American Management Corp.; John A. Hill,
Principal and Managing Director, First Reserve Corporation;
Elizabeth T. Kennan, President Emeritus and Professor ,
Mount Holyoke College; Lawrence J. Lasser,* Vice President of the
Putnam funds. President, Chief Executive Officer and Director of
Putnam Investments, Inc. and Putnam Management. Director, Marsh
& McLennan Companies , Inc .; Robert E. Patterson, Executive
Vice President, Cabot Partners Limited Partnership; Donald S.
Perkins,* Director of various corporations, including
AT&T , Kmart Corporation and Time Warner Inc.; George
Putnam, III,* President, New Generation Research, Inc. ;
Eli Shapiro, Alfred P. Sloan Professor of Management, Emeritus,
Alfred P. Sloan School of Management, Massachusetts Institute
of Technology; A.J.C. Smith,* Chairman, Chief Executive Officer
and Director, Marsh & McLennan Companies, Inc.; and W.
Nicholas Thorndike, Director of various corporations and
charitable organizations, including Data General Corporation,
Bradley Real Estate, Inc. and Providence Journal Co. Also,
Trustee of Massachusetts General Hospital and Eastern Utilities
Associates. The Fund's Trustees are also Trustees of the other
Putnam funds. Those marked with an asterisk (*) are or may be
deemed to be "interested persons" of the Fund, Putnam Management
or Putnam Mutual Funds.
About Your Investment
HOW TO BUY SHARES
All orders to purchase shares must be made through your
employer's defined contribution plan. For more information about
how to purchase shares of the Fund through your employer's plan
or limitations on the amount that may be purchased, please
consult your employer. Shares are sold to eligible defined
contribution plans at the net asset value per share next
determined after receipt of an order by Putnam Mutual Funds.
Orders must be received by Putnam Mutual Funds before the close
of regular trading on the New York Stock Exchange in order to
receive that day's net asset value. Class Y shares are available
to defined contribution plans whose investment in Putnam funds
and other assets managed by Putnam Management or its affiliates,
combined with such investments by the plan's sponsor and the
sponsor's other employee benefit plans, equals at least $250
million. Defined contribution plans that elect to buy Class Y
shares upon attaining eligibility will receive Class Y shares in
place of any Class A shares then owned. Class Y shares are also
available to defined contribution plans whose sponsor confirms a
good faith expectation that investments in Putnam-managed assets
by the sponsor and its employee benefit plans will attain $250
million (using the higher of purchase price or current market
value) within one year of the initial purchase of Class Y shares,
and agrees that Class Y shares may be redeemed and Class A shares
purchased if that level is not attained. To eliminate the need
for safekeeping, the fund will not issue certificates for your
shares. Putnam Mutual Funds will from time to time, at its
expense , provide additional promotional incentives or
payments to dealers that sell shares of the Putnam funds.
These incentives or payments may include payments for
travel expenses, including lodging, incurred in connection with
trips taken by invited registered representatives and their
guests to locations within and outside the United States
for meetings or seminars of a business nature. In some
instances, these incentives or payments may be offered only to
certain dealers who have sold or may sell significant amounts of
shares. Certain dealers may not sell all classes of shares.
HOW TO SELL SHARES
Subject to any restrictions imposed by your employer's plan,
you can sell your shares through the plan to the Fund
any day the New York Stock Exchange is open . For more
information about how to sell shares of the Fund
through your employer's plan, including any charges that may
be imposed by the plan, please consult with your employer.
Your plan administrator must send a signed letter of
instruction to Putnam Investor Services . The
price you will receive is the next net asset value calculated
after the Fund receives your request in proper form . All
requests must be received by the Fund prior to the close of
regular trading on the New York Stock Exchange in order to
receive that day's net asset value . If you sell shares
having a net asset value of $100,000 or more, the signatures of
registered owners or their legal representatives must be
guaranteed by a bank, broker-dealer or certain other financial
institutions. See the Statement of Additional Information for
more information about where to obtain a signature
guarantee.
The Fund generally provides payment for redeemed
shares the business day after the request is received.
Under unusual circumstances, the Fund may suspend redemptions, or
postpone payment for more than seven days, as permitted by
federal securities law. The Fund will only redeem shares for
which it has received payment.
<PAGE>
HOW TO EXCHANGE SHARES
Subject to any restrictions contained in your plan, you
can exchange your shares for shares of other Putnam funds
available through your plan at net asset value .
Contact your plan administrator or Putnam Investor Services on
how to exchange your shares or how to obtain
prospectuses of other Putnam funds in which you may invest.
The exchange privilege is not intended as a vehicle for short-
term trading. Excessive exchange activity may interfere with
portfolio management and have an adverse effect on all
shareholders. In order to limit excessive exchange activity and
in other circumstances where Putnam Management or the Trustees
believe doing so would be in the best interests of the Fund, the
Fund reserves the right to revise or terminate the exchange
privilege, limit the amount or number of exchanges or reject any
exchange. Shareholders would be notified of any such action to
the extent required by law. Consult Putnam Investor Services
before requesting an exchange. See the Statement of Additional
Information to find out more about the exchange privilege.
HOW THE FUND VALUES ITS SHARES
The Fund calculates the net asset value of a share of each class
by dividing the total value of its assets, less liabilities, by
the number of its shares outstanding. Shares are valued as of
the close of regular trading on the New York Stock Exchange each
day the Exchange is open. Portfolio securities for which market
quotations are readily available are valued at market value.
Short-term investments that will mature in 60 days or less are
stated at amortized cost, which approximates market value. All
other securities are valued at their fair value following
procedures approved by the Trustees.
HOW DISTRIBUTIONS ARE MADE; TAX INFORMATION
The Fund will declare a distribution each day in an amount which
is based on projections of its estimated net interest income.
Normally, the Fund will pay these distributions monthly. Net
interest income consists of interest accrued on portfolio
investments of the Fund, less accrued expenses. The amount of
each daily distribution may differ from actual net interest
income determined in accordance with generally accepted
accounting principles. See "Distributions" in the Statement of
Additional Information. The Fund will distribute any net capital
gains (after application of any available capital loss carry
forwards) at least annually.
<PAGE>
The terms of your plan will govern how your plan may receive
distributions from the Fund. Generally, periodic
distributions from the Fund to your plan are reinvested in
additional Fund shares , although your plan may permit you
to receive Fund distributions from net investment
income in cash while reinvesting capital gains distributions in
additional shares or to receive all Fund
distributions in cash. If another option is not
selected , all distributions will be reinvested in
additional Fund shares .
The Fund intends to qualify as a "regulated investment company"
for federal income tax purposes and to meet all other
requirements that are necessary for it to be relieved of federal
income taxes on income and gains it distributes .
The Fund will distribute substantially all of its ordinary income
and capital gain net income on a current basis.
Generally, Fund distributions are taxable
as ordinary income, except that any distributions of net long-
term capital gains will be taxed as such .
However, distributions by the Fund to
employer-sponsored defined contribution plans that qualify for
tax-exempt treatment under federal income tax laws will not be
taxable. Special tax rules apply to investments through such
plans. You should consult your tax adviser to determine the
suitability of the Fund as an investment through such a plan and
the tax treatment of distributions (including distributions of
amounts attributable to an investment in the Fund) from such a
plan.
The foregoing is a summary of certain federal income tax
consequences of investing in the Fund. You should consult your
tax adviser to determine the precise effect of an investment in
the Fund on your particular tax situation (including possible
liability for state and local taxes).
About Putnam Investments, Inc.
Putnam Management has been managing mutual funds since 1937.
Putnam Mutual Funds is the principal underwriter of the Fund and
of other Putnam funds. Putnam Defined Contribution Plans is a
division of Putnam Mutual Funds. Putnam Fiduciary Trust
Company is the Fund's custodian. Putnam Investor Services, a
division of Putnam Fiduciary Trust Company, is the Fund's
investor servicing and transfer agent.
Putnam Management, Putnam Mutual Funds and Putnam Fiduciary Trust
Company located at One Post Office Square, Boston,
Massachusetts 02109 and are subsidiaries of Putnam
Investments, Inc., which is wholly owned by Marsh & McLennan
Companies, Inc., a publicly-owned holding company whose principal
businesses are international insurance and reinsurance brokerage,
employee benefit consulting and investment management.
Differences between the typeset (printed) prospectus and the
EDGAR filing version.
1. Each interior page of the prospectus includes the
word "prospectus" at the bottom of the page.
2. Pagination is different in printed prospectus.
3. Section headings and subheadings in the printed
prospectus are printed in boldface type with colored
ink.
4. The first page of the printed prospectus contains an
illustration of balanced scales, Putnam's logo.
5. The last page of the printed prospectus contains a
graphic recyclable logo.
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